Global trade is increasingly being shaped by regulations, standards, data rules, subsidies and environmental policies behind national borders, creating new costs and uncertainties for businesses that traditional tariff negotiations were not designed to address, the World Trade Organization (WTO) said.
The shift reflects the changing nature of international commerce, with global value chains, digitalisation and artificial intelligence altering what is traded and how goods and services move across borders, according to the WTO’s World Trade Report 2026.
The report said policy measures affecting trade increasingly lie beyond the border, making cooperation over regulation, standards, data, subsidies, security and environmental measures more complex than traditional negotiations over tariffs.
Domestic regulations, including rules on data flows, the recognition of professional qualifications and IP, are increasingly shaping conditions of international trade and may create more significant barriers than traditional border measures such as tariffs, the report said.
The change is particularly significant for services, where regulations behind the border have become central to determining market access. The WTO said non-tariff and behind-the-border measures are now the primary determinants of trading opportunities in services, presenting challenges that were less prominent when the multilateral trading system was designed around trade in goods.
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Digital trade is intensifying the shift. Digitally delivered services accounted for 55% of global services exports in 2025 and grew 10% during the year, while commercial services represented 27.6% of total global trade, according to the report.
As more services move across borders digitally, differences in privacy rules, cybersecurity requirements, competition policies and artificial-intelligence governance can increase the cost of serving foreign markets and create problems around interoperability and accountability, the WTO said.
Environmental policy is creating another layer of trade-related regulation. Differences in carbon pricing, subsidies, environmental standards and border adjustment measures can increase compliance costs, disrupt supply chains and affect the competitiveness of exporters, with smaller firms and developing economies potentially facing disproportionate effects.
The report warned that poorly coordinated environmental policies could also trigger retaliatory measures, subsidy races and wider trade tensions.
At the same time, the WTO said a more coordinated trading system could help businesses and economies benefit from the shift toward cleaner production. Developing economies with strong renewable-energy potential and critical-mineral resources could leverage a “green comparative advantage” to integrate into emerging low-carbon value chains.
The growing role of regulations comes as global production has become more interconnected. The report said goods, services and intangible inputs now move through complex global value chains, meaning tariffs or export restrictions can affect companies and suppliers far beyond the immediate trading partners targeted by a measure.
The WTO said the challenge for the multilateral trading system is therefore no longer limited to reducing tariffs. It increasingly involves coordinating policies that are made domestically but have consequences for companies, consumers and trading partners abroad.
The report argues that this makes multilateral cooperation more necessary even as it becomes harder to achieve, because the growing number of behind-the-border measures creates new cross-border spillovers that individual countries cannot address effectively on their own.
