Obama pushes for net neutrality, opposes data localization in trade pact

A leaked U.S. proposal from April would prohibit countries signing on to the Trade in Services Agreement [TISA] to reject policies requiring that data held by Internet companies and other service suppliers be held within a member country's borders. A handful of nations have moved to require their own residents' data to be stored within their own borders in response to recent revelations about widespread U.S. National Security Agency surveillance.

The U.S. proposal would also require member countries to give consumers some net neutrality protections, by allowing them to access the Web services and applications of their choice, subject to "reasonable network management."

The Obama administration's push for tech policy items in the secretly negotiated TISA raises questions about transparency and public involvement in the democratic process, said Public Citizen, a government watchdog group.

"This leak reveals a dangerous trend where policies unrelated to trade are being diplomatically legislated through closed-door international 'trade' negotiations to which industry interests have privileged access while the public and policy experts promoting consumer interests are shut out," Lori Wallach, director of Public Citizen's Global Trade Watch, said in a statement.

"Given the raging domestic debate over net neutrality, the growing demands for more data privacy and the constantly changing technology, a pact negotiated in secret that is not subject to changes absent consensus of all signatories seems like a very bad place to be setting U.S. Internet governance policies," Wallach added.

TISA, being negotiated in Geneva, Switzerland, would cover 50 countries, representing 70 percent of the world's trade in services. Participants include the U.S., European Union, Australia, Canada, Taiwan, Japan, Mexico, New Zealand, Hong Kong and South Korea. The trade deal may be signed as early as next year.

The U.S. proposal on net neutrality could be controversial because it would fall short of calls by Obama and some advocates for the U.S. Federal Communications Commission to reclassify broadband as a regulated public utility. The net neutrality provisions reflect an FCC policy statement dating back to 2005.

Advocates of strong net neutrality rules in the U.S. protested when Federal Communications Commission Chairman Tom Wheeler proposed new regulations earlier this year that would have allowed "commercially reasonable" network management. Reasonable network management would allow Internet slow lanes, some advocates have said.

The trade pact's net neutrality provision would also allow residents of member countries to connect the devices of their choosing to the Internet and to have access to information about ISP network management practices.

A spokesman for the Office of U.S. Trade Representative didn't immediately return a message seeking comment on the leaked text, posted on the website of Associated Whistleblowing Press, a nonprofit group focused on publishing leaked documents.

Grant Gross covers technology and telecom policy in the U.S. government for The IDG News Service. Follow Grant on Twitter at GrantGross. Grant's email address is grant_gross@idg.com.