RESTRICTEDWORLD TRADE
ORGANIZATIONS/C/W/174
3 November 2000
(00-4828)
Council for Trade in Services
DRAFT
REPORT (2000) OF THE COUNCIL FOR TRADE IN SERVICES
TO THE GENERAL COUNCIL
1. Since its last report to the General Council, dated 26 October 1999, the Council for Trade in
Services has held five formal meetings.  Reports of the meetings are contained in documentsS/C/M/41 to 43, S/C/M/46 and S/C/M/48.  The Council has also held three special meetings devoted
to the review of Article II (MFN) Exemptions, the reports of which are contained in documents
S/C/M/44, 45 and 47, and one special meeting dedicated to the review of the Annex on Air Transport
Services, the report of which is contained in document S/C/M/49.  The reports of the meetings should
be read in conjunction with this report.  The Council addressed the following matters:
I. ASSESSMENT OF TRADE IN SERVICES – ARTICLE XIX:3 OF THE GATS
2. Paragraph 3 of Article XIX of the GATS provides that for each round of negotiations,
guidelines and procedures shall be established.  The same provision also calls upon the Council to
carry out an assessment of trade in services in overall terms and on a sectoral basis with reference to
the objectives of the GATS, including those set out in paragraph 1 of Article IV.
3. At the meeting of 25 February 2000, Members agreed that the discussion on the assessment of
trade in services be moved to the agenda of the Special Session of the Council for Trade in Services.
II. REVIEW OF ARTICLE II (MFN) EXEMPTIONS
4. At the Council meetings held in February and April, the Council continued discussions on
how to conduct the review of MFN exemptions as mandated by paragraph 3 of the Annex on
Article II (MFN) Exemptions.  The Secretariat was tasked with reconstructing the compilation of
MFN exemptions contained in Job No. 6116 and Corr.1 along sectoral lines, as a basis for the review.
The sectoral compilation is contained in Job No. 1551 and Add.1.
5. The first session of the review was held on 29 May, and the Council examined exemptions
listed for "All sectors", "Business services", "Communication services", "Construction and related-
engineering services" and "Distribution services".  The report of the meeting is contained in document
S/C/M/44.
6. The second session, which took place on 5 July, examined exemptions pertaining to
"Financial services", "Tourism and travel-related services", "Recreational, cultural and sporting
services" and "Transport services".  Members also addressed outstanding points arising from the first
session and held an initial discussion on the determination of the "date of any further review", as
mandated by the Annex on MFN Exemptions.  It was agreed that a third session of the review wouldbe held in October.  The Council also agreed that  other general issues arising from the review would
be placed on the agenda of the regular meeting of the Council for Trade in Services.  The report of the
meeting is contained in document S/C/M/45.S/C/W/174
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7. At the third session of the review on 5 October, Members addressed outstanding points
arising from the previous sessions and continued discussions on the determination of the date of any
further review.  It was agreed that the review of MFN exemptions would be placed on the agenda of
the following regular meeting of the Council in Decem ber.  The report of the meeting is contained in
document S/C/M/47.
III. REVIEW OF THE ANNEX ON AIR TRANSPORT SERVICES UNDER
PARAGRAPH 5 OF THE ANNEX
8. At the Council meetings held in February, April and May, Members continued discussions on
how to conduct the review of the Annex on Air Transport Services pursuant to paragraph 5 of the
Annex.  Members agreed to schedule two sessio ns for the review in 2000, in September and
December.  The Secretariat was asked to produce an informal paper containing a suggested list of
issues which Members might wish to take up in the review.  The paper was circulated as Job No. 2451and discussed at the meeting in May.  The Secretariat was also tasked with the updating of the
information it had previously provided in documents S/C/W/59 and S/C/W/129.  Accordingly, the
Secretariat produced a first note, contained in document S/C/W/163, which deals with items (a) to (g)
as listed in document Job No. 2451.
9. The first session of the review was held on 28 September.  The Council discussed the paper
produced by the Secretariat, as well as a number of submissions by Members.  The report of the
meeting is contained in document S/C/M/49.
IV. REVIEW OF THE UNDERSTANDING ON ACCOUNTING RATES
10. At the meeting held on 25 February, the Council begun discussions on the review of the
Understanding on accounting rates, as provided for in paragraph 7 of the Report of the Group onBasic Telecommunications contained in document S/GBT/4.  The Secretariat had produced an
informal note in Job No. 765, providing a brief factual background of the circumstances which had
led to the adoption of the Understanding.
11. At the meeting held on 26 May, the International Telecommunication Union (ITU) provided a
report in document Job No. 2947, on their work on reforming the accounting rates system, as a meansof facilitating the Council's work in the review.  At its meeting of 6 October, the Council heard a
progress report from the ITU Secretariat on the meeting of the World Telecommunications
Standardization Assembly, which was in session and due to conclude its work that same day.  The
Council agreed to revert to the review at its next meeting, also with a view to considering the outcome
of the meeting of the World Telecommunications Standardization Assembly.
V. TOURISM SERVICES
12. At the meeting held on 25 February, the Council began discussions of the paper presented by
the delegations of the Dominican Republic, El Salvador and Honduras on tourism services, distributed
as document S/C/W/127 and Corr.1.  Members agreed to place the item on the agenda of the Special
Session of the Council for Trade in Services and to revert to it in that forum.
VI. PROCEDURES FOR THE CERTIFICATION OF RECTIFICATIONS OR
IMPROVEMENTS TO SCHEDULES OF SPECIFIC COMMITMENTS
13. Article XXI:5 of the GATS calls upon the Council for Trade in Services to establish
procedures for the certification of rectifications or improvements to schedules of specific
commitments.  The Council had decided to refer this task to the Committee on Specific Commitments
in 1997.  At its meeting on 14 April 2000, the Council received the draft procedures from the
Committee, contained in document S/CSC/W/26/Rev.1, as well as a draft Decision by the CouncilS/C/W/174
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adopting such procedures in document S/C/W/133.  The Council adopted the decision and the
procedures, which are contained in doc uments S/L/83 and S/L/84, respectively.
VII. DRAFT COOPERATION AGREEMENT BETWEEN THE WTO AND THE ITU
14. On 22 March 1999, the Council had approved the text of a cooperation agreement between
the International Telecommunication Union (ITU) and the WTO.  The text had been forwarded to the
ITU for consideration by its Council, which had suggested further changes.  The ITU Secretariat had
submitted a revised text, containing several amendments which had been subject to consultations
between the two Secretariats, and which was contai ned in the informal note Job No. 2118.  Members
discussed the note at the Council meeting held on 14 April.
15. An amended version of the draft, contained in Job No. 2118/Rev.1, was produced by the
Secretariat and discussed, along with an ITU communication on "WTO participation at ITU
Conferences and Meetings" in Job No. 2948, at the Council meeting held on 26 May.  Members
suggested two amendments and the Council adopted a revised draft, which is contained in document
S/C/9/Rev.1, with an ad-referendum procedure.
VIII.  REOPENING OF THE FOURTH PROTOCOL FOR ACCEPTANCE
16. At the Council meeting of 26 May, following a request from Dominica, the Council adopted a
decision, which is contained in document S/L/ 86, re-opening the Fourth Protocol to the GATS
relating to basic telecommunications for acceptance by Dominica.
IX. REOPENING OF THE FIFTH PROTOCOL FOR ACCEPTANCE
17. At the Council meeting of 26 May, following a request from Ghana, the Council adopted a
decision, which is contained in document S/L/87, re -opening the Fifth Protocol to the GATS relating
to financial services for acceptance by Ghana.
X. ELECTRONIC DISSEMINATION OF DOCUMENTS – STATEMENT BY
URUGUAY
18. At the Council meeting held on 26 May, the delegation of Uruguay suggested that, without
prejudice to existing dissemination procedures, the Secretariat automatically send all documents
relating to the Council for Trade in Services and its subsidiary bodies to delegations electronically.  Arepresentative of the WTO Secretariat explained that the proposal, though very attractive in principle,
entailed a number of technical complications, as the document distribution system was centralized.
He nevertheless encouraged delegations to communicate their e-mail addresses to the Trade in
Services Division, so that they could benefit from the electronic dissemination of documents that was
already carried out informally.  The Council took note of the statements made and of the discussion.
XI. COMMITMENTS IN BASIC TELECOMMUNICATIONS – COMMUNICATION BY
BRAZIL
19. At its meeting of 6 July, the Council noted the submission by the delegation of Brazil
concerning their revised commitments in basic telecommunications, which is contained in document
S/C/W/160.  The item was taken up for discussion at the meeting held on 6 October and the Council
agreed to revert to it.
XII. WORK PROGRAMME ON ELECTRONIC COMMERCE
20. On 17 July 2000, the General Council had agreed to invite the Goods, Services and TRIPS
Councils, and the Committee on Trade and Development, to pick up where they had left off in theirS/C/W/174
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work on electronic commerce within their respective spheres of competence, to identify cross-sectoral
issues and to report back to the General Council at its regular meeting in December 2000.
21. Accordingly, at its meeting on 6 October, the Council for Trade in Services began discussions
on this issue.  In view of the fact that the Counc il was scheduled to meet again only once before the
December deadline, Members agreed that the Chairman would draw up a report reflecting the thrustof the discussion, which he would present orally at the General Council meeting in December.
XIII.  ARTICLE II (MFN) EXEMPTIONS – GENERAL ISSUES ARISING FROM THE
REVIEW
22. In the course of the review of MFN Exemptions , it had been agreed that an item would be
placed on the agenda of the regular Council to provide an opportunity for Members to raise issues of a
general nature that had arisen during the revi ew.  Accordingly, at th e Council meeting held on
6 October, Members began discussions on the basis of a communication submitted by the delegationsof Hong Kong, China; Japan and Kor ea and contained in document S/C/W/173.
XIV. NOTIFICATIONS TO THE COUNCIL PURSUANT TO ARTICLES III:4 AND IV:2
OF THE GATS – STATEMENT BY THE UNITED STATES
23. At the Council meeting held on 26 May, the delegation of the United States proposed that the
Secretariat compile a list of all notifications received pursuant to GATS Article III:4, regardingenquiry points, and to Article IV:2, regarding contact  points.  They further suggested that the two sets
of notifications be collected in a easily-located area of the WTO web-site.  The Council agreed to the
two proposals.
XV. NOTIFICATIONS TO THE COUNCIL PURSUANT TO ARTICLE V OF THE GATS
– STATEMENT BY THE UNITED STATES
24. At its meeting of 26 May, the Council began discussions of the paper presented by the
delegation of the United States, and contained in document S/C/W/147, concerning notifications
pursuant to Article V of the GATS.
XVI. NOTIFICATIONS TO THE COUNCIL PURSUANT TO GATS ARTICLES III:3,
VII:4 AND XIVBIS
25. At its meeting of 14 April 2000, the Council took note of the following notifications:
(i) Notifications pursuant to Article III:3 of the GATS concerning modifications to
services regulations in sectors where specific commitments have been undertaken:
Canada (S/C/N/86)
Canada (S/C/N/87)
Canada (S/C/N/88)
Canada (S/C/N/89)Canada (S/C/N/90)
Thailand (S/C/N/91)
Czech Republic (S/C/N/92)
Czech Republic (S/C/N/93)
Czech Republic (S/C/N/94)European Communities (S/C/N/95)
Poland (S/C/N/96)
Poland (S/C/N/97)
Poland (S/C/N/98)S/C/W/174
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Poland (S/C/N/111)
Poland (S/C/N/112)
Poland (S/C/N/113)
Australia (S/C/N/103)
Spain (S/C/N/106)Niger (S/C/N/107)
Niger (S/C/N/108)
Guatemala (S/C/N/109)
Madagascar (S/C/N/110)
Kyrgyz Republic (S/C/N/114)
Egypt (S/C/N/116)
(ii) Notifications pursuant to Article VII:4 of the GATS concerning recognition measures
and agreements or arrangements:
Australia (S/C/N/100)
Australia (S/C/N/101)
Australia (S/C/N/102)Australia (S/C/N/104)
Guatemala (S/C/N/105)
(iii) Notifications pursuant to Article XIV bis of the GATS concerning security
exceptions:
Nicaragua (S/C/N/115 and Corr.1)
XVII.  REQUESTS FOR OBSERVER STATUS
26. At the meeting held on 25 February, the Council noted requests for observer status from the
Islamic Development Bank, the League of Arab States and the World Health Organization.  Thequestion of the observer status for the World Tourism Organization was also raised at that meeting.
27. At its meeting on 14 April, the Council agreed to add the names of the Islamic Development
Bank and the League of Arab States to the list pr epared by the Secretariat of all outstanding requests
from regional organizations in document S/C/W/19/Rev.2.  With respect to the requests from the
World Health Organization and the World Tourism Organization, Members agreed to follow the
practice which had previously been adopted in the case of the ITU and ICAO, and granted the two
organizations observer status on an ad hoc  basis, which implied inviting them to meetings of the
Council when the agenda contained an item of interest to them.
28. The request for observer status from the Common Market for Eastern and Southern Africa
(COMESA) was discussed at the Council meeting held on 26 May.  Members agreed to add
COMESA to the list of outstanding requests for observer status from regional organizations.
29. At the meeting held on 6 October, the Council noted two additional requests, from the Gulf
Organization for Industrial Consulting and from the Universal Postal Union (UPU), and agreed to add
the two requests to the list in document S/C/W/ 19/Rev.4.  It was also agreed that, pending the
outcome of discussions in the General Council on the issue of observership, any additional requests
for observer status would be circulated to Members but not inscribed in the agenda of the Services
Council.S/C/W/174
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XVIII.  WORK OF SUBSIDIARY BODIES
30. The activities of Subsidiary bodies are reflected in their respective reports which are annexed
to this report as follows:
Annex I Report of the Committee on Specific Commitments (S/CSC/..)
Annex II Report of the Committee on Trad e in Financial Services (S/FIN/..)
Annex III Report of the Working Party on Domestic Regulation (S/WPDR/..)
Annex IV Report of the Working Party on GATS Rules (S/WPGR /..)
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