TWN Info Service on WTO and Trade Issues (May17/12)
15 May 2017
Third World Network

Efforts to import parts of failed TiSA into services DR thwarted
Published in SUNS #8460 11 May 2017

Geneva, 10 May (D. Ravi Kanth) - Many developing and least-developed countries on Tuesday (9 May) thwarted attempts by the Chair of the World Trade Organization Working Party on Domestic Regulation to steam-roll discussions on proposals, apparently incorporated from the failed Trade in Services Agreement (TiSA) negotiations, services negotiators told SUNS.

The developing and least-developed countries - Cameroon, Rwanda on behalf of the African Group, South Africa, Uganda which coordinates the least-developed countries, Bolivia, and Cuba - raised procedural and systemic objections at the manner in which the Chair for the WTO Working Party on Domestic Regulation (WPDR), Ms. Katarzyna Stecz from Poland, sought to press ahead with informal discussions of the 14 March meeting based on requests from the proponents led by the European Union and Australia among others, said services negotiators who asked not to be quoted.

The proponents which include the European Union, Australia, Chile, Hong Kong (China), Switzerland, New Zealand, and Colombia sought to clarify their respective domestic regulation proposals on the "administration of measures", "development of measures," and "transparency" and introduced their new proposal on "technical standards."

These proposals, according to developing country services negotiators, are being incorporated from the failed TiSA negotiating text.

The developing countries asked the Chair for clarifications on how she intended to proceed with the discussions in informal mode. Citing procedural and systemic grounds, they told the Chair not to prepare an informal summary of the proceedings under her own responsibility.

The face-off with the Chair reached a boiling point when Uganda insisted that there should be no record of an informal meeting that was convened without any prior notice. But the Chair chose to over-rule Uganda's objections and gave the floor to the proponents to make clarifications on their proposals raised during the last formal meeting on 14 March.

The proponents - Australia, Colombia, the European Union, Japan, Korea, Mexico, New Zealand, and Chinese Taipei, who were all participants in the failed TiSA negotiations - called for incorporating an article on "Transparency" to cover elements of domestic regulation related to the transparency of measures within the scope of GATS Article VI:4.

Much of the language in the proposal is drawn from the TiSA negotiating text, said a services negotiator from an African country.

The proposal on transparency has suggested elements of DR (domestic regulation) related to the development of licensing requirements and procedures, qualification requirements and procedures, and technical standards which would be addressed through separate proposals on Development of Measures and Technical Standards. It has also called for additional elements to be developed to address Development, General Provisions and Institutional Provisions.

The proposal says "where a Member requires authorization for supply of a service, further to GATS Article III, the Member shall provide the information necessary for service suppliers or persons seeking to supply a service to comply with the requirements and procedures for obtaining, maintaining, amending and renewing such authorization."

The information shall include:

a. the requirements and procedures;

b. contact information of relevant competent authorities;

c. fees;

d. technical standards;

e. procedures for appeal or review of decisions concerning applications;

f. procedures for monitoring or enforcing compliance with the terms and conditions of licenses;

g. opportunities for public involvement, such as through hearings or comments; and,

h. indicative timeframes for processing of an application.

On "development of measures", the proponents which include Hong Kong (China), New Zealand, and Switzerland have suggested that "where a Member adopts or maintains measures relating to licensing requirements and procedures, qualification requirements and procedures and technical standards, the Member shall ensure" that:

(a) such measures are based on objective and transparent criteria;

(b) such measures are not more burdensome than necessary to ensure the quality of the service;

(c) licensing and qualification procedures are reasonable and do not in themselves unduly impair the fulfilment of requirements;

(d) the procedures are impartial, and that the procedures are adequate for applicants to demonstrate whether they meet the requirements, where such requirements exist; and

(e) the competent authority reaches and administers its decisions in an independent manner.

Further, the proponents argued that "in determining whether a Member is in conformity with the obligation under (a), (b) and (c) of this paragraph, account shall be taken of international standards of relevant international organizations applied by that Member."

The African countries feel these measures impose huge obligations on them while eroding their policy space for regulatory measures.

Cameroon objected to the manner in which the Chair hastily convened an informal meeting to discuss these proposals without giving time for considering them by their government.

The same concern was also voiced by Rwanda on behalf of the African Group, Nigeria, Uganda, Kenya and South Africa and among others, Bolivia and Cuba. They said that the informal had been convened at a time when their governments have not even had the time to consider the proposals, two of which were circulated within the last few days.

Further, they maintained that informal meetings cannot be the venue for discussing formal proposals, and any substantive engagement should take place in formal sessions.

Uganda indicated that if Members agree to implement these disciplines, there needs to be a historical account of the negotiating history and all clarifications being offered by the proponents were put on record.

Rwanda, Uganda, South Africa and Kenya were reluctant to agree to the preparation of an informal Chair's summary of the proceedings since they were not in a position to engage substantively, until they have completed their own consultations, and a Chair's report would not reflect the realities of the capacity constraints facing smaller missions.

Many African countries as well as Bolivia, Cuba and Venezuela expressed concern about the proposals undermining the sovereign right of their countries to regulate, and on systemic grounds since they are incorporated from the failed Trade in Services Agreement (TiSA) negotiations.

Brazil sought the Chair to accelerate the discussions based on a detailed calendar of proceedings. The proponents clarified on several issues that were objected to by members.

The showdown between the African countries and the Chair led to confusion even though the proponents proceeded to make their clarificatory remarks, said a negotiator from the African Group. Ultimately, it was not clear why the Chair was pursuing such an approach at an informal meeting.

The African Group is also sharply concerned over the refusal by the proponents to consider the draft texts issued in 2009 and 2011 by the Chairs of the WPDR negotiations.

Meanwhile, in a separate development, at the informal Heads of Delegations meeting on Monday, India raised sharp concerns on procedural and substantive grounds as to how issues are being pushed without a mandate.

"What is seriously problematic for us is the fact that the kind of policy space used by major members to reach a level of development and market dominance in some of these areas is sought to be constrained or even denied in many ways to those members that are still on that path to development," India argued, according to a trade envoy familiar with the development.

More important, India posed a question "trade for whose benefit" before proceeding to finalize the deliverables for the WTO's eleventh ministerial meeting in Buenos Aires later this year.

"This question has consistently been raised in India since the Uruguay Round and also seems to have taken center stage in many other major economies of the world today... People are questioning the inclusiveness aspect of free trade, its impact on domestic policy space, employment, income distribution etc, " India said.

In short, major industrialized countries along with Brazil and Argentina - who are all aided by the WTO Secretariat - are already resorting to questionable practices for advancing their proposals to be harvested at the Buenos Aires meeting, several negotiators and trade envoys said.