S/CSS/W/39

JOB(05)/190 19 September 2005

Council for Trade in Services
Special Session


FINANCIAL SERVICES

Information Note by the Secretariat



INTRODUCTION
All Members recognize that financial services are not only important in themselves, but also of significance to the rest of the economy. All branches of economic activity today are fundamentally dependent on access to financial services. Members also recognize that a healthy and stable financial system, underpinned by sound macroeconomic management and prudential regulation, is an essential ingredient for economic development.
An analysis of commitments carried out by some Members reveals that most of them cover the core services in insurance, banking and securities. Fewer Members have made commitments in areas such as insurance intermediation, brokerage, asset management, settlement and clearing services, and provision and transfer of financial information. Only about half of the Members which have commitment

S/CSS/W/50

World Trade
Organization RESTRICTED S/C/W/89
16 December 1998 (98-5087) Council for Trade in Services Original: English

COMMUNICATION FROM UNITED STATES

Financial Services

The following communication received from the delegation of the United States was circulated informally on 15 December 1998 to the Members of the Council for Trade in Services to assist in the discussion on Financial Services in the context of the Information Exchange Programme.
In countries with less advanced financial systems, foreign service providers can introduce more advanced management practices, credit quality control, and risk diversification to the market, which makes financial markets more stable.
Both the underlying financial services activities (banking, securities, insurance, other financial services) and the additional trading activities that they support are highly labour intensive, and promote the development of highskilled employment.

POSSIBLE AREAS FOR FUTURE DISCUSSION AND WORK
First and foremost, we note that the deadline for WTO members to notify acceptance of the Fifth Protocol to implement the WTO Agreement on Financial Services is 29 January 1999.
agrees with the conclusion reached in the recent WTO research study (mentioned above) that financial services trade liberalization enables the use of a broad spectrum of financial instruments and that the presence of foreign financial institutions promotes financial sector stability.
would provide for substantially full market access and national treatment, including the right to establish through 100 percent foreignowned subsidiaries and direct branches, and would provide national treatment to foreign banks in interstate banking.
There are discussions underway on emerging international principles and standards for prudential regulation (such as the Basel Core Principles for Effective Banking Supervision and the IOSCO Objectives and Principles of Securities Regulation) which can contribute to higher levels of supervision internationally and greater cooperation and harmonization among regulators for the banking and securities sectors.
Government has undertaken a study of hedge funds and has proposed an international task force to study the broader issue of strengthening regulation of financial institutions, and examination of highly leveraged and offshore institutions.

S/CSS/W/27

World Trade
Organization RESTRICTED S/C/W/72
2 December 1998 (98-4837) Council for Trade in Services

FINANCIAL SERVICES

Background Note by the Secretariat

Introduction
This note has been prepared at the request of the Council for Trade in Services in the context of the information exchange programme.
Although an attempt is made in the following Sections III and IV to refer to the implications of the crisis on liberalization of financial services trade and regulatory reform in Member countries as well as at the international level, it is acknowledged that this is a particularly difficult moment to make firm observations.
For example: items such as the "acceptance of deposits" and "lending" include or exclude certain activities, insurance intermediation such as brokerage and agency is treated either as an independent item, or is part of "services auxiliary to insurance"; credit card services are either a part of "all payment and money transmission services", or they constitute an independent item; there are cases in which the heading in the "Sector or subsector" column indicates a narrower service sector or subsector than the CPC number listed below the heading, or where the CPC code indicates a narrower category than the sector listed; and services such as "venture capital" and "services related to securities markets" are sometimes listed without further definitions.
Another point which may need to be clarified is how to draw the line between the provision and transfer of financial information as a financial service and the supply of such services as part of other information services, such as value-added telecommunication services, audiovisual services or publishing.
Although the Secretariat has not identified any major problems with respect to the classification in the Annex, delegates may wish to discuss whether the existing classification is sufficiently detailed or robust for the purposes of scheduling commitments, and is adequate for use in future negotiations.
They still indicate that, in many countries, the sector has grown in importance over the last 20-25 years, although since 1990 there appears to be a levelling-off of the growth trend in many mature financial markets.
Apart from the effect of the crisis, it is reported that in the financial and transport sectors, the introduction of information technology has increased vastly the demand for high-skilled white-collar workers, while that for low-skilled white-collar workers have fallen in some sectors such as insurance.
In this context, improved commitments made in mode 3 (commercial presence) as a result of the WTO financial services negotiations concluded last year are expected to be a supporting factor for steady flows of FDI capital, including inflows to the countries most seriously affected by the current crisis.
Although existing rankings of the world's top banks are still dominated by institutions from the major industrialized countries, banks from China, Brazil and Singapore appear in the top 100 list.
Offshore markets and financial centres prospered when regulation was tight in most major industrialized country markets, but as deregulation has taken hold in many of the world's major markets,
A recent survey on financial centres concludes that although at least some of the financial centres will continue to thrive, those that thrive will increasingly take business away from rival centres, and today's mainly national centres will be replaced by just a handful of international centres.
Although the raison d'être for such institutions may in some cases be diminishing due to the integration of domestic and international markets, and increasing competition between all types of financial and non-financial institutions, they are often granted special treatment in terms of legal status, taxes and subsidies, or exclusive supply of certain products.

Regulation of the Financial Services Sector
The Objectives of Financial Sector Regulation

The financial services sector is among the most heavily regulated of all service sectors.
which were (i) macroeconomic policy management, (ii) prudential regulations, (iii) non-prudential regulation to pursue various public policy objectives other than that falling under (iv), and (iv) trade restrictions concerning market access or national treatment.

There would be little objection to considering that, in banking, for example, capital adequacy ratios, limits on risk concentration and risk management system requirements, liquidity requirements, prohibitions on insider trading and transactions giving rise to conflicts of interest, rules on the classification of and provisioning for non-performing assets, "fit and proper" tests for directors and managers, as well as transparency and disclosure requirements constitute prudential measures.
Such efforts are expected to reduce the possibility that domestic standards and codes are perceived by other countries as overly burdensome or effectively constitute barriers to trade.
However, as governments embarked on privatization and deregulation eliminating those obstacles and increasingly shifted to the use of market forces to attain efficiency objectives, there is a growing need for competition policy to address anti-competitive behaviour of financial service suppliers.
Although such measures may be motivated by a policy to develop national financial industries, they may also stem from supervisory concerns, since the supervision of branches would require information on the head office abroad, and this is more difficult than the supervision of locally incorporated subsidiaries, particularly when the regulatory mechanism is not well-developed.
Similar considerations may apply to restrictions on the number of operations such as branches or ATMs, as well as limitations on the value of transactions or assets (such as limitations on the share of banking assets allowed to be held by foreign banks).
As a result, the focus of governments in addressing barriers to trade in financial services appears to have shifted to non-discriminatory measures in domestic regulation including prudential measures and licensing requirements and procedures which may have the effect of creating difficulties for foreign suppliers to make headway in the market.
For that matter, deregulation of various restrictions on the activities of the suppliers of financial services, which involves both prudential and non-prudential regulation, has been followed or accompanied by re-regulation in terms of stronger prudential and transparency rules as well as competition policy.
In response to such needs, regulators in some countries have now moved to (i) reorganize the regulatory structure and shift to regulation by function, applicable to all types of entities that supply identical services; and, (ii) create a "super-regulator" which can exercise effective supervision over various types of financial institutions and financial conglomerates.

Although it is too early to foresee the outcome of the most recent reforms being undertaken by governments in financial services regulation and supervision, there seems to be no doubt that they aim to improve the functioning of the markets, and to complete rather than reverse achievements in financial services liberalization.
Although significant improvements have been made to those commitments as a result of the financial services negotiations concluded last December, those new commitments have not yet entered into force as of the date of this note, and the numerical analysis presented in Tables 10 to 21 of the above publication could not be updated due to resource constraints.
Concerning the modal coverage of the commitments made, there is a continuing predominance of commitments for commercial presence (mode 3) as compared to those for crossborder supply (mode 1).
This was when the commitment in a Member's Schedule became more restrictive than the status quo in the country (for example, in terms of the share of foreign capital allowed in local financial institutions, or in terms of the number of branches allowed) due to a change in the laws of the country, a specific commitment was made to guarantee the prevailing level of market access to foreigners.
Issues for Discussion

Are there any other useful sources of information that delegates are aware of?
Core Principles for Effective Banking Supervision, Basle Committee on Banking Supervision, Bank for International Settlements, Basle.
An Open Letter to Prime Minister Mahathir from Paul Krugman, Fortune Investor, 1 September 1998, downloaded from http://www.
Trade Policy Review - United States 1996, World Trade Organization, Geneva.
Table 3: Insurance Premiums as Percentages of GDP
(Direct gross premiums)
Country 1995 1996 Life Non-life Total Life Non-life Total Luxembourg 21 2.
Table 4: Cross-border Trade in Financial Services - Receipts and Expenditure
(Billions of US dollars)
COUNTRY 1985 1990 1995 1996 Receipts (Exports) Austria 0.
Trading in derivatives Trading in Securities Under-writing

Asset management Financial Information Angola X X Antigua and
Barbuda X Argentina X X X X X X X X X X X Australia X X X X X X X X X X X X Austria X X X X X X X X X X X X Bahrain X X X X X X X X X X X X Barbados X Benin X X Bolivia X X X X X X X X X Brazil X X X X X X X X X X Brunei Darussalam X X X X X Bulgaria X X X X X X X X X X Canada X X X X X X X X X X X X Chile X X X X X X X X Colombia X X X X X X X X X X Costa Rica X X X Cuba X X X X X X X X X X X X Cyprus X X X X X X X Czech Republic X X X X X X X X X X X Dominica X Dominican Republic X X X X X X X X Ecuador X X X X X X X X X X X Egypt X X X X X X X X X X El Salvador X X X X X European Community X X X X X X X X X X X X Finland X X X X X X X X X X X X Gabon X X X X X X X X Gambia X X X X X X X X X X Ghana X X X X X X X X X X X Grenada X Guatemala X X Guyana X X X X X Haiti X X X X X Honduras X X X X X X Hong Kong X X X X X X X X X X X X Hungary X X X X X X X X X X X X Iceland X X X X X X X X X X X X India X X X X X X X X X Indonesia X X X X X X X X X X Israel X X X X X X X X X X X Jamaica X X X X X X X Japan X X X X X X X X X X X X Kenya X X X X X X X X Korea RP X X X X X X X X X X Kuwait X X X X X X X X Kyrgyz Republic X X X X X X X X X X X X Latvia X X X X X X X X X X X X Lesotho X X X X X X X Liechtenstein X X X X X X X X X X X X Macau X X X X X X X X X X X X Malawi X X X X X X X X Malaysia X X X X X X X X X X X Malta X X X X X X X Mauritius X X X X X X X X X X Mexico X X X X X X X X X X Mongolia X X X X X X X X X X X Morocco X X X X X X X X Mozambique X X X X X X X X New Zealand X X X X X X X X X X X X Nicaragua X X X X X X X Nigeria X X X X X X X X X X Norway X X X X X X X X X X X X Pakistan X X X X X X X X X X Panama X X X X X X X X X X X Papua New
Guinea X X X X Paraguay X X X X X Peru X X X X X X X X X X X Philippines X X X X X X X X X X X X Poland X X X X X X X X X X Qatar X X X X X X X X Romania X X X X X X X X X X Santa Lucia X Saint Vinc.
Finance Ministries and Other Regulatory Agencies and International Organizations
Country Central Bank Web Addresses Finance Ministries and Other Regulatory Agencies Argentina www.
This report, while estimating that about 140 million workers are fully unemployed in the world, expects that an additional 10 million workers will be unemployed by the end of 1998, mainly as a result of the large-scale displacement of workers in East Asia due to the economic crisis.
Without prejudging the outcome of the continuing negotiation on emergency safeguard measures under Article X of the GATS, the financial sector has always been considered as one of the sectors which might require emergency safeguard measures by the proponents of such measures in services.

Although technically, Article VI:4 and 5 may not be applicable to prudential measures, questions may remain as to whether they are based on objective and transparent criteria, or are not more burdensome than necessary.

S/WPGR/W/25 of 26 January 1998 reports that, according to WTO Trade Policy Reviews, at least ten Members have assisted their offshore banking sectors or rescued ailing domestic banks in recent years.

Such considerations extend beyond borders, as distortionary regulation could provoke regulatory competition between countries, resulting in sub-optimal regulation overall.
It is stated that (in emerging markets where there are limits to the pace at which financial sectors can be strengthened) policymakers need to undertake an orderly opening of their financial systems, and may need to consider imposing temporary measures to restrain certain types of (capital) inflows (P.

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Sheet3
Sheet2
Chart2
Sheet1
Chart1
Country
Average
Australia
Austria
Denmark
Canada
Germany
Iceland
Japan
Netherlands
Portugal
Spain
Switzerland
Turkey
United States
.
Foreign Market Share in Non-Life Insurance Services, OECD Countries,
1989-1996 Average
(Percentage Share)
Source: OECD (1998), Insurance Statistics Yearbook
Foreign Market Share in Non-Life Insurance Services, OECD Countries, 1996
Foreign Market Share
Hungary
Korea
Luxembourg
Mexico
Norway
Poland
91.

S/CSS/W/96

S/CSS/W/86

World Trade
Organization TN/S/W/43S/FIN/W/43
8 June 2005
(05-2335) Council for Trade in Services
Special Session
Committee on Trade in Financial Services Original: English



COMMUNICATION FROM AUSTRALIA, BAHRAIN, CANADA, THE EUROPEAN COMMUNITIES, JAPAN, NORWAY, oman, PANAMA, Singapore, SWITZERLAND, THE SEPARATE CUSTOMS TERRITORY OF TAIWAN, PENGHU, KINMEN AND MATSU, AND THE UNITED STATES

Liberalization of Financial Services


The following communication, dated 6 June 2005, from the delegations of Australia, Bahrain, Canada, the European Communities, Japan, Norway, Oman, Panama, Singapore, Switzerland, the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu, and the United States is being circulated to the Members of the Council for Trade in Services and the Committee on Trade in Financial Services.

_______________


Importance of financial services liberalization for economic growth, stability and development
"Financial services" inc

World Trade
Organization RESTRICTED S/FIN/M/39
7 April 2003 (03-1915) Committee on Trade in Financial Services

REPORT OF THE MEETING HELD ON 26 FEBRUARY 2003

Note by the Secretariat

The Committee on Trade in Financial Services held a meeting on 26 February 2003, under the Chairmanship of Mr.

The Chairman noted his intention under "Other Business" to comment on the presentation made during the morning by the World Bank of its 11th Policy Report entitled "Finance for Growth: Policy Choices in a Volatile World".
Contagion from developments in other countries, herding and momentum trading in certain financial markets had probably contributed to sudden spikes and reversals of capital flows, without an obvious connection to economic fundamentals in the host country.
Experience in numerous countries had shown that as a general rule: (i) the liberalization of foreign direct investment and of other long-term capital flows can be considered relatively early on in the financial opening process, while there is reason to be more cautious with short-term flows; (ii) it will often be appropriate to proceed with the liberalization of outflows before that of inflows; (iii) it may be advisable to liberalize equity transactions before debt transactions; and (iv) transactions of non-residents before those of residents.
Through its FSAPs and work relating to compliance with international financial standards, the Fund, together with the World Bank, had accumulated a body of knowledge for a broad range of countries on issues such as licensing, cross border business participation, the prudential framework, the exchange of information with other regulatory bodies, and transparency of regulatory and financial legislative processes.
She said that during bilateral negotiations, Thailand's trading partners had stressed that they were not looking for capital movement liberalization.
But if that Swiss bank wanted now to establish a commercial presence in Thailand, it could not be automatically assumed that the bank would be able to provide electronic services from Switzerland to consumers in Thailand,
He also said that, if he had heard the World Bank representative correctly, foreign financial institutions improved stability and efficiency of the financial sector, but that did not mean that mode 1 commitments were not good for stability and efficiency.
Members might still decide whether it was appropriate to take on commitments, and then, if they did so, a discussion on issues associated with those commitments might be needed.
The second issue –raised in fact by the presentations by the World Bank and the IMF- concerned the risks and benefits of capital account liberalization and its relationship with financial services liberalization.
The second aspect was related to the legal status of the Understanding on Commitments in Financial Services, particularly taking into account that as, expressed by the Understanding itself, that approach for scheduling commitments was understood as not conflicting with the provisions of the GATS and as not raising any presumption on the degree of liberalization to which a Member was committing itself under the GATS.
China, a representative of the Secretariat said that, from a historical point of view, at the time when the Understanding was negotiated and drafted, the drafting process was also under way with respect to Articles XVI, XVII, and indeed the rest of the Agreement.
The evidence submitted by the World Bank and the IMF might suggest that a good strategy could be to leave mode 1 unbound in order to be free to regulate and to adapt the legislation.
The representative of Canada asked Brazil if it believed that the protection already included in Articles XI and XII of the GATS was insufficient, and if that was the case, whether it was Brazil's view that Brazil could not deal with such insufficiency via the negotiation of commitments in an appropriate fashion.

The representative of the European Communities said, with respect to the intervention by Malaysia, that the World Bank's empirical research showed that foreign bank entry led to deeper financial systems, greater growth and less of a tendency to have banking crisis.
He asked Canada whether it was willing to take a full commitment in mode 1, both in market access and national treatment, according to the Annex on Financial Services, just because Articles XI and XII were there.
Finally, on the points made by Brazil, he agreed that not many countries had taken many commitments under mode 1 and, probably, only a few countries undertook a commitment under mode 1 without any restrictions.
However, the reason for Canada's question to Brazil was whether there was something inherent in the construction of the Understanding , the GATS and the Annex on Financial Services that made impossible for Brazil to undertake negotiations on mode 1 in such a way that would be appropriate to Brazil's own interest.
Brazil took note that Canada had commitments in mode 1 for financial services according to the Understanding, but invited Canada to make full commitments in mode 1 according to the Annex on Financial Services.
Thirdly, the Fund was very concerned about the issue of volatility of capital flows raised by Korea among others, and was working on the ways to better address this volatility in a multilateral context.

The Chairman said that the discussion on this particular agenda item was very interesting and stimulating, focusing on some very complex issues regarding the liberalization of capital flows.
Although e-finance brought benefits to consumers, its growth raised some concerns as it might lead to volatile capital movements.
For example, the cost of a transaction through a branch might be US$ 1, while the same transaction conducted over the Internet cost less than US$ 0,10.
In that regard, he asked whether further information on the general approach taken by Hong Kong, China regarding solicitation might be provided, particularly with respect to other financial services, such as investment funds.
On the questions raised by Switzerland, he confirmed that, as far as he was aware, one bank had been licensed to conduct business on a purely virtual basis.
Secondly, Hong Kong, China regulators had been involved in discussions with other supervisors in the Asia-Pacific region, with a view to exploring the scope for international cooperation with regard to electronic transactions.

date of the next meeting
The Chairman suggested that the Committee hold its next meeting during the next cluster of services meetings,

In his view, the World Bank presentation provided the Committee with a lot of evidence and insights on why finance matters, on what had been the experience with different types of policies, and on what were the preconditions to successful reform programmes.
However, given that the consultation on that matter by the Chairman of the Council for Trade in Services had not yet finished, he suggested that the formal election of the Committee's Chair for this year and the hand over take place at the beginning of the next meeting, right after the adoption of the agenda.

World Trade
Organization S/L/92
28 March 2001 (01-1542) Trade in Services



GUIDELINES FOR THE SCHEDULING OF SPECIFIC COMMITMENTS
UNDER THE GENERAL AGREEMENT ON TRADE IN SERVICES (GATS)


Adopted by the Council for Trade in Services on 23 March 2001



_______________



TABLE OF CONTENTS

Introduction 3
PART I : WHAT ITEMS SHOULD BE SCHEDULED? 3
A. Limitations on Market Access (Article XVI) 4
B. Limitations on National Treatment (Article XVII) 5
C. Additional Commitments (Article XVIII) 7
D. Exceptions 7
E. Specific Commitments and MFN Exemptions 7
PART II: HOW SHOULD ITEMS BE SCHEDULED? 7
A. How to describe committed sectors and subsectors 8
B. How to treat the modes of supply 8
1. Crossborder supply 9
2. Consumption abroad 9
3. Commercial Presence 10
4. Presence of natural persons 10
5. Relationship between modes of supply 10
C. How to record commitments 10
1. Horizontal commitments 10
2. Sectorspecific commitments 11
3. L

Levels of commitment 11
(a) Full commitment 12
(b) Commitment with limitations 12
(c) No commitment 12
(d) No commitment technically feasible 12
(e) Special cases 13
Annex 1 - SCHEDULE OF SPECIFIC COMMITMENTS OF COUNTRY X 14
Annex 2 - LIST OF ATTACHED DOCUMENTS RELEVANT FOR
SCHEDULING PURPOSES 15

GUIDELINES FOR THE SCHEDULING OF SPECIFIC COMMITMENTS
UNDER THE GENERAL AGREEMENT ON TRADE IN SERVICES (GATS)

Explanatory note

Introduction
This note is intended to assist in the preparation of offers, requests and national schedules of specific commitments.
If a Member undertakes a commitment in a sector then it must indicate for each mode of supply that it binds in that sector:
- what limitations, if any, it maintains on market access;

- what limitations, if any, it maintains on national treatment; and

- what additional commitments,
Limitations on Market Access (Article XVI)
A Member grants full market access in a given sector and mode of supply when it does not maintain in that sector and mode any of the types of measures listed in Article XVI.
In other words, all measures falling under any of the categories listed in Article XVI:2 must be scheduled, whether or not such measures are discriminatory according to the national treatment standard of Article XVII.
Numerical ceilings should be expressed in defined quantities in either absolute numbers or percentages; regarding economic needs tests the entry should indicate the main criteria on which the test is based, e.
Where such a measure does not conform to these disciplines, and if it cannot be justified as an exception, it must be brought into conformity with Article VI:5 and cannot be scheduled.
(Although the measure does not formally distinguish service suppliers on the basis of national origin, it de facto offers less favourable treatment to foreign service suppliers because they are less likely to be able to meet a prior residency requirement than like service suppliers of national origin.

Restrictions on the purchase, lease or use of real estate, connected with the supply of a service inscribed in a schedule, are national treatment limitations to the extent that different conditions apply to foreign services suppliers which alter the conditions of competition in favour of service suppliers of the Member compared to like service suppliers of any other Member.
In the schedule, the Additional Commitments column would only include entries where specific commitments are being undertaken, and need not include those modes of supply where there are no commitments undertaken or any entries at all where no Article XVIII undertakings are made.
Therefore, in such cases, a Member may accord treatment in that sector more favourable than the minimum standard to some Members, as long as all other Members receive at least that minimum standard of market access and national treatment appearing in its schedule.
In its offer/schedule, the Member would then enter the subsector under the "Other Business Services" section of its schedule as follows:

Mapmaking services (86754)

If a Member wishes to use its own subsectoral classification or definitions it should provide concordance with the CPC in the manner indicated in the above example.
MODES OF SUPPLY

Supplier Presence
Other Criteria
Mode
Service supplier not present within the territory of the Member Service delivered within the territory of the Member, from the territory of another Member CROSSBORDER SUPPLY Service delivered outside the territory of the Member, in the territory of another Member, to a service consumer of the Member CONSUMPTION ABROAD Service supplier present within the territory of the Member Service delivered within the territory of the Member, through the commercial presence of the supplier COMMERCIAL PRESENCE Service delivered within the territory of the Member, with supplier present as a natural person PRESENCE OF NATURAL PERSON
It is important to have a common understanding of what each mode covers.
Presence of natural persons
This mode covers natural persons who are themselves service suppliers, as well as natural persons who are employees of service suppliers.

Relationship between modes of supply
Where a service transaction requires in practical terms the use of more than one mode of supply, coverage of the transaction is only ensured when there are commitments in each relevant mode of supply.
Example: Legislation may stipulate requirements regarding entry, temporary stay and right to work of natural persons; the categories of natural persons covered by a particular offer may also be specified.
If in the context of such a commitment, a measure is maintained which is contrary to Articles XVI or XVII, it must be entered as a limitation in the appropriate column (either market access or national treatment) for the relevant sector and modes of supply; the entry should describe the measure concisely, indicating the elements which make it inconsistent with Articles XVI or XVII.
Depending on the extent to which a Member has limited market access and national treatment, for each commitment with respect to each mode of supply, four cases can be foreseen:
Full commitment
In this case the Member does not seek in any way to limit market access or national treatment in a given sector and mode of supply through measures inconsistent with Articles XVI and XVII.
Moreover, since the listed examples come from individual existing schedules and are based on their own interpretation of Article XVII of the GATS, the list does not represent the common view of WTO Members on this subject and therefore it does not prejudge Members’ positions on the interpretation of Article XVII of the GATS.
Technology transfer/training requirements

- The foreign service supplier shall use appropriate and advanced technology and managerial experience, and shall have the obligation to transfer its technology and pass on its experience to national personnel

- The foreign service supplier must prove commitment to recruit and develop more local human resources

- Foreign service suppliers, in the context of JV are required to offer on-the-job training for national employees

- Skilled foreign employees required to provide training to locals

X.
purchase as well as rent or lease of real estate by foreign natural persons and juridical persons requires an authorization by the competent regional authorities which will consider whether important economic, social or cultural interests are affected or not

- Foreign entities may only acquire real property through participation in joint ventures

- Nonresidents are excluded from the acquisition of real estate

__________
Attachment 2

Committee on Trade in Financial Services 24.
On the other hand, some general substantive solutions have been proposed such as the following:
all financial transactions (between non-resident suppliers and resident consumers) that take place inside a Member's territory could be classified as mode 1;
mode 1 transactions could be defined as those that take place under the laws of the Member, while mode 2 transactions could be defined as those that take place under the laws of the foreign country from which the service is supplied;
the supply of services accompanied by solicitation could be defined as mode 1, if not, mode 2;
any measure applicable to the supplier of the service could be classified under mode 1, any measure applicable to the consumer under mode 2;
modes 1 and 2 could be merged.
A Member may also encounter a situation in which its mode 2 commitments would become unenforceable, since it may not be possible to implement any commitments concerning transactions which took place entirely outside the Member's legal jurisdiction.
97

Committee on Trade in Financial Services

Report of Informal Consultations held on 27 June 1997
on the Distinction between Modes 1 and 2 in Financial Services

Informal Note by the Secretariat

At the meeting of the Committee on Trade in Financial Services held on 5 June, the Secretariat was asked to organize informal consultations open to all delegations on the question of the distinction between modes 1 and 2 in financial services schedules.
Such a solution must provide as much clarity as possible, must be neutral with regard to existing commitments while facilitating the negotiation of new ones under the two modes, should if possible be accepted at the 17 July meeting of the Committee, and should close the discussions on this issue until the conclusion of the financial services negotiations in December this year.
Several delegations also added that while they themselves had not encountered difficulties with regard to this issue, they were willing to discuss bilaterally with any delegation which had found difficulties in scheduling commitments under these modes.
It was agreed that the responsibility for clarifying the content of commitments under modes 1 and 2 must lie with those individual Members feeling the need to do so; to develop a common multilateral solution for the purposes of the financial services negotiations would be infeasible in the time available and was in any case unnecessary.
97

Example of a headnote explaining the distinction between Modes 1 and 2 in financial services schedules

- Market access and national treatment limitations with respect to the mode (1) (cross-border supply) and mode (2) (consumption abroad) supply of financial services are inscribed in this section of the Schedule in accordance with the following distinction between the measures affecting these two modes of supply:

1.
It was observed that the new disciplines developed under Article VI:4 must not overlap with other provisions already existing in the GATS, including Articles XVI and XVII, as this would create legal uncertainty.
However, it is also recognized that for some categories of measures the determination as to whether an individual measure falls under Article VI:4 disciplines or is subject to scheduling under Article XVII will require careful consideration.
* Discriminatory treatment of applications from foreign service suppliers vis-à-vis domestic applications including: criteria relating to education, experience, examinations and ethics; the overall degree of difficulty when testing competence of applicants; the need for in-country experience before sitting examinations.
Subsector (g) --private leased circuit services -- involves the ability of service suppliers to sell or lease any type of network capacity for the supply of services listed in any other basic telecom service subsector unless otherwise noted in the sector column.
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Attachment 6

World Trade
Organization RESTRICTED S/GBT/W/3
3 February 1997 (97-0415) Group on Basic Telecommunications Original: English

CHAIRMAN'S NOTE

Market Access Limitations on Spectrum Availability

Many Members have entries in the market access column of their schedules indicating that commitments are "subject to availability of spectrum/frequency" or similar wording.
However, it may be useful to draw from "other" basic services cited in participants' responses to the Questionnaire on Basic Telecommunications, in order to furnish the model with some examples of "other" basic telecommunications on which commitment might be undertaken;
the examples of measures listed in the model under the columns on limitations on market access and on national treatment may not be complete and may be further elaborated as a result of discussions on limitations relevant to the modes of supply for basic telecommunications (see also the informal note by the Secretariat on Modes of Supply and Market access Limitations (14 February 1995).
How these tools could be used to clarify the drafting and hence the understanding of offers/schedules may be viewed as follows:
the "categories" are intended to supplement, where relevant to a participant's telecommunications regime, the listing of subsectors 2.
  Voice telephone services: radio based" might be listed separately in a schedule where different sets of limitations apply to each;
whether a participant undertakes particular additional commitments and how such a commitment would be formulated will be likely to depend on the regime concerned and the agreed results of bilateral negotiations and/or multilateral discussions.
Types of measures relevant to possible undertakings:
(Commitments on measures not subject to scheduling under Articles XVI and XVII, including but not limited to those regarding qualifications, standards, or licensing requirements or licensing procedures and other domestic regulations that are otherwise consistent with Article VI and the Annex on Telecommunications.
), total value of transactions or assets, total number of operations or quantity of output;

Quantitative limitation on the number of available frequencies to be allotted to foreign service suppliers; f

Restrictions or requirements regarding the type of legal entity permitted to supply the services (also, a requirement of certain forms of commercial presence could rule out cross-border supply);

Limits on foreign equity participation.
Maintenance and repair of equipment
(not including maritime vessels, aircraft 633+
or other transport equipment) 8861-8866
o.
Trading for own account or for account of customers,
whether on an exchange, in an over-the-counter
market or otherwise, the following:
- money market instruments (cheques, bills, 81339**
certificate of deposits, etc.
The term "limitations" will be used throughout this note to refer to the "terms", "conditions", "limitations", and "qualifications" used in Articles XVI and XVII of the GATS.
Some such examples might include: paging services, satellite transmission services, intra-corporate communications, video dialtone, wireless access, fixed line access, analogue/digital cellular mobile networks and services, PCS networks and services, mobile data services, international switching and other international gateway facilities such as satellite earth stations, domestic/international satellite services and satellite links/capacity.
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World Trade
Organization RESTRICTED S/FIN/M/49
24 August 2005
(05-3739) Committee on Trade in Financial Services


REPORT OF THE MEETING HELD ON 23 JUNE 2005

Note by the Secretariat


The Committee on Trade in Financial Services held a meeting on 23 June 2005. The agenda is contained in airgram WTO/AIR/2596.
The Chairperson noted the incoming chair's intention under "Other Business" to inform Members about the date for the next transitional review of China's commitments.
The Committee so agreed, and adopted the agenda.
appointment of the new chairperson
The Chairperson, Ms. Miyon Lee (Korea), said that according to the rules of procedure for meetings of the Committee, the hand-over of the chairmanship should have taken place at the end of the last meeting. However, since the consultations on the chairmanships of the subsidiary bodies to the Council for Trade in Services had not been finalized yet, it was decided that the hand-over would take place

World Trade
Organization RESTRICTED S/FIN/M/48
4 March 2005
(05-0933) Committee on Trade in Financial Services

REPORT OF THE MEETING HELD ON 10 FEBRUARY 2005

Note by the Secretariat

The Committee on Trade in Financial Services held a meeting on 10 February 2005, under the Chairmanship of Ms. Miyon Lee (Republic of Korea). The proposed agenda is contained in airgram WTO/AIR/2493.
The representative of Australia announced his intention to introduce a statement under Other Business on liberalization of financial services. Also under Other Business, the representative of Korea wished to announce a seminar on financial services liberalization. Finally, the Chairperson indicated that she would make a brief statement on the selection of a new chair for the Committee. The Chairperson proposed that the agenda be adopted with the addition of those items under Other Business.
It was so agreed.
ITEM A: ACCEPTANCE OF THE FIFTH PROTOCOL TO THE GATS
The Chairpers

General Agreement on Trade in Services 作　　者： 靖心慈／WTO中心 國家： 組　　織： 世界貿易組織
機密
： U 議　　題： 服務貿易 產業： 資料來源： WTO
，
Final Act, The Uruguay Round agreements
－
Annex 1B
，
1994年4月15日 分　　類： 服務貿易\議題簡介\服務貿易總協定,法律文件與承諾表\
總協定
General Agreement on Trade in Services
GENERAL AGREEMENT ON TRADE IN SERVICES APRIL 1994
PART I SCOPE AND DEFINITION
PART II GENERAL OBLIGATIONS AND DISCIPLINES
PART III SPECIFIC COMMITMENTS
PART IV PROGRESSIVE LIBERALIZATION
PART V INSTITUTIONAL PROVISIONS
PART VI FINAL PROVISIONS
Annex on Article II Exemptions
Annex on Movement of Natural Persons Supplying Services under the Agreement
Annex on Air Transport Services
Annexes on Financial Services
Annex on Negotiations on Maritime Transport Services
Annexes on Telecommunications
Related instruments
Decision on Institutional Arrangements for the General Agreement on Trade in Services
Decision on Certain Dispute Settlement Procedures for the General Agreement on Trade in Services
Decision on Trade in Services and the Environment
Decision on Negotiations on Movement of Natural Persons
Decision on Financial Services
Decision on Negotiations on Maritime Transport Services
Decision on Negotiations on Basic Telecommunications
Decision on Professional Services
Understanding on Commitments in Financial Services
Appendix
Lists of Schedules of Specific Commitments and of Article II (MFN) Exemptions
SERVICES: AGREEMENTGeneral Agreement on Trade in Services

Members,
Recognizing the growing importance of trade in services for the growth and development of the world economy;
Wishing to establish a multilateral framework of principles and rules for trade in services with a view to the expansion of such trade under conditions of transparency and progressive liberalization and as a means of promoting the economic growth of all trading partners and the development of developing countries;
Desiring the early achievement of progressively higher levels of liberalization of trade in services through successive rounds of multilateral negotiations aimed at promoting the interests of all participants on a mutually advantageous basis and at securing an overall balance of rights and obligations, while giving due respect to national policy objectives;
Recognizing the right of Members to regulate, and to introduce new regulations, on the supply of services within their territories in order to meet national policy objectives and, given asymmetries existing with respect to the degree of development of services regulations in different countries, the particular need of developing countries to exercise this right;
Desiring to facilitate the increasing participation of developing countries in trade in services and the expansion of their service exports including, inter alia, through the strengthening of their domestic services capacity and its efficiency and competitiveness;
Taking particular account of the serious difficulty of the least-developed countries in view of their special economic situation and their development, trade and financial needs;
Hereby agree as follows:
SERVICES: AGREEMENTPart I — Scope and definition

Article I Scope and Definition
1.
For the purposes of this Agreement:
(a) “measures by Members” means measures taken by:
(i) central, regional or local governments and authorities; and
(ii)non-governmental bodies in the exercise of powers delegated by central, regional or local governments or authorities;
In fulfilling its obligations and commitments under the Agreement, each Member shall take such reasonable measures as may be available to it to ensure their observance by regional and local governments and authorities and non-governmental bodies within its territory;
(b) “services” includes any service in any sector except services supplied in the exercise of governmental authority;
(c) “a service supplied in the exercise of governmental authority” means any service which is supplied neither on a commercial basis, nor in competition with one or more service suppliers.
each Member shall accord immediately and unconditionally to services and service suppliers of any other Member treatment no less favourable than that it accords to like services and service suppliers of any other country.
The increasing participation of developing country Members in world trade shall be facilitated through negotiated specific commitments, by different Members pursuant to Parts III and IV of this Agreement, relating to:
(a) the strengthening of their domestic services capacity and its efficiency and competitiveness, inter alia through access to technology on a commercial basis;
(b) the improvement of their access to distribution channels and information networks; and
(c) the liberalization of market access in sectors and modes of supply of export interest to them.
If, in the conclusion, enlargement or any significant modification of any agreement under paragraph 1, a Member intends to withdraw or modify a specific commitment inconsistently with the terms and conditions set out in its Schedule, it shall provide at least 90 days advance notice of such modification or withdrawal and the procedure set forth in paragraphs 2, 3 and 4 of Article XXI shall apply.

Article V bis Labour Markets Integration Agreements
This Agreement shall not prevent any of its Members from being a party to an agreement establishing full integration (2)of the labour markets between or among the parties to such an agreement, provided that such an agreement:
(a) exempts citizens of parties to the agreement from requirements concerning residency and work permits;
(b) is notified to the Council for Trade in Services.
Such disciplines shall aim to ensure that such requirements are, inter alia:
(a) based on objective and transparent criteria, such as competence and the ability to supply the service;
(b) not more burdensome than necessary to ensure the quality of the service;
(c) in the case of licensing procedures, not in themselves a restriction on the supply of the service.
pending the entry into force of disciplines developed in these sectors pursuant to paragraph 4, the Member shall not apply licensing and qualification requirements and technical standards that nullify or impair such specific commitments in a manner which:
(i) does not comply with the criteria outlined in subparagraphs 4(a), (b) or (c); and
(ii) could not reasonably have been expected of that Member at the time the specific commitments in those sectors were made.
inform the Council for Trade in Services of its existing recognition measures and state whether such measures are based on agreements or arrangements of the type referred to in paragraph 1;
(b) promptly inform the Council for Trade in Services as far in advance as possible of the opening of negotiations on an agreement or arrangement of the type referred to in paragraph 1 in order to provide adequate opportunity to any other Member to indicate their interest in participating in the negotiations before they enter a substantive phase;
(c) promptly inform the Council for Trade in Services when it adopts new recognition measures or significantly modifies existing ones and state whether the measures are based on an agreement or arrangement of the type referred to in paragraph 1.
If, after the date of entry into force of the WTO Agreement, a Member grants monopoly rights regarding the supply of a service covered by its specific commitments, that Member shall notify the Council for Trade in Services no later than three months before the intended implementation of the grant of monopoly rights and the provisions of paragraphs 2, 3 and 4 of Article XXI shall apply.
In the period before the entry into effect of the results of the negotiations referred to in paragraph 1, any Member may, notwithstanding the provisions of paragraph 1 of Article XXI, notify the Council on Trade in Services of its intention to modify or withdraw a specific commitment after a period of one year from the date on which the commitment enters into force; provided that the Member shows cause to the Council that the modification or withdrawal cannot await the lapse of the three-year period provided for in paragraph 1 of Article XXI.
The restrictions referred to in paragraph 1:
(a) shall not discriminate among Members;
(b) shall be consistent with the Articles of Agreement of the International Monetary Fund;
(c) shall avoid unnecessary damage to the commercial, economic and financial interests of any other Member;
(d) shall not exceed those necessary to deal with the circumstances described in paragraph 1;
(e) shall be temporary and be phased out progressively as the situation specified in paragraph 1 improves.
Nothing in this Agreement shall be construed:
(a) to require any Member to furnish any information, the disclosure of which it considers contrary to its essential security interests; or
(b) to prevent any Member from taking any action which it considers necessary for the protection of its essential security interests:
(i) relating to the supply of services as carried out directly or indirectly for the purpose of provisioning a military establishment;
(ii) relating to fissionable and fusionable materials or the materials from which they are derived;
(iii) taken in time of war or other emergency in international relations; or
(c) to prevent any Member from taking any action in pursuance of its obligations under the United Nations Charter for the maintenance of international peace and security.
In sectors where market-access commitments are undertaken, the measures which a Member shall not maintain or adopt either on the basis of a regional subdivision or on the basis of its entire territory, unless otherwise specified in its Schedule, are defined as:
(a) limitations on the number of service suppliers whether in the form of numerical quotas, monopolies, exclusive service suppliers or the requirements of an economic needs test;
(b) limitations on the total value of service transactions or assets in the form of numerical quotas or the requirement of an economic needs test;
(c) limitations on the total number of service operations or on the total quantity of service output expressed in terms of designated numerical units in the form of quotas or the requirement of an economic needs test;(2)
(d) limitations on the total number of natural persons that may be employed in a particular service sector or that a service supplier may employ and who are necessary for, and directly related to, the supply of a specific service in the form of numerical quotas or the requirement of an economic needs test;
(e) measures which restrict or require specific types of legal entity or joint venture through which a service supplier may supply a service; and
(f) limitations on the participation of foreign capital in terms of maximum percentage limit on foreign share-holding or the total value of individual or aggregate foreign investment.
There shall be appropriate flexibility for individual developing country Members for opening fewer sectors, liberalizing fewer types of transactions, progressively extending market access in line with their development situation and, when making access to their markets available to foreign service suppliers, attaching to such access conditions aimed at achieving the objectives referred to in Article IV.
With respect to sectors where such commitments are undertaken, each Schedule shall specify:
(a) terms, limitations and conditions on market access;
(b) conditions and qualifications on national treatment;
(c) undertakings relating to additional commitments;
(d) where appropriate the time-frame for implementation of such commitments; and
(e) the date of entry into force of such commitments.
(a) At the request of any Member the benefits of which under this Agreement may be affected (referred to in this Article as an "affected Member") by a proposed modification or withdrawal notified under subparagraph 1(b), the modifying Member shall enter into negotiations with a view to reaching agreement on any necessary compensatory adjustment.
The Council for Trade in Services or the Dispute Settlement Body (DSB) may, at the request of a Member, consult with any Member or Members in respect of any matter for which it has not been possible to find a satisfactory solution through consultation under paragraph 1.
If any Member considers that any benefit it could reasonably have expected to accrue to it under a specific commitment of another Member under Part III of this Agreement is being nullified or impaired as a result of the application of any measure which does not conflict with the provisions of this Agreement, it may have recourse to the DSU.
juridical persons of that other Member identified under subparagraph (i);
(n) a juridical person is:
(i) “owned” by persons of a Member if more than 50 per cent of the equity interest in it is beneficially owned by persons of that Member;
(ii) “controlled” by persons of a Member if such persons have the power to name a majority of its directors or otherwise to legally direct its actions;
(iii) “affiliated” with another person when it controls, or is controlled by, that other person; or when it and the other person are both controlled by the same person;
(o) “direct taxes” comprise all taxes on total income, on total capital or on elements of income or of capital, including taxes on gains from the alienation of property, taxes on estates, inheritances and gifts, and taxes on the total amounts of wages or salaries paid by enterprises, as well as taxes on capital appreciation.
Lists of Article II Exemptions
[The agreed lists of exemptions under paragraph 2 of Article II appear as part of this Annex in the treaty copy of the WTO Agreement.
The Agreement shall not prevent a Member from applying measures to regulate the entry of natural persons into, or their temporary stay in, its territory, including those measures necessary to protect the integrity of, and to ensure the orderly movement of natural persons across, its borders, provided that such measures are not applied in such a manner as to nullify or impair the benefits accruing to any Member under the terms of a specific commitment.
(b) “Selling and marketing of air transport services” mean opportunities for the air carrier concerned to sell and market freely its air transport services including all aspects of marketing such as market research, advertising and distribution.
(d) “Traffic rights” mean the right for scheduled and non-scheduled services to operate and/or to carry passengers, cargo and mail for remuneration or hire from, to, within, or over the territory of a Member, including points to be served, routes to be operated, types of traffic to be carried, capacity to be provided, tariffs to be charged and their conditions, and criteria for designation of airlines, including such criteria as number, ownership, and control.
“services supplied in the exercise of governmental authority” means the following:
(i) activities conducted by a central bank or monetary authority or by any other public entity in pursuit of monetary or exchange rate policies;
(ii) activities forming part of a statutory system of social security or public retirement plans; and
(iii) other activities conducted by a public entity for the account or with the guarantee or using the financial resources of the Government.

(b) A Member that is a party to such an agreement or arrangement referred to in subparagraph (a) , whether future or existing, shall afford adequate opportunity for other interested Members to negotiate their accession to such agreements or arrangements, or to negotiate comparable ones with it, under circumstances in which there would be equivalent regulation, oversight, implementation of such regulation, and, if appropriate, procedures concerning the sharing of information between the parties to the agreement or arrangement.

(xi) Participation in issues of all kinds of securities, including underwriting and placement as agent (whether publicly or privately) and provision of services related to such issues;
(xii) Money broking;
(xiii) Asset management, such as cash or portfolio management, all forms of collective investment management, pension fund management, custodial, depository and trust services;
(xiv) Settlement and clearing services for financial assets, including securities, derivative products, and other negotiable instruments;
(xv) Provision and transfer of financial information, and financial data processing and related software by suppliers of other financial services;
(xvi) Advisory, intermediation and other auxiliary financial services on all the activities listed in subparagraphs (v) through (xv) , including credit reference and analysis, investment and portfolio research and advice, advice on acquisitions and on corporate restructuring and strategy.
Article II and the Annex on Article II Exemptions, including the requirement to list in the Annex any measure inconsistent with most-favoured-nation treatment that a Member will maintain, shall enter into force for international shipping, auxiliary services and access to and use of port facilities only on:
(a) the implementation date to be determined under paragraph 4 of the Ministerial Decision on Negotiations on Maritime Transport Services; or,
(b) should the negotiations not succeed, the date of the final report of the Negotiating Group on Maritime Transport Services provided for in that Decision.

(c) Nothing in this Annex shall be construed:
(i) to require a Member to authorize a service supplier of any other Member to establish, construct, acquire, lease, operate, or supply telecommunications transport networks or services, other than as provided for in its Schedule; or
(ii) to require a Member (or to require a Member to oblige service suppliers under its jurisdiction) to establish, construct, acquire, lease, operate or supply telecommunications transport networks or services not offered to the public generally.
(2)
(b) Each Member shall ensure that service suppliers of any other Member have access to and use of any public telecommunications transport network or service offered within or across the border of that Member, including private leased circuits, and to this end shall ensure, subject to paragraphs (e) and (f), that such suppliers are permitted:
(i) to purchase or lease and attach terminal or other equipment which interfaces with the network and which is necessary to supply a supplier's services;
(ii) to interconnect private leased or owned circuits with public telecommunications transport networks and services or with circuits leased or owned by another service supplier; and
(iii) to use operating protocols of the service supplier's choice in the supply of any service, other than as necessary to ensure the availability of telecommunications transport networks and services to the public generally.
To this end, Members endorse and encourage the participation, to the fullest extent practicable, of developed and developing countries and their suppliers of public telecommunications transport networks and services and other entities in the development programmes of international and regional organizations, including the International Telecommunication Union, the United Nations Development Programme, and the International Bank for Reconstruction and Development.
Such responsibilities shall include:
(a)to keep under continuous review and surveillance the application of the Agreement with respect to the sector concerned;
(b)to formulate proposals or recommendations for consideration by the Council in connection with any matter relating to trade in the sector concerned;
(c)if there is an annex pertaining to the sector, to consider proposals for amendment of that sectoral annex, and to make appropriate recommendations to the Council;
(d)to provide a forum for technical discussions, to conduct studies on measures of Members and to conduct examinations of any other technical matters affecting trade in services in the sector concerned;
(e)to provide technical assistance to developing country Members and developing countries negotiating accession to the Agreement Establishing the World Trade Organization in respect of the application of obligations or other matters affecting trade in services in the sector concerned; and
(f)to cooperate with any other subsidiary bodies established under the General Agreement on Trade in Services or any international organizations active in any sector concerned.
SERVICES: AGREEMENTDecision on trade in services and the environment
Noting that since measures necessary to protect the environment typically have as their objective the protection of human, animal or plant life or health, it is not clear that there is a need to provide for more than is contained in paragraph (b) of Article XIV;
Ministers decide to recommend that the Council for Trade in Services at its first meeting adopt the decision set out below.
SERVICES: AGREEMENTDecision on negotiations on movement of natural persons

Ministers,
Noting the commitments resulting from the Uruguay Round negotiations on the movement of natural persons for the purpose of supplying services;
Mindful of the objectives of the General Agreement on Trade in Services, including the increasing participation of developing countries in trade in services and the expansion of their service exports;
Recognizing the importance of achieving higher levels of commitments on the movement of natural persons, in order to provide for a balance of benefits under the General Agreement on Trade in Services;
Decide as follows:
1.
SERVICES: AGREEMENTDecision on negotiations on maritime transport services

Ministers,
Noting that commitments scheduled by participants on maritime transport services at the conclusion of the Uruguay Round shall enter into force on an MFN basis at the same time as the Agreement Establishing the World Trade Organization (hereinafter referred to as the "WTO Agreement"),
Decide as follows:
1.
the following have announced their intention to take part in the negotiations:Argentina, Canada, European Communities and their member States, Finland, Hong Kong, Iceland, Indonesia, Korea, Malaysia, Mexico, New Zealand, Norway, Philippines, Poland, Romania, Singapore, Sweden, Switzerland, Thailand, Turkey, United States.
Commencing immediately and continuing until the implementation date to be determined under paragraph 4, it is understood that participants shall not apply any measure affecting trade in maritime transport services except in response to measures applied by other countries and with a view to maintaining or improving the freedom of provision of maritime transport services, nor in such a manner as would improve their negotiating position and leverage.
it is understood that no participant shall apply any measure affecting trade in basic telecommunications in such a manner as would improve its negotiating position and leverage.
In making these recommendations, the Working Party shall concentrate on:
(a) developing multilateral disciplines relating to market access so as to ensure that domestic regulatory requirements are: (i) based on objective and transparent criteria, such as competence and the ability to supply the service; (ii) not more burdensome than necessary to ensure the quality of the service, thereby facilitating the effective liberalization of accountancy services;
(b) the use of international standards and, in doing so, it shall encourage the cooperation with the relevant international organizations as defined under paragraph 5(b) of Article VI, so as to give full effect to paragraph 5 of Article VII;
(c) facilitating the effective application of paragraph 6 of Article VI of the Agreement by establishing guidelines for the recognition of qualifications.
Each Member shall permit non-resident suppliers of financial services to supply, as a principal, through an intermediary or as an intermediary, and under terms and conditions that accord national treatment, the following services:
(a) insurance of risks relating to:
(i) maritime shipping and commercial aviation and space launching and freight (including satellites), with such insurance to cover any or all of the following: the goods being transported, the vehicle transporting the goods and any liability arising therefrom; and
(ii) goods in international transit;
(b) reinsurance and retrocession and the services auxiliary to insurance as referred to in subparagraph 5(a)(iv) of the Annex;
(c) provision and transfer of financial information and financial data processing as referred to in subparagraph 5(a)(xv) of the Annex and advisory and other auxiliary services, excluding intermediation, relating to banking and other financial services as referred to in subparagraph 5(a)(xvi) of the Annex.
When membership or participation in, or access to, any self-regulatory body, securities or futures exchange or market, clearing agency, or any other organization or association, is required by a Member in order for financial service suppliers of any other Member to supply financial services on an equal basis with financial service suppliers of the Member, or when the Member provides directly or indirectly such entities, privileges or advantages in supplying financial services, the Member shall ensure that such entities accord national treatment to financial service suppliers of any other Member resident in the territory of the Member.
A non-resident supplier of financial services is a financial service supplier of a Member which supplies a financial service into the territory of another Member from an establishment located in the territory of another Member, regardless of whether such a financial service supplier has or has not a commercial presence in the territory of the Member in which the financial service is supplied.

World Trade
Organization RESTRICTED S/FIN/M/25
8 May 2000 (00-1871) Committee on Trade in Financial Services

REPORT OF THE MEETING HELD ON 13 APRIL 2000

Note by the Secretariat

The twenty-sixth meeting of the Committee on Trade in Financial Services was chaired by Mr.
Item A: Acceptance of the Fifth Protocol to the General Agreement on Trade in Services Embodying the Results of the Financial Services Negotiations
The Chairman recalled that the Fifth Protocol to the General Agreement on Trade in Services (GATS) entered into force on 1 March 1999 for the 53 Member governments that had accepted it by that date.
However, the previous legislative period had concluded without its approval and the new government in office would present it once again in the current legislative period.
The representative of Kenya said that the necessary approval by the Cabinet had been obtained; he expected that the necessary an action by the Ministry for Tourism, Trade and Industry would take place shortly so the acceptance instrument should be received in the following two weeks.
She reminded those Members still in the ratification process that they were bound by the Services Council decision adopting the Fifth Protocol not to take measures that were inconsistent with their scheduled commitments to the fullest extent possible given existing legislation.
Although at the June 1999 meeting there had been no formal agreement to select any items as a priority, there was an exchange of views that had led the Chairman to believe that discussion could be started with the distinction between modes 1 and 2, and the sectoral classification of financial services.
That discussion had arrived at no conclusion as to how to clarify the matter; instead it had been agreed that further work was necessary.
Additionally, this issue had horizontal implications and, given that a more general consideration of the matter could be conducted at that stage, it would be preferable to proceed with caution in the financial services committee, showing prudence in assuming that GATS provisions needed to be rewritten or clarified.
Therefore, he believed that discussions on financial services classification aiming at a common understanding would help in the context of negotiations; however, his delegation had no specific proposal as to the most efficient way to address this matter at that point in time.
In relation to the suggestion on looking at the relation between the classification in the Annex and the CPC, her delegation did not exclude its consideration but it was necessary to ensure that the broad commitments made by countries not using the CPC were respected.
This year the interest rates would be deregulated on a phased basis, and in July the interest rate cap on time deposits with maturity of less than seven days would be removed.
The bill intended to consolidate 10 existing ordinances and simplify regulatory arrangements to reduce compliance burden, to close existing regulatory gaps in order to promote market confidence, to enhance investors' protection, to reduce market misconduct and systemic risks and facilitate innovation and competition.
Established in June 1994, the IAIS contributes to global financial stability through developing cooperation among members; setting international standards on insurance regulation; assisting members in complying with IAIS standards at national and international levels; coordinating work with other national and international financial institutions.
The representative of the United States said that her delegation would like to further consider the request until the following meeting; however, if a decision needed to be taken that day, her delegation would support the granting of "Ad hoc", meeting by meeting, observership.
The representative of Japan understood the concerns raised by some delegations, however, he argued that if cross-border transactions were to be liberalized Members had to bear in mind that proper supervision needed to be in place.

S/CSC/W/34

World Trade
Organization WT/REG164/7
28 September 2007
(07-4087) Committee on Regional Trade Agreements






FACTUAL PRESENTATION

Association Agreement between
the European Communities and Chile
(Services)

Report by the Secretariat



This report, prepared for the examination of the Association Agreement between the European Communities and Chile, has been drawn up by the WTO Secretariat on its own responsibility and in full consultation with the Parties. The report has been made in accordance to the rules and procedures contained in the Decision for a Transparency Mechanism for Regional Trade Agreements (WT/L/671).

Any technical questions arising from this report may be addressed to Mr. Luis Verdeja (tel: +41 22 739 5244) or Mr. Markus Jelitto (tel: +41 22 739 5885).













TABLE OF CONTENTS
Page

I. Trade Environment 1
II. Treaty characteristic elements 6
A. Background Information 6
B. Scope and Definitions 8

World Trade
Organization WT/REG164/1/Add.1
3 November 2005 (05-5169) Committee on Regional Trade Agreements
Original: English/ Spanish


EC-Chile INTERIM AGREEMENT

Addendum

The following joint communication, dated 1 August 2005, is being circulated at the request of the Delegations of the European Communities and Chile.

_______________



TITLE III: TRADE IN SERVICES AND ESTABLISHMENT(

Article 94

Objectives
The Parties shall reciprocally liberalise trade in services, in accordance with the provisions of this Title and in conformity with Article V of the GATS.

The aim of Chapter III is the improvement of the investment environment, and in particular the conditions of establishment between the Parties, on the basis of the principle of non-discrimination.


CHAPTER I: SERVICES


SECTION 1: General provisions

Article 95


Scope

For the purposes of this Chapter, trade in services is defined as the supply of a service through the fo

S/FIN/M/44
World Trade
Organization RESTRICTED S/FIN/M/44
21 April 2004
(04-1807) Committee on Trade in Financial Services


REPORT OF THE MEETING HELD ON 23 march 2004

Note by the Secretariat


The Committee on Trade in Financial Services held a meeting on 23 March 2004, under the chairmanship of Mr. David Usher (Canada). The proposed agenda is contained in airgram WTO/AIR/2270.
Before proceeding with the adoption of the agenda, the Chairman explained why the item on the proposal by Antigua and Barbuda and other Members (S/FIN/W/29/Rev.1) had not been included in the agenda for the meeting. He said that the Committee had agreed to
revert to this item at this meeting or at a future meeting, depending on the availability of the delegations sponsoring the proposal, who are non-residents in Geneva. Before issuing the airgram, the representative of Antigua and Barbuda had informed the Secretariat that neither he nor the other proponents would be able to atte

World Trade
Organization S/CSS/W/66
28 March 2001 (01-1529) Council for Trade in Services
Special Session Original: English

COMMUNICATION FROM AUSTRALIA

Negotiating Proposal for Financial Services

The following communication has been received from the delegation of Australia with the request that it be circulated to the Members of the Council for Trade in Services.
This generates improved efficiency and allows low-cost funds to be channelled towards those firms and sectors that are better placed to use them, further improving economic growth and investment.
In this context, we would encourage the removal of barriers which place potential new entrants at a disadvantage with respect to incumbent foreign service providers.
These include:
greater opportunity for foreign equity participation, including through a greater number of operating licences and more transparent licensing criteria;

greater flexibility on required forms of commercial establishment, particularly by liberalising the requirement to operate through joint ventures;

improved ability to sell products to locals or provide services from offshore;

greater flexibility in the number and types of products which can be offered;

relaxed government-directed lending or operational control;

greater freedom for transfer and employment of company personnel;

recognition of qualifications obtained overseas.

World Trade
Organization RESTRICTED S/FIN/M/34
26 April 2002 (02-2442) Committee on Trade in Financial Services

REPORT OF THE MEETING HELD ON 18 MARCH 2002

Note by the Secretariat

The Committee on Trade in Financial Services held a meeting on 18 March 2002, under the Chairmanship of Mr Jan-Peter Mout (The Netherlands).

Acceptance of the Fifth Protocol to the General Agreement on Trade in Services Embodying the Results of the Financial Services Negotiations
The Chairman recalled that seven WTO Members had not yet ratified the Fifth Protocol, namely Bolivia, Brazil, Dominican Republic, Jamaica, Philippines, Poland, and Uruguay.
Paragraph 9 of the proposal submitted by Canada (S/CSS/W/50) stated that one of its objectives for the GATS negotiation in financial services was to further "the benefits of liberalization by addressing certain ambiguities in the GATS framework as it applies to financial services.
She then asked the following questions:
Could Switzerland please provide specific examples of classification problems that should be resolved in financial services (besides electronic merchanting systems and finance/insurance)?

The representative of Canada took note of the questions raised by Thailand and said that he would respond to them during the discussions on financial services to be held in the Council for Trade in Services in Special Session, because no expert on financial services was available at the meeting.

The representative of the European Communities said that the communication submitted by the United States showed that the system of prior comments was very rigid and did not necessarily meet all the different types of regulatory systems.
This involved the consultation with different participants of Canada's civil society, as well as a broad range of practices, such as the effective communication of laws and related regulations, a clear drafting of the legislation, the publication and codification of laws, appropriate monitoring of procedures carried out by regulators, and appeal procedures.
he asked the United States what measures had been taken to ensure the implementation of the Gramm-Leach-Bliley Act at the sub-federal level.
They included the provision of advance notice and comment period for draft regulations; the publication of final regulations, including a summary of comments received on draft regulations; and providing a reasonable time between the publication of final regulations and their entry into force.
briefing session by the international monetary fund
The Chairman recalled that at the previous meeting, the representative of the International Monetary Fund made a statement under Other Business, suggesting to conduct a briefing session on the Fund/Bank Financial Sector Assessment Program (FSAP).
In the course of those discussions, executive directors from a number of countries expressed particular appreciation for the initiative to hold this seminar, with the idea to explore links and synergies between the two processes –the negotiations on financial services in the WTO and the FSAP in the Fund- while respecting the mandate of both institutions and coherence in overall policy advice.
At the end, the Chairman provided the following summary:
Almost all delegations considered that, in keeping with paragraph 16 of the Negotiating Guidelines and Procedures, subsidiary bodies should be used to their maximum capacity.
It was also pointed out that subsidiary bodies should not be precluded from taking up technical issues raised in the negotiating proposals submitted to the Council for Trade in Services in Special Session.
appointment of the chairperson
The Chairman recalled that according to the Rules of Procedures, the Committee should elect its Chairperson at the first meeting of the year, effective at the end of such meeting.
However, given that the consultation on that matter by the Chairman of the Council for Trade in Services had not yet concluded, he proposed that the formal election of the Committee's Chair for this year and the hand over took place at the beginning of the next meeting.