But yeah, given that previously there was no consequence whatsoever for a government like the US, EU, Japan, UK, etc. signing up to digital provisions in free trade agreements, it’s no surprise that they are now starting to get a bit more scrutiny. I suppose the main point to make about the example above is that the FTA provisions actually improved the proposal by making it more focused.

Back to the main point of this: why is the US’ change of heart annoying? Well, as above, because it’s entirely inward-looking. The wider consequence of the US actions is that it has given implicit permission to governments such as China to adopt (or continue applying) a similar approach. Does the US really want its firms to be required to share source code as a condition of market access to China? Probably not. Has the US got a leg to stand on when it inevitably objects? Now, probably not.

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[This article, slightly edited for house style, was first published on 27 Oct., 2023, in Most Favoured Nation, Sam Lowe’s trade policy newsletter.]