TWN Info Service on WTO and Trade Issues (Aug17/02)
4 August 2017
Third World Network
  
India re-calibrates its TFS proposal
Published in SUNS #8515 dated 3 August 2017

Geneva, 2 Aug (D. Ravi Kanth) - India has re-calibrated its proposal on trade facilitation for services (TFS) at the World Trade Organization by suggesting that the proposed TFS agreement will only cover commitments scheduled under the General Agreement on Trade in Services (GATS), trade envoys told the SUNS.

The African Group and many other developing countries had raised numerous concerns over India's initial draft TFS legal text at the meetings of the Working Party on Domestic Regulation (WPDR) on 14 March, the Council for Trade in Services on 16 March, and at the Doha negotiating body for trade in services on 3 May.

Many developing countries had opposed the draft TFS text on grounds that it is not part of the Doha Work Programme mandate and impinged on their rights to regulate trade in services.

South Africa, for example, had raised numerous concerns that the TFS proposal sought commitments far beyond what is being negotiated in domestic regulation as well as in the Doha services negotiations.

In an attempt to meet and assuage the concerns expressed by the African Group and other developing countries, India has now come out with a revised draft proposal which is substantially moderated so as to remain consistent with the existing draft texts on domestic regulation.

The 18-page restricted Job/Serv/267 document issued on 27 July, according to India, is "in the spirit of constructive engagement."

"India has sought to refine the TFS text by making changes to incorporate the various comments and suggestions raised by Members in order to make the TFS text more meaningful and acceptable," the document said.

More important, the revised draft proposal seems to be consistent with the draft domestic regulation text issued by the then chair for WPDR negotiations Peter Govindasamy in 2009.

According to India, the revised draft TFS proposal contains "three main substantive changes."

The changes include:

i. The TFS Agreement is being limited to commitments that are scheduled under GATS, with the exception of Art. 8.2 (dealing with Mode 2 movement for persons seeking medical treatment).

"In the first draft," India explained, "Article 2 on Publication had also been made applicable to all sectors, whether or not scheduled. But we have now limited Article 2 also to scheduled commitments. With the objective that TFS is primarily aimed at making scheduled commitments more effective, we have modified Article 1 on Scope to reflect this aspect. This also follows the approach in the DR (domestic regulation) negotiations and the draft DR text."

ii. India's initial draft had used the term "Immigration Formalities" to refer to entry measures (visas, work permits, etc.) which are relevant for the entry of natural persons providing services.

This term is being replaced with the phrase "Measures relating to entry and temporary stay", given the various sensitivities expressed by several Members associated with the term "immigration". Changes have been carried out in this regard throughout the text.

iii. The TFS Agreement applies to all measures affecting supply of services in respect of scheduled commitments.

"However, we have in this revised draft limited Article 3 on "Administration of Measures" to the two main types of measures affecting supply of services, namely: Authorisation and Measures relating to entry and temporary stay. The term "Authorisation" refers to permits/licences, etc. required for a service, and "Measures relating to entry and temporary stay" pertains to visa/work permits required for Mode 4 movements. The reason for limiting Article 3 to only two types of measures is because this provision deals with "Administration" related aspects, and places several onerous requirements relating to timeframes, and procedural requirements for dealing with applications, etc. Its applicability to a wide set of "measures affecting trade in services" could have a wide set of obligations for both developed and developing countries. Since the main thrust of concern on TFS is measures pertaining to Authorisation and Measures relating to entry and temporary stay, we have limited this provision accordingly."

The main objective, according to India, is to ensure that existing scheduled commitments by members in the GATS are made "more effective."

Second, India has clarified that the term "immigration facilities" such as visas, work permits that are relevant for the entry of natural persons under Mode 4 of the GATS in the original draft proposal is now replaced with the phrase "Measures relating to entry and temporary stay."

This would address the "sensitivities" expressed by members associated with the term "immigration," India has argued.

More important, the revised draft TFS text has limited the measures affecting the supply of services to "two main types of measures". They are "Authorization and Measures relating to entry and temporary stay."

While "Authorization" refers to "permits/licenses" etc required for a service, the term "Measures" relating to entry and temporary stay pertains to visa/work permits required for Mode 4 movements.

"Since the main thrust of concern on TFS is measures pertaining to Authorization and Measures relating to entry and temporary stay, we have limited the provision accordingly," India has explained.

In response to concerns raised by the African Group about the right to regulate trade in services, the revised draft says, "recognizing the right 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 Members, the particular need of developing countries to exercise this right."

India has further emphasized that the proposed TFS agreement "should not be construed to prescribe or impose particular regulatory approaches or any particular regulatory provisions in relation to measures affecting the supply of services."

The revised draft TFS proposal has sought improvements in aspects concerning GATS Article III (Transparency), Article IV (Increasing the Participation of Developing Countries), Article VI (Domestic Regulation), Article VII (Recognition), Article XIX (Negotiations on Specific Commitments) and the Annex on Movement of Natural Persons Supplying Services under the Agreement so as to address issues relevant to facilitating trade in services.

Although India has circulated the revised draft TFS proposal for placating the concerns raised by members, it has not indicated that the TFS proposal remains a major priority for the WTO's eleventh ministerial meeting in Buenos Aires.

India has subtly served a notice to major industrialized and some developing countries who are trying to run away with an agreement on transparency-related issues of domestic regulation at the Buenos Aires meeting without addressing the core issues of barriers imposed on movement of short-term services providers, said a source who asked not to be quoted.