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A Bright Spot for Tech on USMCA Day

Today the new United States-Mexico-Canada Agreement (USMCA) governing North American trade goes into effect. While increased trade liberalization is beneficial to the broader economy, the USMCA contains many illiberal provisions either unrelated to trade or seeking to displace free trade with managed trade. For these reasons, CEI ultimately opposed the USMCA. However, despite the many flaws with the agreement, it does contain a beneficial provision related to the tech sector.

Article 19.17 of the USMCA states, in part, the following:

[N]o Party shall adopt or maintain measures that treat a supplier or user of an interactive computer service as an information content provider in determining liability for harms related to information stored, processed, transmitted, distributed, or made available by the service, except to the extent the supplier or user has, in whole or in part, created, or developed the information.

Astute observers will notice that this language is quite similar to that of Section 230, the U.S. law governing intermediary liability for web services which has come under recent bipartisan fire. Despite all the hyperbole surrounding the law, it is a common-sense application of liability where it properly lies. (Read more on that here.) Section 230 has thus allowed the U.S. tech sector to grow into the dominant world leader we know it as today.

As more and more of the global economy shifts online, it is important for American-based web services to continue to receive a logical application of liability as their services expand beyond our borders. In turn, Americans will benefit from blossoming tech sectors in other countries that choose to embrace similar liability standards, as both new categories of services emerge and new players rise to challenge existing firms.

While the American tech sector remains dynamic and competitive, there is always room for new competition. The U.S. should continue to promote and strengthen Section 230-type language in international trade agreements, while leaving some of the more illiberal parts of the USMCA behind.