RESTRICTEDWORLD TRADE
ORGANIZATIONS/CSS/M/8
14 May 2001
(01-2467)
Council for Trade in Services
Special Session
REPORT OF THE MEETING HELD ON 28, 29 AND 30 MARCH 2001
Note by the Secretariat
1. The Council for Trade in Services held a Special Session on 28, 29 and 30 March 2001.  The
agenda for the meeting is contained in docume nt WTO/AIR/1513 and Add.1.  Under Other Business,
the Secretariat said that it would make a statement on the compilation of Member's commitments in
electronic format.
2. The Chairman proposed that the Council adopt the agenda as circulated.
3. The Council so agreed.
A. NEGOTIATING GUIDELINES AND PROCEDURES PURSUANT TO ARTICLE XIX
OF THE GATS
4. The Chairman suggested that the Council adopt the negotiating guidelines and procedures (as
they are in document S/L/93) as required by paragraph 3 of Article XIX of the GATS.
5. The representative of Bulgaria said that he wished to make his statement before the adoption
of the guidelines.  The Chairman appealed to Bulgaria to allow the adoption of the guidelines first;
based on that adoption, Members would then make  their statements, which would in no way
undermine their collaboration with that adoption.  The representative of Bulgaria said that his
delegation was making certain assumptions in its statement, on the basis of which they were preparedto adopt the guidelines, so that he could agree with  the Chairman's suggestion provided that this did
not prejudice the legal consequences of his statement.
6. The Council adopted the negotiating guidelines and procedures contained in document
S/L/93.
7. All Members welcomed the adoption of the negotiating guidelines and procedures.
8. The representative of India said that the adoption of the negotiating guidelines and procedures
was without prejudice to the importance his country attached to two issues, namely the assessment of
trade in services and the modalities for the treatment of autonomous liberalization.  He considered thatthere was a certain logic in Article XIX, according to which the assessment should have been carried
out after the implementation of the services agreement, and that based on the results of such an
assessment the negotiating guidelines and procedures should have been worked out.  Similarly, the
modalities for the treatment of autonomous liberalization should have been established and included
in the negotiating guidelines and procedures.  It was therefore with some regret that his delegation
accepted the guidelines.  He said that the assessment of trade in services and the treatment of
autonomous liberalization were very important and that his delegation would pursue them in the
course of the negotiations.S/CSS/M/8
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9. Speaking of behalf of the Mercosur countries (Argentina, Brazil, Paraguay, and Uruguay), the
representative of Paraguay  emphasized their interest in the negotiations on agriculture and services,
which should be carried out in parallel.  He added that the Mercosur countries would continue to
participate in a positive and constructive way, on the understanding that this would be the spirit
guiding all Members in the present negotiations.
10. The representative of Thailand  expressed her disappointment that the negotiating guidelines
and procedures did not include modalities for the treatment of autonomous liberalization.  She said
that the issue was important for all Members, regardless of their level of development.  She
considered that the adoption of the negotiating guidelines and procedures did not mean that work on
the issue of autonomous liberalization should stop;  on the contrary, it should continue during the
negotiations.
11. The representative of the United States  welcomed the adoption of the negotiating guidelines
and procedures, even if they were significantly different from his delegation's starting-point.  He said
that it was important to keep in mind that the ultimate reference for the negotiations was the GATS
itself.  The negotiating guidelines and procedures could neither add to nor take away from the legal
rights and obligations in the GATS or from the mandate of the negotiations.  His delegation viewed
the negotiating guidelines and procedures as cons istent with the GATS objective to promote new
liberalization among all WTO Members.  The adoption of the guidelines would allow Members to
move from procedure to substance;  in that respect, the guidelines provided an adequate basis from
which to launch the substantive negotiating phase.
12. The representative of Colombia said that the negotiating guidelines and procedures were a
balanced document, reflecting the shared interest to  progress in services trade liberalization with the
aim of promoting the economic growth of all part icipants.  The guidelines emphasized the need to
take into account the interests of developing countries, and recognized the right of Members to pursue
their legitimate national policy objectives.  The guidelines contained some issues of particular
importance to his delegation, namely the preservation of the structure and principles of the GATS; the
decision to continue with the assessment of trade in  services as a permanent activity of the Council;
the flexibility provided to developing countries in the negotiations on MFN exemptions and the need
to pay particular attention to sectors and modes of supply of export interest to developing countries.
He hoped that discussions and negotiations on professional services, health services, construction
services, energy services, and tourism services would be given priority.
13. The representative of Ecuador  said that the negotiating guidelines and procedures constituted
a balanced text that would allow Members to make progress in the negotiations.  He considered that
the participation of developing countries in drawing up the guidelines was a clear demonstration oftheir interest in trade in services.  He expressed satisfaction that the guidelines reflected the provisions
contained in Articles IV and XIX of the GATS, and included the notions of progressive liberalization
and appropriate flexibility for developing countries.  The guidelines clearly acknowledged that there
was no a priori exclusion of any sector and that there was space for the development of new
disciplines.  The guidelines also acknowledged the importance of the assessment of trade in services,and of the development of new disciplines, particularly of an emergency safeguard mechanism, which
was of particular importance to his delegation.
14. The representative of Egypt said that his delegation attached great importance to the work on
the assessment of trade in services and on the modalities for the treatment of autonomous
liberalization, both of which should have been completed before the adoption of the guidelines.  Hesaid that his delegation would continue to attach importance to those two issues during the
negotiations.S/CSS/M/8
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15. The representative of the European Communities was pleased with the adoption of the
negotiating guidelines and procedures, since they  allowed Members to move forward to the next
phase of the negotiations.  He said that, in seeking to achieve consensus on the current text, his
delegation had shown considerable flexibility and had accepted to see significant deletions in areas of
major importance to them.  One major deletion was the reference to standstill, which had been astandard element in negotiations until then.  He nevertheless understood that no Member was
proposing to take action with the intention of improving its negotiating position and looked forward to
seeing this confirmed at the Fourth Ministerial Meeting.  With reference to the standstill, he noted that
the provisions of the 1996 Decision on Maritime Transport Services continued to remain in force.
16. The representative of Mauritius expressed strong concern that the term "small economies" had
been deleted from the draft text of 21 March 2001, although there had been no consensus for its
deletion.  She recalled that during previous discussions on the draft negotiating guidelines andprocedures some delegations had called for due consideration to be given to the needs of small
economies in the process of liberalization.  Although her delegation was not attached to the idea of
moving ahead with negotiating guidelines that bo re no reference to the concept of small economies,
they had noted in the text the reference to the idea that economies of different sizes could not be
considered in the same manner and that a small supplier could not be at par with a big supplier.  Shewas not certain that these ideas fully attended to her delegation's concerns the way the concept of
small economies would have done, but she believed that those ideas provided a basis to work on and it
was on that understanding that her delegation had accepted the negotiating guidelines.  However, this
was without prejudice to the position of her delegation on the issue of small economies generally, the
concerns expressed by Ministers in the Geneva Declaration of 1998 over the marginalization of smalleconomies or indeed the work in progress to address such concerns.  She also supported the statement
made by India.
17. The representative of Zimbabwe , speaking on behalf of the African Group, said that most of
their concerns, although not all, were reflected in the guidelines.  Like India, the African Group would
have preferred work on the assessment of trade in services to have been concluded prior to theadoption of the guidelines.  The African Group would actively pursue the offer of technical assistance
promised in order to carry out national and/or regional assessments, as contained in paragraph 14 of
the guidelines.  They would have also liked to see the modalities for the treatment of autonomous
liberalization agreed prior to the adoption of the negotiating guidelines, and the inclusion of
benchmarks for the evaluation of the negotiations highlighted in paragraph 15 of the guidelines;
however, in the interest of flexibility they joined consensus on the text as it stood.
18. Echoing India's statement, the representative of Pakistan expressed his regret that work on the
assessment of trade in services and the treatment of autonomous liberalization as mandated by
Article XIX:3 of the GATS had not been completed prior to the adoption of the negotiating
guidelines, as it should have, and expressed his hope that the Council would conclude that work soon.
19. The representative of Cuba  supported the statement made by India.
20. The representative of Bulgaria said that, since the discussions on the guidelines had taken
place at informal meetings of the Council for Trade in Services, he considered it necessary to make a
statement for the record on the assumptions on which his delegation's consent to adopt the guidelines
had been based.  At the outset of the discussions on the guidelines, his delegation had expressed its
position that rights and privileges and flexibilities for the fulfilment of obligations should not be given
to subjectively defined categories of countries but only on the basis of objective criteria.  At theinformal meetings, he had been assured by other Members and by the Chairman of the Council that
the formulation, included in the current paragraph 3 of the guidelines, stating that there had to be due
respect for the "level of development" of individual Members, which reflected the language of
Article XIX:2 of the GATS, took his delegation's position into account.  In subsequent drafts preparedS/CSS/M/8
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by the Secretariat, this formulation was included in the section on "Objectives and Principles" in a
new paragraph, in which the reference was also made to the size of economies.  It was pointed out by
the Secretariat that such formulations were meant to meet his delegation's concerns.  Accordingly, his
delegation had proceeded on the assumption that the inclusion of the reference to the level of
development in the section on "Objectives and Principles" meant that that provision was of a generalcharacter and other provisions in the guidelines had to  be interpreted in this light, i.e. in an objective
way.  His delegation had agreed to the adoption of the guidelines on the basis of the discussions in the
course of the preparation of the draft guidelines and on the assumption mentioned.  His delegation's
consent to adopt the guidelines was based on the understanding that rights, privileges and flexibilities
in the fulfilment of obligations given to categories of countries were enjoyed by all Members who
fulfilled the objective criteria underlying such categorization.  It was also his delegation's assumption
that Bulgaria was a small economy and that due account had to be taken of this fact in thenegotiations, as stated in paragraph 3 of the guidelines.  He added that in the light of the exchange he
had had with the Chairman before the adoption of the guidelines, it was also his understanding that
the fact that he was making his statement after, and not before the adoption of the guidelines did not
alter or diminish the consequences his delegation attached to it.
21. The representative of Korea  said that his delegation had accepted the guidelines with some
difficulty. He expressed his delegation's concern about the absence of a reference to two issues of
great importance to Korea, namely the negotiations on maritime transport services and the technical
review of the GATS.  As concerned the negotiations on maritime transport services, it was Korea's
interpretation of paragraph 5 of the guidelines that this sector was not excluded from the negotiations.
Moreover, although paragraph 10 of the guidelines stated that the starting-point for the negotiationswere the current schedules of commitments, it was his delegation's understanding that the starting-
point for the maritime transport services negotiations was the relevant decision adopted by the
Council in June 1996.
22. The representative of Canada indicated that  his delegation had identified in its initial
negotiating proposals the key elements which it believed were essential to the negotiations, all of
which Canada saw reflected in the negotiating guidelines and procedures.  Specifically, the guidelines
reaffirmed that the objective of the negotiations was to liberalize trade in services; they preserved the
right of Members to regulate and to introduce new regulations in order to meet national policy
objectives; they confirmed that the negotiations should take place within the existing structure and
principles of the GATS, which allowed countries to  decide which sectors and modes of delivery they
wished to open to foreign service providers, and to  what extent;  they stated that due consideration
should be given to the needs of small and medium-sized service suppliers;  and they recognized thatthe negotiations had to promote the interests of all participants on a mutually advantageous basis, and
that it was in the interest of all Members that developing countries be active participants in and
beneficiaries of the negotiations.
23. The representative of Japan supported the idea of appropriate flexibility for developing
countries in the negotiations on MFN exemptions, on the understanding that such flexibility would be
accorded within the existing structure and principles of the GATS as stated in the part of the
guidelines dealing with "Objectives and Principles".  Additionally, Japan echoed the European
Communities views on the validity of the 1996 Decision on maritime transport services.
24. The representative of Mexico said that the negotiating guidelines provided the basic
framework for the negotiations.  He believed that the guidelines demonstrated that developing
countries were able to organize themselves not only to pursue their own interests but also in the
interest of the WTO as a whole.
25. The representative of Jamaica supported the statement made by Mauritius on the need to
recognize the special situation of small economies.  In that respect, she hoped that the negotiationsS/CSS/M/8
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would bring new market access opportunities for all WTO Members, large and small.  She also
underscored India's statement.
26. The representative of Norway was pleased to see the development-friendly language of the
negotiating guidelines and hoped that the negotiations would lead to improvements for developing
country Members, while maintaining an overall balance of interests.  He associated himself with thestatements made by the European Communities, Korea and Japan on the continued validity of the
1996 Decision on the maritime transport negotiations to the effect that those negotiations should be
resumed on the basis of existing or improved offers.
27. The representative of Venezuela associated herself with the statements made by others on the
importance of the assessment of trade in services and the modalities for the treatment of autonomous
liberalization.  She was convinced that those two issues would remain a priority for Members.  She
also considered the negotiating guidelines and procedures to constitute a balanced text, reflecting theprovisions of the GATS.
28. The representative of New Zealand said that, although the negotiating guidelines and
procedures encapsulated the objectives of all WTO Members, some individual issues had not been
reflected.  He expressed his delegation's disappointment with the fact that it had not been possible to
include a reference to the review of the Annex on Air Transport Services, given that such a referencewould have simply recognized the fact that whatever Members were able to achieve in the review
would naturally flow into the negotiations themselves.  However, recognizing the dynamics of the
process, New Zealand had accepted the text as adopted.
29. The representative of the Philippines, speaking also on behalf of Indonesia, Malaysia and
Thailand, was pleased that the negotiating guidelines and procedures had made clear and generous
references to the interests of developing countries.   The guidelines did not detract from the rights and
obligations under the GATS, but provided the specific parameters under which the negotiations of
specific commitments would be conducted.  He sh ared the view that the work on the assessment of
trade in services and the modalities for the treatment of autonomous liberalization should have been
concluded before the adoption of the negotiating guidelines and procedures.  He looked forward todeveloping the modalities for the treatment of autonomous liberalization, as well as to providing
greater impetus to the work on the assessment of trade in services, in the next phase of the
negotiations.
30. The representative of Brazil reiterated the importance his delegation attached to the
conclusion of the negotiations on rule-making, particularly on subsidies and domestic regulation,
since such disciplines would provide greater incent ives to Members to undertake further commitments
in the WTO.
31. The representative of South Africa associated himself with the statement made by Zimbabwe
on behalf of the African Group.  He said that the adoption of the negotiating guidelines and
procedures meant that Members could move to the next phase of the services negotiations.  The
guidelines could be considered a success, in that they recognized the need to foster the economic
growth of all trading partners, to increase the participation of developing countries, and to secure anoverall balance of rights and obligations.  More importantly, they recognized the primacy of national
policies, and the structure and principles of the GATS.  He hoped that sufficient impetus would be
given to the work on the assessment of trade in servi ces.  He also recognized the technical difficulties
arose with respect to the issue of the treatment of autonomous liberalization and added that more work
needed to be done in that regard.
32. The representative of Argentina said that special attention had to be paid to three issues.
First, specific attention should be given to the interests of developing countries.  Second, decisiveS/CSS/M/8
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progress should be made in the assessment of trade in services.  In that regard, although he recognized
that, as stated in the guidelines, the assessment would be an on-going exercise, he thought that it
would be even better if Members arrived at an early stage at a basic assessment, which could then be
followed up regularly.  Third, priority attention should be given to the issue of autonomous
liberalization, which would make it possible to give recognition to countries, such as his own, that had
considerably liberalized services trade.
33. The representative of Barbados supported the statements by India and Thailand, among
others, in regretting that the work on modalities for the treatment of autonomous liberalization and the
assessment of trade in services had not been completed before the adoption of the negotiating
guidelines and procedures.  Echoing the statement by Mauritius, she said that her delegation would
have liked to see a reference to small economies in the text.  She indicated in that regard that her
delegation would continue to promote the issue of small economies in the multilateral trading system.
34. The representative of the Czech Republic said that the negotiating guidelines and procedures
would allow Members to move forward and achieve progress in the services negotiations and added
that they stroke a good balance between the market access and domestic regulation dimensions.
35. The representative of Poland indicated that his delegation strongly believed that the adoption
of the negotiating guidelines and procedures was the result of the sense of realism shown by all
Members and added that flexibility would be their guiding principle in the negotiations.
36. The representative of the Slovak Republic hoped that the guidelines would create a positive
atmosphere for the negotiations, and would provide opportunities for all Members to benefit from the
negotiations.
37. The representative of Turkey  said that the guidelines and procedures constituted a balanced
text that addressed the concerns of all Members.  He felt that it was time that Members focused on the
substantive part of the negotiations.  He hoped that the negotiations could be brought to an end as
soon as possible.
38. The representative of Chile considered the text of the guidelines to be balanced and flexible.
She said that the guidelines would allow Members to enter into the second phase of the negotiations
and to engage in the discussion of sectoral proposals.
39. The representative of Guatemala  stressed  that priority should be given to the development of
modalities for the treatment of autonomous liberalization.
40. The representative of Saint Lucia supported the views expressed by India.  Echoing the
statement by Mauritius, she indicated that her delegation would continue to raise the issue of small
economies.   Also, her delegation attached particular importance to the implementation of Article IV
of the GATS, particularly in the case of small service suppliers from small economies.
41. The Chairman said that the Council would take note of the statements made and that the text
of the negotiating guidelines and procedures would be issued as an unrestricted document.
B. PROPOSALS RELATING TO THE NEGOTIATIONS UNDER ARTICLE XIX OF
THE GATS
42. The Chairman explained that this agenda item covered the various negotiating proposals
submitted by Members since the previous special session of the Council, held in December 2000.  The
proposals had been grouped according to the Members who had submitted them.S/CSS/M/8
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43. The representative of India presented his delegation's proposal on the liberalisation of the
movement of professionals under the GATS, contai ned in document S/CSS/W/12 and Corr.1.  He said
that the issue was of enormous importance to his delegation.  The proposal had been presented in the
context of Article IV of the GATS, which stated that the increasing participation of developing
countries was to be facilitated through negotiated commitments.  He explained that the objective ofthe proposal was clear: it sought to make an empirical assessment of the liberalization achieved in
mode 4 since the Uruguay Round negotiations; it th en identified the key barriers affecting the
movement of professionals;  and it suggested possible strategies and approaches to achieve
meaningful liberalization in this area.
44. Commitments under mode 4 were modest, and mostly referred to the movement of natural
persons linked to commercial presence, and not linked to mode 4 such as in the case of independent
contract suppliers;  developing countries such as his own were more interested in movement of naturalpersons linked to mode 4.  He then highlighted the main problems encountered in mode 4 trade,
namely:  the lack of commitments on a sectoral basis, an issue that his delegation wished to see
resolved;  the procedural and administrative problems faced by service suppliers, listed in paragraphs
7 to 10 of the proposal, and which included wage parity requirements, quantitative limits on visas and
restrictions that applied even after professionals had entered the market, such as the portability ofwork permits;  the existence of economic needs test, which should be abolished at least in some
sectors;  the lack of participation of developing countries in mutual recognition agreements;  and the
social security payments that individual professionals were obliged to pay without any possibility to
derive the corresponding benefits.
45. The paper suggested ways in which the structure of commitments could be improved, for
example, by including a category for individual contract suppliers in the horizontal commitments
section, or by addressing specific measures for categories on which sectoral commitments were
undertaken.  The paper also proposed the superimposition of the ILO International Standard
Classification of Occupations onto the services sectoral classification contained in document
MTN.GNS/W/120;  the superimposition procedure was illustrated in the Annex to the proposal.  Hethen explained briefly the proposal that Members adopt a reference paper on Economic Needs Tests
(ENTs).  Such a reference paper would contain the definition of ENTs, the criteria for their
introduction, the procedures for their application, the guidelines for their administration, their duration
and transparency of available information.  The paper also suggested that the time-frames for visas
and work permits be specified and that a special "GATS visa" be introduced.  As a solution to the
social security issue, the paper suggested Bilateral Totalisation Agreements between countries.
46. As far as fora were concerned, although his delegation saw a role for the Council in Special
Session in discussing the negotiating proposals and moving negotiations forward, he also believed
that the regular sessions of the Council should monitor the implementation of Article VII of the
GATS and that the Committee on Specific Commitments had a role to play in relation to classification
issues.  He indicated that the way in which deve loped countries approached the issue in this area
would be critical to his delegation's approach in other areas.
47. The representative of the European Communities indicated that her delegation had made
submissions on eleven services sectors or subsectors, in addition to the earlier submission on the
overall approach to the negotiations, which had been somewhat overtaken by the adoption of the
guidelines.  A high number of proposals, of a sectoral, modal and horizontal nature, had already been
tabled, but she was looking forward to receiving further proposals from other partners, since it wasimportant to identify which services were of export interest to Members and which could help to build
up domestic capacities, particular in developing and small economies.  As the discussions on the
guidelines had shown, the collective input of many Members could contribute to a better outcome for
all.  Members needed to come up with an effective and pragmatic way to examine the proposals;  herS/CSS/M/8
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delegation had already contributed some input on th at issue in previous informal discussions, and
looked forward to clarifying how best to ta ke forward future work later in the meeting.
48. She offered some general remarks on her delegation's sectoral proposals, while looking
forward to discussing them in more depth in future meetings.  The proposals covered most service
sectors, and in particular professional and business services, telecommunications, construction andrelated-engineering services, distribution, environmental, financial, tourism, transport and energy
services, and postal and courier services.  As noted in the relevant documents, the proposals had to be
seen as work in progress and her delegation reserved its right to modify them at any time and to add
new proposals.
49. She then welcomed the proposals made by other Members, which taken together covered
practically all service sectors.  She looked forward to contributions from a wider group of Members in
order to expand trade as a means of promoting th e economic growth of all and the development of
developing countries.  As noted in the discussions on the guidelines, the GATS recognized the right of
Members to regulate and to introduce new regulations in order to meet national policy objectives, and
it specifically recognized the particular need of developing countries to exercise this right.
50. She said that trade, environmental and social policies played a mutually supportive role in
favour of sustainable development;  her delegation believed that open trade and investment in servicescould contribute to the achievement of national sustainable development objectives in all fields of
national policy-making.
51. She welcomed the proposal made by India on th e movement of professionals, which covered
many different issues.  Her delegation was still examining the proposal and looked forward to
discussing it further at future meetings.  She then drew attention to her delegation's recentcommunication on the temporary movement of service suppliers, as an expression of her delegation's
interest in mode 4 and of its willingness to pursue discussions with partners in order to further the
European Communities interests in the area.
52. The representative of Australia presented his delegation's six new negotiating proposals,
covering financial services, construction and related engineering services, and four professional
services sub-sectors, namely legal services, accountancy, architectural and engineering services.
These six proposals were in addition to his delegation's negotiating proposal on telecommunication
sector, tabled in December, which set out five key issues to be addressed to achieve progressively
higher levels of liberalisation in telecommunication sector.  Those five issues in the
telecommunication proposal were: first, the adoption by all Members of the Reference Paper; second,
the application of GATS principles of transparency and non-discrimination to all international
telecommunication services, and treating the moratorium on accounting rates disputes as havingexpired; third, promoting fair competition in relation to internet charging arrangements where there
were dominant or de facto monopolies; fourth, reviewing restrictions on the form of commercial
presence; and, fifth, developing disciplines, including a "necessity test", for licensing requirements
and technical standards.
53. He explained that each of the six new proposals briefly discussed the benefits of liberalisation
in the sector concerned, some typical impediments to further liberalisation, and set out proposals for
overcoming those impediments.
54. On financial services, in spite of the greater liberalisation achieved with the Fifth Protocol,
significant market access barriers remained in place in many markets, including commercial presence
restrictions, restrictions on market activities and product distribution, and restrictions on themovement of personnel.  The proposal also noted the importance of prudential regulation for the
stability of financial systems, and the need for such regulation to be both transparent and effective.S/CSS/M/8
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55. With regard to construction and engineering services, the proposal identified a number of
impediments to further progressive liberalisation in the sector, including restrictions on the form and
financial structure of commercial presence, unduly onerous licensing requirements for construction
firms and sub-contractors, lack of timeliness and efficiency in the processing of temporary entry
requirements, and lack of recognition of qualifications of project team personnel.  To address thoseimpediments, his delegation proposed that Members carefully review any commercial presence
limitations with a view to eliminating barriers that  could not be justified on a commercial basis; that
licensing procedures be subject to a necessity test; and that administrative processes to facilitate the
temporary entry of approved project personnel be carried out efficiently and expeditiously.
56. As concerned professional services, each of the four proposals highlighted various barriers to
further progressive liberalisation encountered by foreign service providers, including nationality or
citizenship requirements as conditions to provide services, restrictions on form of establishment andlack of recognition of foreign qualifications.  The proposal called on Members to review commercial
presence restrictions;  maximise the efficiency and timeliness of temporary entry procedures; and
strengthen the accountancy disciplines, as well as extend them, tailored as appropriate, to each of
those sub-sectors.  He then drew specific attention to the proposal on legal services, which set out six
guiding principles necessary to achieve greater liberalisation in the sector, and in particular theconcept of a "limited licence", which could be issued  by a Member to a foreign lawyer.  This "limited
licence" would allow the foreign lawyer to practice prescribed areas or aspects of host country law,
where incidental to the practice of foreign law, as well home country, third country and international
law.
57. The representative of the United States presented his delegation's twelve initial negotiating
proposals, indicating that the United States might be submitting additional proposals in the future, on
those or on other topics related to the negotiations, including other sectors and/or modes of supply.  In
addition to mode 4, movement of natural persons, the sectors included in the proposals were:
accountancy services;  audiovisual and related services;  distribution services;  education and training
services;  energy services;  environmental services;  express delivery services;  financial services(insurance, banking, securities, other financial services);  legal services;  telecommunications,
value-added network, and complementary services;  and tourism services.  The papers proposed that
negotiations be held in the WTO on the different aspects of an open and well-regulated regime in the
particular sector or mode.  While the proposals varied somewhat in their formats, each sought to
identify significant restrictions faced by service pr oviders in the sectors and mode, thereby identifying
common problems that discouraged the growth of trade in services and restricted access for service
providers.  Addressing those restrictions would entail Members agreeing to apply existing GATSdisciplines, including for market access and national treatment, as well as negotiation of additional
GATS disciplines addressing improved regulatory transparency or other regulatory issues not
currently subject to GATS disciplines.  Such new provisions could differ by sector and/or by mode.
He clarified that consistent with such disciplines, governments would nevertheless retain the right to
regulate to meet domestic policy objectives.  Moreover, in sectors such as express delivery, educationand training, and energy services, the submissions reco gnized that in some countries, including in the
United States, governments would continue to play an important role as suppliers of public services.
58. The representative of Japan said that, based on his country's own assessment of trade in
services, the results of which were contained in a paper submitted to the Council two years before,
and his country's experience as a net importer of se rvices, two conclusions could be drawn: first, that
the GATS contributed to the expansion of trade in services; and, second, that liberalization of trade in
services contributed to development regardless of whether a country was a net importer or exporter of
services.
59. He then indicated that his country had submitted negotiating proposals covering nine service
sectors:  professional services;  business services other than professional services;  telecommunicationS/CSS/M/8
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services;  audiovisual services;  construction and related engineering services;  distribution services;
financial services;  tourism services;  and transport services.  He said that the proposals, which had
taken into account the concerns of the Japanese industry, covered all the issues referred to in the
"roadmap", such as comprehensiveness of the negotiations, the possibility of using negotiating
methods complementary to request-offer, the need for more work on rule-making, includingprovisions on transparency, and the elimination and reduction of MFN exemptions.
60. Before addressing the substance of their initial negotiating proposals, the representative of
Canada highlighted the context in which they had been prepared.  Reflecting the importance and
pervasiveness of the service economy in Canada, over seventeen different federal departments andagencies, as well as thirteen provincial and territorial governments, had participated in the work.  She
explained that Canada was a federal state in which federal, provincial, territorial and local
governments exercised authority within their legisl ative jurisdiction regarding, inter alia, matters
covered by the GATS.  Accordingly, policy objectives with respect to matters covered by the GATS
were developed by such governments and had to be accorded due respect.  Further, there had been
interest on the part of an increasingly broad range of Canadians, who recognized the importance of
international activities and specifically of international trade negotiations, and, as a result, extensive
consultations with Canadian stakeholders had been conducted.
61. She explained that the submissions were composed of two elements:  one document,
circulated as S/CSS/W/46, outlined Canada's principles, objectives and contribution to the negotiating
guidelines and procedures;  a second paper contained in Job (01)/41 and also tabled as 13 separate
documents, circulated as S/CSS/W/47 to 58, indicated more specific interests in a range of sectoral,
modal and horizontal subjects.  On the general proposal, she said that Canada's objectives reflectedthe new context in which the services negotiations were taking place.  It reaffirmed the objective of
obtaining improved access to international markets, underlining at the same time elements of the
structure and principles of the GATS, including th e right to regulate in pursuit of national policy
objectives, which would also guide the negotiations.  The proposal also underlined that the
negotiations had to promote the interests of all participants on a mutually advantageous basis, and thatit was in the interest of all Members that developing countries be active participants in, and
beneficiaries of, the negotiations.  She then dr ew Members' attention to two Canadian policies
relevant to the negotiations:  first, Canada would be undertaking a domestic environmental assessment
of the negotiation;  and, second, Canada would not be making any commitments that restricted its
ability to achieve cultural policy objectives until a new international instrument, designed specifically
to safeguard the right of countries to promote and preserve their cultural diversity, could be
established.
62. She indicated that the twelve sectoral, modal and horizontal proposals reflected the above-
mentioned principles and objectives, as well as the important economic interest that her delegation
had in the negotiations.  She further explained that the proposals had been tabled as indicators of her
delegation's interest in further discussing those issues.  The three papers, on mode 4, small and
medium-sized enterprises (SMEs) and regulatory transparency, reflected key interests identified
across a range of sectors.  First, the paper on temporary presence of natural persons underlined the
reality that mode 4 was increasingly important for consumers and for service suppliers.  Second, the
interests of SMEs were important to Canada, as 95 per cent of its exporters were SMEs;  they did
share some interests with large companies, but in certain instances barriers differed as a function of
size and in other cases  a market condition for a large company posed an obstacle for SMEs.  Third,Canadian service suppliers repeatedly underlined the importance of transparency in foreign markets,
and for that reason some details of the Canadian federal Regulatory Policy had been provided, to
encourage the exploration of current best practices in order to determine whether existing GATS
provisions in this area could be enhanced.  To complement those three cross-cutting issues, her
delegation had identified nine sectoral areas of interest:  financial services;  telecommunications;professional services;  environmental services;  tourism and travel-related services;  computer andS/CSS/M/8
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related services;  distribution services;  oil and gas services;  and some other business services.  She
indicated that the papers reflected initial Canadian interests in the negotiations, and that more papers
might be submitted in the future.
63. The representative of Norway expressed the hope that the GATS negotiations would make
substantial contributions towards achieving the ma in objectives of the WTO, namely raising living
standards and securing full employment, securing optimal use of the world's resources in accordance
with the objective of sustainable development and promoting the participation of developing
countries.  To achieve those objectives, the negotiations on trade in services should lead to an
increasing number of legally binding and economically meaningful market access commitments,
contribute to the increased participation of developing countries in trade in services, giving special
priority to least-developed country Members, and build on the MFN principle, a cornerstone of the
WTO agreements and of the GATS.
64. His delegation attached great importance to the liberalization process taking place with due
respect for national policy objectives, and to the right of Members to regulate in order to meet those
objectives.  He also emphasized that the GATS did not require governments to privatize or to
deregulate any service.  In his view, Members had th e right to maintain public services in any sector
and generally organize their public sector as they chose.
65. His delegation's proposals concerned busine ss services, telecommunications, financial
services, maritime transport services, air transport services, and energy services.  On business
services, he indicated that his delegation was seeking commitments particularly in relation to
architectural services, engineering services, technical testing and analysis, real estate services and
accounting and book-keeping services.  Regarding telecommunications, the proposal suggested thatall Members adopt the agreements on value-added and basic telecommunications services, as well as
the Reference Paper on regulatory principles, in the course of the negotiations.  This would also
include satellite, Internet and mobile services.  As for financial services, his delegation wished to see
real improvements in Members' commitments, on the understanding that such liberalisation would not
be an obstacle to the possibility of applying host country regulation for prudential and otherimperative purposes.  He added that marine insurance was of particular interest to his delegation, as
the Norwegian marine insurance market share accounted for 15 to 20 percent of the global premium
volume for marine insurance.  Marine insurance was a highly internationalised business;  however,
national restrictions on underwriters' ability to supply clients with marine insurance were widespread,
especially regarding local tonnage where local market capacity was available.  The most common
restrictions were obligations for vessels flying national flag to insure in the domestic market and
requirements of fronting by a locally licensed company.  He encouraged Members to remove suchrestrictions in relation to marine insurance.
66. Maritime transport was another important sector for his delegation, as half of the value of
Norwegian exports of services was related to maritime transport.  Furthermore, maritime transport
provided the basic infrastructure for world trade, as ships carried close to 80 per cent of world trade in
goods and had environmental advantages compared with  most other modes of transport.  He explained
that Norway, and some 30 other countries, had entered commitments on maritime transport in
schedules under the GATS.  The Norwegian commitments on international maritime transport
reflected Norway's liberal trading regime in this sector.  He recalled that the MFN principle would
enter into force for this sector upon conclusion of the current services negotiations.  His delegation
would approach this sector on the basis of the Decision on Maritime Transport Services adopted bythe Council for Trade in Services on 28 June 1996.  The starting point for the negotiations should be
existing or improved offers, as decided by the Council.  The three main aims of his delegation for the
negotiations in the maritime transport sector were the entry into force of the MFN clause for all
Members, more commitments entailing real and mean ingful liberalization of maritime transport, and
few or no MFN exemptions.  During the negotiations, his delegation would present country-specificS/CSS/M/8
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requests on commitments in relation to restrictions that limited market access and national treatment
under the various modes of supply.  Such requests would be based on the three-pillar structure of the
model schedule (maritime transport services, maritime auxiliary services, port services) and relevant
MFN exemptions principles.
67. On air transport, he explained that, in cl ose co-operation with Denmark and Sweden, his
country pursued a liberal air transport policy, and that this was reflected in their proposal.  As
concerned the services already included in the current GATS Annex on Air Transport Services, his
delegation encouraged Members to increase the number and quality of their commitments.  With
respect to the ongoing review of the GATS Annex on Air Transport Services, his delegation was
particularly interested in establishing overflights/air transit rights.  He explained in that regard that a
right to fly across the territory of a state without landing and to make stops in the territory of a state
for non-traffic purposes would present the airlines with fairer and more equal opportunities tocompete in the international market on a non-discri minatory basis, leading to the more efficient
transport of passengers and cargo.  Furthermore, this would have a positive impact on the
environment and safety, since airlines would be free to choose the optimum international established
airway.
68. He considered that energy services were one of the most important areas to be negotiated
during the current negotiations.  He acknowledged that Members were in various phases of regulatory
development and, as a result, competition for energy services varied significantly from one country to
another.  Differences in the level of commitments undertaken were therefore to be expected.  He
further clarified that the negotiations did not challenge governments' right to regulate, and that the
question of public ownership of natural resources fell outside the negotiations.  He noted that hisdelegation's proposal had several common features with the relevant proposals from the United States
and the European Communities.  For the purpose of the negotiations, Norway suggested that energy
services be defined as encompassing all services involved in the exploration, development, extraction,
production, generation, transportation, transmission, distribution, marketing and consumption of
energy, regardless of the energy source.  The proposal also made the point that services related tooffshore oil and gas production were key activities in this production/value chain, and consequently
had a natural place in the field of energy services.  He summarized his delegation's goals for the
energy services negotiations indicating that the negotiations should be comprehensive and aim for
increased commitments as regarded market access and national treatment.  Given that energy services
were complex and highly regulated, it was important to address regulatory issues specifically to
secure fair and transparent conditions in the marketplace.
69. The representative of Hong Kong, China introduced his delegation's negotiating proposal on
logistics and related services, contained in document S/CSS/W/68, which was the first of a series of
papers that his delegation was expecting to submit in the coming months.  Logistics was a vital
activity in any economy.  It was not a sector as such, but it was covered in a number of sectors and
subsectors and he believed that commitments had not taken into account the interrelated nature of all
the activities involved in logistics.  He explained that his delegation was proposing that Membersdevelop a list of services which were key in logistics.  He added that maritime transport services also
played a key role in logistics, and for that reason the proposal included a strong statement on the need
to resume negotiations in this area in accordance with the 1996 Decision.  Further, he considered that
intermodal transport and e-commerce were also important.
70. The representative of Venezuela presented his delegation's proposal on energy services.  He
shared the view expressed by other delegations that one of the objectives of the negotiations was the
growth of the supply capacity of all Members as a result of market openings.  However, for his
delegation, this objective had to go hand-in-hand with other equally important objectives, namely the
accessibility of energy services to the greatest number of people in order to improve their standard of
living, and to the greatest number of industries, enterprises and service suppliers with the aim ofS/CSS/M/8
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promoting economic growth.  In addition, the agreements in this area had to be conceived so that they
guaranteed greater access to technology for developing countries.  He emphasized a fundamental
objective in his delegation's proposal, namely that the results of the negotiations allow developing
countries to use energy services as a lever to diversify their economies, promote their development
and strengthen their private sectors, and to continue and deepen the application of such policies.  Hestressed that the proposal was in line with the negotiating guidelines and procedures adopted earlier
by the Council.  The paper proposed that Members define mechanisms for continuous evaluation of
the effective implementation of Articles IV and XIX:2 of the GATS with respect to the participation
of developing countries in world services trade, and including in relation to energy services trade.
Regarding classification issues, he reiterated the need  to design a specific classification system for
energy services.
71. The representative of Switzerland announced that this country would be submitting some ten
sectoral proposals for the next special session of the Council.
72. The representative of Korea said that at that stage he would only comment on some of the
general issues arising from some of the proposals.  First, although he agreed with the goal of
progressively expanding market access and reducing national treatment restrictions, he said that
Members also needed to consider the special characteristics of each sector and the diversity ofregulatory regimes in each country.  Second, while proposals from the United States, the European
Communities and Japan dealt with the elimination of MFN exemptions in a few specific sectors, he
believed that this issue should be discussed in a horizontal manner, for all service sectors.  Third, he
noted that some of the proposals by the United States, the European Communities, Canada and Hong
Kong, China dealt with classification issues, and also looked into the possibility of taking a cluster orchecklist approach for the negotiations of specific commitments.  He said that although document
MTN.GNS/W/120 was not sufficient to fully reflect the changing economic situation, Members had to
be careful not to change the basic structure of the W/120 classification system.  Moreover, he
indicated that since classification issues were currently being discussed in the Committee of Specific
Commitments, Members would need to decide which body should carry the main responsibility forthe discussion of those issues.  Fourth, he noted that some of the proposals by the United States and
the European Communities dealt with transparency of domestic regulation.  Although he agreed that
transparency was important on its own merit and that work should focus on it, he considered that in
order to reduce effectively the adverse effects of domestic regulation on trade in services, the issue of
a necessity test should be addressed as well.  He looked forward to having an in-depth discussion on
maritime transport services.
73. The representative of Malaysia said that the proposals reflected an unbalanced situation in the
negotiations.  The fact that there were so many proposals from developed countries and very few from
developing countries raised questions as to where the export interests of developing countries like his
own were and as to whether the domestic industry  of many developing countries was sufficiently
strong.  He added that a country like his own saw the negotiations with a lot of caution and pointed to
the difficulty his delegation faced in trying to understand the proposals and to see the impact theymight have on the domestic services industry.  He also said that the negotiations should benefit
developing countries, and for that reason his delegation had stressed the importance of Articles XIX
and IV with regard to the situation of developing countries;  the provisions on flexibility for
developing countries contained in Article XIX:2 were particularly important in that regard.  Due
recognition of the right to regulate was also impor tant.  He said that, at times, developing and
developed countries might see things from different perspectives;  for example, equity requirements
were sometimes seen by developed countries as trade barriers, whereas in his delegation's perspective
such requirements, if applied in a judicious manner, were one way of overcoming problems faced by
the domestic industry, as they might help spur technology transfers and capital inflows.  He hoped
that negotiating partners would look at the overall picture of the services industry in a given countryS/CSS/M/8
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when requesting specific commitments and said that the question of autonomous liberalization was
crucial in that respect.
74. The representative of the Czech Republic welcomed the proposals submitted by the United
States and the European Communities on the movement of natural persons.  He also highlighted the
approach proposed by Japan regarding the negotiations on MFN exemptions.  He then offered morespecific comments on two proposals.  First, he welcomed the Indian proposal on the movement of
professionals, an issue of great importance to his delegation, and shared the Indian views on how the
issues involved should be addressed.  In that regard, the Annex to the Indian proposal on the
application of the ILO International Standard Classification of Occupations merited attention.
Second, he welcomed the overall approach to the negotiations proposed by the European
Communities in document S/CSS/W/15.  In particular, he supported the development of pro-
competitive principle and he expressed his delegation's willingness to discuss the importance ofliberalization for sustainable development;  he also welcomed the discussion on electronic commerce.
His delegation was flexible with regard to negotiating modalities and the standstill provision.  As
concerned the treatment of autonomous liberalization, he agreed that the value of such liberalization
could only be assessed by individual interested Members in the course of the negotiations.
75. The representative of Turkey made some preliminary comments, as the proposals were still
being examined by her authorities.  Regarding the United States proposal on movement of natural
persons, she shared the view that access to information about laws and regulations relevant to entry,
residence and work authorization of natural persons, and procedural transparency, including timely
governmental responses to applications submitted for temporary entry and stay, and, in appropriate
cases, a statement of the reason for denial of such application, were amongst the core issues to beaddressed during the negotiations.  She also supported India's submission on the movement of
professionals and particularly welcomed the proposal to introduce a special GATS permit for
categories of personnel covered by horizontal and sectoral commitments undertaken by Members in
mode 4.
76. With regard to the United States proposals on legal and accounting services and the European
Communities proposal on professional services, she said that Turkey had restrictive measures on the
provision of professional services, like many other Members, and that for the time being the
regulatory public institutions and associations of those professions were in a position to approve the
liberalization of those professions only on a recipr ocal basis.  For that reason, at that stage her
delegation could not express full support for those proposals.
77. On the other hand, she indicated that her country generally had no objections to the United
States proposal on financial services.  In particular, she agreed with the prudential and regulatoryprinciples identified therein. In principle, Turkey was also in agreement with the attachment to the
proposal in which the importance of transparency was emphasised. However, she expressed concerns
with regard to the liberalization of cross-border tr ade in insurance services.  She also welcomed the
European Communities proposal on financial services, although she sought some clarification as to
whether the term "certain tax and subsidy measures" in paragraph 10 also included measures forbranches and agencies.
78. Concerning the United States proposal on distribution services, she felt that the coverage of
distribution services in that document was too broad, and that it might be problematic.  On the other
hand, the European Communities proposal on the same sector seemed more reasonable in
emphasizing the need for closing distribution services of sensitive products.  With regard to educationservices, her delegation was not in a position to support the United States proposal since the sector
was still publicly dominated and deemed very sensitive by her authorities.  She was of the view that
the United States proposal on audiovisual services recognized the public concern for the preservation
and promotion of cultural values and identity, but did not mention the necessary safeguards in thatS/CSS/M/8
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regard;  it was therefore difficult for her delegation to lend its support to the proposal.  With respect to
the United States proposal on tourism and hotels, she sought some clarification as to whether the
United States intended to incorporate this proposal into the proposed tourism Annex.  Although she
agreed with the list of obstacles identified by the United States in some sectors, she said that these
were too broad, even including non-discriminatory taxes, and that her delegation did not favour such abroad listing.
79. The representative of Bolivia noted that out of 40 proposals, only 2 were from developing
countries, while the remaining 38 were from developed countries.  She added that while proposals
from developing countries were related to mode 4, tourism and energy, developed countries' proposals
covered virtually all the sectors listed in document MTN.GNS/W/120.  She was also surprised to see
that proposals from developed countries did not contain any reference to the interests of developing
countries.  In their objectives, the proposals did not refer at all to increasing the participation ofdeveloping countries in services trade, nor did they refer to the overall balance of rights and
obligations or the promotion of the interests of all Members on a mutually advantageous basis.  No
mention was made in those proposals of the appropriate flexibility that should be given to developing
countries, nor was there any information in the specif ic assessment of trade in services in the sector
concerned.  Many of the proposals did not even refer to developing countries or to the fact that theywere net service importers.  It was clear that the main objective of the proposals submitted by
developed countries was to achieve the opening of sectors in which they were competitive.  She
stressed that the services negotiations were part of the built-in agenda, which also included
negotiations on agriculture, and was surprised to see the different course that those two negotiations
had taken.  In the negotiations on agriculture, 125 Members, close to 90 per cent of the WTOMembership, had submitted 44 negotiating proposals, 4 more than in services, where negotiating
proposals had been tabled only by 26 countries, representing less than 20 per cent of the Membership.
There was another substantial difference.  All the agriculture proposals refered to developing
countries, and included a section on special and differential treatment to be given to these countries.
Moreover, many developed countries had included a more detailed distinction amongst the developingcountries, proposing that account be taken of the special characteristics of developing countries, least-
developed countries, smaller island states, land-locked countries, developing countries with
vulnerable economies, and small economies.  In the services negotiations, instead, developed
countries' proposals ignored developing countries, or in the best of cases made vague references to
these countries;  some proposals did not even refer to  issues such as transfer of technology.  Another
difference in the proposals in the two negotiations concerned access opportunities;  while several
developed countries in the agriculture proposals had stated that the fundamental problem rested in animbalance of rights and obligations of exporting and importing countries, in the services proposals the
issue had not been mentioned and the different situation of supply and demand in the world for each
sector had been overlooked.  A preliminary c onclusion that she had drawn was that developed
countries recognized that, as far as trade in agriculture was concerned, there were differences between
developing and developed countries, as well as amongst developing countries, and between exporters
and importers.  In trade in services, however, all countries seemed to be equal and thus rights and
obligations should be the same.  She said that, in spite of developed countries' expressing their good
intentions regarding developing countries, and in spite of the negotiating guidelines and procedures
adopted by the Council, where the objectives of Article IV on the increasing participation of
developing countries and the appropriate flexibility contained in Article XIX: 2 were inter alia
recognised, the negotiating proposals from developed countries were sending an entirely different
message.  She was concerned by that situation, in view of the fact that Bolivia was a developing
country with a small and open economy which did not apply protectionist measures on trade in
agriculture, industrial products or services and that did not distort trade.
80. In order to ensure that the interests of developing countries were duly considered in the
second phase of the services negotiations, she prop osed that the following items be included at the
beginning of the agenda of all the negotiating meetings:  first, the assessment of trade in services, inS/CSS/M/8
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general and sectoral terms with reference to the objectives contained in GATS and in particular
Article IV;  second, the elaboration of multilaterally agreed criteria on autonomous liberalization and
their application;  third, issues related to appropriate flexibility for developing countries in the
negotiating proposals and in the negotiations themselves, and fourth, liberalization of trade in services
in the sectors and modes of supply of interest to developing countries.
81. The representative of Thailand expressed her delegation's disappointment that some Members
seemed to consider that the negotiating guidelines and procedures adopted by the Council were not as
important as the negotiating proposals.  As concerned the issue of grand-fathering raised in the
proposals on financial services by the United States and the European Communities, she wondered
what acquired rights those Members wanted to protect.
82. The representative of Indonesia made preliminary comments only on proposals dealing with
the overall objectives for the negotiations.  Her delegation agreed that the core of the services
negotiations was market access.  In that regard, sh e indicated that, even after the conclusion of the
Uruguay Round, Indonesia had continued to open its market beyond what it had committed.  For that
reason, her delegation considered the issue of modalities for treatment of autonomous liberalization as
a prerequisite before further commitments could be undertaken.  She stressed that the deadline for the
negotiations on emergency safeguards had to be respected;  although Indonesia remained committedto trade liberalization in the area of services, it would be very difficult for her country to be more
forthcoming in the negotiations without the assurance that Members could resort to emergency action
in the event of injury caused by liberalization measures.  As far as time-frames for the negotiations
were concerned, she shared the view that Members might agree on certain targets or milestone dates
for the negotiations, but said that setting the deadline for the completion of the negotiations waspremature at that stage.  She underscored that the GATS recognized Members' right to regulate and to
introduce new regulations on the supply of services w ithin their territories in order to meet national
policy objectives.  Members also had the right to maintain public services in sectors of their choice;
the GATS could not be interpreted as requiring privatization or general deregulation.  The process of
progressive liberalization had to respect the level of development of individual Members and promotethe increased participation of developing countries in trade in services.  It was in the interest of all
Members that developing countries be beneficiaries of the services negotiations.  She supported the
Norwegian proposal that the negotiations take into account the need for technical assistance aimed at
strengthening the efficiency and trade capacity of services sectors in developing countries.  Members
also needed to consider how to support the negotiating capabilities of developing countries.  She also
shared the view that the starting-point for the nego tiations was the existing level of commitments as
set out in current schedules and that request-offer was the main method of negotiation.
83. The representative of Paraguay, speaking on behalf of the Mercosur countries, said that they
were still analysing the proposals and that the Mercosur members would present their individual
considerations.  He also indicated that the Mercosur members would be presenting their own
proposals concerning sectors of interest to them.  On behalf of his own delegation, he supported the
proposal by India regarding mode 4.  He recognized the limitations that existed in Members'commitments, and wished to see them phased out.  He also expressed great interest in India's proposal
on the use of the ILO classification.  With respect to proposals made by the United States, he
considered that some of the limitations identified therein could be taken up, and were indeed taken up,
by the Working Party on Domestic Regulation.
84. The representative of Hong Kong, China said that maritime transport services were clearly
linked to logistics, and that his government was looking for early resumption of the negotiations on
the sector, as provided for in the 1996 Decision, w ith a view to obtaining meaningful commitments by
all Members on an MFN basis.  Multimodal transport had continued to gain in importance and
relevance as a trade issue and all relevant aspects of it should be considered.  He explained that,
although his delegation was not insensitive to the concerns some Members had on the sector, HongS/CSS/M/8
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Kong, China did not believe that the way to deal with such sensitivities was to argue that the matter
could not be discussed or that no commitments could be undertaken;  such an approach would lead
others to adopt a similar approach in areas where they had sensitivities and the end-result would not
be in accordance with the requirement in Article XIX:1 to achieve progressively higher liberalization.
85. He welcomed the papers submitted by Japan, the European Communities and Norway on
maritime transport services:  there seemed to be a good commonality of views on the starting-point, as
well as on other areas that were of significant trade and economic importance.  He expressed also
particular interest in exploring further the id eas in the Norwegian "Supplement to the Maritime
Transport Model Schedule", attached as Annex 1 to their proposal.  In his view, that supplement
tackled in a sensitive and focused way some of the important areas relevant to international maritime
transport.  He also found the ideas and proposals in the body of the Norwegian paper on MFN issues
very relevant and worthwhile.
86. On the proposals submitted by Canada, he found the paragraph stating that "Canada will also
not make any commitment that restricts our ability to achieve our cultural policy objectives until a
new international instrument, designed specifically to safeguard the rights of countries' to promote
and preserve their cultural diversity, can be established" worrying for a number of reasons.  First, it
was not clear what Canada meant by "cultural diversity", rendering thus the scope of their intendedexclusion unknown.  Additionally, noting that Canada had made proposals in sectors related to
culture, such as telecommunications, distribution, business services, computer and related services, he
wondered what it was exactly that Canada intended not to cover.  Second, it was not clear why the
GATS could not take account of those concerns, given that it provided for listing by sector, subsector
and mode of supply, provided for progressive liberalization and excluded services supplied in theexercise of governmental authority.  He wondered  whether it was really Canada's position that no
commitments whatsoever could be made in any sector where "cultural diversity" might be restricted.
87. On electronic commerce and modal issues, he noted that several submissions, most noticeably
the ones by the United States and the European Communities, had made proposals that Members
extend and deepen their commitments in both ma rket access and national treatment across all four
modes of supply.  While mode 3 had been a natural focus, it was clear to him that those Members also
wished to see increased commitments in modes 1 and 2 and he fully supported that aim.  He
announced that his delegation would table a paper on e-commerce, proposing that Members consider
how best to establish a facilitatory environment for e-commerce to flourish.  He believed that in
addition to the proposals on relevant sectors, Members should consider making horizontal additional
commitments in a number of areas within the compet ency of the WTO to ensure that the environment
was facilitatory for e-commerce.  He considered th at some difficult issues would also need to be
tackled, such as the distinction between modes 1 and 2, and the lack of clarity in the scope and reach
of national treatment.
88. On professional services, he noted that several submissions by the European Communities,
Canada, Australia and India suggested that a more focused approach to mutual recognition
agreements (MRAs) would be a good way to take ma tters forward.  However, in spite of the MRA
guidelines for the accountancy sector completed some time before, little seemed to have happened.
He was interested to know how the Members th at had proposed greater use of MRAs intended to
pursue their suggestion and make it effective.  In this regard, he had noted with interest the points and
suggestions made by India.  He suggested that the best way to tackle the non-discriminatory barriers
to trade in professional services was through the work of the Working Party on Domestic Regulationon professional services;  almost all Members who ha d consulted their interested relevant bodies had
indicated that the accountancy disciplines would form a good basis for other professions.  He
wondered why the whole medical, veterinary and services relating to medical services had been
omitted from the Canadian and the European Communities proposals.  He pointed to a reference in
the Canadian proposal related to Article VI:4 to continuing to work "within current and other bodiesS/CSS/M/8
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as appropriate", and wondered what "other bodies" Canada had in mind.  He wondered about the
reason for the deletion of the cross reference to scheduling under Articles XVI and XVII in the United
States paper on accountancy, and about the reason why they had decided to take that approach to the
matter, rather than, for instance an Annex approach, which would ensure that all Members inscribed
the same disciplines.  Regarding the Australian papers on accountancy and legal services, hewondered how the reach of the disciplines on accountancy developed in the Working Party on
Professional Services under Article VI:4 could be extended to measures subject to scheduling under
Articles XVI and XVII.  On express delivery, postal and courier services, transport and distribution
services, he said that, in acknowledging the importance of those activities, his delegation had tried to
capture the services involved under the rubric of logistics.  In that regard, he continued to be
interested in the United States' proposal on express delivery, and agreed that that activity did not sit
well under postal and courier services.  However, he did not think that the definition used by theUnited States was appropriate for scheduling classification purposes, since it was too vague and
covered too many services sectors/activities.
89. He added that many issues had been identified by other Members as being ripe for action.  He
noted, for example, that both the United States and the European Communities had mentioned the
problem of subsides only being available for domestic suppliers and that of tax discrimination.  Heobserved that subsidy disciplines under Article XV would be very useful to overcome such problems.
As regarded some of the barriers identified by the United States, he noted with interest the problem of
a lack of "predetermined objective criteria for licensing requirements", and pointed to the need to
develop a general necessity test which would deal with such problems.
90. The representative of the Slovak Republic said that the number of proposals submitted thus
far was a reflection of the high importance Members attached to the services negotiations.  She added
that all the proposals merited careful study, and that the issues raised therein constituted a good basis
for the negotiations.
91. The representative of Norway agreed with Malaysia on the need to have more proposals
coming from developing countries.  He said that all Members had the responsibility of ensuring that
special attention be given to sectors and modes of supply of export interest to developing countries, as
stated in paragraph 5 of the negotiating guidelines and procedures.  He added that liberalization would
have positive effects for the whole world economy, including developing countries' economies.  He
gave the example of shipping services, noting that cheaper shipping services would be to the benefit
of all countries, and particularly developing countries.  On maritime transport services, he noted the
similarity of approaches between the European Communities, Japan, and his own delegation, and
added that Norway supported the use of the model schedule and that multimodal transport also beaddressed.  His delegation also supported strong rules on safety and environmental protection in the
field of maritime transport.  On energy services, he noted that the proposals put forward by the
European Communities, the United States, Canada, and his own delegation shared common features,
and that their aim was similar, namely achieving meaningful commitments.  He clarified that
liberalization did not mean deregulation, and that the protection of consumers remained an importantissue.
92. The representative of Singapore said that his country was keen to pursue further liberalization
of maritime transport services.  He could support the following elements contained in the proposals on
maritime transport services:  the resumption of the negotiations on the basis of the 1996 Council
Decision;  the starting-point for the negotiations being existing or improved offers;  the usefulness ofthe model schedule and the negotiations being based on three pillars, namely international maritime
services, maritime auxiliary services, and access to and use of port facilities.  He also said that the
checklist proposed by Norway in their supplement to the maritime transport model schedule deserved
further consideration.S/CSS/M/8
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93. The representative of Israel said that the starting-point for the negotiations were the current
schedules of specific commitments.  By way of preliminary comment, he said that he shared Canada's
view on the importance of small and medium-sized enterprises (SMEs), since barriers to trade were
difficult to overcome for SMEs.  He stressed that it was essential that the negotiations address the
particular situation of SMEs.  He supported the liberalization of telecommunication services, as thissector was key to the development of the overall economy;  in particular, he supported the proposal
made by Australia, Norway, the United States, and Japan that all Members adopt the Reference Paper.
He also supported the liberalization of maritime transport service and commended India for their
proposal on the movement of natural persons.
94. The representative of India echoed Malaysia's concerns.  It was important that developing
countries be involved in the negotiations and that their concerns be met.  He recalled that the GATS
talked of successive rounds and that therefore the current one would not be the last round of servicesnegotiations.  He had taken note of the point made by some delegations that one way of addressing
developing countries' concerns was for those countr ies to submit their own proposals;  he thought the
latter a fair point, and added that India would submit further proposals on sectors it was interested in.
95. By way of preliminary comment, the representative of Uruguay said that reference in the
European Communities proposal to the fact that prop osals could be analysed in the Special Session or
in subsidiary bodies established for that purpose had already been resolved by the General Council
when it had decided that the Special Session of the Council for Trade in Services was competent to
analyse everything related to the services negotiations.  On the European Communities proposal on
distribution services, he wondered whether some re strictions with respect to the distribution of
agricultural products would be justified;  he felt that some products considered sensitive by someMembers could also be considered sensitive by other Members, but for different reasons, particularly
if the latter had the ability to supply such distribution services for those specific products.  With
respect to the European Communities proposal on the movement of service suppliers, he said that
some issues, such as the definition and description of different categories under mode 4, would benefit
from further exploration;  the issue of labour market tests could also be usefully analysed by theSpecial Session.  Regarding the European Communities proposal on business services, he noted that it
was important to go into the details of areas such as computer services and related issues.
96. With respect to the United States proposals, he noted that they implied not only specific
approaches on how to structure the schedules, but also contained specific proposals for reference
papers in virtually all sectors covered.  On audiovisual services, he wondered why the issue of
subsidies was to be tackled on a sectoral basis while there was a clear mandate in the GATS to hold
negotiations on the issue in general, and not only in a particular sector.  On movement of naturalpersons, he noted a somewhat lower level of ambition than for other sectors.  The proposal addressed
regulatory aspects with respect to information and transparency of procedures, but contained no
reference to market access and national treatment.  Additionally, with respect to the proposal to
request prior comment or notification, he indicated that such provisions did not exist in many
countries.  As for the United States proposal on environmental services, he was of the view that inprinciple it should be taken up jointly with the proposal by the European Communities in the
Committee on Specific Commitments, as he considered the two proposals to be interrelated.  He
added that the cluster, or group approach, for a core sector and related sectors, and the implications
therefrom were still to be analysed by Members both in the Special Session and in the Committee on
Specific Commitments.  With respect to the proposal on tourism services, he felt it was important toadopt a sector-by-sector analysis in the future, given that there were other proposals on the sector,
such as those submitted by the Dominican Republic and others and by the European Communities.
97. The representative of Cuba said that the large number of proposals tabled by developed
countries as opposed to the small number of proposals by developing countries showed the difficultiesS/CSS/M/8
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faced by many countries in the negotiations.  Her delegation supported India's proposal on mode 4
and echoed the comments by Bolivia.
98. The representative of Brazil supported the comments made by Thailand on the importance of
the negotiating guidelines and procedures adopted by the Council.  He also expressed some concern
that, although the negotiating guidelines and procedures stated that there was no a priori exclusion ofany sector, some Members seemed to be excluding some sectors from the negotiations.  He said that
the proposals made reference to measures falling under Articles XVI, XVII and VI of the GATS, but
also to measures that in his view did not fall within the scope of the GATS.  Therefore, he considered
that discussions should also clarify the exact scope of the proposals.  Drawing attention to the work of
the Working Party on Domestic Regulation, he added that it was important to ensure consistency with
the work undertaken in that context.
99. Regarding an imbalance of commitments between developed and developing countries, he
said that there were two ways of looking at the issue:  in the context of the assessment of trade in
services or by looking at specific commitments.  As for the latter, he noted that developing countries'
schedules contained a much lower level of limitations than developed countries' schedules, where
limitations abounded, and that the vast majority of MFN exemptions belonged to developed countries.
He said that his country's expectation was that Members making proposals would themselves bewilling, in the course of negotiations, to eliminate the restrictions they were requesting other Members
to eliminate.
100. On classification issues, he shared Korea's view that Members should stick to the structure of
document MTN.GNS/W/120 as much as possible, so as to ensure legal certainty.  Some of the
proposals, such as the one by the United States on telecommunications, made reference tocomplementary services in a way that seemed to configure what Members had identified as clusters.
He said that such issues needed to be looked at, in order to ensure balanced negotiations and to
achieve results satisfactory for all Members.  There was a need to ensure that, when making or
seeking commitments, Members were clear on the le gal certainty of those commitments.  In that
regard, he stressed the need to have appropriate escape valves in terms of trade defense mechanismsand, more importantly, to look at the ambiguities of certain GATS disciplines.
101. By way of preliminary comment, the representative of Mexico pointed at some common
elements in the proposals submitted until then, with respect to sectoral classification, grand-fathering,
clusters, and regulatory principles, and wondered whether the work in the subsidiary bodies already
covered such interests.  He also stressed that proposals had to be discussed in light of principles such
as the right to regulate, appropriate flexibility for developing countries and due respect for national
policy objectives.
102. The representative of Colombia expressed concern that the focus on sectoral proposals could
constitute a means to limit the overall balance of rights and obligations provided for in Article XIX of
the GATS and in the first paragraph of the negotiating guidelines and procedures.  She feared that the
sectoral negotiations might transform the services negotiations into a set of separate negotiations
where the balance of rights and obligations might be overlooked.
103. She said that a preliminary assessment conducted on the list of obstacles identified in the
sectoral proposals had revealed that her country had fairly liberal policies on trade in services.
However, just as most developing countries, her country's share in world trade in services was very
small.  Referring to the need to improve the partic ipation of developing countries, she wished that the
proposals from the more developed countries included offers for the effective application of ArticleIV of the GATS, as otherwise the negotiations would simply result in the adoption of new disciplines
which would benefit the most important services tr aders, widening the gap in sectoral development
and the differences in the share of world trade in services.S/CSS/M/8
Page 21
104. Her delegation had studied the Indian proposal on the movement of natural persons as a
priority matter because the issue was of particular interest to Colombia.  The suggestions raised
therein were essential to ensure the growing partic ipation of developing countries as provided for in
Article IV.  The assessment made by India of mode 4 liberalization and of the obstacles to the
movement of professionals constituted valuable inputs in identifying strategies and mechanismswhich would lead to liberalization in those services markets.  She shared India's interest in adopting
alternative approaches and strategies to achieve effective market access in mode 4;  she expressed
particular interest in the proposal to develop multilateral guidelines and standards which would
establish, inter alia , a more transparent and objective system of processing of visas and work permits.
It was extremely important that work be carried out on issues such as recognition of professional
qualification, prerequisites for obtaining licenses, and classification, in order to disaggregate
categories in light of the needs and the potential of the market.  She endorsed the proposal that theSpecial Sessions of the Council for Trade in Services discuss this issue as a horizontal matter and that
it be kept on its agenda as a regular item, as well as the proposal that a new classification be adopted.
105. The representative of Dominican Republic s upported the views expressed by Colombia.  He
said that there was a clear case of asymmetry of information between some Members, who knew
exactly the problems affecting their service exporters, and others, who faced serious difficultiescountering the proposals with other proposals on sector s of interest to them.  He also mentioned, as a
preliminary comment, that all proposals were using the cluster approach;  all of them had a scope of
application that went beyond the specific sector in question.  The issue of competition policy seemed
to have increased its sectoral coverage;  a proof of the latter was to be found in the pro-competitive
disciplines that had been proposed for energy services, and in the proposal that Members adopt theprinciples of the Reference Paper in basic telecommunications.  He added that there was no doubt that
in future such additional commitments would have  to cover anti-competitive practices that affected
trade in sectors such as maritime transport services, financial services, postal services, distribution
services, electronic commerce and air transport services.
106. The representative of Panama said that more work was needed on the issue of the granting of
credit for autonomous liberalization.  He supported the resumption of negotiations on maritime
transport services as a matter of priority, and considered that Members should be flexible as the
conduct of those negotiations.  He added that Members should not necessarily completely follow the
approach taken in previous negotiations on the sect or.  He suggested that the Chairman address the
issue of how the Council should conduct the evalua tion of the effects of the suspension of the MFN
principle foreseen in paragraph 4 of the 1996 Decision.
107. The representative of Pakistan said that the negotiations had started in an unbalanced manner,
and that the timing and pace of the negotiations were crucial.  He called on developed countries to
approach the negotiations in a more balanced and development-friendly manner.  The negotiations
had to proceed in light of the letter and spirit of the negotiating guidelines and procedures.
108. Commenting on the statement by Malaysia, the representative of Argentina said that the
current round of services negotiations was not the last one, as liberalization was a continuous process.
He announced that his delegation would submit a negotiating proposal on distribution services that
would complement other Members' approaches and that his delegation was particularly interested in
the distribution of agricultural products, amongst ot hers.  He associated himself with the comments
made by Brazil with regard to the scope of the proposals submitted by the United States.  He noted
that in some specific cases the scope of issues went beyond the scope of the GATS and, hence, of thenegotiations.  It was important to distinguish between obstacles to trade in services on the one hand,
and issues pertaining to domestic regulation that were being dealt with in the Working Party on
Domestic Regulation.  Regarding telecommunicati on services, he wondered how the complementary
services identified by the United States in paragraph 7 of its proposal would be approached, and how
this proposal would be made compatible with other sectoral proposals on distribution and audiovisualS/CSS/M/8
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services.  On India's proposal on the movement of natural persons, he said that, although the proposal
went beyond the scope of the GATS with respect to certain issues, such as social security, it
nevertheless raised some interesting points, particularly in paragraph 3.  The proposal to harmonize
definitions and categories of professionals under mode 4 was also of interest, and needed to be
addressed not only in the case of intra-corporate transferees but also in the case of independent servicesuppliers.
109. The Chairman concluded that it had been a good first review of the proposals and that the
Council would take note of the statements made and revert to this item at its next session depending
on what would be decided under the stocktaking item in terms of how to proceed.  On Panama's
request that consultations be held on how the Council  should approach the review of the suspension of
the MFN principle for maritime transport services, he said that he would bring this issue to the
attention of his successor and allow him to discuss this particular proposal with Members.
C. TOURISM SERVICES
110. The Chairman recalled that the Symposium on Tourism Services, held on 22 and 23 February
2001, featured sixteen speakers, and had been well attended by representatives from both developed
and developing countries.  Symposium presentations and background documentation were all posted
in the services section of the WTO web-site.  The purpose of the Symposium had been to evaluatecurrent developments in international tourism that might be of relevance to the ongoing GATS
negotiations, and especially those developments related to the Tourism Annex proposal contained in
document S/C/W/127 and Corr.1.  Symposium presentations and discussions had focused upon the
complex  sectoral and commercial linkages essential to the supply of tourism services, as well as the
issue of anti-competitive practices.  Presentations on national experiences with tourism-related issueshad been made by Cuba, Jamaica, Portugal and Thailand.  A number of Members had also submitted
papers.  Topics raised and some of the main comments made in the discussions included visa-related
restrictions;  the imperfect nature of both tourism statistics and tourism classification systems;  the
negative effects of the horizontal restrictions contained within Members schedules;  profit levels of
tour operators;  and anti-competitive practices, including in aviation-related sectors.
111. The representative of the Dominican Republic thanked the Secretariat for the organization of
the Symposium and said that the high-quality debate at the Symposium permitted to make a clear
diagnosis that the situation of international touris m trade justified the search for a common solution to
the problems confronted by both countries "exporting" tourists and those receiving them.  The debate
showed that an asymmetry existed in terms of lib eralization:  while the receiving countries had
undertaken broad-based commitments in the WTO, the "exporting" countries had nullified the effects
of those commitments by taking horizontal measures and listing MFN exemptions.  There wereserious threats for the tourism industry in developing countries, due to anti-competitive practices in
essential services, such as transport and inform ation networks.  Discussions at the Symposium
allowed to identify certain elements for a common solution which should be negotiated at the WTO:
the need for an exhaustive coverage;  ensuring that  the sector was viable, both in the country from
which the tourists originated and in the country receiving them;  effective enforcement of specific
important GATS provisions, such as Articles IV and XIX;  overcoming the current asymmetry and
increase market access for service providers in areas which were currently affected by anti-
competitive practices, such as tour operator services and computer-reservation services;  securing
balanced results for all countries involved in the tourism chain.  He recalled that his delegation had
presented, in December 2000, a proposal on the cluster of tourism industries in documentS/CSS/W/19.  The paper summed up the background to the concept of the cluster of tourism
industries.  The original definition proposed in the Annex on Tourism, and contained in document
S/C/W/127, was based on the definition of the Tourism Satellite Account (TSA) given by the World
Tourism Organization at the Nice World Conference in June 1999.  On 1 March 2000, the United
Nations Statistical Commission decided that the TSA comprised only the "set of tourism-S/CSS/M/8
Page 23
characteristic products".  The tourism-related products appeared, therefore, to have been excluded.
Tourism-characteristic products included those services which would cease to exist in meaningful
quantities, or those for which the level of consumption would be significantly reduced, in the absence
of visitors.  Document S/CSS/W/19 contained two appendices:  the first one contained a detailed list
of tourism characteristic products, based on the UN Central Product Classification Codes;  the secondone contained a link between the tourism-characteristic services and the services sectoral
classification used during the Uruguay Round in MTN.GNS/W/120.  The purpose of this
classification was to ensure that a comprehensive tr eatment be given to tourism in the current round of
negotiations, and avoid lengthy discussions on classification.  This classification was of a focused
nature because it covered only the set of tourism-characteristic products;  hence, it showed that it was
possible to adopt a comprehensive treatment for tourism, referring to the set of characteristic products
as the cluster of tourism industries, without prejudice to the use of the cluster as the scope for newdisciplines or for requesting additional specific commitments.
112. The representative of Japan shared the view that tourism was important for both developing
and developed countries and said that Members should undertake further liberalization in this sector.
His delegation would revert to this issue at the next meeting.
113. The Chairman said that the Council would take note of the statements made and revert to this
item at its next meeting.
D. MODALITIES FOR THE TREATMENT OF AUTONOMOUS LIBERALIZATION
114. The Chairman recalled that on 1 December 2000, a special meeting had been held to address
the issue of the treatment of autonomous liberalization.  He described the discussions as having been
very useful.  He noted that submissions made by Hong Kong, China and of Korea, in Job No. 7580and Job No. 7634 and Addendum 1, respectively had contributed to the debate.  He said he was aware
that many delegations felt that the discussion on issues such as recognition, credit, or even the
meaning of "autonomous liberalization" should continue. Recalling also that that the negotiating
guidelines and procedures just adopted referred in paragraph 13 to autonomous liberalization, the
Chairman opened the floor for comments.
115. Most delegations stressed the importance of discussion on autonomous liberalization and
supported the idea of having another special session dedicated exclusively to discussing the treatment
of autonomous liberalization.
116. The representative of Thailand suggested that another special session on autonomous
liberalization should be held and indicated that he r delegation remained flexible regarding the timing
of such a meeting.  She noted that Thailand intended also to make a submission contributing to the
debate on this issue.  Most subsequent speakers lent their support to the idea of having another special
session devoted to discussion of autonomous liberalization.
117. The representative of India stressed that India attached importance to this issue and that its
views remained those reflected in the minutes of the earlier meeting, in paragraph 11 of document
S/CSS/M/6.  He urged that another special meet ing dealing with autonomous liberalization should
take place after delegations had had further opportunity to discuss the topic among themselves toavoid repetition of previously stated positions.  He said that it would be very helpful for or such a
meeting to take place before the access negotiation began.  He looked forward to further reactions to
some of the points made, such as the concerns of developing countries about whether developed
countries would want the issue to be left exclusively to the bilateral setting, or would simply want to
ask that autonomous liberalization be bound or it would be considered meaningless.  These werelegitimate concerns, and now that autonomous liberalization had been included in the guidelines, theS/CSS/M/8
Page 24
question was what could be done at the multilateral level.  He said that ideas from major trading
partners on what would be appropriate in this respect would be welcome.
118. The representative of Korea said that the spec ial meeting on the topic had been valuable and
constructive.  The paper Korea had tabled was intended to invite discussion on how a multilateral
formula-based approach might work and from th e viewpoint that autonomous liberalization should
not be addressed exclusively in a bilateral context where credit would be affected by the negotiating
leverage of the Members concerned.  He noted that the general reaction to the paper had not been as
favorable as had been expected and sympathized with other Members’ concern that the assessment of
the value of specific liberalization measures in specific sectors was, in nature, subjective and would
vary according to the interests of each Member.  He admitted that simple and succinct multilateral
criteria which could guide bilateral or multilateral negotiations might be a workable solution.  He
suggested that, since points made at the last special meeting on the issue might serve as a referencepoint for developing such multilaterally agreed criteria, it could be helpful for the Secretariat to draw
up a checklist of these points and welcomed the proposal by Thailand on holding a second session on
autonomous liberalization.
119. The representative of the European Communities said that the topic was important and that it
would be important to arrive at criteria or modalities at an early date, to meet the concerns of all
Members, since all had probably undertaken autonomous liberalization since the last round. Members
needed to be flexible and pragmatic to determin e what treatment autonomous liberalization should be
given.  She agreed with Korea that assessments might be subjective, as they would depend on each
Member’s possibility to avail itself of the liberalization concerned.  For this reason, a solution would
need to be general in nature, rather than based on a formula approach.  Moreover, for over two years
Members had been consistently rejecting any type of formula approaches.  She supported the
suggestion to hold another special meeting on autonomous liberalization and suggested that the issues
that needed to be dealt with included transparency, credit and the possibility of a review mechanism.
Regarding transparency, it was up to each Member se eking recognition or credit to determine whether
it would communicate it to one or several Members or notify all Members through the Council.Regarding credit, it would be important for whoever was involved, and whether at a bilateral,
plurilateral, or multilateral level, to discuss what they would consider appropriate in relation to
specific liberalization and to decide whether or not they would bind both the liberalization and the
credit.  Given potential differences in the negotiating strengths involved, a mechanism might be
considered to allow Members to bring related issues into a review of progress in negotiations, to help
them in obtaining the balance they sought.
120. The representative of Canada supported the idea another special session on autonomous
liberalization and agreed that the issues raised by the European Communities and others needed
further exploration.
121. The representative of Pakistan said that the issue was immensely important because Pakistan
had undergone a lot of autonomous liberalization and wished to receive credit for its measures.  He
noted that there appeared to be more questions than answers at this early, conceptual stage ofdiscussions.  He observed that the Council had yet to complete its work under Article XIX:3 to
establish modalities and hoped that it would be completed successfully, to include criteria developed
on a multilateral basis.  He supported the proposal to hold another special session on the issue in
which analysis could be more focused.
122. The representative of the Czech Republic said that, as stated in Article XIX:3, the negotiating
guidelines had to establish modalities for the treatment of liberalization undertaken autonomously by
Members since previous negotiations.  But the question was what was meant by autonomous
liberalization.  Was it liberalization in a certain sector or subsector undertaken autonomously between
negotiating rounds or a similar measure taken during the course of negotiations?  At any rate, theS/CSS/M/8
Page 25
basic prerequisites were transparency in the negotiating process, ways to achieve recognition of such
measures, and how to obtain credit for it.  In his delegation’s view, such measures were any measures
taken voluntarily, as a result of trade policy between rounds of negotiations or any unilateral decision
in the context of negotiations.  Both testified to liberalization trends in an individual economy.  Next
was the question of the weight of an autonomous liberalization measure in the form of a boundinternational commitment in a schedule or as a legislative measure.  His delegation thought that the
real value of autonomous liberalization could be assessed only in the negotiating process;  therefore,
only interested trading partners could arrive at an acceptable compromise on credit.
123. The representative of Hungary said that it was obvious from the relevant provision of the
agreed guidelines and for Article XIX:3 that this was an area upon which the Council needed to focus.
He supported the idea of another dedicated session on the topic.  He observed that, as the paper by
Hong Kong, China had noted, different liberalization measures had different value for differentMembers;  therefore, the bilateral request-offer process seemed to provide the best avenue for seeking
and granting recognition and credit.  At the same time, his delegation believed that agreed,
multilaterally developed criteria were needed, mainly to ensure that smaller WTO Members with
limited bargaining power had equal opportunities to receive recognition and credit.  He suggested that
the criteria should be broad and that the factors listed in paragraph 11(d) of the Hong Kong, Chinapaper could serve as a good starting-point for discussion. He noted with interest the European
Communities suggestion regarding a possible mechanism for review and saw merit in exploring the
idea further.  He added that it would be logical to have criteria developed prior to the start of market
access negotiations.
124. The representative of Hong Kong, China noted his interest in the European Communities
comments about transparency as this appeared to be a helpful perspective.  He was concerned about a
possible tension between informing the full member ship of autonomous liberalization measures and
the possibility that this might reduce Members' bargaining power, at the same time reducing their
ability to obtain credit.  Therefore, there was a need to explore the balance between transparency,
credit and binding.  His delegation saw the bilateral request-offer process as the best way toaccomplish this balance, drawing upon a combination between multilateral factors and a bilateral
process.  He agreed that it was a good idea to have another special session on the topic and that it
would be helpful to have further submissions from Members prior to such a meeting. He asked
whether the Chairman thought the timing would not be appropriate for the preparation of a Secretariat
note on autonomous liberalization.
125. The representative of Japan supported the proposal to hold another special session on the
topic.  He suggested that further consideration should be given to development of a common
understanding on key concepts, such as the relationship between negotiations and autonomous
liberalization, transparency and bilateral and/or multilateral approaches.  As there were also other
important issues to consider, he supported the proposal that the Secretariat be asked to prepare a
checklist of issues for further discussion.
126. The representative of Argentina said that his delegation wanted the issue to be taken up
because Argentina had made substantial efforts towards liberalization over the previous ten years.  His
delegation was certainly in favor of recognition for autonomous liberalization, but the question was
how this should be done.  It had tot be borne in  mind that this was a complex issue requiring a down-
to-earth consideration of issues such as how to measure the relative value of sectors in different
countries.  The Korean paper referred to “proportional credit” related to the level of improvement, inwhich it appeared to make no distinction between relaxation of domestic regulation and opening up of
market access.  While both quantitative and qualitative issues needed to be taken into account, it was
not easy to see how these could be translated into numerical terms.  He sought further clarification of
this and related points in the Korean paper.  Further discussion in the Council was needed to clarify a
number of issues on this topic.S/CSS/M/8
Page 26
127. The representative of Qatar said that this was an important issue because many developing
countries had liberalized services trade.  He supported the development of multilateral criteria and
supported the proposal to hold another special session on the topic.
128. The representative of Bolivia asked that the issue be maintained on the agenda of future
meetings of the Council.  She said that drawing up multilateral criteria should be accomplished as
quickly as possible and that another special session should be held and should be well prepared
through advanced consultations by the Chairman.  She suggested the following elements:  first, the
need for multilateral criteria, rather than bilate ral negotiations;  second, avoiding conditionality with
respect to binding;  third, drawing a distinction between autonomous liberalization and new
liberalization commitments;  and, fourth, credit and additional binding.
129. The representative of Brazil said that his delegation’s positions remained as expressed in the
earlier session devoted to the topic.  He added that Brazil saw merit in exploring the idea of
combining multilaterally agreed criteria with a bi lateral approach, provided that the former were
preponderant.  He agreed that there remained more questions than answers as to how to measure
autonomous liberalization and transform it into credit and recognition. He recalled that Brazil had
suggested criteria such as size of market and nature of the sector, but that his delegation was still
examining those issues.
130. The representative of Paraguay supported the proposal of another special session on the topic
and the comments made earlier that further information and ideas from Members were needed.  He
observed that the mathematical nature of the Korean proposal, without detracting from its merit, made
it difficult to evaluate autonomous liberalization.  He noted the points made in the Hong Kong, China
paper regarding the complexities involved. He said  that factors leading to autonomous liberalization,
such as the lack of proper preparation for domestic regulation, needed to be considered. For example,
in certain developing countries the absence of proper preparation for domestic regulation had given
rise to autonomous liberalization being a de facto situation.  He therefore wondered what would
happen if those countries, if they were not given credit for such liberalization, decided to regulate so
that the autonomous liberalization might be considered a backward step.   He doubted that delegationscould agree to simple recognition, one of the options suggested in the paper by Hong Kong, China.
However, the option proposing methods for multilateral work that could be used in bilateral settings
was perfectly valid.
131. The representative of Uruguay said that he agreed with Argentina that a realistic and
pragmatic approach should be adopted. He also agreed that Members should continue to explore such
possibilities and, therefore, supported the proposal for another special session on the issue. He
stressed that, now that negotiations had started, his delegation would be looking for concessions fromother Members.  But if autonomous liberalization implied a need for bindings, this would prejudice
Members' negotiating positions.  If some delegations thought that further bindings were needed, his
delegation would prefer to have concessions, rather than points or credits.  The issue had to be
clarified and Members might reach agreement on modalities during the following special session
132. The representative of Australia recalled that she had made it clear in the earlier meeting that
her delegation was prepared to give recognition an d credit for autonomous liberalization in its
bilateral request-offer negotiations, based on multilaterally agreed criteria.   She noted that there
would be value in the Council deciding on a set of factors to be taken into account in the negotiations.
She also supported the proposal that the Secretariat be asked to prepare a checklist to assist in the
development of criteria.  Regarding transparency and the possibility of notifications, she observedthat, without knowing what was at stake, it would be difficult to develop criteria, and therefore the
issue should continue to be discussed.  Exploring what would constitute liberalization and credit
would also need to be discussed in further detail.  She suggested that an annotated agenda for the next
session on this topic might be useful in helping to focus on some of those questions.S/CSS/M/8
Page 27
133. The representative of Indonesia supported the proposal to hold another special session on the
topic and the proposal that the Secretariat be asked to prepare a note.  It was his delegation’s view that
autonomous liberalization should cover all measures, as envisaged by the GATS, and not only
measures covered by specific commitments.  He suggested that a cross-sectoral approach should be
allowed, so that a liberalization measure taken in on e sector or sub-sector should also provide benefits
in other sectors or sub-sectors.
134. The representative of Malaysia realized that difficulties with data and other peculiarities of
services trade made it difficult to measure autonomous liberalization and arrive at credits, although it
might be possible in particular sectors.  He recalled that autonomous liberalization principles had been
used in the Uruguay Round, but that they might not have been effective.  Malaysia had hoped it would
alleviate pressures to bind tariffs, but, by the end of the Round, Malaysia had bound more than 1000
additional tariff lines.  He suggested that it would be helpful if the Secretariat paper contain somefactors related to the history of this issue in the Uruguay Round.  He urged that liberalization
measures be recognized, as, for example, in the banking sector in Malaysia, where restrictions on
foreign investment had been eased, even if not bound, given in some instances could be very difficult
to make bindings.  He supported the proposal to hold another session dedicated to the topic and
agreed that, as Members needed to be fully prepared for the meeting, the Secretariat prepare achecklist of issues with some background on the Uruguay Round treatment of the topic.  Regarding
transparency, he was unsure how this would give away bargaining leverage as changes in laws were
normally made public, especially if credit was being sought.
135. The representative of Mexico supported the idea of continuing special sessions on
autonomous liberalization.  He said that the modalities for autonomous liberalization had to involve
multilaterally agreed, objective and simple criteria, and that, within such multilateral modalities,
bilateral processes might be recognized.  He said that request-offer procedures were also bilateral in
nature, but were conducted under a multilateral framework of guidelines;  his delegation could
therefore agree to finding a multilateral solution that would recognize a bilateral process.  His
delegation would not be seeking "points" in the negotiations, rather concessions from other Members.He was encouraged by the European Communities comments, and described autonomous
liberalization as an exercise that went far beyond transparency.
136. The representative of Chile said that the guidelines had established that autonomous
liberalization was for all Members, but noted that its meaning would vary for different sectors and
countries.  He said that, in many developing countries, deregulation, rather than liberalization, might
have occurred and that this would not be something that a Member would bind in negotiations.
However, negotiations would bring out the relations hip between credits obtained and granted and the
willingness to bind autonomous liberalization measures.  He supported the proposal to hold another
special session on the topic.
137. The representative of Korea expressed gratitude for comments offered on his delegation's
paper.  He reiterated that he had understood from these that a quantitative approach could have
limitations in accommodating different market situatio ns in different countries.  He had also taken
note of observations that assessing the value of liberalization was subjective in nature, and agreed that
simple and succinct criteria might be an alternative to be explored.
138. The representative of Hong Kong China sa id that, regarding his earlier comments on
transparency, he had intended to say that where, for example, Members did not have any laws or
regulations governing a sector, transparency would be problematic.  He recalled further that thetransparency obligations of the GATS were not so rigorous as to require notification of all measures.
139. The representative of Thailand noted that, since autonomous liberalization could be
undertaken with respect to horizontal measures, it should not be considered to relate only to particularS/CSS/M/8
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sectors, as such measures would benefit every sect or and every country.  Credit should be given for
horizontal measures as well.
140. The Chairman concluded  that there was broad support for further work on the treatment of
autonomous liberalization.  He noted that delegations had shown flexibility regarding the timing of
further work.  He welcomed the observations that the value of a future special session would beenhanced by the contribution of additional submissions by Members.  He asked the Secretariat to
prepare a paper involving a checklist of issues and any relevant material on the Uruguay Round
experience with efforts to address autonomous liberalization.
E. ASSESSMENT OF TRADE IN SERVICES
141. The Chairman recalled that, at its last meeting, the Council had held a preliminary discussion
of a communication from Slovenia, Bulgaria, th e Czech Republic, Poland and the Slovak Republic
contained in document S/CSS/W/18 and Corrigendum 1.  He also drew delegations' attention to a newcommunication tabled by Argentina and circulated as S/CSS/W/44.
142. The representative of Argentina said that the paper was a contribution to the assessment of
trade mandated by Article XIX.  Its aim was to share sectoral and global information with Members
and its focus were developing countries as a group, rather than his country's position.  He stressed the
importance of continuing with the assessment of trade as a means of contributing to the objectives ofthe GATS, and particularly that of progressive liberalization.  He said that the figures presented in the
paper were eloquent and clearly showed that work still had to be carried out in order to advance
liberalization of services trade.  Trade in services as defined by the GATS was less documented than
trade in goods, and, bearing in mind all the relevant qualifications, he highlighted a number of trends.
First, the share of commercial services, measured on a Balance-of-Payments basis, in total worldexports and imports of goods and services had remained virtually unchanged since the mid-1990s.  In
1999, the services share in total world imports of goods and services amounted to 19.6 per cent.
Second, cross-border supply had been estimated to be the major component of world trade in services,
accounting for 41 per cent of total trade, closely followed by commercial presence with 38 per cent.
Third, developing countries' services exports appeared to be particularly concentrated in travel andtransportation services.  Fourth, trade in commercial services was highly concentrated.  The top 15
traders accounted for 71 per cent of world exports and 68 per cent of world imports;  in addition, the
share of the top 15 traders of commercial services  had not changed significantly since the mid-1990s.
Fifth, the prevalence of developed countries in world services trade was noteworthy.  Since the
conclusion of the Uruguay Round, the contribution of developing countries to world trade in services
had remained fairly constant;  while in 1994 the 16 leading developing countries accounted for
16.45 per cent of world services exports, this share was virtually unchanged at 16.29 per cent in 1999.Finally, regional trade balances showed the same general trends;  according to 1999 Balance-of-
Payments data, North America and Western Europe recorded export surpluses of 67 and 31 billion
dollars, respectively.  The United States recorded an export surplus of about 73 billion dollars in 1999,
while the European Union’s surplus amounted to 13 billion dollars.  He indicated that these trends had
been brought forward in order to promote a better understanding of developments in services trade inthe recent past and stimulate an exchange of views among Members.
143. The representative of Japan noted that the submission in document S/CSS/W/18 was based on
Members' own experiences and said that it offere d interesting conclusions.  On page 12, the first
indent showed that the broader implications of services trade liberalization, such as those illustrated
on page 11, required attention and he indicated that these were applicable to all Members, and not justto transition economies.  As for the submission by Argentina, he observed that, while the paper stated
that most developing countries had deficits in services trade, table 4 showed that 10 out of the 23
leading importers and exporters also exhibited deficits, including Japan and several other developed
countries.  Paragraph 16 was also noteworthy;  in contrast to the export surpluses of the United StatesS/CSS/M/8
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and the European Union, Japan accounted for 54 billion dollars out of the 72 billion dollars deficit
recorded by Asia.
144. The representative of Pakistan noted that many contributions, of both a quantitative and
qualitative nature, were available on the assessment of trade and that Members had been discussing
the issue at considerable length.  Progress had been achieved and it was now important to decide whatthe aims and objectives of the assessment exercise were and how this could be used in the
negotiations, as agreed in the negotiating guidelines and procedures.  Useful conclusions could be
drawn from the papers submitted.  In particular, he  referred to paragraph 5 of document S/CSS/W/18
and to the helpful points raised in the submission by Argentina, which was based on reliable sources
of information, about the composition of commercial services trace, the participation of developing
countries, the leading exporters and the net importers.  He therefore urged Members to make use of
such conclusions and invited their comments on possible criteria for ways and means of concretisingsuch conclusions.
145. The representative of Chile said that she would revert to the intervention by Pakistan.  She
said that documents such as S/CSS/W/18 were a useful contribution to the on-going assessment
exercise, especially in view of the dearth of statistical information on services trade, particularly for
developing countries.  It was important to carry out the assessment in a broader framework than just
the statistical one.  She concurred with the broad lines and main conclusions of the paper by
Argentina, but made two observations.  First, with respect to mode 1 being the most important mode
of supply, she noted that most statistical information was drawn from the Balance-of-Payments and
therefore did not provide information on services trade taking place through mode 3, which was an
important mode of supply for Chile;  second, with respect to services trade being concentrated in afew countries and the situation of developing countries not having changed over time, she noted that
the total volume of services trade had increased, so that Members were sharing a bigger pie.
146. Commenting on the paper submitted by Argentina, the representative of Uruguay drew
particular attention to paragraph 5, based on Table 1 on page 4, showing that in 1997 mode 1
accounted for 41 per cent of services trade, mode 2 for 20 per cent, mode 3 for 38 per cent and mode4 only for 1 per cent.  He also noted that, with respect to the leading importers and exporters in world
trade in commercial services, 1999 data provided by the WTO Secretariat showed that these were
mainly developed countries;  such a reality had to be addressed and redressed in the on-going
negotiations, by focusing on sectors of export interest to developing countries and thereby increasing
their participation in world services trade.
147. With respect to the submission by Argentina, the representative of the United States made two
comments, the first pointing to the different stories which could be told using different statistics and
the second highlighting to the difficulties involved  in relying on incomplete statistical information.
With respect to the first, he drew attention to paragraph 9, which stated that the top 15 traders
accounted for 71 per cent of world exports and 68 per cent of world imports and that the share of the
top 15 traders had not changed significantly since the mid-1990s.  This was true, but it was also true
that exports from countries not listed amongst the top 15 services traders had increased 10 per centfaster per year than those of the top 15 countries.  According to WTO data, there had been a
1.2 per cent decline in the share of world export of other commercial services by the top 15 traders
between 1990 and 1999, from 78.2 per cent to 77 per cent.  Whilst this appeared to be a small shift, it
signified that the growth of services exports by other countries had exceeded the growth of services
exports by the top 15 traders.  As for his second comment, he pointed to table 1, which showed that38 per cent of world services trade was accounted for by mode 3, yet little statistical data was
available on this mode of supply and Argentina's conclusion relied on such incomplete data.
However, the value of mode 3 transactions to any country should not be underestimated.  In order for
a foreign affiliate to establish a commercial presence, typically some level of foreign direct
investment was required, local personnel might be employed and trained, skills and technology mightS/CSS/M/8
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be transferred.  In addition, cross-border sales by the affiliate to third markets would be recorded as
exports for the host country, for which it would receive inflows from foreign exchange.  Hence, a
country might benefit more from "importing" a commercial presence than from exporting services
cross-border.  He wondered what conclusions could be drawn from the information he had just
presented.  As for Pakistan's reference to the need to concretise conclusions from the assessment, hesaid that his delegation had its own conclusions an d would be interested in hearing Pakistan's and
others'.
148. The representative of Canada said that, given problems with data collection for services trade,
he was hesitant to draw conclusions and that the fact that the data which delegations were referring to
was WTO data was not necessarily comforting, given that it had originated with Members anyway.
He pointed out that, like Japan, Canada was also running a deficit in services trade.  He then drew
attention to paragraph 8 of the submission by Argentina, which stated that the fact that developingcountries' services exports were focused on travel and transportation might create a structural problem
for developing countries, as such trade was related to the physical movement of persons and goods,
rather than to the movement of knowledge and inform ation.  However, he felt that, with the growth of
the Internet and electronic commerce, just-in-time delivery and logistics management, the knowledge
component of these sectors had increased over time.
149. The representative of Brazil stressed that the paper by Argentina demonstrated that an
imbalance existed between developing and developed c ountries in their participation to services trade.
He said that the fact that the share of services trade through mode 1 surpassed that of trade through
mode 3 could be explained by the importance of transport for mode 1 and by the fact that Balance-of-
Payments data did not account for mode 3 transactions.  He asked whether the Secretariat couldprovide an update on the work of the Intra-Agency Task Force on Statistics of International Trade in
Services and reiterated the importance attached by his delegation to the development of statistical
information for services trade, for the assessm ent of trade and the negotiations themselves.
150. The representative of the European Communities said that statistics could be read in different
ways and that they could be captured at different levels, but that the seminar which had been
organized on services statistics had been a helpful contribution.  She noted that the submission in
S/CSS/W/18 went beyond statistical information, and looked at the role of services in helping growth
and development in an economy, for example by pointing at the role of small and medium-sized
undertakings in developing alternative forms of economy and helping with employment.  There were
a variety of elements which needed to be taken into account when looking at the assessment of trade
rather than just Balance-of-Payments statistics.  One of the difficulties with statistics was that they
were not sufficiently disaggregated;  for example, in the telecommunication sector, it was not possibleto distinguish the effect of issues such as call-back.
151. The representative of Egypt referred to paragraph 8 in the submission by Argentina to
indicate that he had arrived at a different conclusion from the one reached by the representative of
Canada.  The paragraph reflected well the situation of his country, as the bulk of Egypt's commercial
services exports were the fees collected from ships crossing the Suez Canal and he felt that this didcause some structural problems, as it did not enhance the movement of knowledge and information.
152. The representative of Slovenia said that the assessment needed to be carried out in a precise
manner and that that was the reason why document S/CSS/W/18 had been submitted.  He clarified
that the contribution of the delegations of Bulgaria, the Czech Republic, Poland, the Slovak Republic
and his own was only the cover note, but that the paper attached had been produced by the OECDSecretariat and did not necessarily reflect national positions.  The cover note drew attention to the fact
that transition economies were in a particular situation, as stated in paragraph 5, that their specific
concerns should be taken into account in the negotiations, and that all possible implications of furtherS/CSS/M/8
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liberalization on different countries and sectors should be carefully considered pursuant to
Article XIX:2.
153. With respect to the request by Brazil, a representative of the Secretariat explained that the
Intra-Agency Task Force had concluded its work on the development of the Manual on Statistics in
International Trade in Services and indicated that it was now up to Members to implement itsrecommendations.  He added that the Secretariat would provide a short note on the subject for the
May meeting.
154. The Chairman said that the Council would take note of the statements made and revert to this
standing item at its next meeting.
F. WORK OF THE SUBSIDIARY BODIES – REPORTS BY CHAIRPERSONS
155. In keeping with what had been agreed concerning the regular reporting from the subsidiary
bodies to the Special Session, the Chairman invited the outgoing Chairpersons of those bodies to
present their oral reports.  He thanked the outgoing Chairpersons for their work and congratulated the
incoming ones on their appointment.
156. The Chairman of the Committee on Specific Commitments, Mr. Tomo Uyama of Japan,
recalled that paragraph 2(e) of the so-called "road-map" called upon the Committee to endeavour to
complete its on-going work by March 2001.  During the previous year, the Committee had beenworking on two items, namely the revision of the guidelines for the scheduling of specific
commitments and possible amendments to the existing services sectoral classification.  With a view to
meeting the said deadline, the Committee had had a very intense schedule.  Since May 2000, it had
held 5 formal meetings and 10 informal meetings, with the informal discussions channelled into the
formal meeting through written reports by the Chairman.  The details of the discussions held at thosemeeting were contained in documents S/CSC/M/15 to 19.  Regarding the revision of the guidelines
for the scheduling of specific commitments under the GATS, he was pleased to announce that on
22 March 2001 the Committee had agreed the text containing the results of the revision exercise and
had also recommended to the Council its adoption as a set of non-binding guidelines.  The revised text
had subsequently been adopted by the Council on 23 March, and the decision and the guidelines werecontained in documents S/L/91 and S/L/92,  respectively.
157. As far as classification was concerned, the Committee had discussed six items:  legal services,
postal and courier services, construction services, environmental services, energy services and the
status of production on a fee or contract basis.  He had recently produced a detailed note on the state
of play of the discussion of those six items, contained in Job(01)/37 dated 16 March 2001.  The note
had been discussed at the last meeting of the Committee held on 22 March 2001 and its conclusions
had been generally endorsed by Members.  All delegations agreed that the Committee's work onclassification had been extremely useful, first in identifying sectors where work on classification was
necessary, second, in better understanding the peculiarities of each sector identified, and third in
discussing the way classification could address such peculiarities.  In that respect, Members agreed
that the Committee had fulfilled the mandate given by the Council.  There was also a consensus to
state the different stages of progress in the various sectors and therefore the need for further technicalwork.  While agreeing on the need for further technical work, Members did not want to prejudge in
any manner the results of the stock-taking exercise, notably on the future agenda of the Committee
and on its relationship with the negotiating proposals pending before the Special Session of the
Council.  Taking this opportunity, he asked delegations to give further consideration to how to
proceed with the future work of the Committee, in particular with respect to classification issues.  Anumber of negotiating proposals contained classifi cation matters, and the question of what was the
appropriate role of the Committee in this context needed to be asked.  Since the WTO was a Member-S/CSS/M/8
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driven organization, useful guidance needed to be given by delegations to the new Chairperson of the
Committee to enable her to lead a productive and efficient process that year.
158. The Chairman of the Working Party on GATS Rules, Mr. Tony Sims of the United Kingdom,
stated that the Working Party had a negotiating mandate on three issues left over from the Uruguay
Round:  emergency safeguards, subsidies and government procurement.  In December 2000, theCouncil had agreed to extend the deadline for negotiations on a possible emergency safeguard
mechanism to 15 March 2002.  Although it was disappointing that an extension was needed, many
Members expressed the view that this extension, the third, should be the last.  This was achievable.
Considerable progress had been made on safeguards during 2000.  ASEAN had tabled a concept
paper in March and a fully worked-up draft agreement in October.  Members had agreed to leave
aside the issue of desirability and form of any safeguard and had engaged in an intensive work
programme in which key aspects of a mechanism, contained in a chairman's checklist, were beingexamined in depth.  The current phase of work would continue until at least June, when Members
might want to reflect on what had been achieved and whether any preliminary conclusions could be
drawn.  They would then consider how to organise work in the run up to the deadline.  On subsidies,
the Working Party mandate was to consider the need for and possible scope of disciplines on
subsidies which might distort trade in services.  In October 2000, the group had agreed to workthrough a checklist of five key issues covering the main questions which needed to be addressed.  The
work programme would continue to July, when it would be necessary to consider next steps.  The
work on government procurement in services had not advanced significantly in the previous year.
Indeed, no Member had requested the floor during the previous two formal meetings.  However, one
Member had indicated that it planned to table a new submission shortly, which might help to provokedebate.  In the negotiating guidelines and procedures just adopted, Members stated their aim to
complete the work on subsidies and government procurement prior to the conclusion of negotiations
of specific commitments.  In order to complete this work, the Working Party required considerably
more input from delegations, particularly in the way of written contributions.  Finally, he said that it
had been an honour to chair the Working Party.  The group had worked very hard in the previousyear, particularly on safeguards, and the tone of debate had always been friendly, constructive and
increasingly interactive.  Mr. Hugo Cayrus of Uruguay had now assumed the role of Chairperson and
he was confident that he would do an excellent job and that the Working Party's best days were still to
come.
159. The new Chairman of the Working Party on Domestic Regulation, Mr. Scott Gallacher of
New Zealand, reported that, since the previous report to the Special Session, the Working Party on
Domestic Regulation had held one informal and one formal meeting, on 14 and 20 Marchrespectively.  Due to the strong interest by delegations, as well as time constraints, the debate at each
of those half-day meetings had focused almost exclusively on the "Checklist of Issues for WPDR".
At the conclusion of the formal meeting, he had been appointed as the new Chairperson of the
Working Party and, in the absence of Sergio Escudero of Chile, who had been the Chairperson
throughout the period in question, he was providing an overview of the work that the Working Party
had undertaken since its previous report.  As concerned the discussion of concepts relating to the
development of regulatory disciplines, at the formal meeting the Chairperson first presented a
summary of the previous week’s informal meeting.  Two delegations, Japan and Australia, presented
papers giving examples of the kinds of measures to be addressed by regulatory disciplines.  The
discussion of the Checklist focused on several issues.  Most delegations thought that the linkagebetween transparency and necessity was important and that transparency alone was probably not
sufficient to replace the need for a provision on necessity.  The suggestion for a mandatory prior-
comment provision on new regulations was rejected by many delegations as excessively burdensome,
and not permitted under the legal systems of certain governments.  A significant number of Members
were interested in the dispute settlement implica tions of including specific examples of legitimate
objectives for regulations as part of a necessity provision.  One Member pointed out that the Appellate
Body had never questioned the legitimate objectives of Members.  Members agreed to revise theS/CSS/M/8
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summary of Checklist discussions to include the result s of both the formal and informal sessions.  The
suggestion made at the formal meeting that Members should begin focusing on the creation of actual
disciplines on domestic regulation was considered as premature by some Members.  Due to lack of
time, there was no discussion of the development of general disciplines for professional services, at
either the informal or formal meeting.  As for the organization of future work, at the informal meeting
the Chairperson had requested Members to begin exchanging views on the issue.  Several delegations
gave preliminary comments.  In his view, full-day meetings would probably be required for future
sessions of the Working Party so as to effectively take its work ahead.
160. The Chairman reminded Members that, regarding the Committee on Trade in Financial
Services, in the absence of the former Chairman of that Committee, he had chaired the meeting which
had been held on 29 November 1999 and had presented an oral report about that meeting at the
Special Session of the Council in December.  The Committee had not met since then, as the meetingoriginally foreseen for 20 March had been postponed to allow for an additional meeting of the
Council to discuss the negotiating guidelines an d procedures.  He informed Members that the
Committee would meet on 2 April 2000.
161. The Council took note.
G. STOCK-TAKING
162. The Chairman drew Members' attention to paragraph 2(g) of the road-map that stated that "the
second phase of these negotiations would begin with a stock-taking exercise by the Special Session in
March 2001, to consider progress made and how to move forward".  The paragraph clearly stated the
purpose of the exercise.  He therefore invited delegations to speak under this item and express their
views on how they saw progress made in the nego tiations until then and on how the Council should
organize its work beyond that point.  In this regard, he recalled that at the previous meeting, on 6
December 2000, Members had agreed on a provisional programme of meetings, according to which
three more clusters of services meetings should be expected before the Ministerial, in May, July and
the beginning of October.  At these meetings, in addition to the other items on the agenda such as the
assessment of trade, the question of the treatment of autonomous liberalization and so on, it wasnecessary to take up for discussion the negotiating proposals already tabled, as well as any further
proposals which might be submitted.  Whilst not making a specific proposal on how time should be
divided between different meetings, he suggested that the Special Session, in addition to other items
on its agenda, organize discussions according to the sectors, modes of supply and horizontal issues
which had been identified in the proposals.  In principle, sectors would be taken up in the order in
which they appeared in the sectoral classification list in document MTN.GNS/W/120.
163. For the following cluster in May, he suggested  that the Council discuss all the proposals,
covering sectors, modes and other horizontal issu es.  After holding that first discussion of all
proposals, Members would be in a better position to have a more detailed programme of work which
could divide the proposals into groups of sectors to be taken up at successive meetings.  If the wish of
delegations was to follow the example of agriculture and plan work up to March 2002, he proposed
adding another two clusters, in December and in March, to the notional programme he had mentionedpreviously.
164. The representative of Paraguay, speaking on behalf of the members of Mercosur, said that
Mercosur had always worked in a constructive way, particularly in the course of the preparatory
process of the services negotiations, in light of the objectives set out by Article XIX of the GATS, and
urged other Members to commit to a similar attitude in the other negotiations of the built-in agenda, inorder to ensure an adequate balance between them.  In a preliminary manner, he proposed, first, that
in the course of the 12 months ahead Members carry out a substantive discussion of the negotiating
proposals already submitted and of those yet to be submitted on the various services sectors andS/CSS/M/8
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modes of supply.  Such discussions would take place in the Special Session of the Services Council
and would follow the calendar of meetings to be agreed.  Second, the substantive discussions could be
organized, for example, on a sector-by-sector basis,  with the understanding that in the 12 months
ahead all proposals would be examined in such a way as to ensure both the necessary flexibility and
the predictability for the organization of work;  the main elements contained in the proposals could beidentified during the same period, so as to facilitate the work of all delegations.  In that respect, he
suggested that the Secretariat prepare a matrix sing ling out in each sector the main elements of the
submissions, to help delegations in their analysis of the proposals, both individually and from an
overall perspective.  Such a matrix would be factual, non-exhaustive and illustrative, and it would be
regularly updated.  Third, he proposed that in such a process the time up to the summer break be used
in the most efficient way possible, as delegations would probably have to devote most of their time
between September and November to the preparatory process of the Fourth Ministerial Conference.However, without prejudice to the Ministerial and its preparatory process, work on the analysis of the
negotiating proposals would continue after the summer break.  Fourth, in parallel with the analysis of
the negotiating proposals, work should continue on the negotiations under Articles VI:4, X, XIII and
XV of the GATS in conformity with the mandates contained therein and the relevant decisions
adopted by the Council.  Finally, at the end of the 12-month period, in March 2002, the SpecialSession would hold a meeting in order to make a review of progress and an assessment of the results
achieved as well as consider ways to move forward.
165. The representative of Nicaragua, speaking also on behalf of the delegations of El Salvador,
Honduras, Panama and the Dominican Republic, echoed the statement by Paraguay on behalf of
Mercosur.  The second phase of the services negotiations should facilitate Members’ work towardsthe progressive liberalization of services trade.  In order to attain this objective, the Council’s work
had to be organized consistently with the provisions in the negotiating guidelines.  The discussion of
negotiating proposals should be organized without prejudice to later proposals and be structured along
sectoral lines, without exclusions, in order to facilitate the comparison of different proposals.  He
suggested that, for transparency purposes, the discussion be organized in the chronological order inwhich the proposals were submitted.  He supported the calendar of meetings suggested by the
Chairman and stressed the importance that, also with reference to paragraph 19 of the guidelines and
to enable the active participation of small delegations, such meetings not be in conflict with other
meetings, especially those of the Committee on Agriculture.  The organization of meetings, especially
of informal ones, should be agreed by the Council, open and announced ahead of time.  He said that a
specific benchmark to evaluate progress should be established in March 2002.  The Chairman said
that organizing the discussion in chronological order might be problematic, for instance when it came
to deciding the order of proposals tabled on several sectors on the same day.
166. The representative of the European Communities noted the progress achieved in the first
phase of negotiations:  negotiating guidelines and procedures had been established and a number of
negotiating proposals had been submitted, work on emergency safeguard measures, while not
completed, had advanced and Members had determined  how to move forward, and work on the rest of
the rule-making agenda would also continue.  The work programme ahead was considerable,
comprising the discussion of the negotiating proposals, work on autonomous liberalization and the
meeting of the Special Session dedicated to the issue, the assessment of trade, which was on-going,
and, especially in light of the March 2002 deadline, the negotiations on emergency safeguards.  Her
delegation was flexible on the analysis of the proposals, and suggested that, given that provision hadbeen made for three meetings before the Fourth Ministerial Conference, in May the Council carry out
a first overview examination on a sectoral, modal and horizontal basis of all proposals, thereby
avoiding any prioritisation.  After the initial exam ination, the proposals could be subdivided into two
parts, on the same basis which had been used for the review of MFN exemptions, and be analysed
respectively during the July and October meetings to allow for more in-depth examination and to
facilitate the participation of experts.  The Ministerial Conference would provide an opportunity to
review progress and might offer guidance for future work, but it was nonetheless useful to lookS/CSS/M/8
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beyond by scheduling meetings in December, March and possibly also in February.  She hoped that
such an organization might facilitate the involvemen t of all Members in the debate and allow capital-
based experts to familiarise themselves with issues on an on-going basis.  Her delegation's suggestion
would in no way preclude submission of furthe r proposals or comments from any other Member
during the on-going examination, and she hoped that, as the debate advanced, individual Members
might realise their own specific interests better and bring their contribution to broaden the debate.
167. The representative of Singapore said that the stock-taking exercise was the threshold to the
next phase of the negotiations and offered an oppor tunity to review progress made and decide how to
move forward.  His delegation was satisfied with the progress made in the first phase of negotiations.
The adoption of the guidelines was testimony to th e constructive engagement and participation of all
Members, including developing countries, and provided the parameters necessary to embark on
negotiations on specific commitments.  In addition, the Council for Trade in Services had adopted therevised scheduling guidelines, which would assist in the preparation of requests and offers during the
course of the negotiations.  Members were ready to consider in detail the negotiating proposals
submitted and those that would be submitted in future months.  He stressed that, as Members
embarked on the negotiations of specific commitments, the rule-making work under Articles VI:4, X,
XIII and XV of the GATS should not be left behind, as those rules would provide legal certainty inrelation to the scheduling of commitments.  It was imperative that progress be achieved in that area in
parallel with the negotiations of specific commitments.  He recalled the 15 March 2002 deadline for
the completion of the negotiations on emergency sa feguard measures and the ASEAN submission of a
draft agreement to facilitate those negotiations.  He noted that great progress had been achieved in
2000 and stressed the importance of not losing momentum and of working towards meetings thedeadline.  On the rest of the rule-making work, he recalled that Members had expressed their intent to
aim to complete the negotiations prior to the conc lusion of negotiations on specific commitments and
to this aim he encouraged all Members to engage actively, including by tabling relevant proposals, to
move the work forward.  There were other outstanding areas that Members needed to focus on.  One
such area was the question of the distinction between modes 1 and 2 in relation to financial services;without an understanding on this distinction, it might be difficult for Members to schedule
commitments clearly in this sector.  The other important area was autonomous liberalization.  In the
guidelines, Members had agreed to endeavour to develop multilaterally agreed criteria prior to the
start of the negotiations on specific commitments.  One Special Session meeting devoted to the issue
had been held in December, but more work was necessary in order to try to resolve the issue.
168. The key question now was deciding how to move  forward.  In his delegation’s view, it was
important to set out at least an indicative work programme or time schedule, in terms of the frequencyand the agenda of the meetings of the Special Session.  While such a work programme would ideally
go beyond the immediate future to the conclusion of the services negotiations, at least an initial work
programme should be set to guide the Council’s work until the Fourth Ministerial Conference, with
clusters of meetings in May, July and October.  Given the number of negotiating proposals, the May
meeting could be devoted to a first detailed examination of all the proposals.  More in-depthdiscussion could be scheduled for the July and October sessions, organized by the various sectors and
modes of supply, while allowing for the possibility that more negotiating proposals would be
submitted;  the proposals could even be divided over the two special sessions in July and October.  At
the end of the October meeting, Members could conduct a review of the discussions and decide on
future steps;  the outcome of the review would fit into the preparation for the Ministerial Conference.In addition to the negotiating proposals, the Special Session needed to address also the issue of
autonomous liberalization.  The meetings of the Speci al Session would continue to be held back-to-
back with the regular meetings of  the Council, as well as those of the subsidiary bodies, where the
rule-making work would continue.  He could also  support the Mercosur proposal of agreeing on
clusters of meetings also beyond the Ministerial and of the Secretariat preparing a matrix on theprincipal elements of the proposals.S/CSS/M/8
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169. The representative of the Czech Republic was pleased with the progress that had been
achieved in both the agriculture and services negotiations.  The services negotiations had been
proceeding in a constructive spirit and a high degree of commitment by all delegations, irrespective of
their level of development, which was evidence of the general interest in progressive liberalization of
services trade, based on a clear framework of rules and recognition of the right of Members toregulate in order to meet national policy objectives.  The negotiations were a process in which every
Member appeared to have its own stakes and interests, both offensive and defensive, and which stood
a good chance of success only if they were beneficial to all and achieved a proper balance between
rights and obligations.  Until that moment, the negotiations had been based on the road-map adopted
in May 2000 and had been conducted in full compliance with Article XIX and other provisions of the
GATS.  Within such a framework, a great deal of work had been done by the Council and its
subsidiary bodies.  The work had focussed on rule-making which, together with market access,represented two sides of the same coin, and on meeting all the requirements prescribed by the GATS.
Useful work had been undertaken on the assessment of trade;  some new light had been shed on how
to approach autonomous liberalization;  progress had been achieved in negotiations on possible
emergency safeguards and disciplines regarding domestic regulation, as well as classification issues.
The Council had been successful in adopting revised scheduling guidelines and negotiating guidelines
and procedures.  A solid basis therefore existed on which the subsequent stages of the negotiations
could be built.  To advance them, it was necessary to organise work efficiently, to allow all issues and
interests to come together and to ensure effective participation of all Members.  His delegation
expected work to proceed in parallel on a number of fronts, while bearing in mind that the starting
point for the negotiations were existing commitments.  Progress had to be made on rule-making.Members had agreed a new deadline for the negotiations on emergency safeguards and efforts had to
be redoubled to meet the new target date.  As for autonomous liberalization, he supported the proposal
to have a special meeting devoted to the issue so as to agree, at the appropriate time, on the modalities
required by Article XIX:3.  The Council also needed to start considering negotiating proposals
submitted thus far as well as future ones;  in this regard, he could support embarking on such aprocess at the May meeting and continuing it in a more structured manner in July and October.  As to
the number of meetings, his delegation was flexible and could support having a review meeting in
March 2002, with the understanding that the work programme under discussion would be without
prejudice to decisions that might be taken at the Fourth Ministerial Conference.
170. The representative of Norway said that, looking at the road-map, Members had been
successful in achieving progress as planned.  The negotiating guidelines and procedures had been
adopted and a number of proposals had been tabled, while more would hopefully be forthcoming.The proposals were characterised by an open and constructive approach, and at the same time difficult
and sensitive issues were dealt with in a manner which signalled willingness and flexibility to find
solutions acceptable to all parties, thereby demons trating the significance that Members attached to
the services negotiations and their mutual goal of achieving services trade liberalization.  Ample time
was necessary to discuss all the proposals;  a general debate could be held at the May meeting,followed by more detailed discussions.  The proposals reflected the interests and concerns from broad
segments of the business community, so that having a clear work programme was helpful.  He also
concurred with the European Communities that it was important to provide for a sufficient number of
meetings to carry out proper work.  He noted that the work programme in agriculture had been agreed
without prejudice to any decisions taken at the Fourth Ministerial Conference, and agreed to that, butwas of the view that the Ministerial Conference would deal with broader issues and hoped that
Ministers would take note of the useful work unde rway in the negotiations.  He agreed that the
discussion of the proposals be organized by sector, following the order of the W/120 classification,
while incorporating also new areas which were not a sector in that classification, such as energy
services;  this would provide a better idea of the topics for discussion and would allow new proposalsto be included.  He stressed that the situation of least-developed countries called for special attention
and special treatment, in particular through technical assistance aimed at strengthening the efficiency
and trade-capacity of their domestic services sector and at improving their national authorities'S/CSS/M/8
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regulatory capacity.  He reiterated his delegation's belief that a comprehensive round of negotiations
to include a number of issues in addition to the built-in agenda through a single undertaking was the
best way of achieving a balanced outcome of the negotiations to the benefit of all Members.
171. The representative of Korea noted that progress had been achieved with the adoption of the
negotiating guidelines and the revised scheduling guidelines and, even if to a lesser extent, with the
classification and rule-making work.  The negotiating guidelines offered clear direction for the next
phase of the negotiations, incorporated the concerns of developing countries and were evidence of the
flexibility and spirit of compromise exhibited by all Members.  As for future work and the
organization of the discussion of the negotiating proposals, he could support the Chairman’s
suggestion that a time schedule for the discussions be fixed as soon as possible to facilitate the
participation of capital-based experts, as well as Mercosur’s suggestion that the Secretariat prepare a
matrix of all submissions.  His delegation had a keen interest in infrastructural services, such asfinancial, telecommunications, distribution, maritime transport and construction services, and was
working on submission which would hopefully be tabled for the May meeting.  He stressed the
importance that the subsidiary bodies expedite thei r work to provide a more complete framework for
services trade.  Classification work in the Committee on Specific Commitments and the work in the
Working Party on Domestic Regulation and in the Working Party on GATS Rules presenteddifficulties but should be completed as quickly as possible to facilitate greater liberalization and
maximise its benefits.  The work on autonomous liberalization also had to be completed with
dispatch.  He recalled that his delegation had proposed that the Secretariat prepare an updated
compilation of Members’ commitments in maritime tr ansport services, given that some material was
readily available, and a note on developments in the sector and he reiterated his delegation's request.He also suggested that Members look into the possibility that the Secretariat prepare background
documents for all those services sectors where they did not exist.  Finally, he reiterated that,
notwithstanding the adoption of the negotiating guidelines and procedures, meaningful progress in the
services negotiations could only be obtained in the framework of a comprehensive round of trade
negotiations.
172. The representative of New Zealand said that the Council had made much progress in terms of
technical and background work for the services negotiations.  Such progress had been amply
demonstrated with the establishment of the negotiating guidelines and procedures mandated by
Article XIX:3 and with the establishment of the revised scheduling guidelines, which would assist
Members in the preparation of offers, requests and schedules of specific commitments in the
negotiations.  His delegation was looking forward to the next phase of negotiations, which would
focus on more substantive issues, with the negotiat ing guidelines representing a key reference point.
Such work had already been assisted by the various negotiating proposals that had been tabled, and
his delegation intended to submit several sectoral and horizontal papers in advance of the May
meeting.  He looked forward to the increasing participation of all Members in the process, which
needed to take into account the fact that some Me mbers might approach the negotiations at a different
pace than others.  As for the negotiating proposals th emselves, he believed that they provided an idea
of the various interests and objectives of Members and the broad parameters of the negotiations as
these increasingly started to focus on substantive market access and national treatment issues.  The
focus of future work was naturally not limited to such questions, but, as stated in the guidelines and in
the GATS itself, needed to touch upon the full range of outstanding rules issues, as well as such issues
as autonomous liberalization and assessment of trade.  In this regard, his delegation placed particularemphasis on two areas, namely the work on safeguards and on domestic regulation.  Much progress
had been achieved in those two areas and his delegation intended to engage actively in future
discussions to explore ways to make further progress and ensure that the interests of all Members
were effectively accommodated.  The other key area in terms of work ahead was the resumption of
the review of the Annex on Air Transport Servic es.  He acknowledged that the issue was not
necessarily part of the negotiations in and of themselves, but it was an important element of the workS/CSS/M/8
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programme of the Council and Members needed to plan for a substantive resumption of the review at
some point before the summer break.
173. Looking ahead, he agreed that sufficient time had to be allowed in forthcoming meetings,
particularly those in May, July and October, for more detailed exchanges of views on the various
negotiating proposals, those already tabled as well as those that would be submitted in due course.The special sessions of the Council should continue  to be convened back-to-back with the regular
ones, as well as the regular meetings of the various subsidiary bodies.  He could support the proposal
that the May meeting deal with all the proposals and that the subsequent meetings, in particular those
in July and October, divide the proposals in terms of sectors and horizontal issues, in order to allow
for a more detailed examination of the issues, but with the understanding that the structure of
discussions in July and October would not prejudice any Member’s right to introduce a negotiating
proposal at any time.  He also agreed that the W/120 classification be used as the guide for orderingthe sectoral discussion, but stressed that flexibility needed to be retained for those sectoral proposals
that might step beyond the confines of the W/120 classification.  As to the possibility of extending the
future work programme through to March 2002, his delegation had initially thought of sketching it
ahead only until the Fourth Ministerial Conference, but was flexible and believed it useful to map it
thorough to March 2002, provided that such a programme was without prejudice to any decisions thatmight be taken at the Ministerial.  As for Mercosur’s suggestion that the Secretariat produce a matrix
summarising the negotiating proposals in a non-exhaustive manner, his delegation could support the
suggestion as a way of helping Members with the identification of the broad parameters of the
proposals and of assisting future discussions, whereas, when it came to substance, Members would
still need to refer to the proposals themselves.
174. The representative of Australia noted the areas where progress had been achieved in the first
phase of negotiations.  She was pleased that the negotiating guidelines had been established.
However, work on classification had not advanced, and would benefit from a more concrete focus that
could come from the analysis of issues in the negotiating proposals.  On domestic regulation,
Members had undertaken an educational process, achieving a greater common understanding on manyissues, and her delegation agreed that focusing on problems and solutions would be of help in the
course of future discussions.  In the Working Party on GATS Rules, work was advancing well with
respect to emergency safeguards, but Members had displayed little involvement in the discussions on
government procurement and on subsidies;  at the May meeting, Members should discuss how to be
more focused in the latter two areas.  Little progress had been achieved in the Committee on Trade in
Financial Services;  the focus of the Committee’s work  needed to be directed by the Special Session
on the basis of the discussion of the negotiating proposals on that sector.  With respect to all the on-going work, priorities needed to be set to underpin the negotiations.  As for the discussion of the
negotiating proposals, she agreed with the suggestion that they be all taken up at the May meeting and
then divided between the July and October meetings for more detailed examination;  she said that it
would be productive to set objectives for their ex amination, such the identification of elements which
could require further work in the relevant working groups, or of issues which might require horizontalconsideration.  She supported Mercosur’s suggestion that the Secretariat prepare a matrix
summarising the main issues of the negotiating  proposals, which would be a rolling document
regularly updated.  As for the schedule of meetings, she supported agreeing on a work programme
until March 2002, in line with the deadline in the rule-making work, and echoed New Zealand’s
statement on the review of the air transport Annex, suggesting that the next meeting of the review bescheduled in late May, and at any rate before the summer break;  she also understood that the
executive summary promised by the Secretariat would be circulated over the following weeks and
looked forward to receiving it.
175. The representative of Colombia said that Members had two useful tools at their disposal to
advance the services negotiations, namely the revised scheduling guidelines and the negotiating
guidelines and procedures.  It was now important to  decide how to advance.  In this regard, herS/CSS/M/8
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delegation was concerned that the concentration of proposals for sectoral negotiations might affect the
overall balance of rights and obligations as guaranteed by the GATS and taken up in the negotiating
guidelines.  Whilst sectoral issues could be brought up in the negotiations, it was essential to avoid
that the services negotiations be transformed in a series of separate negotiations, which would affect
the overall balance of rights and obligations that had been recognized by all Members as one of theobjectives of the negotiations.  As for the future work programme, this could not be defined in a
mechanical manner, simply by deciding on the order in which negotiating proposals, both existing and
forthcoming ones, would be discussed.  The determination of the issues on the negotiating agenda had
to be guided by the negotiating guidelines.  Therefore, besides deciding on the organization of the
discussion of the negotiating proposals, Members also needed to agree on the inclusion on the agenda
of a number of issues of crucial importance to developing countries, in order for the negotiations to
proceed in a balanced manner.  She suggested that the following horizontal items of special interest to
developing countries be included as standing items on the agenda of the Special Session.
176. First, classification criteria.  Classification was an issue of great importance to her delegation.
She suggested that Members negotiate two criteria, which would guide the classification work in the
Committee on Specific Commitments:  a criterion of specificity on the one hand, and a criterion of
disaggregation on the other.  Given that what facilitated the identification of an activity were itscharacteristics, specificity would allow to distinguish the core activities of a production process from
those which were only support activities.  A good deal of activities could be classified into different
sub-sectors, but each sub-sector had special characteristic elements which, although necessary for
other activities, distinguished it from the other sub-sectors.  For example, it could be said that
75 per cent of tourism took place by air;  however, air transport had its own classification which madeit easily identifiable.  As for disaggregation, developing countries in general found disaggregation
necessary to facilitate the evaluation and undertaking of specific commitments.  Besides added
transparency, the disaggregation of activities offered better discretionality and greater confidence to
undertake deeper commitments.  Countries like her own, where the production chain in services was
not very integrated, could competitively develop certain activities in the production line, whereas suchlevels of efficiency could not be achieved in other areas.  In the latter instances, national producers
and consumers would benefit from market opening.  However, there were some activities which
governments wished to preserve from foreign competition for domestic policy reasons.  Only a
specific and detailed classification could provide the flexibility and discretionality guaranteed by the
GATS and restated in the guidelines.  Second, criteria and rules for professional services liberalization
and the movement of natural persons in general.  Her delegation was in favour of the proposal by
India that multilateral guidelines be developed to establish more transparent and objective visa andwork permit regimes.  In addition, issues such as the application of Article VII required substantial
work, especially if progress was to be achieved with respect to traditional policies linked to mode 4
that were listed in all the proposals as barriers  to trade in services.  Third, MFN exemptions.  A
significant reduction in the use of MFN exemptions by developed countries and more transparent
disciplines on domestic regulation could offer new business opportunities;  such issues were includedin the guidelines and should be placed on the agenda of the Special Session.  Fourth, criteria for the
recognition of autonomous liberalization.  These, toge ther with due flexibility in undertaking specific
commitments, should not be residual elements in the negotiations, but rather be taken into account in
each negotiating phase and be given priority in the course of the work in the year ahead.  Fifth, the
assessment of trade in services, which was already an item on the agenda of the Special Session,should continue to be so, given that the reasons which had led to its inclusion in the first place were
still valid.
177. The representative of Switzerland said that the priority of the Council was the analysis of all
the negotiating proposals.  He was flexible as to how such discussions might be organised, and could
support examining all the proposals at the May meeting and splitting them for more detailed analysisbetween the meetings in July and October.  He expressed a concern with respect to the number of
proposals that had been tabled and the forthcoming ones, including from his delegation, and namelyS/CSS/M/8
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that sufficient time be available for their discussion.  He suggested that in May Members discuss in
more detail the organisation of the two subsequent meetings, as well as the time-sharing between the
Special Session and the subsidiary bodies, as two-day meetings of the Council were likely to prove
insufficient.  He could support scheduling a meeting to review progress achieved in March 2002, but
said that such a meeting could also be held in the current year.  As to the organisation of the sectoraldiscussion, he could support following the order of the W/120 classification while also allowing for
the discussion of other new areas, such as energy services.  He also supported the Mercosur proposal
that the Secretariat prepare a table of the negotiating proposals, keep it updated and available on the
WTO web-site with hyperlinks to the negotiating proposals themselves.
178. The representative of Hong Kong, China said that progress had been achieved in the first
phase of the negotiations.  The negotiating guidelines had been established, and good work had been
carried out with emergency safeguards, whereas work on other rule-making issues had beendisappointing.  With respect to the future work programme, many proposals had been tabled and
many more would hopefully be forthcoming, especially from developing countries, and needed to be
catered for.  Members would increasingly focus on the Fourth Ministerial Conference, which was an
important event.  Discussions on the assessment of trade and on autonomous liberalization would
continue, as would work in the subsidiary bodies.  The work of the regular sessions of the Councilshould also press on, including on MFN exemptions.  As for the negotiating proposals, these were of a
sectoral, modal and horizontal nature and covered as many as 20 different areas.  They were complex
and often sensitive, making the participation of capital-based experts important and calling for a
detailed work programme.  In 2001, work would still be conducted in special sessions of the Council,
which had to last at least a week;  this implied that either more time would have to foreseen for theCouncil or that less time would have to be allocated to the subsidiary bodies, which might wish to
meet informally outside the services "clusters" of meetings.  As for the suggested organization of
work in the three forthcoming clusters, he could support discussing all the proposals in May and then
splitting them between the July and October meetings.  He acknowledged that the October meeting
might not be very focused, but stressed that Members had to engage in a real discussion nonetheless.He also underscored that new proposals had to be accommodated.  As to the order of the discussion,
he suggested taking up modal and horizontal issues at the beginning and using the order of the W/120
classification for the sectoral proposals.  He was in favour of agreeing on a schedule of meetings
beyond the Fourth Ministerial Conference, and could also support going beyond March 2002, but
while he hoped that positive results would be achieved at the Ministerial, such as the setting of a date
for the start of the request-offer process, he was not confident that, in terms of substantive discussion,
the December, February and March meetings would be independent of the outcome of the Ministerial.As for the Mercosur suggestion that the Secretariat prepare a matrix highlighting the main elements of
the proposals, he felt that this might prove difficult and that the Secretariat might have more guidance
following a more detailed discussion of the proposals at the May meeting.
179. The representative of Hungary was pleased with the progress achieved in the first 15 months
of negotiations and said that solid and valuable work had been carried out and that Members were on
the right track.  The Council, in both regular an d special sessions, and the subsidiary bodies had
achieved tangible results, such as the adoption of the negotiating guidelines and of the revised
scheduling guidelines, as well as progress made in the negotiations on emergency safeguards.  He
welcomed the submission of the negotiating proposals, which all required detailed analysis, and hoped
that more would be forthcoming, making the range of countries that expressed export interest morerepresentative.  He believed that only a balanced package, containing rules elements as well as market
access negotiations, could advance services trade liberalization, and that the launching of a
comprehensive round of negotiations, allowing for cross-sectoral trade-offs, would significantly
improve the process.  Looking at the future, he said that Members' attention should focus on rule-
making, particularly on emergency safeguards and domestic regulation, on autonomous liberalizationand on discussing the negotiating proposals.  As for the organization of future work, his delegation
was flexible, but a structured discussion was important to allow for the participation of capital-basedS/CSS/M/8
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experts.  He could support holding a discussion of all the proposals in May and then splitting them
into two groups for more detailed analysis at the July and October meetings according to sectors, on
the basis of the W/120 classification and taking into account also those sectors that did not fit in the
W/120, modes and horizontal issues.  He saw merit in setting out future work until the Fourth
Ministerial Conference and beyond, on the understanding that it would not prejudge any decisionstaken at the Ministerial.  Beyond the Ministerial, it  would be useful to think about a further meeting in
February 2002.  He supported the proposal by Mercosur that the Secretariat prepare a factual matrix
of the negotiating proposals, but wondered whether this should wait until after the May meeting.
180. Responding to the comment by Hong Kong, China, the representative of India said that the
political reality was different from the legal reality, the latter being that the services negotiations were
mandated negotiations.  Given that Members had no control over the outcome of the Fourth
Ministerial Conference, and that the services negotiations were mandated negotiations, the serviceswork programme had to be de-linked from the outcome of the Ministerial.  He supported the 12-
month programme suggested by Mercosur, as well as the schedule of meetings for the discussion of
the negotiating proposals suggested by the Chairman.  He said that a lot of work had to be carried out
before the access negotiations could begin and he was worried that, given that the negotiating
guidelines contained best endeavour language, such  work would not be carried out, whereas it was
independent of the outcome of the Ministerial and should be completed regardless.  He referred to
work on emergency safeguards, where there was a deadline, work on classification, the substance of
which should precede the negotiations, on autonomous liberalization and assessment of trade, where
at least ground work should be carried out, issues of domestic regulation and the discussion of the
sectoral proposals.  Therefore, a work programme laying out the ground work was essential.
181. The representative of Japan noted the progress made in preparing for the more substantive
phase of the negotiations, and referred to the adoption of the negotiating guidelines and of the revised
scheduling guidelines and the review of MFN exemptions, which had deepened Members'
understanding and would contribute to future negotiations on MFN exemptions.  In accordance with
the road-map, a number of negotiating proposals had been tabled which would enable Members toturn to more substantive discussions.  As for future work, he encouraged further submissions and
active participation by all Members and said that the negotiations should be comprehensive.  Provided
that all proposals were analysed thoroughly, he supported organizing the discussion along sectoral
lines in the order the W/120 classification, while allowing for the examination of proposals of a more
horizontal nature.  He concurred with the Chairman's suggestion that all the proposals be examined
thoroughly at the May meeting and that the discussions be very focused in July and October, but said
that discussions could continue beyond the Fourth Ministerial Conference if there was a need.  Hisdelegation's preference was that no concrete benchmarks be set, but they could be flexible and
pragmatic;  at any rate, the work programme would not prejudge any decisions taken at the
Ministerial.  He reiterated the importance of launching a comprehensive round of negotiations to gain
further momentum also in the services negotiations.  He supported Mercosur's proposal that the
Secretariat prepare a matrix of all the submissions, but suggested that it might be prepared after theMay meeting.
182. The representative of the Slovak Republic said that the first phase of the negotiations had
been a positive one.  She was pleased that the negotiating guidelines had been adopted, as they offered
a clear direction for the negotiations in accordance with Article XIX of the GATS with respect to
objectives, principles, scope, modalities and procedures.  She had appreciated the transparency of theprocess, as well as the involvement of many Members at different levels of development.  The
number of proposals submitted was an indication of Members' level of interest and of their broad
expectations.  They reflected the interests of Members in a wide range of sectors that were important
for their economic development, were a good basis for future stages of the negotiations and needed to
be carefully analysed to consider their impact on market access, economic growth and development.She supported the Chairman's proposal for future work, and evaluated positively the work carried outS/CSS/M/8
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by the subsidiary bodies.  Future work should be managed effectively and address all issues arising
from the negotiating process and having an impact on services trade.  The negotiations had to focus
on the interests of individual Members, taking into account their right to regulate and with due respect
for national policy objectives.  Her delegation attached great importance to the rule-making work and
the issue of the treatment of autonomous liberalization, for which multilateral criteria had to bedeveloped, and supported holding a special meeting on the issue.  She hoped for a balanced and
satisfactory outcome for all Members and called for a transparent negotiating process.
183. The representative of Bolivia supported the work programme suggested by Mercosur that
discussions of the proposals take place over the following year, on a sector-by-sector basis and
independently of the outcome of the Fourth Ministerial Conference, as well as the suggested
Secretariat paper.  He also stressed that the meetings of the Committee on Agriculture should not be
held in parallel with the meetings of the Services Council.  He added that the agenda of the Councilshould include the elements contained in paragraphs 2 and 3 of Article XIX and that a meeting to
review progress should be held in March 2002.
184. The representative of Ecuador was pleased with the progress achieved and optimistic about
future work on the basis of the negotiating guidelines just agreed.  He underscored the need to
proceed in a balanced ways with respect to th e examination of the negotiating proposals and the
horizontal issues that were on the agendas of the Council and of its subsidiary bodies and which were
linked to the negotiations.  Work on the assessment of trade and on autonomous liberalization was a
priority for developing countries, had to advance substantially over the subsequent months and would
have a positive impact on the outcome of the Fourth Ministerial Conference.  On work in subsidiary
bodies, he had taken note of the statement by Colombia, which contained useful criteria to establishan order of priority for work in the subsidiary bodies.  His delegation attached particular importance
to the work on emergency safeguards.  Setting out a work programme for the year ahead was
essential, and a new stock-taking exercise should be carried out at the end of that period in March
2002.  The Council needed to examine the negotiating proposals submitted in accordance with a pre-
determined order, enabling sector-by-sector as well as modal examination and which could follow theorder in W/120, without prejudging the possibility of new proposals being submitted.  Regular
reporting on progress of work in the subsidiary bodies should also continue.  He supported the
proposed schedule of meetings and stressed the importance of avoiding overlaps between negotiating
meetings on services and on agriculture because of the constraints of small delegations.
185. The representative of El Salvador stressed the importance of defining a tentative date for the
review of the Annex on Air Transport Services, possibly in May;  the process needed to continue as it
had an impact on other sectors and it would provide greater clarity as concerned the coverage of theAnnex.  He also referred to the importance of the work on autonomous liberalization and on
emergency safeguards.  He supported Colombia's proposal regarding the review of W/120;  it was on-
going work which Members needed to bear in mind, as it affected the sectors they would include in
their schedules.
186. The representative of Indonesia said that, after adopting the negotiating guidelines and
receiving various proposals, the work programme was the next important issue to be taken up and
should be agreed soon, so as to have a clear direction for the subsequent phase of the negotiations.
Although he agreed that, in order to better or ganize the debate, the work programme should be
organized by sector and mode, he was of the view  that the work programme should enable Members
to refer back to any proposal tabled by Members.  Like many developing countries, Indonesia neededample time to study the proposals before making detailed responses to the individual sectors and
modes proposed by Members.  His delegation was overwhelmed by the proposals and had
encountered difficulties in finding a way to deal with them.  This was why his delegation might not be
in a position to respond to any sector or mode when these were discussed.  As far as issues to be taken
up in the following phase, in addition to the nego tiating proposals, he referred to the rule-makingS/CSS/M/8
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work, which was a priority issue for developing countries like his own, particularly as concerned
emergency safeguards, and the work on autonomous liberalization, which had to be completed prior
to the conclusion of the negotiations of specific commitments.  The assessment of trade was another
key issue.  It was his delegation's view that the work programme should include those issues as
standing items on the agenda.  He also underlined that the organization of work had to take intoaccount the limited resources of many developing country Members.  He concurred that the work
programme had to be de-linked from the outcome of the Fourth Ministerial Conference.
187. The representative of the United States said that, like many other Members, her delegation
had been actively engaged in the services negotiations over the previous year and welcomed the
stock-taking session.  The stock-taking offered Members an opportunity to look back at what they had
accomplished and to look forward to consider how to build on progress.  Progress had been made.
From the negotiating guidelines and procedures to the revised scheduling guidelines, to thenegotiating proposals submitted over the previous months from both developed and developing
countries, signs pointed to serious and sustained interest in the negotiations.  Her delegation
considered that the stock-taking clearly conveyed that Members were turning the corner in the
negotiations.  Members' achievements until then provided a firm foundation for moving to discuss the
outlines of how to meet the mandate of the negotiations, including the mandate to remove restrictionsand provide effective market access, to the benefit of all Members.  Throughout those discussions, the
United States had said that one of their objectives was to help make the GATS work for all Members.
For their part, it was not so much a question of giving priority to any one Member's objectives over
those of another, but of moving all of Members' interests forward together.  By its very structure, the
GATS allowed all Members to do that, and she believed that the negotiating guidelines andprocedures had allowed all of Members' interests to move forward together.  Moreover, the
scheduling guidelines were an important step in the preparations, as they would promote clarity and
consistency of future commitments, thereby help ing to make the commitments more understandable
not only to other governments but also to domestic constituencies.  But, by its very structure, the
GATS also required significant contributions from individual Members to make it work.  Oneexample was the negotiating proposals submitted until then.  She was pleased to hear that a number of
other Members were working on or considering additional proposals.  Another example was the
assessment of trade in services, provided for in Ar ticle XIX, and development of modalities for the
treatment of autonomous liberalization, also in Article XIX.  Both provisions had been highlighted in
the guidelines as important to all Members, but it was upon Members jointly to respect those
requirements.  The earlier discussion on those two items had proven fruitful, and she was optimistic
that, with further contributions, Members would be able to meet those obligations soon and in a waywhich promoted the objectives of the GATS.  Her delegation also hoped that similar attention would
be devoted to the Article XIX provision, also highlighted in the guidelines, on special treatment for
least-developed countries.
188. With respect to looking forward, her delegation joined others in supporting an organization of
work that took into account the following poi nts, which her delegation believed would allow
Members to build on progress achieved.  First, rather than discussing proposals according to who had
submitted them, it was sensible to group them by sector and mode.  Second, the agendas of the
meetings should be planned, in terms of which sectors and modes would be taken up at which
meetings, far enough in advance to facilitate participation by capital-based experts.  Third, time
devoted to the Special Session had to be sufficient to allow for full, focussed discussion of each of theproposals.  As a result, Members might want to consider time implications for some of the subsidiary
bodies.  Fourth, after Members had had a chance to present and respond to questions regarding the
individual submissions, they might want to ask the Secretariat to facilitate discussion by identifying
issues they might want to consider in the course of the sector or mode discussions.  This would help to
see the differences and similarities in proposals.  Her delegation welcomed the start of the secondphase of the negotiations, confident that Members had devoted the needed time to their preparations
and interested in working with other Members to promote the objectives of the GATS.S/CSS/M/8
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189. The representative of Canada said that a solid basis existed to move forward with the
Council's work.  The negotiating guidelines, the revised scheduling guidelines and the principles and
objectives that her delegation had outlined earlier would be guiding Members' work through the
following phase.  Members had commitments to  continue their work on rules, autonomous
liberalization, assessment of trade and the review of the air transport Annex, and it was in this contextthat she wished to look at forthcoming work on market access.  It was essential to be both pragmatic
and rules results-oriented;  there were many proposals, with more coming, and it was important to let
substance drive the work.  She concurred with Mercosur's idea that the Secretariat could provide
useful help;  she had noted the comments made by Hong Kong, China and was open to the discussion,
but liked the idea of the Secretariat providing such support.  As for future months, she stressed the
importance of allowing sufficient time for formal and informal meetings of the Special Session.
Members had agreed to the schedule of meetings for the year ahead, but her delegation was preparedto look even further.  She anticipated additional guidance from the Fourth Ministerial Conference, but
said that this would be just one factor in the services negotiations.  She agreed to having all the
proposals addressed in May, followed by two examinat ions in July and October, to split the work and
to allow for the active participation of capital-base d experts and smaller missions.  She agreed to the
discussion being organized along the lines of the W/120 classification, and suggested that the general,horizontal and modal issues be considered at the end, given that some of the latter issues, such as the
movement of natural persons, would come up in seve ral instances throughout the sectoral discussions
and that this would help delegations gather the different comments and make a much more substantive
input at the end.  She said that finding sufficient time for the discussion was crucial and suggested
that, in light of the substantial work ahead, especially for smaller delegations, Members focus onessential work in the subsidiary bodies, namely domestic regulation and GATS rules, particularly
emergency safeguards, and that they allow the work in substance in the Special Session over the
following months to subsequently drive the work  in the Committee on Financial Services and the
Committee on Specific Commitments, while reiterating the importance that her delegation attached to
the work in the two committees.  She welcomed the opportunity to identify and clarify the interests ofall Members in the upcoming substantive work.
190. The representative of Venezuela said that she appreciated progress made in the Council, the
adoption of the guidelines and the proposals submitted.  As a delegation from a developing country,
Venezuela was proud to have been able to table a negotiating proposal on energy services.  She
concurred with the comments made by the delegation of Colombia, particularly on pending work,
which needed to be continued, on classification, autonomous liberalization and assessment of trade;
the contribution and active participation of all Members was indispensable.  She supported theproposal by Mercosur that the Secretariat prepare a matrix based on the order of the W/120
classification and including energy services, as well as the suggestion by Switzerland that such a
matrix be available on the Internet.  She said that such a matrix would allow the identification of the
main elements of the proposals, their differences and degrees of convergence, and well as facilitate
the identification of the sectors and modes of interest to developing countries.  By way of preliminaryreaction to some of the suggestions made, she said that addressing all negotiating proposals in one
meeting would be overwhelming, a nd proposed dividing the discussion on a sectoral basis into a
manageable number of proposals in terms of content and volume, as this would facilitate the
participation of capital-based experts.  She could consider the May meeting addressing all horizontal
and modal issues, rather than sectoral ones.  She requested that, in drawing up the work programme,the Secretariat take into special account the capacity of developing countries' delegations as well as
the work required for the preparation of the Fourth Ministerial Conference.  She also supported the
idea of holding a stock-taking session in March 2002, to assess progress made and possible
adjustment in positions taken up to that point.
191. The representative of Egypt said that some progress had been achieved over the previous
months, culminating principally with the adoption of  the revised scheduling guidelines and of the
negotiating guidelines and procedures.  However, a number of areas were awaiting successfulS/CSS/M/8
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conclusion and required further work, such as emergency safeguards, of particular importance to his
delegation.  The work programme had to be flexible in this respect, and time had to be allocated to on-
going work in the rule-making area, with due consideration given to the constraints of developing
countries' delegations.  Equally important were discussions on the assessment of trade in services and
the modalities for the treatment of autonomous liberalization.  He supported the proposal by Mercosurfor the organization of future work as well as the suggestion that the Secretariat to prepare a matrix
with the main elements in negotiating proposals, with the understanding that it would be an on-going
process.  With regard to the comments made on the Fourth Ministerial Conference, he said that
Ministers in Doha would give some guidance regarding the work in services, but also regarding work
in other areas of the WTO work-programme, which would all be politically balanced by Members in
accordance with their interests and aspirations.
192. The representative of the Philippines said that his delegation was generally pleased with
progress achieved, with the adoption of the revised scheduling guidelines and of the negotiating
guidelines and procedures.  Substantive progress had been achieved on emergency safeguards;  any
work-programme should take this into account and allow Members to hold sufficient additional
meetings to continue their intensive work on the proposed draft tabled by ASEAN and build on
progress made.  He referred to other areas which would impact on Members' work in the negotiationson specific commitments, including other aspects of  the rule-making work in the Working Party on
GATS Rules, and modalities for the treatment of autonomous liberalization, where, while he remained
hopeful that concrete progress could be achieved early, he hoped that the dedicated meeting would not
be the last session on which Members could build on to advance work.  He looked forward to
Members' submissions on modalities for the special treatment of least-developed countries.  As for thefuture work programme, he agreed that a substantive discussion of the negotiating proposals be
carried out in the coming year, and that they be all addressed, on a sectoral, modal and horizontal
basis, in May, and then split into two groups between July and October.  However, he stressed that
sufficient flexibility had to be provided to discuss any future submissions which might cover sectors
already addressed in previous meetings;  that some Members had capacity constrains which impactedon their ability to discuss the technical details of the negotiating proposals;  and that, while mindful of
the guidance to be provided by the Fourth Ministerial Conference, this should not infringe on
Members' own ability to carry out substantive discussion on the proposals.  As for the Mercosur
proposal for a matrix, while he saw value-added in such a matrix, he suggested that it might be
prepared after the May meeting.
193. The representative of Argentina said that, whil e indications on how to approach future work
in services might emerge from the Fourth Ministerial Conference, he was worried by the simultaneous
emphasis on the need to go deeper into the analys is of the proposals and on the discussion including
elements, both in terms of proposals and in terms of work in the subsidiary bodies, which were not
priority elements for the current phase of the negotiations.  It was important to have a concrete idea of
the work programme, not only of the dates but also the content of the discussion on such dates.  While
work in the subsidiary bodies was important and mandated, the content of their agendas could bephased depending on priorities that existed in other meetings in the same period, and possibly put
forward to future meetings.  He was worried that the upcoming phase was going to be technically
difficult and that this might run counter to the objective of a thorough, deep and constructive analysis
of all the proposals, which was in the interest of all Members.
194. The representative of Turkey said that his delegation was satisfied with the progress achieved
until then.  The first phase of the negotiations, which had been mainly procedural and had been
concluded with the adoption of the negotiating guidelines and procedures, was an important step
forward.  He noted the importance of building on the flexibile and constructive spirit displayed until
then to finish work in the foreseeable future.  He said that future work had to be organized logically
and efficiently.  He concurred with the suggestion that all the negotiating proposals be discussed at theMay meeting, along sectoral, modal and horizontal lines, and that on that basis discussions beS/CSS/M/8
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continued until the Fourth Ministerial Conference.  He also supported the idea that another stock-
taking be held in March 2002.  He reiterated some points of importance to his delegation.  First. while
having the GATS reviewed, the existing architecture of the GATS should be preserved and the
negotiations be conducted within this architecture.  Second, certain points regarding the cluster
approach needed to be clarified, particularly the formulation of commitments for further trade
liberalization for which a cluster approach was suggested.  Third, regarding Article VI:4, his
delegation was closely following the discussion on the disciplines to be developed with a view to
ensuring that the measures covered by Article VI:4 did not constitute unnecessary barriers to trade in
services.  Fourth, he believed that granting credit for autonomous liberalization measures would
provide impetus to the negotiations.
195. The representative of Malaysia said that the main achievement over the previous year had
been the positive attitude of each and every delegation, which had given Members the confidence to
progress and to adopt the negotiating guidelines and procedures and revised scheduling guidelines.
He hoped for a similar attitude and comparable results also in the negotiations in agriculture.  As for
future work, he stressed the need to take into a ccount the complexity of the issues under discussion,
the different pace among the participants, the constraints of developing countries' delegations, the fact
that additional proposals would be coming in, hopefully from a cross-section of delegations to includemore developing countries.  Time was needed to reflect on the proposals and to ensure adequate
communication with capital-based experts.  Memb ers had to try to conclude work on autonomous
liberalization and on the assessment of trade before the start of the market access negotiations;  this,
together with the development of emergency safeguards, would give delegations a level of comfort.
He thought that the statement by Mercosur did take into account all the factors that he had mentionedand he supported it in full.
196. Responding to some of the suggestions made, a representative of the Secretariat said that, as
concerned the preparation of a matrix of the negotiating proposals, it would be useful to think of such
a matrix as on-going work.  The matrix could be as simple as a sectoral list of the documents and of
the Members having tabled them, but it would be more valuable if it included factual indicationsabout what the proposals contained, such as, for example, references to the desirability of a reference
paper, which were present in several papers.  He stressed that it would be work that would develop
over time, especially in light of the discussions at the May meeting.  As for the Korean request that
the Secretariat prepare a compilation of Members' commitments in maritime transport services, he
said that such a compilation existed and could be updated and circulated.  The Korean delegation had
also suggested that the Secretariat update its background paper on maritime transport services, as well
as, if he had understood correctly, the rest of the Secretariat background papers.  In this regard, heindicated the readiness of the Secretariat to update the background note on maritime transport
services;  with respect to the other notes, he said that it would be a difficult and very heavy task and
that he was much more hesitant to commit to undertaking such work.  He could imagine a simple
update, with an addendum indicating what had been  included in the schedules of Members having
acceded to the WTO since those notes had been written, but a thorough-going update of all thosenotes would be difficult and might even become  an impediment to Members' on-going work.
197. By way of concluding remarks, the Chairman said that the stock-taking discussion had been
carried out swiftly thanks to the positive and constructive spirit of delegations.  Members had an
ambitious negotiating agenda ahead, but they had got off to a successful start.  Beyond the negotiating
proposals, many delegations had referred to on-going work and to the need to continue the rule-making work with dispatch.  He indicated that the Council needed to determine the date of the
meeting of the Special Session dedicated to the issue of autonomous liberalization and of the next
meeting of the review of the Annex on Air Transport Services, to be held possibly in late May.  The
assessment of trade would remain an important standing item on the agenda of the Special Session,
whereas the regular sessions of the Council would be concerned with concluding the review of MFN
exemptions.S/CSS/M/8
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198. There was convergence on the schedule of meetings for the year ahead.  Members agreed to
hold clusters of services meetings in May, July, October, December and March 2002, when they
would review progress made in the negotiations.  Th e scheduling of an additional meeting in February
2002, proposed by two delegations, could be decided upon later on in the year.
199. As concerned the organization of the discussion of negotiating proposals, all proposals would
be addressed at the May meeting and the discussion would be structured according to sectors, modes
of supply and the horizontal issues identified.  The proposals would be divided into two groups for a
more detailed discussion at the meetings in July and October.  Sectors would be taken up in the order
in which they appeared in the W/120 sectoral classification, while also allowing for the discussion of
other sectors, such as energy services.  It was poi nted out that such a work programme would require
the Special Session to meet over several days and that it might have implications on the allocation of
time between the Council and the subsidiary bodies.  Several delegations had called for a predictablework programme in terms of the allocation of sectors to meetings, in order to facilitate the
participation of capital-based experts.  He stressed that Members remained free to introduce new
proposals at any time.  With respect to the suggestions for work by the Secretariat, he referred to what
the representative of the Secretariat had said as his conclusions.
200. He indicated that the work programme was without prejudice to the outcome of the Fourth
Ministerial Conference.  He proposed that Members adopt what he had outlined as the future work
programme for the Special Session of the Council for Trade in Services.
201. It was so agreed.
202. With regard to date of the next meeting of the air transport review, the representative of
Australia recalled that her delegation had suggested that it be held in late May;  she therefore
wondered how a decision would be taken, given that the Council would not meet until mid-May.  A
representative of the Secretariat said that the Chairman would be holding consultations on the date of
the meeting and then communicate the proposed date by fax, subject to Members' agreement.
H. OTHER BUSINESS
203. A representative of the Secretariat informed Members that the Secretariat had now completed
its work on the schedules of commitments in electronic format and that these were available in a trial
version on the WTO Members' web-site and could be accessed through the icon "services electronic
schedules" on the home page.  In addition, two copies of a CDROM containing the electronic
schedules would be circulated to delegations, and with them a detailed user manual for both the
Internet facility and the CDROM.  The user manual would be distributed as a formal Council
document, with the purpose of recording officially the non-binding character of the compilation of
schedules.  The Secretariat would also be organizing a demonstration, lasting about one hour, showinghow to operate the system.
204. The Council took note.
I. APPOINTMENT OF THE NEW CHAIRPERSON
205. The Chairman indicated how much he had enjoyed working with delegations and with
members of the Secretariat.  He took the occasion to warmly thank David Hartridge, on his last
presence before the Council for Trade in Services, for his leadership, commitment and competence as
Director of the Services Division.  He also heartily congratulated Hamid Mamdouh on his
appointment as new Director of the Division.  He was delighted that the General Council had
approved the appointment of Ambassador Cels o Amorim of Brazil, who was a capable and
experienced negotiator, to take up the post of Chairman of the Council for Trade in Services.  HeS/CSS/M/8
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proposed that Ambassador Amorim be appointed by acclamation as the Chairman of the Council for
Trade in Services.
206. The Council so agreed.
207. The new Chairman, Ambassador Am orim of Brazil, thanked Ambassador Marchi for his kind
words, leadership and energy and adjourned the meeting.
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