RESTRICTEDWORLD TRADE
ORGANIZATIONS/C/W/151
20 June 2000
(00-2471)
Council for Trade in Services Original:  English
COMMUNICATION FROM KOREA
Review of Article II Exemptions
Second Questionnaire on the List of MFN Exemptions
(from Financial Services to Transport Services)
The attached paper has been received from the delegation of Korea with the request that it be
circulated to Members of the Council for Trade in Services.
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1. Korea is of the view that the first review session of Article II exemptions that took place on
May 29 was very informative and contributed to the enhancement of transparency and the progressive
liberalisation of trade in services, as well as paved the way for future negotiations.  Korea would like
to express its appreciation to all those members who provided responses to its previous set of
questions and looks forward to the continued exchange  of information during the next review session
to be held on July 5-6.  In this regard, Korea submits the following questionnaire under the sameprinciples and priorities as stipulated in its first questionnaire.
2. Upon reviewing the numerous MFN exemptions, it is clear that the majority of exemptions,
particularly those in the financial services sector, were claimed on the basis of reciprocity.  In these
circumstances, Korea is concerned that such bilateral arrangements could in essence undermine the
WTO principles of strengthening a rules-based trading system based on multilateralism.
3. With respect to procedural issues, in light of the fact that some members expressed their
intention to withdraw certain MFN exemptions, in  whole or in part, during the previous review
session, Korea supports the idea of further discussion on the legal status of MFN exemptions list.
4. Although Korea does not presently submit written questions relating to exemptions in the
maritime transport services sector, it reserves the right to present oral questions on this and perhapsother sectors during the next review session.  Finally, Korea would appreciate if members would
provide their responses in writing in advance of the meeting so as to allow for more productive
exchanges.S/C/W/151
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A. FINANCIAL SERVICES
1. Austria (page 75)
− Please specify the criteria for the “economic interest test” referred to in column 2.
− Please specify the countries for which the economic interest test is waived.
2. Canada (page 77)
− Please clarify what is meant by “preferential access”.
− Is full national treatment accorded to suppliers described therein?
3. Canada (page 78)
− Please clarify what is meant by “preferential treatment” in column 2 of row 2.
− Is full national treatment accorded to suppliers described therein?
4. European Communities and their Member States (page 81)
− What type of “favorable tax treatment” in column 2 would be granted to eligible
countries?
5. Indonesia (page 82)
− Please list the countries that have been accorded reciprocal treatment since 1995.
6. Israel (page 82)
− Please clarify the meaning of “similar commercial presence” in column 2, particularly
in relation to establishment and the scope of business activity.
7. Pakistan (second entry, page 83)
− Please clarify the meaning of “ favorable treatment” in column 2.
− Please provide a list of specific financial institutions that were established pursuant to
the “Treaty of Izmir and the Istanbul Summit” as mentioned in column 5.
8. Singapore (page 86)
− What is the present level of paid-up capital of ASEAN Re?
− Please clarify the intended duration of this measure as set out in column 4.
9. Singapore (page 87)
− Please explain why the measure described in column 2 qualifies as an MFN
exemption given that it appears to fall within the exercise of government authority.S/C/W/151
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10. Turkey (page 89)
− Please clarify whether “stricter conditions” in column 2 relate to measures affecting
market access, measures related to prudential regulations, or both.
11. United States of America (first entry, page 91)
− Please specify why the condition imposed by Florida and Oklahoma as set out in
column 2 limiting the commercial presence of foreign financial institutions on the
basis of their size is regarded as requiring an MFN exemption as opposed to being
seen as a market access limitation.
B. HEALTH -RELATED AND SOCIAL SERVICES
12. Cyprus (page 92)
− Please specify the nature of the preferential treatment granted to countries in
column 3.
C. TOURISM AND TRADE RELATED SERVICES
13. Mexico (page 92)
− Please explain whether or not the measure is related to footnote 6 of Article XIV of
GATS.
D. RECREATIONAL , CULTURAL AND SPORTING SERVICES
14. European Communities and their Member States:  the 1st row (page 93)
− France has made an identical commitment in its Schedule of Specific Commitments
except that an additional condition of reciprocity is set out in column 2 . Please
confirm that the level of commitment made in the national Schedule applies to all
WTO members.
− Please list the countries that have been accorded the benefits of this measure since
1 January 1995.
15. European Communities and their Member States:  the 2nd row (page 93)
− Please explain the meaning of “market access” in column 2.
− Please list the countries that received the benefits of the measure since 1 January
1995.
E. TRANSPORT SERVICES
16. Canada:  the 3rd row (page 117)
− Please explain the meaning of “ some foreign repair and maintenance service
suppliers” in column 2.
− Please clarify the nature of the preferential treatment described in column 2.S/C/W/151
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− Please provide a list of countries that have been accorded such preferential treatment.
17. Canada:  the 4th row (page 117)
− Considering that the measure described in column 2 appears to be a limitation, please
clarify the nature of preferential treatment accorded to countries in column 3.
18. Thailand:  the 3rd row (page 124)
− Please explain the meaning of “ permission” in column 2 in relation to the
preferential treatment accorded to the countries in column 3.
F. SPACE TRANSPORT
19. United States of America (page 126)
− Considering that the measure described in column 2 appears to be a limitation, please
clarify the nature of the preferential treatment accorded to countries in column 3.
G. ROAD TRANSPORT SERVICES
20. Austria (page 129)
− Please explain the meaning of “ de facto  reciprocity.”
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