98-5203 MOREPRESS RELEASE
PRESS/118
14 December 1998
 WTO ADOPTS DISCIPLINES ON DOMESTIC REGULATION
FOR THE ACCOUNTANCY SECTOR
The WTO's Council for Trade in Services today (14 December) adopted the Disciplines on
Domestic Regulation in the Accountancy Sector  which have been developed by the Working Party on
Professional Services.  The disciplines are to be applicable to all WTO Member who have scheduled
specific commitments for accountancy under the General Agreement on Trade in Services (GATS).
This is the first step in the development of GATS Disciplines on the domestic regulation of services.
Most professional services, and many others, are heavily regulated, and for goods reasons:  but it isalso true that regulations can be an unnecessary, and usually unintended, barrier to trade in services.
The GATS calls for the development of disciplines to ensure that measures relating to qualification
requirements and procedures, technical standards and licensing requirements do not constitute such
barriers.
The disciplines now adopted, in addition to transparency requirements and other general
provisions, contain provisions on the administra tion of licensing requirements, qualification
requirements and procedures, and technical standard for the accountancy profession.  A key provision
is the general requirement that measures taken for these purposes should not be more trade-restrictive
than is necessary to fulfil a legitimate objective.  Examples of legitimate objectives specified in theDisciplines are the protection of consumers (including all users of accounting services and the public
generally), ensuring the quality of the service, ensuring professional competence, and ensuring the
integrity of the profession.  The disciplines relate to measures taken by governments and to those
taken by non-governmental authorities exercising delegated powers:  in many countries the
accountancy profession is regulated by professional associations operating under delegated powers.
The disciplines will not have immediate legal effect.  WTO Members, as stated in today's
Decision on Disciplines Relating to the Accountancy Sector , will continue their work on domestic
regulation in the context of the Working Party on Professional Services (WPPS), aiming to develop
general disciplines for professional services while retaining the possibility to develop additionalsectoral disciplines.  Before the end of the forthcoming round of services negotiations, which
commence in January 2000, all the disciplines developed by the WPPS are to be integrated into the
GATS and will then become legally binding.  Today's decision by the Council includes a "standstillPRESS/118
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MOREprovision", effective immediately, under which all WTO Members, including those without GATS
commitments in the accountancy sector, agree, to the fullest extent consistent with their existing
legislation, not to take measures which would be inconsistent with the accountancy disciplines.
Notes to Editor
1. The disciplines (attached) were created in accorda nce with the mandate of Article VI:4 of the
General Agreement on Trade in Services (GATS) , which states that the Council for Trade in
Services shall develop "any necessary disciplines" to ensure that measures relating to qualification
requirements and procedures, technical standards and licensing requirements "do not constitute
unnecessary barriers to trade in services".
2. Accountancy is generally defined in the WTO context to include accounting, auditing and
bookkeeping services.  Members, subject to negotiations with trading partners, have the right to
specify commitments in all or any part of these services within their GATS schedules.
3. The Disciplines apply only to measures not su bject to scheduling under GATS Articles XVI and
XVII.  The excluded measures, which restrict access to the domestic market or limit the
application of national treatment to foreign suppliers, are addressed in the GATS through the
negotiation and scheduling of specific commitments.PRESS/118
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MOREDISCIPLINES ON DOMESTIC REGULATION
IN THE ACCOUNTANCY SECTOR
I. OBJECTIVES
1. Having regard to the Ministerial Decision on Professional Services, Members have agreed to
the following disciplines elaborating upon the provisions of the GATS relating to domestic regulationof the sector.  The purpose of these disciplines is to facilitate trade in accountancy services by
ensuring that domestic regulations affecting trade in accountancy services meet the requirements of
Article VI:4 of the GATS.  The disciplines therefore 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.  Such measures are addressed in the GATS
through the negotiation and scheduling of specific commitments.
I. GENERAL PROVISIONS
1. Members shall ensure that measures not subject to scheduling under Articles XVI or XVII of the
GATS,
1 relating to licensing requirements and procedures, technical standards and qualification
requirements and procedures are not prepared, adopted or applied with a view to or with the effect of
creating unnecessary barriers to trade in accountancy services.  For this purpose, Members shallensure that such measures are not more trade-restric tive than necessary to fulfil a legitimate objective.
Legitimate objectives are, inter alia , the protection of consumers (which includes all users of
accounting services and the public generally), the quality of the service, professional competence, and
the integrity of the profession.
II. TRANSPARENCY
2. Members shall make publicly available, including through the enquiry and contact points
established under Articles III and IV of the GATS, the names and addresses of competent authorities
(i.e. governmental or non-governmental entities res ponsible for the licensing of professionals or firms,
or accounting regulations).
3. Members shall make publicly available, or shall ensure that their competent authorities make
publicly available, including through the enquiry and contact points:
(a) where applicable, information describing the activities and professional titles which
are regulated or which must comply with specific technical standards;
(b) requirements and procedures to obtain, renew or retain any licences or professional
qualifications and the competent authorities' monitoring arrangements for ensuring
compliance;
(c) information on technical standards;  and
(d) upon request, confirmation that a particular professional or firm is licensed to practise
within their jurisdiction.
                                                     
1 The text of GATS Articles XVI and XVII is reproduced in an appendix to this documentPRESS/118
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MORE4. Members shall inform another Member, upon request, of the rationale behind domestic regulatory
measures in the accountancy sector, in relation to legitimate objectives as referred to in paragraph 2.
5. When introducing measures which significantly affect trade in accountancy services, Members
shall endeavour to provide opportunity for comment, and give consideration to such comments, before
adoption.
6. Details of procedures for the review of administrative decisions, as provided for by Article VI:2
of the GATS, shall be made public, including the pres cribed time-limits, if any, for requesting such a
review.
III. LICENSING REQUIREMENTS
7. Licensing requirements (i.e. the substantive requirements, other than qualification requirements,
to be satisfied in order to obtain or renew an authorization to practice) shall be pre-established,
publicly available and objective.
8. Where residency requirements not subject to scheduling under Article XVII of the GATS exist,
Members shall consider whether less trade restrictive means could be employed to achieve the
purposes for which these requirements were set, taking into account costs and local conditions.
9. Where membership of a professional organisation is required, in order to fulfil a legitimate
objective in accordance with paragraph 2, Members shall ensure that the terms for membership are
reasonable, and do not include conditions or pre-conditions unrelated to the fulfilment of such anobjective.  Where membership of a professional organization is required as a prior condition for
application for a licence (i.e. an authorization to practice), the period of membership imposed before
the application may be submitted shall be kept to a minimum.
10. Members shall ensure that the use of firm names is not restricted, save in fulfilment of a
legitimate objective.
11. Members shall ensure that requirements regardin g professional indemnity insurance for foreign
applicants take into account any existing insurance co verage, in so far as it covers activities in its
territory or the relevant jurisdiction in its territory and is consistent with the legislation of the host
Member.
12. Fees charged by the competent authorities shall reflect the administrative costs involved, and shall
not represent an impediment in themselves to practising the relevant activity. This shall not preclude
the recovery of any additional costs of verification of information, processing and examinations.  A
concessional fee for applicants from developing countries may be considered.
IV. LICENSING PROCEDURES
13. Licensing procedures (i.e. the procedures to be  followed for the submission and processing of an
application for an authorization to practise) shall be pre-established, publicly available and objective,
and shall not in themselves constitute a restriction on the supply of the service.
14. Application procedures and the related documentation shall be not more burdensome than
necessary to ensure that applicants fulfil qualification and licensing requirements.  For example,
competent authorities shall not require more documen ts than are strictly necessary for the purpose of
licensing, and shall not impose unreasonable requirements regarding the format of documentation.Where minor errors are made in the completion of applications, applicants shall be given thePRESS/118
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MOREopportunity to correct them.  The establishment of the authenticity of documents shall be sought
through the least burdensome procedure and, wherever possible, authenticated copies should beaccepted in place of original documents.
15. Members shall ensure that the receipt of an application is acknowledged promptly by the
competent authority, and that applicants are in formed without undue delay in cases where the
application is incomplete.  The competent author ity shall inform the applicant of the decision
concerning the completed application within a reasonable time after receipt, in principle within sixmonths, separate from any periods in respect of qualification procedures referred to below.
16. On request, an unsuccessful applicant shall be informed of the reasons for rejection of the
application.  An applicant shall be permitted, within reasonable limits, to resubmit applications for
licensing.
17. A licence, once granted, shall enter into effect immediately, in accordance with the terms and
conditions specified therein.
V. QUALIFICATION REQUIREMENTS
18. A Member shall ensure that its competent authorities take account of qualifications acquired in
the territory of another Member, on the basis of equivalency of education, experience and/or
examination requirements.
19. The scope of examinations and of any other qualification requirements shall be limited to subjects
relevant to the activities for which authorization is sought.  Qualification requirements may include
education, examinations, practical training, experience and language skills.
20. Members note the role which mutual recognition agreements can play in facilitating the process of
verification of qualifications and/or in establishing equivalency of education.
VI. QUALIFICATION PROCEDURES
21. Verification of an applicant's qualifications acquired in the territory of another Member shall take
place within a reasonable time-frame, in principle within six months and, where applicants'
qualifications fall short of requirements, shall result in a decision which identifies additional
qualifications, if any, to be acquired by the applicant.
22. Examinations shall be scheduled at reasonably frequent intervals, in principle at least once a year,
and shall be open for all eligible applicants, including foreign and foreign-qualified applicants.
Applicants shall be allowed a reasonable period for the submission of applications.  Fees charged by
the competent authorities shall reflect the administrative costs involved, and shall not represent an
impediment in themselves to practising the relevant activity.  This shall not preclude the recovery ofany additional costs of verification of informati on, processing and examinations.  A concessional fee
for applicants from developing countries may be considered.
23. Residency requirements not subject to scheduling under Article XVII of the GATS shall not be
required for sitting examinations.PRESS/118
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ENDVII. TECHNICAL STANDARDS
24. Members shall ensure that measures relating to technical standards are prepared, adopted and
applied only to fulfil legitimate objectives.
In determining whether a measure is in conformity with the obligations under paragraph 2, account
shall be taken of internationally recognized standards of relevant international organizations2 applied
by that Member.
                                                     
2 The term "relevant international organizations" refers to international bodies whose membership is
open to the relevant bodies of at least all Members of the WTO.