Main Building Blocks: Agreement, Annexes, and Schedules

2.6 How Schedules are Structured

As noted above, the obligations of any WTO Member under GATS consist of the provisions of the Agreement and its Annexes as well as the specific commitments contained in the national schedule. The schedule is a relatively complex document, more difficult to read than a tariff schedule under GATT. While a tariff schedule, in its simplest form, lists one tariff rate per product, a schedule of commitments contains at least eight entries per sector: the commitments on each market access and national treatment with regard to the four modes of supply.

The services schedule of “Arcadia”, an imaginary WTO Member, displays the normal four-column format (Box C). While the first column specifies the sector or sub-sector concerned, the second column sets out any limitations on market access that fall within the six types of restrictions mentioned in Article XVI:2. The third column contains any limitations that Arcadia may want to place, in accordance with Article XVII, on national treatment. A final column provides the opportunity to undertake additional commitments as envisaged in Article XVIII; it is empty in this case.

Any of the entries under market access or national treatment may vary within a spectrum whose opposing ends are full commitments without limitation (“none”) and full discretion to apply any measure falling under the relevant Article (“unbound”). The schedule is divided into two parts. While Part I lists “horizontal commitments”, i.e. entries that apply across all sectors that have been scheduled, Part II sets out commitments on a sector-by-sector basis.

Arcadia’s horizontal commitments under mode 3, national treatment, reserve the right to deny foreign land ownership. Under mode 4, Arcadia would be able to prevent any foreigner from entering its territory to supply services, except for the specified groups of persons. Within the retailing sector, whose definitional scope is further clarified by reference to the United Nations provisional Central Product Classification (CPC), commitments vary widely across modes. Most liberal are those for mode 2 (consumption abroad) where Arcadia is bound not to take any measure under either Article XVI or XVII that would prevent or discourage its residents from shopping abroad.

Entries into schedules should remain confined to measures incompatible with either the market access or national treatment provisions of the GATS and to any additional commitments a Member may want to undertake under Article XVIII. Schedules would not provide legal cover for measures inconsistent with other provisions of the Agreement, including the MFN requirement under Article II or the obligation under Article VI:1 to reasonable, objective and impartial administration of measures of general application. MFN-inconsistent measures, that have not been included in the relevant list, need to be rescinded and the same applies to any inconsistencies with Article VI. The trade-impeding effects associated with non-discriminatory domestic regulation — qualification requirements for teachers, lawyers, or accountants; minimum capital requirements for banks; mandatory liability insurance for doctors; etc. — do not call for scheduling per se. As noted before, the Agreement clearly distinguishes between, on the one hand, trade liberalization under specific commitments and, on the other hand, domestic regulation for quality and other legitimate policy purposes. By the same token, there is no need to schedule access restrictions, such as sales bans on arms or pornographic material and the like, that fall under the General Exceptions of Article XIV or prudential measures aimed to ensure the stability and integrity of the financial services sector.