Part
VI: Final
Provisions
Article
XXVII: Denial
of Benefits
A Member may deny the benefits of this Agreement:
(a) to the supply of a service, if it establishes that the service is
supplied from or in the territory of a non-Member or of a Member to
which the denying Member does not apply the WTO Agreement;
(b) in the case of the supply of a maritime transport service, if it
establishes that the service is supplied:
(i) by a vessel registered under the laws of a non-Member or of a Member
to which the denying Member does not apply the WTO Agreement, and
(ii) by a person which operates and/or uses the vessel in whole or in part
but which is of a non-Member or of a Member to which the denying
Member does not apply the WTO Agreement;
(c) to a service supplier that is a juridical person, if it establishes
that it is not a service supplier of another Member, or that it is a
service supplier of a Member to which the denying Member does not
apply the WTO Agreement.
Article
XXVIII: Definitions back to top
For the purpose of this Agreement:
(a) “measure” means any measure by a Member, whether in the form
of a law, regulation, rule, procedure, decision, administrative
action, or any other form;
(b) “supply of a service” includes the production, distribution,
marketing, sale and delivery of a service;
(c) “measures by Members affecting trade in services” include
measures in respect of
(i) the purchase, payment or use of a service;
(ii) the access to and use of, in connection with the supply of a service,
services which are required by those Members to be offered to the
public generally;
(iii) the presence, including commercial presence, of persons of a Member
for the supply of a service in the territory of another Member;
(d) “commercial presence” means any type of business or
professional establishment, including through
(i) the constitution, acquisition or maintenance of a juridical person, or
(ii) the creation or maintenance of a branch or a representative office,
within
the territory of a Member for the purpose of supplying a service;
(e) “sector” of a service means,
(i) with reference to a specific commitment, one or more, or all,
subsectors of that service, as specified in a Member’s Schedule,
(ii) otherwise, the whole of that service sector, including all of its
subsectors;
(f) “service of another Member” means a service which is
supplied,
(i) from or in the territory of that other Member, or in the case of
maritime transport, by a vessel registered under the laws of that
other Member, or by a person of that other Member which supplies the
service through the operation of a vessel and/or its use in whole or
in part; or
(ii) in the case of the supply of a service through commercial presence or
through the presence of natural persons, by a service supplier of that
other Member;
(g) “service supplier” means any person that supplies a service;(12)
(h) “monopoly supplier of a service” means any person, public or
private, which in the relevant market of the territory of a Member is
authorized or established formally or in effect by that Member as the
sole supplier of that service;
(i) “service consumer” means any person that receives or uses a
service;
(j) “person” means either a natural person or a juridical
person;
(k) “natural person of another Member” means a natural person
who resides in the territory of that other Member or any other Member,
and who under the law of that other Member:
(i) is a national of that other Member; or
(ii) has the right of permanent residence in that other Member, in the case
of a Member which:
1. does not have nationals; or
2. accords substantially the same treatment to its permanent residents as
it does to its nationals in respect of measures affecting trade in
services, as notified in its acceptance of or accession to the WTO
Agreement, provided that no Member is obligated to accord to such
permanent residents treatment more favourable than would be accorded
by that other Member to such permanent residents. Such
notification shall include the assurance to assume, with respect to
those permanent residents, in accordance with its laws and
regulations, the same responsibilities that other Member bears with
respect to its nationals;
(l) “juridical person” means any legal entity duly constituted
or otherwise organized under applicable law, whether for profit or
otherwise, and whether privately-owned or governmentally-owned,
including any corporation, trust, partnership, joint venture, sole
proprietorship or association;
(m) “juridical person of another Member” means a juridical
person which is either:
(i) constituted or otherwise organized under the law of that other Member,
and is engaged in substantive business operations in the territory of
that Member or any other Member; or
(ii) in the case of the supply of a service through commercial presence,
owned or controlled by:
1. natural persons of that Member; or
2. juridical persons of that other Member identified under subparagraph (i);
(n) a juridical person is:
(i) “owned” by persons of a Member if more than 50 per cent
of the equity interest in it is beneficially owned by persons of that
Member;
(ii) “controlled” by persons of a Member if such persons have the
power to name a majority of its directors or otherwise to legally
direct its actions;
(iii) “affiliated” with another person when it controls, or is
controlled by, that other person; or when it and the other
person are both controlled by the same person;
(o) “direct taxes” comprise all taxes on total income, on total
capital or on elements of income or of capital, including taxes on
gains from the alienation of property, taxes on estates, inheritances
and gifts, and taxes on the total amounts of wages or salaries paid by
enterprises, as well as taxes on capital appreciation.
The Annexes to this Agreement are an integral part of this Agreement.
Annex
on Article II Exemptions back to top
Scope
1. This Annex specifies the conditions under which a Member, at the entry
into force of this Agreement, is exempted from its obligations under
paragraph 1 of Article II.
2. Any new exemptions applied for after the date of entry into force of
the WTO Agreement shall be dealt with under paragraph 3 of
Article IX of that Agreement.
Review
3. The Council for Trade in Services shall review all exemptions granted
for a period of more than 5 years. The first such review
shall take place no more than 5 years after the entry into force of
the WTO Agreement.
4. The Council for Trade in Services in a review shall:
(a) examine whether the conditions which created the need for the
exemption still prevail; and
(b) determine the date of any further review.
Termination
5. The exemption of a Member from its obligations under paragraph 1
of Article II of the Agreement with respect to a particular
measure terminates on the date provided for in the exemption.
6. In principle, such exemptions should not exceed a period of 10 years.
In any event, they shall be subject to negotiation in subsequent trade
liberalizing rounds.
7. A Member shall notify the Council for Trade in Services at the
termination of the exemption period that the inconsistent measure has
been brought into conformity with paragraph 1 of Article II
of the Agreement.
Lists
of Article II Exemptions
[The
agreed lists of exemptions under paragraph 2 of Article II will be
annexed here in the treaty copy of the WTO Agreement.]
Annex
on Movement of Natural Persons Supplying Services Under the Agreement back to top
1. This Annex applies to measures affecting natural persons who are
service suppliers of a Member, and natural persons of a Member who are
employed by a service supplier of a Member, in respect of the supply
of a service.
2. The Agreement shall not apply to measures affecting natural persons
seeking access to the employment market of a Member, nor shall it
apply to measures regarding citizenship, residence or employment on a
permanent basis.
3. In accordance with Parts III and IV of the Agreement, Members may
negotiate specific commitments applying to the movement of all
categories of natural persons supplying services under the Agreement.
Natural persons covered by a specific commitment shall be allowed to
supply the service in accordance with the terms of that commitment.
4. The Agreement shall not prevent a Member from applying measures to
regulate the entry of natural persons into, or their temporary stay
in, its territory, including those measures necessary to protect the
integrity of, and to ensure the orderly movement of natural persons
across, its borders, provided that such measures are not applied in
such a manner as to nullify or impair the benefits accruing to any
Member under the terms of a specific commitment.(13)
Annex
on Air Transport Services back to top
1. This Annex applies to measures affecting trade in air transport
services, whether scheduled or non-scheduled, and ancillary services.
It is confirmed that any specific commitment or obligation assumed
under this Agreement shall not reduce or affect a Member’s obligations
under bilateral or multilateral agreements that are in effect on the
date of entry into force of the WTO Agreement.
2. The Agreement, including its dispute settlement procedures, shall not
apply to measures affecting:
(a) traffic rights, however granted; or
(b) services directly related to the exercise of traffic rights,
except
as provided in paragraph 3 of this Annex.
3. The Agreement shall apply to measures affecting:
(a) aircraft repair and maintenance services;
(b) the selling and marketing of air transport services;
(c) computer reservation system (CRS) services.
4. The dispute settlement procedures of the Agreement may be invoked only
where obligations or specific commitments have been assumed by the
concerned Members and where dispute settlement procedures in bilateral
and other multilateral agreements or arrangements have been exhausted.
5. The Council for Trade in Services shall review periodically, and at
least every five years, developments in the air transport sector and
the operation of this Annex with a view to considering the possible
further application of the Agreement in this sector.
6. Definitions:
(a) “Aircraft
repair and maintenance services” mean such activities when
undertaken on an aircraft or a part thereof while it is withdrawn from
service and do not include so-called line maintenance.
(b) “Selling
and marketing of air transport services” mean opportunities for
the air carrier concerned to sell and market freely its air transport
services including all aspects of marketing such as market research,
advertising and distribution. These activities do not include
the pricing of air transport services nor the applicable conditions.
(c) “Computer
reservation system (CRS) services” mean services provided by
computerised systems that contain information about air carriers’
schedules, availability, fares and fare rules, through which
reservations can be made or tickets may be issued.
(d) “Traffic
rights” mean the right for scheduled and non-scheduled services
to operate and/or to carry passengers, cargo and mail for remuneration
or hire from, to, within, or over the territory of a Member, including
points to be served, routes to be operated, types of traffic to be
carried, capacity to be provided, tariffs to be charged and their
conditions, and criteria for designation of airlines, including such
criteria as number, ownership, and control.
Annex
on Financial Services back to top
1. Scope and Definition
(a) This
Annex applies to measures affecting the supply of financial services.
Reference to the supply of a financial service in this Annex shall
mean the supply of a service as defined in paragraph 2 of Article
I of the Agreement.
(b) For
the purposes of subparagraph 3(b) of Article I of the Agreement, “services supplied in the exercise of governmental
authority” means the following:
(i) activities
conducted by a central bank or monetary authority or by any other
public entity in pursuit of monetary or exchange rate policies;
(ii) activities
forming part of a statutory system of social security or public
retirement plans; and
(iii) other
activities conducted by a public entity for the account or with the
guarantee or using the financial resources of the Government.
(c) For
the purposes of subparagraph 3(b) of Article I of the Agreement,
if a Member allows any of the activities referred to in subparagraphs
(b)(ii) or (b)(iii) of this paragraph to be conducted by its financial
service suppliers in competition with a public entity or a financial
service supplier, “services” shall include such activities.
(d) Subparagraph
3(c) of Article I of the Agreement shall not apply to services covered
by this Annex.
2. Domestic Regulation
(a) Notwithstanding
any other provisions of the Agreement, a Member shall not be prevented
from taking measures for prudential reasons, including for the
protection of investors, depositors, policy holders or persons to whom
a fiduciary duty is owed by a financial service supplier, or to ensure
the integrity and stability of the financial system. Where such
measures do not conform with the provisions of the Agreement, they
shall not be used as a means of avoiding the Member’s commitments or
obligations under the Agreement.
(b) Nothing
in the Agreement shall be construed to require a Member to disclose
information relating to the affairs and accounts of individual
customers or any confidential or proprietary information in the
possession of public entities.
3. Recognition
(a) A
Member may recognize prudential measures of any other country in
determining how the Member’s measures relating to financial services
shall be applied. Such recognition, which may be achieved
through harmonization or otherwise, may be based upon an agreement or
arrangement with the country concerned or may be accorded
autonomously.
(b) A
Member that is a party to such an agreement or arrangement referred to
in subparagraph (a), whether future or existing, shall afford
adequate opportunity for other interested Members to negotiate their
accession to such agreements or arrangements, or to negotiate
comparable ones with it, under circumstances in which there would be
equivalent regulation, oversight, implementation of such regulation,
and, if appropriate, procedures concerning the sharing of information
between the parties to the agreement or arrangement. Where a
Member accords recognition autonomously, it shall afford adequate
opportunity for any other Member to demonstrate that such
circumstances exist.
(c) Where
a Member is contemplating according recognition to prudential measures
of any other country, paragraph 4(b) of Article VII shall
not apply.
4. Dispute Settlement
Panels for disputes on prudential issues and other financial matters shall
have the necessary expertise relevant to the specific financial
service under dispute.
5. Definitions
For
the purposes of this Annex:
(a) A
financial service is any service of a financial nature offered by a
financial service supplier of a Member. Financial services
include all insurance and insurance-related services, and all banking
and other financial services (excluding insurance). Financial
services include the following activities:
Insurance and insurance-related services
(i) Direct
insurance (including co-insurance):
(A) life
(B) non-life
(ii) Reinsurance and retrocession;
(iii) Insurance intermediation, such as brokerage and agency;
(iv) Services auxiliary to insurance, such as consultancy, actuarial, risk
assessment and claim settlement services.
Banking and other financial services (excluding insurance)
(v) Acceptance
of deposits and other repayable funds from the public;
(vi) Lending
of all types, including consumer credit, mortgage credit, factoring
and financing of commercial transaction;
(vii) Financial
leasing;
(viii) All
payment and money transmission services, including credit, charge and
debit cards, travellers cheques and bankers drafts;
(ix) Guarantees
and commitments;
(x) Trading
for own account or for account of customers, whether on an exchange,
in an over-the-counter market or otherwise, the following:
(A) money
market instruments (including cheques, bills, certificates of
deposits);
(B) foreign
exchange;
(C) derivative
products including, but not limited to, futures and options;
(D) exchange
rate and interest rate instruments, including products such as swaps,
forward rate agreements;
(E) transferable
securities;
(F) other
negotiable instruments and financial assets, including bullion.
(xi) Participation
in issues of all kinds of securities, including underwriting and
placement as agent (whether publicly or privately) and provision of
services related to such issues;
(xii) Money
broking;
(xiii) Asset
management, such as cash or portfolio management, all forms of
collective investment management, pension fund management, custodial,
depository and trust services;
(xiv) Settlement
and clearing services for financial assets, including securities,
derivative products, and other negotiable instruments;
(xv) Provision
and transfer of financial information, and financial data processing
and related software by suppliers of other financial services;
(xvi) Advisory,
intermediation and other auxiliary financial services on all the
activities listed in subparagraphs (v) through (xv), including credit
reference and analysis, investment and portfolio research and advice,
advice on acquisitions and on corporate restructuring and strategy.
(b) A
financial service supplier means any natural or juridical person of a
Member wishing to supply or supplying financial services but the term “financial service supplier” does not include a public
entity.
(c) “Public
entity” means:
(i) a
government, a central bank or a monetary authority, of a Member, or an
entity owned or controlled by a Member, that is principally engaged in
carrying out governmental functions or activities for governmental
purposes, not including an entity principally engaged in supplying
financial services on commercial terms; or
(ii) a
private entity, performing functions normally performed by a central
bank or monetary authority, when exercising those functions.
Second
Annex on Financial Services back to top
1. Notwithstanding Article II of the Agreement and paragraphs 1
and 2 of the Annex on Article II Exemptions, a Member may,
during a period of 60 days beginning four months after the date
of entry into force of the WTO Agreement, list in that Annex measures
relating to financial services which are inconsistent with paragraph 1
of Article II of the Agreement.
2. Notwithstanding Article XXI of the Agreement, a Member may,
during a period of 60 days beginning four months after the date
of entry into force of the WTO Agreement, improve, modify or withdraw
all or part of the specific commitments on financial services
inscribed in its Schedule.
3. The Council for Trade in Services shall establish any procedures
necessary for the application of paragraphs 1 and 2.
Annex
on Negotiations on Maritime Transport Services back to top
1. Article II and the Annex on Article II Exemptions, including the
requirement to list in the Annex any measure inconsistent with most-favoured-nation
treatment that a Member will maintain, shall enter into force for
international shipping, auxiliary services and access to and use of
port facilities only on:
(a) the implementation date to be determined under paragraph 4 of the
Ministerial Decision on Negotiations on Maritime Transport Services;
or,
(b) should the negotiations not succeed, the date of the final report of
the Negotiating Group on Maritime Transport Services provided for in
that Decision.
2. Paragraph 1 shall not apply to any specific commitment on maritime
transport services which is inscribed in a Member’s Schedule.
3. From the conclusion of the negotiations referred to in paragraph 1,
and before the implementation date, a Member may improve, modify or
withdraw all or part of its specific commitments in this sector
without offering compensation, notwithstanding the provisions of
Article XXI.
Annex
on Telecommunications back to top
1. Objectives
Recognizing the specificities of the telecommunications services
sector and, in particular, its dual role as a distinct sector of
economic activity and as the underlying transport means for other
economic activities, the Members have agreed to the following Annex
with the objective of elaborating upon the provisions of the Agreement
with respect to measures affecting access to and use of public
telecommunications transport networks and services. Accordingly,
this Annex provides notes and supplementary provisions to the
Agreement.
2. Scope
(a) This
Annex shall apply to all measures of a Member that affect access to
and use of public telecommunications transport networks and services.(14)
(b) This Annex shall not
apply to measures affecting the cable or broadcast distribution of
radio or television programming.
(c) Nothing in this Annex
shall be construed:
(i) to require a Member to authorize a service supplier of any other
Member to establish, construct, acquire, lease, operate, or supply
telecommunications transport networks or services, other than as
provided for in its Schedule; or
(ii) to require a Member (or to require a Member to oblige service
suppliers under its jurisdiction) to establish, construct, acquire,
lease, operate or supply telecommunications transport networks or
services not offered to the public generally.
3. Definitions
For the purposes of this Annex:
(a) “Telecommunications”
means the transmission and reception of signals by any electromagnetic
means.
(b) “Public
telecommunications transport service” means any
telecommunications transport service required, explicitly or in
effect, by a Member to be offered to the public generally. Such
services may include, inter alia, telegraph, telephone, telex,
and data transmission typically involving the real-time transmission
of customer-supplied information between two or more points without
any end-to-end change in the form or content of the customer’s
information.
(c) “Public
telecommunications transport network” means the public
telecommunications infrastructure which permits telecommunications
between and among defined network termination points.
(d) “Intra-corporate
communications” means telecommunications through which a company
communicates within the company or with or among its subsidiaries,
branches and, subject to a Member’s domestic laws and
regulations, affiliates. For these purposes, “subsidiaries”,
“branches” and, where applicable, “affiliates” shall be as defined by each Member.
“Intra-corporate communications” in this Annex excludes
commercial or non-commercial services that are supplied to companies
that are not related subsidiaries, branches or affiliates, or that are
offered to customers or potential customers.
(e) Any reference to a paragraph or subparagraph of this Annex
includes all subdivisions thereof.
4. Transparency
In the application of Article III of the Agreement, each Member
shall ensure that relevant information on conditions affecting access
to and use of public telecommunications transport networks and
services is publicly available, including: tariffs and other terms and conditions of service;
specifications of technical interfaces with such networks and
services; information on
bodies responsible for the preparation and adoption of standards
affecting such access and use; conditions
applying to attachment of terminal or other equipment; and notifications, registration or licensing requirements, if
any.
5. Access to and use of
Public Telecommunications Transport Networks and Services
(a) Each Member shall ensure that any service supplier of any other
Member is accorded access to and use of public telecommunications
transport networks and services on reasonable and non-discriminatory
terms and conditions, for the supply of a service included in its
Schedule. This obligation
shall be applied, inter alia,
through paragraphs (b) through (f).(15)
(b) Each Member shall ensure
that service suppliers of any other Member have access to and use of
any public telecommunications transport network or service offered
within or across the border of that Member, including private
leased circuits, and to this end shall ensure, subject to paragraphs
(e) and (f), that such suppliers are permitted:
(i) to purchase or lease and attach terminal or other equipment which
interfaces with the network and which is necessary to supply a
supplier’s services;
(ii) to interconnect private leased or owned circuits with public
telecommunications transport networks and services or with circuits
leased or owned by another service supplier; and
(iii) to use operating protocols of the service supplier’s choice in the
supply of any service, other than as necessary to ensure the
availability of telecommunications transport networks and services to
the public generally.
(c) Each Member shall ensure
that service suppliers of any other Member may use public
telecommunications transport networks and services for the movement of
information within and across borders, including for intra-corporate
communications of such service suppliers, and for access to
information contained in data bases or otherwise stored in
machine-readable form in the territory of any Member. Any new or
amended measures of a Member significantly affecting such use shall be
notified and shall be subject to consultation, in accordance with
relevant provisions of the Agreement.
(d) Notwithstanding the
preceding paragraph, a Member may take such measures as are necessary
to ensure the security and confidentiality of messages, subject to the
requirement that such measures are not applied in a manner which would
constitute a means of arbitrary or unjustifiable discrimination or a
disguised restriction on trade in services.
(e) Each Member shall ensure
that no condition is imposed on access to and use of public
telecommunications transport networks and services other than as
necessary:
(i) to safeguard the public service responsibilities of suppliers of
public telecommunications transport networks and services, in
particular their ability to make their networks or services available
to the public generally;
(ii) to protect the technical integrity of public telecommunications
transport networks or services; or
(iii) to ensure that service suppliers of any other Member do not supply
services unless permitted pursuant to commitments in the Member’s
Schedule.
(f) Provided that they
satisfy the criteria set out in paragraph (e), conditions for access
to and use of public telecommunications transport networks and
services may include:
(i) restrictions on resale or shared use of such services;
(ii) a requirement to use specified technical interfaces, including
interface protocols, for inter-connection with such networks and
services;
(iii) requirements, where necessary, for the inter-operability of such
services and to encourage the achievement of the goals set out in
paragraph 7(a);
(iv) type approval of terminal or other equipment which interfaces with the
network and technical requirements relating to the attachment of such
equipment to such networks;
(v) restrictions on inter-connection of private leased or owned circuits
with such networks or services or with circuits leased or owned by
another service supplier; or
(vi) notification, registration and licensing.
(g) Notwithstanding the
preceding paragraphs of this section, a developing country Member may,
consistent with its level of development, place reasonable conditions
on access to and use of public telecommunications transport networks
and services necessary to strengthen its domestic telecommunications
infrastructure and service capacity and to increase its participation
in international trade in telecommunications services. Such
conditions shall be specified in the Member’s Schedule.
6. Technical Cooperation
(a) Members recognize that
an efficient, advanced telecommunications infrastructure in countries,
particularly developing countries, is essential to the expansion of
their trade in services. To this end, Members endorse and
encourage the participation, to the fullest extent practicable, of
developed and developing countries and their suppliers of public
telecommunications transport networks and services and other entities
in the development programmes of international and regional
organizations, including the International Telecommunication Union,
the United Nations Development Programme, and the International Bank
for Reconstruction and Development.
(b) Members shall encourage
and support telecommunications cooperation among developing countries
at the international, regional and sub-regional levels.
(c) In cooperation with
relevant international organizations, Members shall make available,
where practicable, to developing countries information with respect to
telecommunications services and developments in telecommunications and
information technology to assist in strengthening their domestic
telecommunications services sector.
(d) Members shall give
special consideration to opportunities for the least-developed
countries to encourage foreign suppliers of telecommunications
services to assist in the transfer of technology, training and other
activities that support the development of their telecommunications
infrastructure and expansion of their telecommunications services
trade.
7. Relation to International Organizations and Agreements
(a) Members recognize the
importance of international standards for global compatibility and
inter-operability of telecommunication networks and services and
undertake to promote such standards through the work of relevant
international bodies, including the International Telecommunication
Union and the International Organization for Standardization.
(b) Members recognize the
role played by intergovernmental and non-governmental organizations
and agreements in ensuring the efficient operation of domestic and
global telecommunications services, in particular the International
Telecommunication Union. Members shall make appropriate
arrangements, where relevant, for consultation with such organizations
on matters arising from the implementation of this Annex.
Annex
on Negotiations on Basic Telecommunications back to top
1. Article II and the Annex on Article II Exemptions, including
the requirement to list in the Annex any measure inconsistent with
most-favoured-nation treatment that a Member will maintain, shall
enter into force for basic telecommunications only on:
(a) the implementation date to be determined under paragraph 5 of the
Ministerial Decision on Negotiations on Basic Telecommunications;
or,
(b) should the negotiations not succeed, the date of the final report of
the Negotiating Group on Basic Telecommunications provided for in that
Decision.
2. Paragraph 1 shall not apply to any specific commitment on basic
telecommunications which is inscribed in a Member’s Schedule.
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