Key stages in the services negotiations

The mandate and early stages of negotiations

The General Agreement on Trade in Services (GATS) calls on WTO members to enter into successive rounds of negotiations in order to achieve progressively higher levels of liberalization. Negotiations are to be "directed to the reduction or elimination of the adverse effects on trade in services of measures as a means of providing effective market access". The process of progressive liberalization is to be advanced "through bilateral, plurilateral or multilateral negotiations directed towards increasing the general level of specific commitments undertaken by Members".  

GATS Article XIX provides that negotiations would take place with due respect to the level of development of individual members and that these members would benefit from flexibility, thereby being allowed, for example, to open fewer sectors, in line with their individual development situation.  The Agreement (Article IV) also states that negotiations shall facilitate the increasing participation of developing countries in world trade.  

In 2000, the General Council decided that negotiations would take place in the Council for Trade in Services in Special Session.  In March 2001, the Special Session approved the 'Guidelines and Procedures for the Negotiations on Trade in Services' (S/L/93). The document builds on GATS provisions, in particular Article IV (‘Increasing Participation of Developing Countries’) and Article XIX (‘Negotiation of Specific Commitments’).  The content of the Negotiating Guidelines is summarized here.  

These Guidelines provided that exemptions from the obligation of most-favoured-nation (MFN) treatment would be subject to negotiations, as provided by the GATS.  The Guidelines also integrate into the services negotiations the Agreement's mandated negotiations on rule-making (domestic regulation  - Article VI:4), emergency safeguards (Article X), government procurement (Article XIII) and subsidies (Article XV). 

The Working Party on Domestic Regulation is responsible for developing disciplines in the area of domestic regulation as mandated by Article VI.4. The Working Party on GATS Rules has three negotiating mandates: emergency safeguard measures (Article X), government procurement (Article XIII) and subsidies (Article XV). These working parties have routinely reported on their negotiating work to the Special Session.  The Special Session, in turn, reports to the Trade Negotiations Committee.

The Negotiating Guidelines were complemented, in 2003, by the 'Modalities for the Special Treatment for Least-Developed Country Members' (TN/S/13) and the 'Modalities for the Treatment of Autonomous Liberalization' (TN/S/6).

The LDC Modalities aimed to ensure “maximum flexibility” for least-developed countries (LDCs) in the negotiations. Moreover, all members committed to exercising restraint in seeking commitments from LDCs as well as giving special priority to sectors and modes of interest to these members in preparing their own schedules of commitments. This eventually led to agreement on a Waiver for LDCs.  Paragraph 26 of the Hong Kong Ministerial Declaration of 2005 provided that in recognition of the particular circumstances of LDCs, they were not expected to undertake new commitments.

Recognizing that countries have continued to improve market access and introduce significant domestic regulatory reforms outside of the GATS negotiations, the Modalities for Autonomous Liberalization provided criteria for assessing the value of autonomous liberalization and the procedures for how such liberalization could be treated in the context of the services negotiations.

Exchange of requests and offers (2002-2005)

In view of the relatively detailed Negotiating Guidelines of March 2001, the Doha Ministerial Declaration essentially confined itself to endorsing the Guidelines and bringing services under the wider framework of the Doha Development Agenda. The Doha Declaration introduced target dates for the circulation of initial requests (30 June 2002) and initial offers (31 March 2003) of specific commitments and envisaged all negotiations to be concluded not later than 1 January 2005.

The Cancun Ministerial Meeting in early September 2003, however, failed to make progress. The concluding statement reaffirmed the Doha Declaration and Decisions and recommitted members “to working to implement them fully and faithfully". Reflecting the lack of political impetus, the request-and-offer process in services virtually ground to a halt in the wake of Cancun.

It was not until mid-2004 that the so-called July 2004 Package (Doha Work Programme — Decision adopted by the General Council on 1 August 2004) injected new momentum into the negotiations. With regard to services, the July Package contained a target date of May 2005 for the submission of revised offers and adopted a set of recommendations that had been agreed before by the Council for Trade in Services (Special Session). These included recommendations for members that had not yet submitted initial offers to do so as soon as possible.

Members continued to exchange offers after the July Package, but the Chair of the Special Session reported in May 2005 that the quality of initial and revised offers was 'poor' and that the negotiations were not progressing as they should. 

A total of 71 initial offers and 31 revised offers (counting the European Union as one) had been submitted by 2008, when the last offer was circulated.

The Hong Kong Ministerial Declaration and its Annex C  

The Hong Kong Ministerial Declaration of December 2005 reaffirmed key principles and objectives of the services negotiations and called on members to intensify the negotiations in accordance with the objectives, approaches and timelines set out in Annex C to the Declaration with a view to expanding sectoral and modal coverage of commitments and improving their quality, with particular attention to export interests of developing countries. The Ministerial Declaration also established that LDCs were not expected to undertake new commitments in the Doha Round.

Annex C contained a more detailed and ambitious set of negotiating objectives to guide members than any previous such document. While ensuring appropriate flexibility for individual developing country members, it established a framework for:

  • offering new or improved commitments under each mode of supply   
  • treating most-favoured nation (MFN) exemptions   
  • the scheduling and classification of commitments.

Among other things, the Annex also urged members to intensify their efforts to conclude the rule-making negotiations, develop text for adoption on disciplines on domestic regulation, and devise methods for the full and effective implementation of the Modalities for the Special Treatment of Least-Developed Country Members. With respect to negotiating approaches, Annex C envisaged that the request-offer negotiations also be pursued on a plurilateral basis and provides guidelines for the conduct of these negotiations.

Plurilateral negotiations   

Under plurilateral negotiations, a group of members with a common interest make a joint request to individual members to improve specific commitments in a particular sector or mode of supply. Subsequently, they meet collectively with the countries that have received this request. It is up to each member to respond individually to the collective request.

Two rounds of plurilateral negotiations were conducted in early 2006, based on 22 collective requests that were formulated mostly along sector lines. The feedback from the informal negotiating groups dealing with these requests was positive.

Each group was initiated by a dozen or more members with common negotiating interests. The groups invited other members to discuss and consider these interests which were normally couched in the form of a common request.

The results of the plurilateral negotiations, as well as additional bilateral meetings, were expected to be reflected in a second round of revised offers. While Annex C provided a timeline of 31 July 2006 for the submission of these offers, all negotiations under the Doha Development Agenda (DDA) were suspended just one week earlier, due mostly to a stalemate over agricultural and non-agricultural market access (NAMA).

It was not until February 2007 that the time seemed ripe for a full resumption of the negotiations. As before, meetings in services were organized mostly in the form of clusters so as to afford experts from capitals an opportunity, every three or four months, not only to attend relevant Council and Committee meetings but to organize bilateral and plurilateral encounters in order to explore the scope for and content of improved offers.

Signalling Conference and elements for the conclusion of the negotiations

While continuing with bilateral encounters, members discussed the elements that would guide the services negotiations to completion. In this connection, the Chair of the services negotiations (Council for Trade in Services in Special Session) issued on 26 May 2008 a report with a draft services text that WTO members, after further discussion, could adopt.

The draft, which was based on consultations conducted by the Chair, addressed issues such as participants' level of ambition, their willingness to bind existing and improved levels of market access and national treatment, as well as specific reference to Modes 1 and 4 with respect to the treatment of sectors and modes of supply of export interest to developing countries.

On a parallel track, the Chair of the Trade Negotiations Committee (TNC), at the request of WTO members, convened a “signalling conference” for interested ministers as part of the Mini-Ministerial meeting of “July 2008”. At the signalling conference, participating ministers indicated how their governments' current services offers might be improved in response to the requests they had received. The signals were not intended to represent the final outcome of the services negotiations but enabled members to assess the progress made in the request-offer negotiations while preparing new draft schedules for submission. Subsequently, the TNC Chair reported on the conference.  However, the Mini-Ministerial foundered over disagreement on certain elements of the draft modalities on agriculture.

Post 2008 discussions  

Progress was limited following the failure to conclude agriculture and non-agricultural market access (NAMA) modalities in July 2008.  The remaining gaps were reflected in the stocktaking report by the Chair of the Council for Trade in Services in Special Session to the Trade Negotiations Committee in 2010.

 In April 2011, the Chair of the Council for Trade in Services submitted a report to the Trade Negotiations Committee on the achievements and remaining gaps in all four areas of the services negotiations: market access; domestic regulation; GATS rules; and the implementation of LDC modalities.

However, at the Eighth Ministerial Conference in 2011, Ministers recognized that DDA negotiations had reached an 'impasse' and that there was a need to more fully explore different negotiating approaches.  They committed to advancing negotiations where progress could be achieved.

At the 2011 Ministerial Conference, members adopted the waiver which allows WTO members to deviate from their most-favoured nation obligation of non-discrimination in order to provide preferential treatment to services and service suppliers from least-developed countries (LDCs). The duration of the waiver was extended until 2030 by a Ministerial Decision at the Tenth Ministerial Conference in Nairobi in 2015.

At the Bali Ministerial Conference, ministers instructed the Trade Negotiations Committee to develop a work programme covering the remaining DDA issues.  The Chair of the Special Session of the Council for Trade in Services reported in July 2015 that no convergence could be found on services elements of the work programme.

In December 2015, at the Nairobi Ministerial Conference, ministers acknowledged that members “have different views” on how to address the future of the Doha Round negotiations but noted the strong commitment of all members to advance negotiations on the remaining Doha issues, including services. Some members said that new approaches were necessary.    

At the Buenos Aires Ministerial Conference in December 2017 the Chair of the Conference said in her concluding statement that members agreed to advance negotiations on all remaining issues, including services.

At the Buenos Aires Conference, a group of 59 WTO members issued a Joint Statement on Services Domestic Regulation.  The signatories reaffirmed their commitment to advancing negotiations on domestic regulation and to intensify work towards concluding the negotiations of disciplines in advance of the Twelfth Ministerial Conference.

Since Buenos Aires, discussions in the Special Session of the Council for Trade in Services have focused on communications from members in relation to exploratory discussions on market access.  Members exchanged views on tourism services in April 2019 and on environmental services in September 2019.