WTO members discussed five new or enhanced proposals to advance services negotiations at meetings of the Working Party on Domestic Regulation and the Services Council on 14-17 March 2017. Four of these proposals aim to ensure that domestic licensing procedures and technical standards do not constitute unnecessary barriers to trade while one proposal relates to the establishment of a trade facilitation agreement for services.

The Chairperson of the Working Party on Domestic Regulation Ms Katarzyna Stecz of Poland welcomed WTO members’ “hard work” and “substantial engagement” and encouraged delegations to deepen conversations, including at the informal level.

Proposed domestic regulation disciplines

Increasing the transparency of regulatory measures affecting services trade was the aim of a proposal put forward by eight co-sponsors (Australia, Colombia, European Union, Japan, Republic of Korea, Mexico, New Zealand and Chinese Taipei). They are proposing enhanced transparency provisions requiring WTO members to make relevant information available to services providers and to publish draft regulation so as to allow interested parties to comment. Some developing countries highlighted their limited resources for publishing information and for setting up a system for responding to comments.

Two proposals – one submitted by Australia, Canada, Colombia, EU, Israel, Japan and Mexico and the other put forward by Hong Kong (China), Chile, Switzerland and New Zealand – concerned how WTO members should develop their regulatory measures, ensuring that they are reasonable and impartial, and are based on objective and transparent criteria. Members disagreed on whether a necessity test (ensuring that measures are not more burdensome than necessary) should feature in future disciplines on domestic regulation. Several said it was unrealistic to seek consensus on this issue.

A further proposal related to how WTO members should administer processes for the authorization of services suppliers and builds upon comments members shared during previous discussions.[1] It has ten co-sponsors: Australia, Chile, Colombia, EU, Japan, Mexico, Norway, Peru, Korea, and Chinese Taipei. Some members reiterated concerns about the proposal of a “single window” for streamlining the licensing of service businesses. The co-sponsors said they are happy to discuss this further.

Proposal for a Trade Facilitation Agreement for Services

A draft text for a Trade Facilitation Agreement for Services was submitted by India.[2] This builds on earlier submissions that New Delhi had put forward for discussion in previous meetings. The proposed agreement addresses a wider range of regulatory measures affecting services trade under the WTO’s General Agreement on Trade in Services (GATS). It aims to reduce bottlenecks and streamline procedures to ease services trade and intends to strike a balance between obligations and “best endeavour language”, India said. The proposal suggests setting a transition period for developing countries to comply with the provisions and only “encourages” least developed countries (LDCs) to do so.

Several developing countries called for the proposed agreement to replicate the special and differential treatment provisions for developing countries contained within the Trade Facilitation Agreement (TFA) for goods, which entered into force on 27 February. The African Group questioned the benefits of the proposal for African countries and said they are analysing what the proposed agreement would mean for the LDC Services Waiver.

Some WTO members expressed interest in discussing the cross-border temporary movement of professionals (also known as mode 4) but some questioned whether this was feasible given the current political climate. Others expressed concerns about immigration issues, including social security contributions and multiple entry visas. Some members expressed reservations about the provisions on cross-border information flows, facilitation of movement of health patients and insurance portability.

India said it would take members’ comments into consideration.

Members’ concerns

New concerns

Korea – tourism and distribution services

Korea claimed that some measures related to tourism and distribution services from China are directly affecting its suppliers and alleged that the measures in question are inconsistent with China’s WTO obligations. China questioned the existence of the measures.

Russia – financial services

Russia registered concerns about two measures recently enacted by Ukraine in financial services, alleging that they are inconsistent with the GATS. Arguing that its measures were WTO-compliant, Ukraine said it would come back to this issue.

Previously raised concerns

Russia – gas transportation system

Russia reiterated claims that measures related to the reform of Ukraine’s unified gas transportation system continue to violate Ukraine’s obligations under the GATS regarding non-discrimination (most-favoured-nation treatment principle) and its specific commitments under the GATS. Ukraine restated that its measures comply with its WTO commitments and obligations.

Future work on e-commerce

Members discussed four papers intended to revive negotiations on e-commerce. The debate focused on the moratorium concerning customs duties on e-commerce transmissions. WTO members have renewed their commitment not to impose customs duties on these transmissions at each Ministerial Conference. Ministers last extended the moratorium at the Nairobi Ministerial Conference in December 2015.

Members discussed making the moratorium permanent, allowing e-signatures as a means of determining the digital identity of users, electronic authentication, increasing transparency and promoting the participation of small and medium-sized businesses in services trade.

Seminars on e-commerce and mode 4

Members agreed to hold a workshop on the services-related aspects of e-commerce and a seminar on barriers that restrict access of members’ services suppliers to foreign markets through mode 4 of the GATS.

Implementing LDC Services Waiver

The LDC Group reported on the preferences notified by members, including the sectors and modes of supply for which these members will grant preferential access to services and services suppliers from LDCs. The current number of notifications under the LDC Services Waiver is available here.

The LDC Group called on members granting preferences to help LDCs enhance their supply capacity and to raise awareness of the waiver. Further background information can be found here.

Next

Discussions among WTO members on the various proposals will continue in various settings. The next regular cluster of services meetings will take place in June.

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[1] The proposal was submitted by Australia, Chile, Colombia, the European Union, Mexico, Norway, Republic of Korea, and the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu.

[2] See the following Communications from India: pdf Concept Note for an Initiative on Trade Facilitation in Services (73 KB)  (September 2016) and pdf Possible elements of a Trade Facilitation in Services Agreement (144 KB)  (November 2016)