WORLD TRADE  
ORGANIZATION  RESTRICTED 
S/WPPS/M/21 
29 September 1998 
 (98-3766) 
Working Party on Professional Services  
   
NOTE ON THE MEETING HELD ON 29 JULY 1998 
 
Note by the Secretariat 
 
 
1. The Working Party on Professional Services held  its twenty-first meeting on 29 July 1998.  
The agenda for the meeting was contained in airgram WTO/AIR/892. 
 Work Pursuant to Paragraph 2(a) of the Decision on Professional Services 
 
2. The Chairman opened the meeting by stating that he intended to discuss only the outstanding 
paragraphs of the draft disciplines on which no con sensus had been obtained, i.e. paragraphs 11 and 
20 of the Disciplines on Domestic Regulation in the Accountancy Sector (tenth revision, Job 
No. 3980).  The Chairman noted that he had held informal consultations on these paragraphs in order 
to resolve the outstanding issues, and observed that  the delegations concerned had made every effort 
to arrive at a consensus.  
3. Regarding paragraph 11, the Chairman ask ed Mexico to explain its concerns.  The 
representative of Mexico stated that he had asked for the floor to state a concern that Mexico had 
regarding a possible inconsistency, perhaps only theo retical, between what was stated in paragraph 11 
of the Disciplines on Domestic Regulation in the Ac countancy Sector on the one hand, and what had 
already been included in the schedule of commi tments of Mexico for accounting, auditing and 
bookkeeping services on the other hand.  This concern emanated from the fact that in paragraph 11 of 
the Disciplines it was stated that: "Members shall ensure  that the use of firm names is not restricted, 
save in fulfilment of a legitimate objective", while in the column of limitations on national treatment 
in the schedule of commitments of Mexico it had clearly and explicitly been mentioned that:  "Foreign accounting and auditing enterprises must use the name of the Mexican partners".  Taking into account 
that the purpose of the Disciplines was to clarify the provisions of Article VI:4 of the General 
Agreement on Services, Mexico considered that th ese disciplines had no effect what so ever on the 
commitments or limitations on market access or national treatment included in the schedules of comments of Members.  However, for transparency  purposes before the rest of the Members of the 
Working Party, the delegation of Mexico wished to  know the opinion of the Chairman on this matter. 
 
4. The Chairman replied that, from Mexico's inte rvention, he understood that the concern related 
to a limitation included in the national treatment  column of the schedule of Mexico, and its 
relationship with paragraph 11 of the Disciplines on Domestic Regulation in the Accountancy Sector 
which the WPPS was in the process of adopting.  He  noted that the relationship between Articles VI 
and Articles XVI and XVII was important, and was d ealt with in the Disciplines.  The "Objectives" 
part of the disciplines (paragraph 1), after remi nding what was the purpose of the Disciplines, 
Specifically stated that "The disciplines therefor e do not address measures subject to scheduling under 
Articles XVI and XVII of the GATS, which restrict access to the domestic market or limit the application of national treatment to  foreign suppliers".  Also that "Such measures are addressed in the 
GATS through the negotiation and scheduling of specifi c commitments".  The Chairman said that he 
thought the above explanation should reassure Mexico that the disciplines the WPPS was developing 
under Article VI of the GATS were not intended to overlap nor to overrule measures which are 
addressed in the GATS through the negotiation and scheduling of specific commitments on market access under Article XVI or on national treatment under  Article XVII.  The representatives of Canada, S/WPPS/M/21 
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the European Commission and the United States supported the Chairman's interpretation.  Mexico stated that the comments were helpful, as Mexico now understood that the entry in its Schedule concerning national treatment for the accountancy would not be affected by paragraph 11 of the 
Article VI disciplines on accountancy.  
5. On Paragraph 20, the Chairman asked if I ndia had any points it wished to make.  India 
responded by noting that, at the WPPS meeting of 1 Ap ril, 1998, it had suggested the inclusion of an 
additional paragraph in this section on qualification re quirements, with the intention of providing an 
indicator to what could be the least trade restrictive measure that could be considered by Members in cases where the qualifications of a foreign candida te are regarded as not being equivalent.  In 
subsequent meetings, based on the responses and comments of Members, India had presented various 
amended versions of this paragraph.  Members, however, had continued to express reservations on the 
Indian proposal.  In the WPPS meeting of 16 Ju ly, 1998, India in this context had expressed a 
reservation on the existing formulation of the section on qualification requirements, stating that it did 
not adequately reflect India's concerns on the po ssibility of Members adopting procedures which may 
be more trade restrictive than necessary, or wh ich may create unnecessary barriers to trade in the 
accountancy sector.  Since that meeting, India had a number of bilateral meetings with various delegations in an attempt to arrive at a formula tion which would take care of India's concerns and 
satisfy the observations and sugges tions made by other delegations. 
 6. India's concern, as previously stated, was basically that while fully qualified professionals 
could be put through any kind of pre-license examination that the host country might wish, they 
should not, at least in principle, be asked to go  through the entire professional education requirement 
once again.  Bases on the responses and discussions with other delegations, India had proposed an 
alternate formulation for a new paragraph to  be added to section VI of the disciplines.
1  India felt that, 
by including the words " inter alia ", "including" and "etc." in the first sentence of the formulation, it 
had adequately addressed the concerns expressed by  Members that they did not want either a 
hierarchy to be established, as far as the various procedures were concerned, nor any restrictions imposed on their competent authorities on what procedures to adopt as a prerequisite to the issue of a license.  Further, while India strongly felt that "in principle" full requalification should not be required, in view of the concerns expressed by Members, India expressed th e willingness to accept the 
word "normally", which clearly indicated that co mpetent authorities would have the freedom to ask 
for full requalification as and when so necessitated. 
 7. In spite of having diluted the original formulation to a large extent, India was unable to generate any move towards a consensus.  The furt her revised formulation, thought acceptable to some 
Members did not achieve the necessary consensus.  Re grettably, this left India with no option but to 
continue to maintain its reservation.  However, I ndia was open to any further suggestions or meetings 
on the matter, even though the Chairman proposed to suspend further discussions on the text.  The 
Chairman responded by expressing disappointment that India was unable to participate in the consensus on the text of the discip lines. The Chairman then indicated that he considered the text of 
the disciplines on accountancy closed, and stated that  he looked forward to India being able to soon 
lift its reservation. 
 
8. The Chairman then proposed an informal mee ting, in addition to the next formal meeting 
previously set for 22 October, on the morning of 2 October.  The proposal was accepted.  9. Under "Other Business", the Chairman observed that he had produced two Notes.  One Note 
was a follow-up of the earlier Secretariat Note on issues related to Articles XVI and XVII, and the 
                                                      
1 The text of the revised Indian proposal was as follows:  "Where foreign qualifications are regarded as 
not being equivalent, Members shall adopt such procedures, inter alia  including a test of competency, period of 
apprenticeship, training et c., which do not create unnecessary barriers to trade in accoun tancy services, as 
referred to in paragraph 2.  Normally, full professional re-qualification should not be required".  S/WPPS/M/21 
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second was a written statement of the Chairman's pr oposal on the legal form of the disciplines, as 
requested by Members at the previous meeting.  The Chairman invited Members to study the Notes 
over the summer, and to make comments at the next meetings.  
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