RESTRICTED
WORLD TRADE S/NGBT/W/6
21April 1995
ORGANIZATION(95-1002)
Original: English Negotiating Group onBasic Telecommunications
COMMUNICATION FROM THE EUROPEAN COMMUNITY
AND ITSMEMBER STATES
GATS Coverage ofTelecom Regulatory Issues
Theattached communication iscirculated attherequest oftheEuropean Community andits
Member States toMembers oftheNegotiating Group onBasic Telecommunications.S/NGBT/W/6
Page2
GATS COVERAGE OFTELECOM REGULATORY ISSUES
1. Introduction -Scope oftheGATS
All"measures" taken byaGATS Member government orbyaNational Regulatory Authority
inthefieldoftelecom, fallwithin thescope oftheGATS Agreement.1
Itfollows that,inasector inwhich specific commitments aremade, anymeasures which
constitutesarestrictiononmarketaccesswithinthesenseofArticleXVIGATS(forinstance,restrictions
onforeign ownership oftelecom service suppliers), orwhich discriminates against services andservice
suppliers ofanother Member within thesense ofArticle XVII GATS, mustbescheduled inorder to
bemaintained.Moreover,regardlessofspecificcommitments,ArticleIIGATSonmost-favoured-nation
treatment (mfn) isapplicable (unless anexemption frommfnislisted). MFN isanobligation ofnon-
discrimination between service suppliers ofdifferent Members. Specific commitments must beon
thebasis ofmost-favoured-nation treatment.
Theobject ofthispaper isprincipally toexamine thedisciplines existing intheGATS inrelation
tothetelecom regulatory measures mentioned below when suchmeasures donotconstitute restrictions
oneither Article XVIorXVII GATS.
2. There hasbeenconsiderable discussion among NGBT participants oftheneedtodevelop sector-
specific provisions forbasic telecommunications ifGATS specific commitments inthesector areto
beeffective andmeaningful. Theneedforsector-specific provisions presupposes thattheexisting GATS
isinadequate forthebasic telecommunications sector. TheEuropean Community anditsMember
States haveexamined theapplication oftheGATS withreference totheregulatory issues defined in
Secretariat paper TS/NGBT/W/2. Thispaper isatechnical contribution totheon-going debate intended
tofocus future discussion.
Inthecontext ofwork onthe"draft model schedule" attheendof1993, certain regulatory
issues wereidentified asrequiring further work. GATT Secretariat paper TS/NGBT/W/2 subsequently
listed these issues:
- measures relating tolicensing;
- interconnection;
- competitive safeguards;
- transparency requirements;
- separation ofregulatory andoperational functions;
- access tofrequency spectrum;
- numbering;
- standards;
1TheGATS applies to"measures byMembers affecting trade inservices "-Article I.1."Measures" isdefined as"anymeasure by
aMember, whether intheformofalaw,regulation, rule,procedure, decision, administrative action oranyother form" (Article XVIII(a))
andincludes measures taken by"central, regional orlocalgovernments orauthorities" andby"non-governmental authorities intheexercise
ofpowers delegated bycentral, regional orlocal government authorities" -Article I.3(a).S/NGBT/W/6
Page3
- tariffs andcostissues;
. environmental andtown planning considerations affecting infrastructure installation
andrights ofway.
Thispaper seeks toexamine theexisting GATS disciplines inrelation toeachofthese issues.
Thepaper isstructured under general headings. Itshould benoted thatmany oftheissues relevant
tothese headings overlap.
IntermsofachievingeffectiveandmeaningfulspecificcommitmentsintheNGBT,theEuropean
Community anditsMember States haveidentified measures relating tolicensing, interconnection,
competitive safeguards anduniversal/public service obligations asbeing among themostimportant
issues.
3. Measures relating tolicensing
Articles VI,XVI, XVII andXVIII GATS andparagraph 5oftheTelecom Annex apply to
licensing procedures andcriteria insectors inwhich specific commitments areundertaken. TheGATS
accepts thataMember mayimpose arequirement ofalicence orother formofauthorization forthe
supply ofaservice initsterritory. Such arequirement initself isnotconsidered tobearestriction
onmarket access.
Three separate issues canbeidentified inrelation tolicensing:
- licensing procedures: howthedecision togrant alicence ismade andthepossibility
ofreview;
- licensing criteria: thecriteria inaccordance withwhich alicence isgranted; and
- licensing conditions: theconditions attached toalicence, forinstance universal service
obligations.
These issues aredealtwithintheGATS asfollows:
Procedures :Applications mustbetoldwhether ornotthelicence willbegranted "within a
reasonable period oftimeafterthesubmission ofanapplication".2Applicants havetheright
torequest regulatory authorities toprovide themwithinformation concerning thestatus ofthe
application "without undue delay".3Service suppliers whoareaffected byadministrative
decisions concerning trade inservices mustbeoffered recourse against these decisions, that
isthepossibility ofreview andwhere appropriate remedies.4
2Article VI.3GATS.
3Article VI.3GATS.
4Article VI.2GATS.S/NGBT/W/6
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Licensing procedures arealsomentioned inArticle VI.4(c) inrelation tothedevelopment of
disciplines necessary toensure thattheprocedures arenotinthemselves arestriction onthe
supply ofservices (seepoint oncriteria below forinrelation toArticle VI.4). TheGATS
doesnotmandate thatMembers useoneformofprocedure overanother. Itwould bepossible
todosointhecontext ofanArticle VI.4work programme. However, theobject ofArticle VI
isnotto"harmonize" Members 'licensing procedures, butrather todiscipline suchprocedures
toprevent them from restricting trade.
Criteria :Theapplication oftheGATS tolicensing criteria depends onthenature ofthose
criteria. Where acriterion toobtain alicence hasamaximum quantitative element interms
ofArticle XVIonmarket access (forinstance, onlyXlicences willbegranted, licenses are
subject toaneconomic needs testortheeligibility ofanapplicant depends onnotexceeding
acertain percentage offoreign participation), thenthatcriterion required tobescheduled.
Likewise, anydiscriminatory qualitative criteria must bescheduled under Article XVII on
national treatment. (Articles XVIandXVIIapply onlytosectors inwhich specific commitments
areundertaken). Where aMember applies licensing criteria which areincompatible with
Article IIonmost-favoured-nation treatment, forinstance bysubjecting thegranting oflicences
toatestofreciprocity, thenthepossibility forthatMember tomake specific commitments
isaffected, asspecific commitments mustbeonthebasis ofmost-favoured-nation treatment.
Conditions which areoutside thescope ofArticles XVI, XVII andIIaresubject toArticle VI.
Article VIapplies tosectors inwhich specific commitments areundertaken. Paragraph 4of
thisArticle (thesoleparagraph toapply regardless ofspecific commitments) envisages the
"development ofthenecessary disciplines" toensure thatqualification requirements and
procedures,technicalstandardsandlicensingrequirementsdonotconstituteunnecessarybarriers
totrade. These disciplines would aimatensuring thatrequirements are,interalia:
"(a) based onobjective andtransparent criteria, suchascompetence andtheability
tosupply theservice;
(b) notmore burdensome thannecessary toensure thequality oftheservice;
(c) inthecaseoflicensing procedures, notinthemselves arestriction onthesupply
oftheservice."
Pending thedevelopment ofthese disciplines, paragraph 5prevents Members fromapplying
licensing requirements which would "nullify orimpair itsspecific commitments inamanner
which:
(i) doesnotcomply withthecriteria outlined insub-paragraphs 4(a),(b)or(c)
(above); or
(ii) could notreasonably havebeenexpected oftheMember atthetimethespecific
commitments were undertaken."
Moreover, theGATS Annex onTelecommunications specifies theconditions which canbe
taken intoaccount inauthorizing "access toanduseofpublic telecommunications transport
networks andservices" (PTTNS) initsparagraph 5.Paragraphs 5(e)and5(f)oftheTelecom
Annex thusaimatlimiting undue restrictions totheaccess toanduseofPTTNS. Interpretation
oftheconditions foraccess toanduseofPTTNS byMembers willalsofallwithin therealm
ofArticle VIandwilltherefore besubject tothedisciplines ofthatArticle outlined above.S/NGBT/W/6
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Thetreatment tobeaccorded tocriteria forthegranting ofalicence which arevague or
discretionary, suchas"public interest criteria" or"tests ofpublic necessity andconvenience"
hasbeen thesubject ofdiscussion throughout theUruguay Round. TheCommunity has
consistently maintained thatsuchcriteria cannot bescheduled under Article XVI, astheyare
insufficiently precise. Moreover, theCommunity hasconsistently doubted whether suchcriteria
are"based onobjective andtransparent criteria" asArticle VI.4and5required. (Unlike
Articles XVIandXVII, Members maynotschedule restrictions onmeasures which arenot
compatible withArticle VI).
Licensing criteria which arenotcompatible withArticle VIGATS must beeliminated, and
thelicensing process made compatible withtheobligations ofArticle VIGATS.
Conditions :Itcanbeseenfromtheabove thatArticle VIisa"negative obligation" inrelation
tolicensing procedures andcriteria. Itdoesnotseekpositively tomandate aparticular licensing
procedure overanother, nordoesitimpose particular criteria fortheaward oflicences or
conditions which mustbeincluded inlicences. Itseeks rather tolimittheliberty ofMembers
totheextent necessary toprevent undue restrictions ontrade inservices. However, itis
conceivable inthecontext ofanArticle VI.4 work programme todevelop thenecessary
disciplines thatparticular licensing procedures, criteria orconditions would befavoured over
others.
Although theidentification oflicensing procedures andcriteria which arecompatible with
Article VIanticipates theestablishment ofaworkprogramme ontheseissues which isexpressly
foreseen inArticle VI.4, theissueisofsufficient importance interms ofsecuring meaningful
commitments thatitshould befollowed up.Indeed, there islittlepoint inaddressing other
regulatory issues intheNGBT, suchasinterconnection, ifservice suppliers ofother Members
areunable toobtain alicence onGATS-compatible terms.
4. Interconnection
Theestablishment ofaregulatory framework governing interconnection conditions between
service suppliers andnetwork operators andbetween network operators isacrucial element ofthe
liberalization ofbasic telecommunications. Assuch, ithasbeenaddressed within theCommunity in
relation totelecommunications services inthecontext ofOpen Network Provision andisaddressed
atsome length inPartIIoftheCommission Green Paper onintra-Community liberalization of
infrastructure. PartIIofthisCommission Green Paper, makes explicit reference tothelinkage between
interconnection anduniversal service obligations. Hence, beyond thecompetitive aspects, thedefinition
ofaregulatoryframeworkoninterconnectioninaliberalizedenvironmentaimstoguaranteetheuniversal
availability ofpublic telecommunications services andinfrastructure.
Theterminterconnection canaddress anumber ofsituations:
- interconnection ofanon-facilities-based service supplier toafacilities-based service
supplier;
- interconnection oftwonon-facilities-based service suppliers; and
- interconnection between twofacilities-based service suppliers.S/NGBT/W/6
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Interconnection ofanon-facilities-based service supplier toanetwork operator
TheTelecom Annex applies to"allmeasures ofaMember thataffect access toanduseofpublic
telecommunications transport networks andservices (PTTNS)"5.Public telecommunications transport
service isdefined as:
- "anytelecommunicationstransportservicerequired,explicitlyorineffect,byaMember
tobeoffered tothepublic generally. Suchservices mayinclude, interalia,telegraph,
telephone, telexanddatatransmission typically involving thereal-time transmission
ofcustomer-supplied information between twoormore points without anyend-to-end
change intheform orcontent ofthecustomer 'sinformation".
Paragraph 5oftheAnnex requires Members toensure thatservices suppliers ofotherMembers
haveaccess toanduseofPTTNS onreasonable andnon-discriminatory terms andconditions forthe
supply ofaservice included intheirschedules. Non-discriminatory istobeunderstood torefer to
mfnandnational treatment asdefined intheGATS "aswellastoreflect sector-specific usage ofthe
termtomean "terms andconditions nolessfavourable thanthose accorded toanyother likeuserof
PTTNS under likecircumstances". Paragraph 5goesontospecify thatMembers must ensure that:
- terminal equipment canbeattached;
- private leased orowned circuits canbeinterconnected; and
- theprotocols oftheservice supplier 'schoice canbeused, other thanasnecessary to
ensure theavailability oftelecom networks andservices tothepublic generally.
However, inaccordance withparagraph 5,Members areentitled tomake suchaccess toand
useofthePTTNS subject toconditions, although onlythose necessary toensure public service
obligations, technical integrity ofthenetwork andthatservice suppliers donotsupply services unless
permitted pursuant tospecific commitments.
Interconnection between twonon-facilities-based service suppliers
Given thatparagraph 5oftheTelecom Annex isapplicable bothtopublic telecommunications
transport networks andservices (PTTNS), itcovers interconnection ofanon-facilities-based service
supplier toapublic telecommunications service supplier inthesame wayasoutlined above.
Interconnection between twofacilities-based service suppliers
Certain NGBT participants havestated thattheTelecom Annex doesnotcover network-to-
network interconnection. However, thescope oftheTelecom Annex isnotexplicitly limited. Indeed,
paragraph 5(a)oftheTelecom Annex states onlythat:
"Each Member shallensure thatanyservice supplier ofanyother Member isaccorded access
toanduseofpublic telecommunications networks andservices onreasonable andnon-
discriminatory terms andconditions, forthesupply ofaservice included initsschedule (...)".
Thefactthatparagraph 5(b)refers explicitly to"private leased circuits" doesnotpreclude that
network-to-network interconnection isalsocovered.
5Measures affecting thecable orbroadcast distribution ofradio ortelevision programming areexplicitly excluded fromthescope of
theAnnex inparagraph 2.2.S/NGBT/W/6
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Inparticular, where aMember makes aspecific commitment onthesupply ofbasic telecom
services onafacilities-basis, thatMember might besaidtohaveanobligation toensure thenecessary
access toanduseofthePTTNS (ofparagraph 5(a))which would include interconnection ofnetworks.
Separately, disciplines intheexisting GATS might besaidtooblige aMember toregulate
interconnection between facilities-based service suppliers. Three articles oftheGATS appear tobe
particularly relevant: Articles VI,VIIIandIX.
Incertain countries, thequestion ofinterconnection isdealtwithessentially intheindividual
licencesgrantedtofacilities-basedservicesuppliers.Thismeansthattherightsandobligationsinrelation
tointerconnection, including theterms andconditions ofinterconnection, aredependent ontheinter-
relation between thesevarious licences. Ashasbeenpointed outatpoint3above inrelation tolicences,
Article VIGATS doesnotrequire Members toinclude particular conditions inlicences which itgrants
toservice suppliers within itsterritory. Itfollows thattheGATS doesnotcomprise anobligation to
dealwiththequestion ofinterconnection inthelicences oftelecom service suppliers (however, please
seebelow inrelation tothedisciplines contained inArticle VIIIGATS inrelation tointerconnection).
Nonetheless, itwould bepossible toagree among NGBT participants thatgeneral principles
inrelation tonetwork-to-network interconnection should beincluded intelecom licences. Dealing
withthematter inthiswayunder Article VIwould cover situations inwhich Members make specific
commitments ontheprovision ofbasic telecom services onafacilities basis.
Article VIIIGATS concerns monopoly andexclusive service suppliers, whether dejureor
defacto. Solesuppliers onaspecific relevant market andexclusive service suppliers onsuchamarket,
willbesubject toArticle VIIIiftheconditions ofthatArticle aremet,i.e.thattheMember isinvolved
inthemaintenance ofthemonopoly orexclusive service supplier. Inrelation tomonopoly service
suppliers,ArticleXXVIIImakesclearthattheMembermayauthorizeorestablishsuchaservicesupplier
formallyorineffect.Operatorsofcertain"bottleneckfacilities"willfallwithinthescopeofArticleVIII.
However, itwillbenecessary toexamine suchsituation individually before arriving atthisconclusion
inrelation toaspecific operator. Alldominant carriers willnotnecessarily fallwithin Article VIII.
Thisquestion requires tobeexamined further.
Article VIIIobliges aMember toensure thatsuchservice suppliers within itsterritory donot
actinamanner inconsistent witheither mfnoritsspecific commitments. Theextent ofbehaviour
inconsistent withspecific commitments falling under Article VIIIisopentointerpretation. Article VIII
might besaidtoprevent suchsuppliers fromrefusing interconnection (thiswould certainly bethecase
ifaspecific commitment ontheprovision ofservice byresale weremade). Itmight alsobesaidto
prevent suchsuppliers from "abusing their dominant position" inareas subject tocompetition by
discriminatingbetweenotherservicesuppliersinthetermsofinterconnection(thispointismadeexplicitly
intheTelecom Annex inrelation tointerconnection ofnon-facilities-based service suppliers toanetwork
operator, seeabove).
There isthusaneedforclarification bothoftheservice suppliers subject toArticle VIIIand
oftheexact extent oftheobligations imposed onMembers inrelation tointerconnection intheir
regulation ofmonopoly andexclusive service suppliers.
Article IXonrestrictive business practices willapply todominant carriers which areneither
monopolies, norexclusive service suppliers within theterms ofArticle VIII. Itforesees nomore than
consultations between therelevant Members ifoneofthem experiences problems intheterritory of
another asaresult ofsuchpractices. Itimposes nodisciplines beyond that.S/NGBT/W/6
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Thus, theextent ofGATS disciplines inrelation tonetwork-to-network interconnection further
totheTelecom Annex andArticles VIandVIIIrequires tobeexamined further. Although
interconnection isnotrelevant onlyto"dominant carries" andmustbeaddressed inabroader perspective
thanArticle VIIIinorder tomaintain theuniversal availability ofpublic telecommunications services
andinfrastructure.
5. Universal/public service
Aswithanumber ofthetelecom regulatory issues described above, thesoleGATS disciplines
toapply arethose contained inArticles VI.1and2andpossibly VI.3, 4and5(with theusual proviso
thatiftheregulation were todiscriminate against services andservice suppliers ofother Members,
itwould require tobescheduled under Article XVII). Thismeans thatMembers arefreetoregulate
basictelecommunicationstakingintoaccountuniversal/publicserviceobligationsastheyseefit,provided
thattheregulation isreasonable, objective andimpartial andthatanyrelated conditions inlicences
arebased onobjective andtransparent criteria andarenotmoreburdensome thannecessary. Inaddition,
itshould benoted thatparagraph 5oftheTelecom Annex exhaustively liststhereasons forwhich
Members maylimit access toanduseofPTTNS, although theinterpretation ofthese issubject to
Article VI.Public service obligations areexplicitly mentioned asbeing ofrelevance.
6. Competitive safeguards
Discussions between NGBT participants haverevealed thatthetermcompetitive safeguards
isoften usedspecifically todesign regulatory measures which apply todominant carriers suchas
measures oninterconnection, practices ofregulatory authorities inrelation tolicensing conditions, and
evenmechanisms which allow end-users tohaverecourse against decisions ofpublic authorities and/or
dominant carriers.
Inthislight,thetermcompetitivesafeguardsrefersalmosttohorizontalissuesofgoodregulatory
practice which areaddressed generally throughout theGATS framework text. Interms oftheGATS,
itispossible toconclude thatcompetitive safeguards covers allregulatory issues, whatever thelevel
ofrelationship between theparties, provided thattheyaregovernmental "measures".
Thetermcompetitive safeguards might include measures todealwithsituations where the
regulator ofaMember seesaneedtocontrol thesituation attheother endofaninternational service
wheretheregulatormayhavenojurisdiction.Somecompetitivesafeguardsmayappeartobeinconsistent
withmost-favoured-nation treatment (Article IIGATS). However, where thesemeasures aredesigned
toaddress specific difficulties anddonotdiscriminate between service suppliers onthebasis of
nationality, theycould beconsidered tobelegitimate competitive safeguards. Thisisnotthecaseof
measures which condition themarket access ofaservice supplier ofanother Member toanexamination
ofwhether thatother Member affords equivalent market opportunities initsterritory. There isaneed
forclarification ofthispoint among NGBT participants.
7. Transparency requirements
Article IIIoftheGATS requires Members tomake public "allrelevant measures ofgeneral
application which pertain tooraffect" theoperation oftheAgreement. International agreements are
alsotobepublished. There isanobligation toinform theCouncil forTrade inServices atleastannually
of"anynew,oranychangestoexistinglaws,regulationsoradministrativeguidelines"whichsignificantly
affect trade inservices insectors covered byspecific commitments.S/NGBT/W/6
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Article IIIdoesnotapply todecisions affecting aparticular service supplier, forinstance terms
andconditions oflicences orofinterconnection terms mediated bytheregulatory authority inaparticular
case. Moreover, Article IIIbisexplicitly excludes fromtheobligation oftransparency thedisclosure
ofconfidential information which would be"contrary tothepublic interest orwhich would prejudice
legitimate commercial interests ofparticular enterprises, public orprivate".
Paragraph 4oftheGATS Annex onTelecommunications expands upon theprovisions of
Article III.Itrequires Members to:
- "ensure thatrelevant information ontheconditions affecting access toanduseofpublic
telecommunicationstransportnetworksandservicesispubliclyavailableincludingtariffs
andother terms andconditions ofservice, specifications oftechnical interfaces with
suchnetworks andservices, information onbodies responsible forthepreparation and
adoption ofstandards affecting such access toanduse,conditions applying for
attachment ofterminal orother equipment, andnotifications, registration orlicensing
requirements, ifany".
Itisnecessary toclarify theinter-relation between paragraph 4oftheTelecom Annex which
applies totariffs andterms andconditions foraccess toanduseofthePTTNS andtheprovisions of
Article IIIbiswhich allow Members nottomake public, information which would prejudice legitimate
commercialinterests.ArticleIIIbisGATSisageneralprovisionwhichshouldprevailoverparagraph4.
Moreover, paragraph 4willapply toalltariffs, terms andconditions forallforms ofaccess
toanduseofPTTNS, i.e.bothinterconnection ofanon-facilities-based service supplier toanetwork
operator andnetwork-to-network interconnection.
8. Separation ofregulatory andoperational functions
Within theCommunity, theseparation ofregulatory andoperational functions wascentral to
theliberalization oftelecom services.
Nothing intheGATS requires Members toadopt aparticular regulatory structure. TheGATS
examines onlythe"measures" which aretaken bythatregulatory authority andrequires them tobe
reasonable,objectiveandimpartial6insectorsinwhichspecificcommitmentsareundertaken.Moreover,
affected service suppliers must haverecourse against administrative decisions, thatisthepossibility
ofreview andwhere appropriate remedies.7
ThismeansthatMembersmaymaintaintelecomregulatoryauthoritieswhicharenotindependent
fromthetelecom operator without breaching GATS obligations, provided thatthemeasures themselves
arecompatible withArticle VI.
Where aservice supplier subject toArticle VIIIisalsoresponsible forregulation, theMember
mayhaveanobligation toensure thatsuchaservice supplier doesnotabuse thispower (please refer
topoint 4above fordetails ofArticle VIII).
6Article VI.1GATS.
7Article VI.2GATS.S/NGBT/W/6
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9. Access tofrequency spectrum andnumbering
Themanner inwhich frequency isallotted toservice suppliers varies fromMember toMember,
forinstance firstcome, firstserved orauctions. Numbering isalsodealtwithinavariety ofways.
Paragraphs 1and2ofArticle VIrequire frequency tobeallotted andnumbers tobedistributed
inareasonable, objective andimpartial manner; there must beapossibility ofreview and,where
appropriate, remedies against administrative decisions affecting aservice supplier.
Given thataccess tofrequency and/or tonumbering isaprecondition forobtaining authorization
toprovide services, Article VI.4(c) isalsorelevant (please refertopoint 3above).
10. Standards
Timely publication ofstandards isessential. ThisisdealtwithinArticle IIIGATS, andmore
particularly inparagraph 4oftheTelecom Annex.
Paragraph 5(f)(ii) ofthatAnnex allows Members torequire theuseofspecified technical
interfaces foraccess toanduseofthePTTNS.
Paragraph 7oftheTelecom Annex recognises theimportance ofinternational standards for
global compatibility andinter-operability oftelecom networks andservices. Members haveundertaken
inpursuance ofthisparagraph topromote suchstandards through thework ofrelevant international
bodies.
TheGATS contains noprovision ontheparticipation ofservice suppliers ofanother Member
inthestandards-setting process. Participation intheEuropean Telecommunications Standards Institute
(ETSI) isopentothirdcountries: ETSI associate members andobservers participate fullyintheprocess
ofdeveloping standards. Observers donot,however, havetheright tovoteontheacceptance of
standards.
Ithasbeensuggested thattheCode onTechnical Barriers toTrade (TBT), andinparticular
itsAnnex 3,theCode ofGood practice forthePreparation, Adoption andApplication ofStandards
(thecodeofGood practice), regulates theissue. TheTBTapplies onlytogoods andtoprocesses of
manufacturing goods. Ittherefore covers telecommunications equipment, butnotstandards related
totelecommunications services.
However, where thenon-participation ofservice suppliers ofother Members inthedrawing
upofanyform ofstandard isusedtoadopt standards which are,inthemselves, restrictive oftrade
inservices, thenArticle VI.4andVI.5would apply (please refertopoint 3where theprovisions of
Article VIareexplained inrelation tolicensing conditions).
11. Tariffs andcostissues
Nothing intheGATS deals with theregulation byMembers oftariffs orcosts in
telecommunications orindeed inanyother sector (although measures discriminating against services
andservice suppliers ofthirdcountries must ofcourse bescheduled under Article XVII inorder to
bemaintained).S/NGBT/W/6
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DuringthenegotiationoftheGATStext,therewasdiscussionofanobligationofcost-orientation
(bestefforts) intheTelecommunications Annex. However, thisprovision metfierce opposition from
certain members andwasremoved. TheGATS thusdoesnotrequire Members toenforce "cost-
orientation" ofprices inanysector.
Thetariffs imposed byprivate enterprises oftheirownfreewilldonotconstitute "measures"
ofaMember andarethusoutside thescope ofGATS. However, tariffs andother terms ofconditions
ofservice foraccess toanduseoftothePTTNS aresubject tothetransparency obligation contained
inparagraph 4oftheTelecom Annex.
Inrelation totariffs, theGATS imposes noobligations inrelation tocost-orientation, butdoes
require tariffs foraccess toanduseofthePTTNS tobepublicly available (please refertopoint7above).
12. Rights ofwayfortheinstallation ofinfrastructure
Therights ofMembers toregulate theinstallation oftelecom infrastructure inaccordance with
theirenvironmental andplanning lawsisprotected byArticles VI.1, VI.2, VI.4 and5,totheextent
thatsuchconsiderations arebased onobjective andtransparent criteria andarenotmore burdensome
thannecessary. Elaboration ofthese general principles inadvance ofanArticle VIwork programme
ontelecommunications appears difficult. Nonetheless, there arecertain limits inthepossibility ofa
Member torefuse rights ofwayfortheconstruction ofinfrastructure, thatisinamanner which nullifies
thebenefits ofanyspecific commitments onfacilities-based telecommunications service.