RESTRICTED
WORLD TRADE S/FIN/2
23October 1996
ORGANIZATION
(96-4476)
Committee onTrade inFinancial Services
REPORT OFTHE COMMITTEE ONTRADE INFINANCIAL SERVICES
TOTHE COUNCIL FOR TRADE INSERVICES
I. Activities oftheCommittee in1996
1. Theactivities oftheCommittee onTrade inFinancial Services in1996 focused onfivemain
issues: monitoring oftheacceptance andimplementation oftheresults ofthefinancial services
negotiations concluded inJuly1995; exchange ofinformation onrecent developments infinancial
services trade; consideration ofsome technical issues regarding theschedules ofspecific commitments
andArticle II(MFN) exemptions; availability offinancial services data; andorganization offuture
work. Thework oftheCommittee in1996 wasconducted under theChairmanship of
Mr.Frank Swedlove ofCanada. TheCommittee heldtwoformal meetings in1996.1
2. Onthemonitoring oftheacceptance andimplementation oftheresults ofthefinancial services
negotiations, theCommittee provided transparency onthestatus ofacceptances oftheSecond Protocol
totheGATS toallMembers, andcontributed tothecompletion oftheacceptance process bythe
Members concerned.2Although notallMembers concerned wereabletoaccept theProtocol bythe
initial deadline of30June1996, itentered intoforce on1September 1996byvirtue ofadecision taken
on30July1996 byMembers which hadaccepted it.Thiswasinaccordance withtheprocedures
inscribed intheProtocol adopted bytheCommittee inJuly1995. Adecision bytheCouncil forTrade
inServices wasalsotaken onthesame daytoextend theperiod foracceptance oftheProtocol until
30November 1996, allowing theremaining Members toaccept. TheCommittee continues tomonitor
theacceptance oftheProtocol bytheremaining Members.
3. Concerning theexchange ofinformation onrecent developments infinancial services trade,
several Members reported recent liberalization measures. These developments werewelcomed, and
Members were encouraged toreport anyrelated developments totheCommittee fortransparency
purposes.
4. Regarding theconsideration oftechnical issues, theSecretariat produced anoteindicating issues
fordiscussion ontwotechnical questions; thedistinction between Modes 1and2infinancial services
andsectoral classification offinancial services. Other technical issues, suchashowtoimprove the
verification ofschedules andMFN exemptions afternegotiations, havealsobeenraised. TheCommittee
agrees topursue these discussions. ./.
1Uptoandincluding themeeting of22October 1996.
2TheMembers concerned are:Australia, Brazil, Canada, Chile, Czech Republic, Dominican Republic,
Egypt, European Community anditsMember States (15), Hong Kong, Hungary, India, Indonesia, Japan, Korea,
Kuwait,Malaysia,Mexico,Morocco,Norway,Pakistan,Philippines,Poland,Singapore,SlovakRepublic,South
Africa, Switzerland, Thailand, Turkey, Venezuela. TheMembers which have notyetaccepted theProtocol
asof22October 1996 areBelgium, Brazil, Egypt, Greece, Portugal andSpain.S/FIN/2
Page 2
5. Ontheavailability offinancial services data,theCommittee encouraged theSecretariat towork
inclose cooperation withother international organizations intheirefforts toimprove theavailability
ofstatistics, andrequested ittoreport onanyfuture developments withrespect tothissubject.
II. Theagenda for1997
6. TheCouncil forTrade inServices haddecided inJuly1995 thatallMembers begiven the
opportunity tomodify orwithdraw allorpartoftheirspecific commitments andtolistArticle II(MFN)
exemptions under theGATS infinancial services during aperiod of60days beginning on
1November1997.TheCommitteewilloverseenegotiationsundertakeninaccordancewiththisdecision,
andhasdecided thatsuchnegotiations willresume inearly April 1997.
7. Ontheorganization offuture work, theCommittee recognized theimportance ofproper early
preparation fortheresumption ofnegotiations in1997. Ittherefore agreed todraw upatimetable
forsuchnegotiations leading totheirconclusion inDecember 1997. Suchatimetable willbepresented
tothenextmeeting oftheCommittee tobeheldinearly April 1997.
8. TheCommittee considers thatitwillbeimportant forMinisters inSingapore toexpress their
intention tobring thenegotiations ontrade infinancial services toberesumed inearly 1997 toa
successful conclusion within theprescribed timeframe. Theaimofthese negotiations should beto
achieve higher levels ofliberalization commitments infinancial services tradeonamost-favoured-nation
basis, withthebroadest levelofparticipation, bearing inmindtheprinciple ofprogressive liberalization.
Such negotiations should takefullaccount ofrecent regulatory reforms byMembers.