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Implemented by Enabling Environments Ltd. and Cardno

Workshop on Services Trade Negotiations Kingstown, 16-18 May 2012 Module 1: WTO and Other Services Negotiations. Implemented by Enabling Environments Ltd. and Cardno. Up Front: Ever seen anything like this before?.

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Implemented by Enabling Environments Ltd. and Cardno

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  1. Workshop on Services Trade NegotiationsKingstown, 16-18 May 2012 Module 1: WTO and Other Services Negotiations Implemented by Enabling Environments Ltd. and Cardno

  2. Up Front: Ever seen anything like this before? Modes of supply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence of natural persons

  3. Warm-Up Exercise • What are services? (What are goods?) • How do you trade services internationally? • How are different services traded differently? • Are there services that cannot be traded? • Are there services that should not be traded? Why? • How is trade in services regulated? 3

  4. What is Trade in Services? • Definition depends on the territorial presence of the supplier and the consumer at the time of the transaction. • (a) from the territory of one Member into the territory of any other Member(Mode 1 - Cross‑border trade); • (b) in the territory of one Member to the service consumer of any other Member (Mode 2 – Consumption abroad); •  (c) by a service supplier of one Member, through commercial presence, in the territory of any other Member (Mode 3 - Commercial presence); and •  (d) by a service supplier of one Member, through the presence of natural persons of a Member in the territory of any other Member (Mode 4 - Presence of natural persons). 4

  5. Negotiations on Trade in Services – What Being is Negotiated? • Market Access • Usually by sector, subsector and mode of supply (schedules) • National Treatment (Non-Discrimination) • Usually by sector, subsector and mode of supply (schedules) • Domestic regulation disciplines, including mutual recognition • General and/or sector-specific • Special case: Obligations to provide pro-competitive regulation in certain sectors, e.g. Telecommunications • Other commitments • Exemptions and Exceptions • MFN exemptions • General policy exceptions • Prudential exceptions • Security exceptions 5

  6. SVG‘s Trade Policy Interests Regarding Services? • Consider Three (not Two) Main Types of Interests • Offensive Interests • Defensive Interests • (Positive) Import Interests 6

  7. WTO Negotiations on Services Recalled: Unfinished GATS Business • Art. XIX: Progressive liberalization – “successive rounds of negotiations”, starting within 5 years  GATS 2000 • NB: Para. 2: “appropriate flexibility for developing country Members” • Art. VI: Disciplines on Domestic Regulation • Art. X: Emergency Safeguards • Art. XIII:2: Government Procurement • Art. XV: Disciplines on Subsidies 7

  8. Update: WTO Negotiations on Services: Market Access • GATS 2000/DDA negotiations ongoing since 2000 • (Revised) Requests, (Revised) Offers • Plurilateral Requests • Scheduling issues (e.g. Express Delivery Services) • 2008 “Signalling Conference” • (Official) negotiations “hostage” to progress in NAMA and AG (“single undertaking”) 8

  9. Update: WTO Negotiations on Services: Market Access (cont‘d) • 2012: Initial (but vigorous) talks about a new plurilateral International Services Agreement • Discussion on plurilateral solution had been building up over the past few years • Strong demands from business communities (esp. in OECD countries, but also elsewhere) • Group «Really Good Friends of Trade in Services» (RGF) – currently around 72% of world trade in services • Developed countries plus Chile, Costa Rica, Colombia, Korea, Mexico, Pakistan, Peru – spec.: Barbados, Malaysia, Panama, Vietnam may join • BRICS (currently) opposed 9

  10. Update: WTO Negotiations on Services: Market Access (cont‘d) • 2012: Talks about a new plurilateral International Services Agreement (cont’d) • Inside, outside or attached to the WTO? • Contours of the ISA very unclear – market access, but how much DR? • Negative list approach or agreed target objectives? • How to deal with MFN – extend or exclude? • Interesting ideas re mode 4, e.g. bonding requirement for lower-skilled service providers, generally better tailoring of mode 4 requirements • Disciplines on Government procurement, competition policy, mutual recognition, transparency, DR/regulatory coherence? 10

  11. Update: WTO Negotiations on Services: Market Access (cont‘d) • 2012: Talks about a new plurilateral International Services Agreement (cont’d) • Some «cutting edge» ambitions floating around, e.g. disciplines on • State-owned enterprises • Cross-border data flows • Forced localization • Investment protection and guarantees • Subsidies • Emergency safeguards 11

  12. Update: WTO Negotiations on Services: Domestic Regulation • Recalled: • Currently only weak DR disciplines in the GATS (Art. VI) • Built-in mandate to negotiate DR disciplines (Art. VI:4) • Pilot “Accountancy Disciplines” 1998 • Since 1999 negotiations in “Working Party on Domestic Regulation” (WPDR) • Concerns in particular • Licensing requirements • Licensing procedures • Qualification requirements • Qualification procedures • Technical standards (for services) 12

  13. Update: WTO Negotiations on Services: Domestic Regulation (ct‘d) • Major issues include, for example: • Fees (cost-based or more?) • Recognition of work experience (instead of or complementing formal qualifications?) • Transparency (prior comment?) • Necessity test (none, full, or something in the middle?) • Use of international standards (TBT/SPS as guidance?) • Consider: Interests of regulators vs. Interests of service exporters (if same country  same negotiators!) • Current status: The DR negotiations are alive (even if not exactly kickin’) • Chairman’s July 2006 “Working Paper” • The Chairman’s “Informal Note” of 23 January 2008 (a draft text) • Various renditions of Chair’s drafts • Currently thematic technical discussions on details 13

  14. Update: WTO Negotiations on Services: “GATS Rules“ • GATS: Mandated negotiations on • Subsidies • Government Procurement • Energency Safeguards • Negotiations technically ongoing, but de facto virtually no negotiations 14

  15. Update: WTO Negotiations on Services: The LDC Waiver • WTO Ministerial 2011: Waiver for services and service providers from Least-developed Countries • Authorizes (but does not require) WTO Members to grant preferences • Market Access: All preferences automatically covered • Other preferences (National Treatment, Domestic Regulation) can be authorized by the CTS • Origin: Who is an “LDC Service Provider”? (How to avoid free-riding through shell companies?) • Owned/controlled by LDC persons • Engaged in substantive business operations in any LDC 15

  16. SVG: Current WTO Commitments and Offers Made • Current Commitments (see WTO doc S/DCS/W/VCT): • Financial Services: Only Reinsurance • Health Services: Only Hospital Services • Tourism Services: Only Hotel & Resort Development • Entertainment Services • Sporting Services (apparently excl. Mode 3) • Maritime Transport (International, Passengere & Freight) • Ancillary to Transport: Transshipment Services and Free Zone Operation • In other words: Very few commitments 16

  17. SVG: Current WTO Commitments and Offers Made • 2005 SVG Initial Offer (see WTO doc TN/S/O/VCT): • Business-Related: Research & Development (engineering, tech) • Aircraft rental/leasing without operator • Courier services • Telecoms: Varous commitments and limitations (e.g. Mode 1 unbound for basic public telecoms services) • Life and Accident Insurance (Mode 3: capital reqquirements) • Hospital services: Mode 3 further liberalized/clarified • Tourism: Hotel and other lodging (mode 3 subject to Hotel Aid Act) – but «none» for NT ( subsidies!) • Entertainment and Sporting: Clarified/modified • Maritime transport and auxiliary: Clarified/modified 17

  18. Discussionrnmsts@yahoo.ca / fc185627@skynet.behannes.schloemann@wtiadvisors.com

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