Singapore and the European Union have taken an important step to strengthen economic ties with the European Union‑Singapore Digital Trade Agreement ( EUSDTA ) entering into force on February 1.

The pact, concluded in July 2024 and signed in May 2025, establishes high‑standard rules for digital trade and secure cross‑border data flows between Singapore and all 27 EU member states.

The agreement complements the existing EU‑Singapore Free Trade Agreement ( EUSFTA ) and comes against a backdrop of deepening trade and investment links. The EU is Singapore’s fifth largest goods trading partner and second largest services trading partner.

Comprising 7.5% of Singapore’s total goods trade, bilateral trade in goods grew to over S$100 billion ( US$78.6 billion ) in 2025. Bilateral trade in services exceeded S$110 billion ( US$86.5 billion ) in 2023. Today, more than half of trade in services between the EU and Singapore is digitally delivered.

For the business community, the EUSDTA enhances legal certainty for companies operating across digital services, e‑commerce, cloud, fintech, and data analytics markets by aligning regulatory approaches and promoting interoperability between Singapore’s and the EU’s digital regimes.

“Singapore is heartened by the swift entry into force of the EU-Singapore Digital Agreement. The EUSDTA is Singapore’s largest bilateral digital economy agreement to date, establishing rules for digital trade with all 27 EU Member States. It is an ambitious, high-standard Agreement which will strengthen digital connectivity by promoting transparent and fair digital trade,” said Grace Fu, minister-in-charge of trade relations.

“The EUSDTA also strongly signals our commitment to working together to positively shape the global digital trade landscape, and ensure that Singapore and the EU remain well-positioned for growth amidst global economic headwinds,” added Fu.

Key provisions target friction‑reducing measures such as facilitating electronic payments and invoicing, paperless trade documentation, and strong protections for personal data.

Notably, the EUSDTA prohibits customs duties on electronic transmissions and restricts demands for source code transfer, helping preserve digital innovators’ competitive advantage.

Business groups and tech firms welcomed the agreement for providing regulatory clarity and expansion pathways. Executives from ASEAN‑headquartered platforms such as Grab and ShopBack highlighted its potential to accelerate cross‑border services and support scaling into European markets.

By setting high benchmarks for digital trade governance, the pact positions Singapore as a gateway for Asian firms eyeing European markets and strengthens the city‑state’s role in shaping global digital economic rules.