Info Service on WTO and Trade Issues (Nov16/06)
2 November 2016
Third World Network
WTO now physical venue for questionable TISA pluri talks
Published in SUNS #8346 dated 2 November 2016
Geneva, 1 Nov (D. Ravi Kanth) - After inducing coma into the Doha
Development Agenda (DDA) negotiations, major industrialized countries
led by the United States and the European Union have now turned the
World Trade Organization as the venue for their 21st round of negotiations
for cobbling a grossly imbalanced plurilateral deal on trade in services
agreement (TISA), trade envoys told the SUNS.
Beginning from Wednesday (2 November), the WTO along with the European
Union mission will provide physical space for conducting negotiations
among 23 countries of the TISA who seem determined to finalize the
agreement by the end of the year.
The TISA involves around 17 sectors along with institutional and dispute
settlement provisions, said a TISA trade envoy who asked not to be
TISA's 23 members include Australia, Canada, Chile, Chinese Taipei,
Colombia, Costa Rica, the European Union, Hong Kong, Iceland, Israel,
Japan, Liechtenstein, Mexico, New Zealand, Norway, Panama, Peru, South
Korea, Switzerland, Turkey, the United States, Pakistan, and Mauritius.
In what appears to be a skewed closed/plurilateral (like the Government
Procurement Agreement) in which the US wants ambitious outcomes in
sectors like financial services, telecommunications, e-commerce, state-owned
enterprises, and delivery services, chief negotiators along with their
negotiators and specialists will move from one room to the other at
the WTO for the next ten days until 11 November.
A combination of plenary and small group meetings will be held on
a range of areas, particularly revised market access offers, financial
services, localization provisions, telecoms, and e-commerce.
While other areas such as maritime transport, air transport, and road
transport are also scheduled, the bulk of the intensive sessions are
focused only on financial services, localization provisions, e-commerce,
and dispute settlement, according to the agenda reviewed by SUNS.
However, issues of interest to developing countries such as movement
of short-term services providers in Mode 4 and restrictive domestic
regulation measures are not part of the agenda.
The round will begin on 2 November with plenary meetings in which
all the participants will be provided a debriefing on what happened
during the meeting of capital-based officials in Washington last month
and intersessional meetings between the heads of delegations.
On 3 November, the TISA participants will focus on the revised market
access offers at a plenary level as well as air transport services,
localization issues, and financial services in small groups.
While air transport services are important for Australia, Switzerland,
the European Union, and Hong Kong among others, the localization provisions
to remove barriers on cloud computing services are at the heart of
the United States' agenda.
The following day on 4 November, TISA negotiators will focus on maritime
services in an open-ended meeting, and localization and financial
services in small group meetings.
On 5 November, the 23 countries will focus their discussions on institutional
issues in a plenary meeting, while continuing with discussions on
localization, financial services, and dispute settlement in small
TISA negotiators will again discuss localization, financial services,
dispute settlement provisions, and electronic commerce in small groups
on 6 November.
From 7 November, the focus will largely be on issues concerning state-owned
enterprises, e-commerce, telecommunications, and dispute settlement
Other issues like delivery services and transport services are also
expected to figure during the last four days.
The United States along with Canada, Australia, New Zealand, and Japan
are pushing hard for new issues, i.e. provisions that will allow bringing
new issues in the future into the TISA agreement.
The US wants horizontal national treatment commitments in new services
in which the TISA members are following the so-called negative list
approach involving national treatment commitments in areas that are
listed in the offer.
However, the EU and its supporters such as Norway and Switzerland
are resisting inclusion of any language on new issues in the TISA.
They also remain opposed to ambitious provisions in the localization
The US had presented its revised offer on 21 October with commitments
on short-term services providers in Mode 4 being close to nil, said
a developing country TISA negotiator.
Meanwhile, the EU cannot rule out the possibility that the TISA agreement,
as and when it is concluded, could come under the category of mixed-competence
which implies that whatever is negotiated by the EU and the Commission
are not final unless they are ratified by the 28 countries and the
European Court of Justice, an EU official told SUNS.
It appears that the ECJ (European Court of Justice) is currently examining
the EU-Singapore bilateral free trade agreement to determine whether
it falls in the mixed-competence category or in the exclusive domain
of the Commission.
"We hope the court gives a clear verdict on what is mixed and
what is not in the trade deals being negotiated by Brussels,"
the official suggested.
The just-concluded bilateral free trade agreement with Canada, and
other agreements such as TISA, will hinge on the court's ruling wherein
the agreements will have to be ratified by all the 28 members.
During the just-concluded mini-ministerial trade meet in Oslo, the
TISA ministers separately held their meeting in which the EU and several
other countries cautioned that they will scale down the level of ambition
if there are no commensurate offers from others.
The US, according to one source, has not included an offer on Mode
4 (delivery through movement of natural persons) and maritime transport
services while raising the ante on financial services, telecom services,
e-commerce, and localization (local content requirements in services,
particularly servers and other requirements in e-commerce).
The US is also not ready to table and commit its sub-federal sectors
in the overall market access demands.
However, Washington pressed the other members to start negotiating
about new services which are not yet fully implemented by several
TISA member countries, the source said.
The US is also not prepared to accept any reservations/exceptions
in the national treatment provisions for new services and other areas
in which the TISA members are following the negative list criteria
for the agreed sectors, according to the source.
The TISA commitments are replete with asymmetrical levels of ambition
between capital-intensive sectors such as finance and telecoms among
others and less capital-intensive areas like Mode 4. Significantly,
the developed countries took more meaningful commitments in Mode 4
at the WTO as compared to TISA.
Further, the overall level of ambition in transport services involving
maritime, road, and air are well below other areas because of opposition
from the United States, according to another participant.
The TISA participants are also stuck on the issue of "policy
space" as some major developed countries including the US and
the EU are not prepared to open some sectors on the pretext of policy
space, participants said.
In conclusion, the US and its allies - who ensured that the multilateral
negotiations on the Doha work program are pushed into comatose conditions
at the WTO - are now using the Centre William Rappard that houses
the WTO as their preying ground to ram through plurilateral trade
agreements such as TISA, a developing country trade envoy said.
[In a comment, Mr. Chakravarthi Raghavan, Editor-Emeritus of the SUNS,
adds: From the beginning when the talks were mooted, initially as
an International Services Agreement (ISA), and then as a conditional
plurilateral accord to be called TISA, or a GATS Article V integration
agreement, there have been serious questions and issues about its
being prima facie WTO-GATS illegal (see Chakravarthi Raghavan (2014),
Third World in the Third Millennium CE, Vol 2, pp 368-369). For the
WTO secretariat to provide "physical space" (and not as
"the forum") for the exercise, without a Ministerial Conference
or General Council mandate and authorization, seems likely to land
the Secretariat and the WTO DG into more controversy, and charges
of functioning in the interests of a few members, and not the membership
as a whole. Whether all this will find an echo in the re-election
process of Mr. Azevedo, as DG for a second term, remains to be seen.