161 Tradable Services Covered under the General Agreement on Trade in Services (Gats)

In certain circumstances, the GATS allows governments of WTO Member States to restrict trade in services in areas where the Member has made specific commitments. For example, if a member government experiences (or is threatened with) serious balance-of-payments difficulties, it may apply emergency guarantees to restrict the provision of services, provided that such guarantees are non-discriminatory, temporary and expire if the situation improves. Negotiations are under way in the GATS Rules Committee on the development of an agreed emergency response mechanism for services. The interests of developing countries have inspired both the general structure of the agreement and the individual articles. In particular, the objective of facilitating the increasing participation of developing countries in trade in services was enshrined in the preamble to the Agreement and underpins the provisions of Article IV. This Article requires, inter alia, Members to negotiate specific commitments relating to the development of domestic service capabilities of developing countries; improving developing countries` access to distribution channels and information networks; and liberalization of market access in areas of export interest to those countries. The GATS agreement has been criticized for its tendency to replace the authority of national law and justice with that of a GATS dispute settlement body that conducts consultations behind closed doors. Spokespeople for WTO members and governments are forced to reject such criticism because they have already embraced the perceived benefits of dominant trade principles of competition and “liberalization.” Services provided by governments are excluded from the GATS. These are services provided on a non-market basis (e.g. B, social security systems, health education, etc.).

In addition, air services are also exempt from coverage, which is concerned with traffic rights. The GATS divides services liberalization commitments into two: general obligations and specific obligations. The GATS is essentially an essential step towards trade in services under the Uruguay Round. Liberalization of trade in services is in the early stages. As a multilateral system of regulation and trade liberalization, the GATS needs to be expanded through further discussions. While the overall objective of the GATS is to remove barriers to trade, Members are free to decide which sectors should be progressively “liberalized” (i.e. traded and privatized). what type of procurement would apply to a particular sector; and to what extent this “liberalization” will take place over a certain period of time. Members` obligations are governed by a ratchet effect: commitments are unilateral and should not be reduced once they have been contracted.

The reason for this rule is to create a stable business climate (i.e. a market). However, Article XXI allows members to withdraw their commitments and, so far, two members (US and EU) have made use of this option. In November 2008, Bolivia announced that it would withdraw its health commitments. The Doha Ministerial Conference of November 2001 kicked off the market access phase of the GATS negotiations and ordered that “participants submit the first requests for specific commitments by 30 June 2002 and the first tenders by 31 March 2003”. In view of these delays, Canada and other WTO Members submitted initial requests in 2002 and submitted initial offers at the end of March 2003. The documents in this section provide an overview of Canada`s offers at the market access stage. The GATS Agreement includes four modes of supply for the supply of services in cross-border trade[3] Most-favoured-nation treatment: Article II of the GATS requires members to provide services or service suppliers to all other Members without delay and without conditions, “treatment no less favourable than that accorded to service and similar service suppliers from another country”. In principle, this amounts to prohibiting preferential arrangements between groups of members in individual sectors or restricting the benefits of access to trading partners granting similar treatment. Some activist groups believe that the GATS could undermine the ability and authority of governments to regulate commercial activities within their own borders, resulting in the transfer of power to commercial interests before the interests of citizens. In 2003, the GATSwatch network issued a critical statement supported by more than 500 organizations in 60 countries.

[1] At the same time, countries are not required to conclude international agreements such as the GATS. For countries seeking to attract trade and investment, the GATS offers a degree of transparency and legal predictability. Legal barriers to trade in services may have legitimate political reasons, but they can also be an effective tool for large-scale corruption. [2] Exceptions are possible in the form of so-called Article II exceptions. Members were allowed to request such derogations before the entry into force of the Convention. New waivers may be granted to new Members only at the time of accession or, in the case of existing Members, by way of a waiver under Article IX(3) of the WTO Agreement. All exceptions are subject to review; in principle, they should not last more than 10 years. In addition, the GATS allows groups of members to conclude economic integration agreements or mutually recognize regulatory standards, quotas, etc., if certain conditions are met.

The GATS aims to ensure that the laws and regulations applied to trade in services by the governments of WTO member States are transparent and fair. The most important element of market opening is the schedule of specific commitments that each signatory has attached to the GATS as an integral part of the agreement. In these schedules, which are the result of the Uruguay Round negotiations, the signatories defined the extent to which they would grant full market access and national treatment in certain services sectors. Paragraph 3 of Article 1 of the GATS excludes “services provided in the exercise of governmental powers”. These are services that are not provided on a commercial basis or in competition with other providers. Examples include social security systems and all other public services, such as health or education, provided on non-market terms. While services currently account for more than two-thirds of global output and employment, they account for no more than 25% of total trade, as measured by the balance of payments. However, this proportion – apparently modest – should not be underestimated. Balance of payments statistics do not cover one of the modes of supply of services defined in the GATS, namely supply by commercial presence in another country (mode 3).

In addition, services, although increasingly traded independently, also serve as crucial inputs for the production of goods and, therefore, services, measured in terms of value added, account for about 50% of world trade. The creation of the GATS was one of the important milestones of the Uruguay Round, the results of which entered into force in January 1995. The GATS is essentially based on the same objectives as its merchandise trade counterpart, the General Agreement on Tariffs and Trade (GATT): to create a credible and reliable system of international trade rules; ensure fair and equitable treatment of all parties concerned (principle of non-discrimination); stimulate economic activity through guaranteed political links; Promoting trade and development through progressive liberalization. .