Info Service on WTO and Trade Issues (Oct17/03)
9 October 2017
Third World Network
India, Africa resist IC moves to finalize outcomes in GATS DR at
Published in SUNS #8547 dated 6 October 2017
Geneva, 5 Oct (D. Ravi Kanth) - India and the African Group have expressed
sharp concern over attempts to finalize outcomes in the domestic regulation
for trade in services by major industrialized countries and their
allies in the developing world without adhering to the work done in
the 2009 and 2011 texts, services negotiators told SUNS.
The proponents are seeking an outcome on various disciplines in domestic
regulation concerning trade in services at the World Trade Organization's
eleventh ministerial conference beginning in Buenos Aires on 10 December.
The proposed disciplines seem to have been transposed from the failed
draft text of the plurilateral initiative of the Trade in Services
Agreement (TiSA) in which the US was largely comfortable with the
transparency improvements in the domestic regulation, according to
negotiators familiar with the discussions.
The US was not prepared to address the substantive issues on which
considerable work was done in the 2009 and 2011 draft texts issued
by the then chairs, according to the negotiators familiar with the
In a restricted proposal - Job/Serv/268/Rev.2 - issued on 3 October,
the proponents - the European Union, Japan, Canada, Norway, Switzerland,
New Zealand, Australia, Chile, Colombia, Costa Rica, Hong Kong (China),
Iceland, Israel, Kazakhstan, Korea, Mexico, Liechtenstein, Moldova,
and Taipei among others - floated a working document for negotiating
outcomes on various disciplines on domestic regulation.
The working text for negotiations in the GATS (General Agreement on
Trade in Services) Working Party on Domestic Regulation, according
to the proponents, "consolidates proposals on Administration
of Measures, Development of Measures, Transparency, Technical Standards,
and Gender Equality."
As part of the disciplines on domestic regulation, the proponents
said, "these disciplines apply to measures by Members relating
to licensing requirements and procedures, qualification requirements,
and procedures, and technical standards affecting trade in services
where specific commitments are undertaken."
The proposed disciplines, however, "do not apply to any terms,
limitations, conditions, or qualifications set out in a Member's schedule
pursuant to GATS Articles XVI [Market Access] and XVII [National Treatment]"
in specific commitments.
Further, "members recognize the right to regulate, and to introduce
new regulations, on the supply of services within their territories
in order to meet [national] policy objectives," the proponents
These proposed disciplines, according to the proponents, "shall
not be construed to prescribe or impose particular regulatory approaches
or any particular regular provisions in domestic regulation."
The proposal calls for various disciplines in the administration of
measures such as submission of applications, application timeframes,
electronic applications, acceptance of copies, processing of applications,
fees, and examinations.
It has suggested how a competent authority must administer decisions
in an independent manner and listed various transparency provisions
such as publication and information to be made available by members,
setting up of enquiry points, opportunity to comment and information
before entry into force.
The proponents included technical standards, and development of measures
based on objective and transparent criteria.
In addition, some of the proponents - Albania, Argentina, Canada,
Chile, Colombia, the EU, Iceland, Kazakhstan, Liechtenstein, Moldova,
Norway, Panama, and Uruguay - included their proposal on gender equality.
The proposal says: "Where a Member adopts or maintains licensing
requirements, licensing procedures, qualification requirements or
qualification procedures, the Member shall ensure that such measures
do not discriminate against individuals on the basis of gender."
Significantly, another sub-set of proponents - Chile, Hong Kong (China),
Moldova, New Zealand, and Switzerland - included a proposal on "necessity
The proposal says that: "Where a Member adopts or maintains [measures
relating to licensing requirements and procedures, qualification requirements
and procedures, or where a Member adopts or maintains measures relating
to technical standards as a condition for the supply of a service],
the Member shall ensure that such measures are not more burdensome
than necessary to ensure the quality of the service."
In short, the consolidated draft text includes elements on which some
of the proponents are not on board and yet, they pressed for negotiating
an outcome on all the issues.
India, in a restricted room document RD/Serv/146, exposed the glaring
contradictions in the consolidated proposal issued by the proponents.
India said significant work by members was undertaken in the chair's
report of 2009 and 2011, including several clauses in the 2011 report
on which there was "ad referendum" agreement.
It asked the proponents "why did they adopt the approach of dissecting
specific elements, only to consolidate them" in their document.
The draft consolidated text "does not reflect the common position
of the proponents, and there appear to be several aspects on which
some of the Members are still consulting, or differences remain with
regard to bracketed texts," India said.
Some of the members "appear to be proponents only for the single
article on Gender Equality, and not on the remaining aspects of the
Disciplines," India said.
More important, "given the fragmentation of views, what is the
process that the proponents believe should be followed on the way
forward?" India asked.
India said it is "concerned" about the overarching aspect
of the consolidated text dealing with Article 1.1 of the draft text
wherein it is stated that "these disciplines relate to licensing
requirements and procedures, qualification requirements and procedures,
and technical standards affecting trade in services where specific
commitments are undertaken".
The African Group said that its trade ministers have already emphasized
in November 2016 that "the work we undertake in multilateral
trade and rule-making support Africa's continental integration agenda
and, at a minimum, not undermine it."
In the AMOT declaration issued by the African trade ministers in November
2016, it was emphasized that "any outcome on GATS Article VI.4
disciplines on domestic regulation does not involve implementation
of new and/or onerous administrative requirements or requirements
that intrude into the domestic policy-making processes."
The proposal by the proponents, according to the preliminary assessment
of the African Group, includes various provisions that "are intended
to prescribe or impose particular regulatory approaches."
"In our view, this would significantly constrain African Members'
right to regulate for legitimate public policy objectives," the
African Group said.
The African Group said domestic regulation must provide "the
right to regulate and the inter-linkages between regulations and broader
domestic economic imperatives."
The African Group posed the following general questions:
i. In accordance with GATS Article VI.4, which disciplines do you
think are necessary, and why?
ii. What were the circumstances or specific issues that led to the
suspension of the domestic regulation (DR) negotiations in the past,
and have those circumstances changed?
iii. Is there a clear economic rationale for adopting DR disciplines,
and what is the evidence that benefits from the proposed disciplines
will accrue to all Members?
iv. Is there any evidence of the costs entailed by introducing these
new obligations, and who would bear those costs?
v. Is there any consideration that there are different capabilities
amongst Members, and amongst their firms and stakeholders, to take
greater advantage of these proposed new disciplines?
vi. Have the proponents undertaken an economic impact assessment that
demonstrates that their stakeholders are losing out on economic opportunities
in the absence of multilateral DR disciplines?
vii. In which Members have your stakeholders experienced problems
that the disciplines are seeking to address, and has there been any
attempt to resolve them bilaterally? Have domestic remedies been exhausted?
viii. In instances where you have felt aggrieved, has the issue been
taken up with the competent authorities in the Member?
ix. To what extent has the application of GATS Article VI.5 been insufficient
in meeting the objectives being sought?
x. How will these disciplines contribute to supporting structural
transformation and industrialisation for Africa?
xi. Can proponents indicate the basis for making their proposal/s
differently from the approaches taken in 2009-2011 where separate
rules were considered for licensing requirements and procedures and
qualification requirements and procedures?
xii. Can proponents clarify whether their proposals would impose obligations
only on existing commitments?
xiii. Are there linkages between the proposed DR disciplines and e-commerce
xiv. What are the proponents' perspectives on DR in an increasingly
digital world economy, how do each of the DR elements relate to e-commerce,
and what are the implications?
On administration of measures, the African Group raised several pertinent
1. What is the scope of these provisions, and how does this scope
relate to the Development of Measures and Transparency provisions?
2. Some proponents have recently introduced changes to their skilled
visa policies. To what extent would these proponents themselves be
infringing on the proposed DR disciplines, in terms of the General
Provisions where it says, "These disciplines apply to measures
by Members relating to licensing requirements and procedures, qualification
requirements and procedures, and technical standards affecting trade
in services where specific commitments are undertaken"?
3. How do you define "authorisation"?
4. How do technical standards and licensing requirements operate in
Mode 1 in relation to the proposed DR disciplines?
The African Group also posed numerous questions on "transparency",
"development of measures," including gender equality, and
It asked the proponents "under which mandate" they are seeking
to "address transparency in DR disciplines" and "what
do these provisions have to do with trade?"
It asked the proponents to clarify on the "relationship between
GATS Article III and the Transparency provisions," and "under
which mandate are the proponents seeking to expand GATS Article III?"
On gender equality, the African Group sought to know "how would
gender issues be taken up in DR disciplines and trade agreements"
and the "underlying economic rationale" for such a provision.
"Could those principles and approaches be extended to other poor,
disadvantaged or marginalised groups or regions in Members",
the African Group asked.
On development measures, the African Group asked the proponents whether
the provisions suggested by them are subjected to their own necessity
In short, the proposal seeking outcomes on the disciplines in domestic
regulation by the major industrialized countries along with their
allies at the Buenos Aires meeting fails to address the core issues
concerning the recent spate of barriers imposed by major industrialized
countries, trade negotiators argued.