Article I:1 stipulates that the GATS applies to
measures by Members affecting trade in services. It does not matter
in this context whether a measure is taken at central, regional or
local government level, or by non-governmental bodies exercising
delegated powers. The relevant definition covers any measure,
“whether in the form of a law, regulation, rule, procedure,
decision, administrative action, or any other form, ... in respect
the purchase, payment or use of a
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;
the presence, including commercial
presence, of persons of a Member for the supply of a service in the
territory of another Member”.
This definition is significantly broader than
what governmental officials in trade-related areas may expect. It
is thus important to familiarize staff at all levels with basic
concepts of the GATS to prevent them from acting, unintentionally,
in contravention of obligations under the Agreement and enable them
to negotiate effectively with trading partners.
For purposes of structuring
their commitments, WTO Member have generally used a classification
system comprised of 12 core service sectors (document
MTN.GNS/W/120 (7 pages, 47KB)):
Business services (including
professional services and computer services)
Construction and related engineering
Financial services (including
insurance and banking)
Health-related and social services
Tourism and travel-related services
Recreational, cultural and sporting
Other services not included elsewhere
sectors are further subdivided into a total of some 160 sub‑sectors.
Under this classification system, any service sector may be included in
a Member’s schedule of commitments with specific market access and
national treatment obligations. Each WTO Member has submitted such a
schedule under the GATS.
There is only one sector-specific exception to the
Agreement’s otherwise comprehensive coverage. Under the GATS Annex on
Air Transport Services, only measures affecting aircraft repair and
maintenance services, the selling and marketing of air transport
services, and computer reservation system (CRS) services have been
included. Measures affecting air traffic rights and directly-related
services are excluded. This exclusion is subject to periodic review.
Another blanket exemption applies to “services supplied in the exercise of governmental authority” (Article I:3b). The
relevant definition specifies that these services are “supplied neither
on a commercial basis, nor in competition with one or more service
suppliers” (Article I:3c). Typical examples may include police, fire
protection, monetary policy operations, mandatory social security, and
tax and customs administration.
Despite its broad coverage, the GATS does not
compromise Members’ ability to regulate for national policy purposes.
Issues related to domestic regulation will be further discussed in