Digital Trade and Cyber Sovereignty: Reconciling WTO Obligations with National Security Priorities

Abstract

The proliferation of digital trade has brought international commerce into new legal and geopolitical territories, where national security and cyber sovereignty increasingly shape regulatory frameworks. This study explores the tension between World Trade Organization (WTO) obligations—particularly under the General Agreement on Trade in Services (GATS) and the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS)—and state measures justified on grounds of cybersecurity and national sovereignty. The research employs a doctrinal and comparative legal method, analyzing key WTO provisions, national digital trade policies, and dispute settlement jurisprudence, including the landmark Russia – Traffic in Transit case. The study finds that while WTO law permits certain exceptions for national security, the lack of precise boundaries opens the door to potential misuse and regulatory fragmentation. Cyber sovereignty strategies, such as data localization and digital censorship, increasingly challenge the WTO’s foundational principles of non-discrimination and market access. The paper concludes that reconciling these competing priorities requires clarifying the scope of national security exceptions, fostering digital trade disciplines through plurilateral agreements, and promoting multilateral cooperation on cyber norms. These reforms are essential to sustaining an open yet secure global digital economy.