RESTRICTEDWORLD TRADE
ORGANIZATIONS/WPDR/M/7
19 September 2000
(00-3771)
Working Party on Domestic Regulation
REPORT ON THE MEETING HELD ON 12 JULY 2000
Note by the Secretariat
1. The Working Party on Domestic Regulation held a meeting on 12 July 2000.  The agenda for
the meeting is contained in Airgram WTO/AIR/1347.  The meeting began with Members' reports ondomestic consultations with professional services organizations;  also addressed was the issue of
Secretariat consultations with international professional organizations.  This was followed by
consideration of concepts relating to the development of regulatory disciplines for services as a whole.
In this latter context, Members commented on the Secretariat Checklist of issues under discussion,
deciding to revise and expand the Checklist in preparation for further discussion of the substantiveissues involved.
(a) Development of General Disciplines for Professional Services
2. The Chairperson noted that, due to time pressures, Members had been unable at the previous
meeting to further report on consultations with their domestic professional organizations regarding the
applicability of the accountancy disciplines to other professions.  Consequently, delegations asked for
this item to be placed first on the next agenda.  Generally speaking, Members had earlier reported that
initial responses have been rather positive.
3. Since the previous discussions on professional services, a number of delegations had
circulated reports concerning their domestic consultations.  These were:  Hong Kong, China in
document S/WPDR/W/3, dated 26 April;  Uruguay in three documents, Jobs No's 3062, 3063, and3064, all dated 17 May;  the European Communities in document S/WPDR/W/5, dated 17 May; Japan
in document S/WPDR/W/6, dated 18 May, Poland in document S/WPDR/W/7, dated 22 May, and
Australia in Job No. 3262, dated 25 May.
4. Discussions, held in informal mode, opened with introductions by delegations of their written
reports, followed by Members' verbal reports on their domestic consultations.  In summarizing the
discussions, the Chairperson observed that nine delegations had spoken, with six delegations
providing updated information on the progress of their consultations.  He noted that there seemed tobe a general acceptance of the suitability of the accountancy disciplines for other professions, but
more time and more responses would be required to confirm this impression.
5. The Chairperson further noted that the methodologies of consultation differed somewhat
between Members, and that at least one delegation had consulted with regulators as well as with
professional associations.  Some delegations had stated that they wished to commence work on a set
of "core disciplines" for professional services, wh ile others felt that initiating such work would be
premature.  Members also reported that certain professions wanted additional disciplines specific to
their sector.
6. Turning to the issue of the parallel Secretaria t consultations with international professional
services organizations, the Chairperson noted that two Members had suggested additional
organizations to be included in the Secretariat compilation.  The suggestions from Uruguay wereS/WPDR/M/7
Page 2
submitted as an informal document, Job No. 3065, dated 17 May, and the revised Secretariat
compilation was circulated as Job No. 2139/Rev.1, dated 18 May.  This was followed by additional
suggestions from Poland, circulated as Job No. 3482, dated 6 June and a further revision of the
Secretariat compilation was circulated as Job No. 2139/Rev.2, dated 10 July.  The possibility
remained open for additional listings.
7. At the April meeting, Members had expressed varying opinions on whether regional
organizations should be included in the Secretariat compilation.  One delegation wished to see the
internal consultation processes concluded before the Secretariat contacted international organizations.
Another delegation had suggested four organizations for the initial consultations:  these were the
International Union of Architects, the International Federation of Consulting Engineers, the World
Federation of Engineering Organizations and the International Bar Association.  Due to lack of time,however, discussion of the suggestion had been postponed.
8. The Chairman stated that, in his view, consulti ng with regional organizations only made sense
if there was a fear that international professional services organizations would not include, or would
not fully reflect, regional views.  There might also be some time, resource and even equity constraints(e.g. if some but not all regional organizations in a given profession were consulted).  He pointed out
that technically domestic consultations had been completed by Members, according to the originally
agreed December 1999 deadline and, therefore, the Secretariat might be considered to have some
degree of freedom to consult with the international organizations agreed to by Members.
9. Following comments by Members, again in informal mode, the Chairman summarized by
stating that it would not yet be possible to take a decision on the issue of consultations with
international professional services organizations.  The time-period originally allocated by Members
for domestic consultations had indeed passed, but relatively few replies were received.  The number
of replies was not sufficient to permit a decision to be taken.  The international consultations couldtake place in parallel with domestic consultation, but some delegations had raised concerns in this
regard.
10. The Chairman concluded this item by stating, based on the suggestions of several delegations,
that Members should seek to make a final listing of the international organizations to be consulted by
the Secretariat, in connection with the next WPDR m eeting to be held in early October, as well as to
make their best efforts to conclude domestic consultations within this time period.
(b) Discussion of Concepts Relating to the Development of Regulatory Disciplines
11. The second major item on the agenda was the discussion of concepts relating to the
development of regulatory disciplines.  At the previous meeting, the Chairman noted, Members'
interventions focused on the U.S. paper concerning transparency, which had been introduced in the
previous meeting, and subsequently released as an unrestricted formal document (S/WPDR/W/4),
dated 3 May.  Most of the delegations who spoke found some points of disagreement with the U.S.
paper;  however, these disagreements did not seem to be insurmountable.
12. One of the main issues in the discussions was whether to allow prior comment on proposed
regulations.  Some delegations stated there are often constitutional prohibitions on foreign
involvement in the domestic legislative process.  The United States responded that the issue is
providing an opportunity for commenting on the regula tions, not direct involvement in the legislative
process.  A related issue was the potential administrative burden, especially upon local and regional
administrations, associated with strengthening GATS transparency requirements.  The U.S. intention
in this respect was not completely evident, but in discussions it emerged that this was likely to take
the form of notifications in the official government gazette, rather than additional notifications to the
WTO or directly to the services providers concerned.S/WPDR/M/7
Page 3
13. As a consequent of the intensive discussions at the last meeting of the concepts relating to the
development of regulatory disciplines, the Secretariat was asked to draw up a Checklist of the main
issues under discussion.  The draft Checklist was circulated as Job No. 4103, dated 23 June.  The
Secretariat introduced the draft Checklist, at the request of the Chairman,  noting it was a straight-
forward listing of the issues raised in discussion, and that it did not attempt to structure or limit
subsequent discussion.
14. Discussion of the draft Checklist, and of the concepts relating to the development of
regulatory disciplines, was held in informal mode.  In summarizing the discussions, the Chairperson
stated that the debate had been very useful.  The draft Checklist had generally been well-received, andwould be helpful for future work.  Several delegations had commented that certain items required
further clarification or elaboration, and these comments were noted by the Secretariat.  Among therequested changes were to add a point concerning examples of the types of problems to be dealt with
under Article VI:4 discipline, to examine the terminology of the necessity tests and related concepts in
other WTO agreements, and to consider listing "n on-legitimate objectives" instead of attempting to
define legitimate objectives in the context of a necessity test.
15. In concluding, the Chairperson asked the Secretariat, based on the comments received, to
revise the Checklist of issues under discussion by end-July.  Noting that discussion of the substantive
issues was still at a preliminary stage, he encouraged Members to provide additional documentation
regarding the issues addressed in the Checklist.  In order to permit sufficient time for discussion of
these issues, he suggested – and Members accepted – that a half-day informal session be heldimmediately before the next meeting of the Working Party.
16. Following the Chairperson's conclusions, the delegate of Canada
 asked to state formally that
Canada supported the general consensus that if a list of legitimate objectives was to be developed, it
should only be an indicative, non-exhaustive listing.  In this respect, he stated, the determination of alegitimate objective rested solely with individual governments.  The delegate also stated that
Members should add to the Checklist a point concerning the types of regulatory problems to be
addressed by the disciplines to be created.
(c) Request for Observer Status from the International Association of Insurance Supervisors
17. The Chairperson mentioned that previous Working Party meetings had noted that a request
for observer status had been received from the International Association of Insurance Supervisors.
This request was contained in Job No. 779, dated 10 February 2000.
18. The delegation of the European Communities stated  that there was a need to build bridges to
the international community of regulators, and on that basis they supported the request for observer
status.  The delegate from Malaysia noted this was a systemic issue, and therefore, to be consistent,
said that Members should wait for a decision of the General Council in this regard.
19. Consequently, Members again agreed to revert to the issue at the next meeting.
(d) Date of Next Meeting
20. The Chairperson again noted that Members had requested in the Council for Trade in Services
that meetings of subsidiary bodies be held near to  meetings of the Council.  In accordance with this
request, the Chairperson suggested that the next meeting – a full day – be scheduled tentatively for
2 October 2000.
__________