WORLD TRADE  
ORGANIZATION  WT/REG158/4 
28 September 2004 
 
 (04-4070) 
Committee on Regional Trade Agreements Original:   English 
  
SINGAPORE – AUSTRALIA FREE TRADE AGREEMENT 
 
SERVICES ASPECTS
 
 
Communication from the Parties  
 
 
 The following communication, dated 27 September 2004, is being circulated at the request of the Delegations of Australia and Singapore. 
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 I BACKGROUND INFORMATION ON THE AGREEMENT  
 
1. Membership and dates of signature,  ratification and entry into force 
The Parties to the Agreement are Singapore a nd Australia.  The Free Trade Agreement is 
defined in Article 1.2 of the Agreement to include  the territory of Australia including its offshore 
territories and territorial sea, contiguous zone, ex clusive economic zone and continental shelf, and 
territory of Singapore including the territory of the Republic of Singapore, the territorial sea and any 
maritime area situated beyond the territorial sea whic h has been or might in the future be designated 
under its national law, in accordance with internatio nal law, as an area within which Singapore may 
exercise rights with regards to the sea, the sea- bed, the subsoil and the natural resources. 
 
 The Free Trade Agreement was signed on 17 February  2003 and entered into force on          
28 July 2003.  
2. Type of Agreement 
 The Agreement creates a free-trade area in conformity with the definition set out in 
Article XXIV: 8(b) of GATT 1994 and in accordance with Article V:1 of the GATS. 
  The objectives of the Agreement are, in additio n to the liberalisation of trade in goods and 
services, to strengthen the relationship between th e Parties, establish a framework conducive for 
bilateral investments, support the wider libera lization process in the Asia-Pacific Economic 
Cooperation consistent with its goals of free and open trade and investment, build upon their 
commitments at the World Trade Organization, and to support its efforts  to create a predictable, and 
more free and open global trading environment, impr ove the efficiency and competitiveness of their 
goods and services sectors and expand trade and invest ment between them, establish a framework of 
transparent rules to govern trade and investment between them; and explore newer areas of economic 
cooperation.  
 
3. Scope 
The free trade area established by the Agreemen t provides the framework for trade relations 
between Australia and Singapore. WT/REG158/4 
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   The Agreement covers trade in services and all modes of supply, providing, subject to the 
reservations expressed in Annex 4-I and Annex 4-II of  the Agreement and the exception of certain Air 
Transport Services provided in Article 7.22, market access and national treatment to the service providers of the Parties. The aspects of the Agre ement related to trade in goods are notified in a 
separate document (WT/REG158/3). 
 
  The Agreement also contains provisions, inter alia , on competition, and government 
procurement. 
 
4. Trade Data 
 According to Australia’s trade data, in 2003, Singapore’s total services exports to Australia 
was A$2,385 million while Australia’s exports in  services to Singapore were A$2,088 million.  
Historical information on services trade from 1999 to 2003 are provided at Annex 1.     In 2003, Australia’s exports in services to  Singapore were A$2,088 million.  Singapore’s 
export in services to Australia in 2002 were S$1, 878.7 million. Trade data on services from 1999 to 
2003 are provided at Annex 1.  Historical inform ation on services trade is presently limited, although 
details of the services trade are provided in the A nnex.  The statistics available cannot be relied upon 
to paint an accurate or complete picture of service s trade prior to and post entry into force of the 
Agreement. 
 
 Further, in accordance with the Standard Fo rmat for Information on Economic Integration 
Agreements on Services (WT/REG/W/14), we have obt ained statistics for Singapore and Australia’s 
total international trade in servi ces from 2000 – 2002. See Annex 1. 
  II. PROVISIONS AFFECTING TRADE IN SERVICES 
1. (a) Provisions in the Agreement which are relevant to the scope of the GATS
: 
 
- Chapter 1 – “Objectives and General Definitions”: Article 1 – Objectives 
 
- Chapter 6 – “Government Procurement” 
 
- Chapter 7 – “Services”, including reservation set-out in Annex 4-I and Annex 4-II,          
and additional commitments pr ovided for in Annex 4-III. 
 - Chapter 8 – “Investment” 
 
- Chapter 9 – “Financial Services” 
 
- Chapter 10 – “Telecommunications Services” 
 
- Chapter 14 – “Electronic Commerce” 
 
- Chapter 15 – “Education Co-operation” 
 - Chapter 16 – “Dispute Settlement”   
 
- Chapter 17 – “Final Provisions” 
  WT/REG158/4 
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  (b) SAFTA liberalises bilateral trade in servi ces in that it provides for universal sectoral 
coverage of all service activities, except for measures and services sectors contained in lists of reservations (Annexes 4 – I and 4 – II).  In particular, market access and 
national treatment applies to all sectors except those covered by specific reservations.  Article 7.20 also provides for the Parties to consult on the incorporation in the 
Agreement of any future unilateral liberali sation, or any more favourable treatment 
that either Party gives in an agreement with a non-party.  Any such incorporation 
should maintain the overall balance of benef its under the Agreement.  The extent of 
coverage of Air Transport Servi ces is defined in Article 7.22. 
 
2. Rules Of Origin 
The Agreement extends benefits to a “natural” or  “legal” person of a Party. Article 7.1 of the 
Agreement contains definitions – with minor adapta tions to the specific context of the Agreement – 
corresponding to the relevant provisions in the GA TS (Article XXVIII). This includes definitions of 
“services supplier”, “person”, “natural person of a Party”, “legal person”, “legal person of another 
Party”, “supply of a service” and “commercial presence”.  In particular, the benefits of the Agreement 
apply to a natural person of a Party, i.e. someone who is a is a national of that Party or has the right of 
permanent residence in it, as well as to a legal person  of a Party, i.e. any legal entity duly constituted 
or otherwise organised under its law, or, in the case of supply of a service through commercial 
presence, owned or controlled by natu ral persons of that Party or by a legal entity organised under its 
law. 
 
Article 7.17 provides that, subject to prior notif ication and consultation, a Party may deny the 
benefit of the Agreement where “the Party establish es that the service supplier is owned or controlled 
by persons of a non-Party and that it has no substa ntive business operations in the territory of the 
other Party”. 
 
3. Standards/Recognition 
 Article 7.11 on domestic regulation builds on the relevant provisions of GATS Article VI.  In 
sectors where specific commitments are undertaken, each Party shall ensure that all measures of 
general application affecting trade in services ar e administered in a reasonable, objective and 
impartial manner.  In addition, Parties shall jointl y review the development of disciplines pursuant to 
GATS Article VI.4, with a view to incorporating su ch disciplines into the Agreement.  Article 7.11.6 
also adopts the GATS interim disciplines which apply pending the development of the above 
mentioned disciplines.     Article 7.11.8 goes beyond GATS requirements and provides for: making publicly available 
information on requirements and procedures to obtai n, renew or retain any licences or professional 
qualifications, and information on technical standards;  explaining, on request, the policy rationale of a 
measure, particularly of a new measure; and providing the opportunity to comment, and give 
consideration to such comments, before thei r adoption, when introducing measures which 
significantly affect trade in services.  
 Article 7.23 provides that for the purposes of the fulfillment of its standards or criteria for the 
authorization, licensing or certification of services  suppliers, a Party may recognize the education or 
experience obtained, requirements met, or licenses or  certifications granted in the other Party. The 
Article also provides that the Parties shall encour age their relevant competent bodies to enter into 
negotiations on recognition of prof essional qualifications and/or regi stration procedures with a view 
to the achievement of early outcomes. 
 WT/REG158/4 
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 4. Safeguards 
 Article 7.13 provides that neither Party sh all take safeguard action against services and 
service supplies of the other Party, with an express exception for balance-of-payments purposes 
(Article 7.15).   5. Subsidies And State-Aid 
 Article 7.2.2 states that the Services Chapter (Cha pter 7) does not apply to subsidies or grants 
provided by a Party. However, Article 7.21 provides that the Parties shall review the treatment of 
subsidies in the context of developments in intern ational fora of which both Parties are Members. It 
also provides that the Parties shall consult on appropri ate steps in regard to subsidies related to trade 
in services where any subsidies issu es arise under the Chapter on services. 
 
6. Description Of Any Treatment Provided For In The Agreement Relating To 
Government Procurement 
Article 7.16 states that Articles 7.3 (Market Access) and 7.4 (National Treatment) in the 
Chapter on services shall not apply to government procurement.  
  Chapter 6 prescribes for government procur ement obligations in goods and services for 
various government entities listed in  Annex 3A (Australian entities) a nd 3B (Singaporean entities) of 
the Agreement and their successors, but excluding tho se subsequently commercialized or privatized.  
Article 6.3 imposes National Treatment obligations to the goods, services and suppliers of the other 
Party offering goods or services of the other Party.  
 
  Article 6.3 imposes National Treatment obligat ions to the goods, services and suppliers of 
the other Party offering goods or services of the other Party.  
 
Article 6.5 prohibits technical specifications bei ng prepared, adopted or applied with a view to 
creating unnecessary obstacles to trade between the Parties. 
 Article 6.6 describes the principles and procedur es to be applied to tendering.  Open tenders 
are to be published in an accessible and ti mely manner.  Tender evaluation shall be non-
discriminatory, and Parties shall provide releva nt feedback to unsuccessful tenderers on request. 
 
Confidential information provided to a Party by a person or an entity is protected under 
Article 6.8. 
 Article 6.9 provides principles for the protection of intellectual property in the tender process 
and the resulting contracts. 
 Article 6.11 encourages the use of electroni c commerce in the procurement process, and 
emphasizes the requirements for promoting greater access for suppliers in both Parties and also 
providing for information security. 
 
Article 6.13 provides for enhanced transparency through the publication of information 
relating to procurement laws, re gulations, procedures and practi ces, open tendering opportunities, 
supplier qualifications and decisions on contracts. 
 Article 6.14 identifies the exceptions, including defence, security, the protection of public 
morals, order or safety, human animal or plant life or health or intellectual property, the conservation  WT/REG158/4 
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 of exhaustible natural resources, provided they are not applied in an arbitrary or unjustifiably 
discriminatory manner. 
 Article 6.15 states that notwithstanding the G overnment Procurement Chapter in the SAFTA, 
Australia is free to promote employment and tr aining opportunities for its indigenous people in 
regions where significant indigenous  populations exist, and Article 6.16 allows both parties to assist 
small and medium enterprises to gain ac cess to the government procurement market. 
 
7. Sector-Specific Provisions 
 Chapters 9 and 10 contain additional specifi c provisions covering Financial Services and 
Telecommunication Services respectively. 
 
III. GENERAL PROVISIONS OF THE  AGREEMENT 
 
1. Exceptions and Reservations 
 SAFTA, through Article 6.14, Article 7.18, Artic le 7.19, Article 8.19, Article 8.20, Article 
9.5, Article 10.15 and Article 14.9, allows excep tions, based on the standard WTO exceptions in 
GATS Article XIV and XIVbis.  The specified purposes are:  
- protection of essential security interests; 
- protection of public morals and prevention of disorder or crime; 
- protection of human, animal or plant life or health; 
- protection of national treasures or artistic , historical, anthropological, archaeological, 
palaeontological or geological value; 
- to conserve limited natural resources; 
- necessary to secure compliance with laws or re gulations which are not  inconsistent with 
the provisions of the Agreement including those relating to: 
- the prevention of deceptive and fraudulent practices or to deal with the effects 
of a default on a contract;  
- the protection of the privacy of indi viduals in relation to the processing and 
dissemination of personal data and th e protection of confidentiality of 
individual records and accounts; and  
- safety. 
 
In addition, as provided in Article 7.5 and Ar ticle 8.5, commitments in Chapters 7 and 8 
respectively are subject to reservations expressed in Annex 4-I and Annex 4-II of the Agreement. 
 
2. Accession  
Article 17.4 of SAFTA enables Australia and Si ngapore to agree to the association of any 
other State or separate customs territory.  To this  point in time Australia and Singapore are the only 
acceding parties and no other State has sought association with the Agreement.  
 
3. Dispute Settlement Procedures 
 Chapter 16 of SAFTA provides the framework fo r the dispute settlement obligations of the 
Parties. 
  Article 16.2 requires each Party to afford the other Party adequate opportunity for 
consultations regarding any benef it accruing to it directly or indi rectly under SAFTA being nullified WT/REG158/4 
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 or impaired.  A request by the complaining Party must be responded to by the other Party within 
seven days.  The Parties must make every effort  to reach a mutually satisfactory resolution. 
  Article 16.4 provides that if the consultations fail to settle the dispute within 60 days an 
arbitral tribunal will be appointed, which will be comprised of three members (one nominated by each 
Party and the third by common agreement – Article 16.5). 
  Article 16.6 states that the function of an arbitral tribunal is to make an objective assessment of the dispute before it, and provide its findings and recommendations in a report released to the 
Parties.   
 
 Article 16.8 allows the Parties to agree to term inate the proceedings of an arbitral tribunal in 
the event that a mutually satisfactory solution to the dispute has been found. 
  Article 16.9 provides that the Party concerne d shall comply with the arbitral tribunal’s 
recommendations within a reasonable period. 
  Article 16.10 states that where a Party fails  to comply with the arbitral tribunal’s 
recommendations within 20 days of the report bei ng provided to the Parties, the complaining Party 
can request consultations on compensation.  Article  16.10.2 provides that where those consultations 
do not achieve agreement on compensation within 20 days, the complaining Party may request the 
original arbitral tribunal to determine an appropriate  level of suspension of benefits.  Article 16.10.3 
provides that the suspension of benefits can only ap ply to benefits derived from the Agreement, and 
Article 16.10.5 states that the suspension will only be temporary.   Article 16.11 states that each Party shall bear th e costs of its appointed arbitrator, and its own 
expenses and legal costs.  The cost of the other expenses shall be equally borne by both Parties. 
 
4. Relations with Other Trade Agreements 
 Article 17.5 provides that in the event of an y inconsistency between this Agreement and any 
other agreement to which both Parties are parties,  the Parties shall immediately consult with each 
other with a view to finding a mutually satisfact ory solution in accordance with customary public 
international law. 
  
5. Institutional Framework 
No intergovernmental or supranational institutio ns were created to op erate the Agreement. 
Article 17.2 requires that each Party designate a c ontact point to facilitate communications between 
the Parties on any matter covered by SAFTA. 
 Article 17.3 provides for Ministers in charge of  trade negotiations of the Parties to meet 
within a year of the date of entry into force of this Agreement and then biennially or otherwise as 
appropriate to review this Agreement. 
 
 
IV. OTHER 
 
1. Movement of Business People 
 Chapter 11 of the Agreement on Movement of Business People applies to measures affecting 
the movement of natural persons of a Party who enter the territory of another Party for business  WT/REG158/4 
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 purposes. The Chapter covers natural persons specifi ed in Article 11.2, subject to the reservations 
expressed in Annex 4-I and Annex 4-II of the Agreement. (Article 11.16) 
 In addition, Article 11.7 states that nothing in the Chapter shall prevent a  Party “from 
applying  measures to regulate the entry of natural persons of the other Party into, or their temporary stay in, its territory,  including those  measures  nece ssary  to protect  the  integrity of, and to ensure 
the orderly movement of natural persons across its borders, provided that such measures are not 
applied in such a manner as to nullify or impair th e benefits accruing to the other Party under the 
terms of [the] Chapter”.   
2. Disclosure of Confidential Information 
 Article 7.10 stipulates that nothing in Chapter 7 “require any Party to provide confidential 
information, the disclosure of which would impede la w enforcement, or otherwise be contrary to  the 
public  interest,  or which would prejudice  legiti mate commercial interests of particular enterprises, 
public or private.”  
 The full text of the Agreement is available from: 
 
The Government of Australia: - http://www.dfat.gov.au/trade/negotiations /australia_singapore_agreement.html
 
 The Republic of Singapore: - http://www.fta.gov.sg
 
 
 WT/REG158/4 
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 ANNEX 1
 
 
 
Details of Bilateral Trade in Services 
 
Australian Exports to Singapore of Serv ices by Services Categories, 2000-2003  
(Value in A$ millions) 
 
Services 2000 2001 2002 2003 
Transportation 737 899 863 710 
Travel 766 852 844 805 
Insurance 37 32 32 32 
Government  5 11 14 17 
Construction  np np np np 
Financial 55 58 60 61 
Computer & Information  11 16 8 6 
Royalties np np 5 np 
Social  38 48 64 52 
Other Business Services 196 248 345 395 
Total 1,897 2,215 2,327 2,088 
 The Australian Bureau of Statistics 
  
Singaporean Exports to Australia by Services Categories, 2000-2002
 
(Value in S$ millions) 
 
 Export 
Services  2000 2001 2002* 
Transportation  955.8 998.4 1078.8 
Financial 37.1 35.9 46.1 
Insurance 59.1 81.3 89.2 
Construction - 17.8 15.8 
Computer & Information 25.8 18.2 16.9 
Royalties 10.0 14.4 12.5 
Social - - - 
Other Business Services 434.5 443.4 616.8 
Total  1,528.1 1,612.5 1,878.7  
 Singapore Department of Statistics 
 * preliminary figures 
 Note: 
1. [Figures presented in this table are mainly comp iled from the Singapore Trade in Services survey] 
2. '-' denotes nil or negligible. 
3. Figures may not add up due to rounding. 
 
  WT/REG158/4 
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 Australia’s Total International Trade in Services, 2000-2002 
(A$ million) 
 
Export Import Services 
2000 2001 2002 2000 2001 2002  
Transportation 7,459 7,967 7,672 10,860 11,117 11,003 
Financial 902 644 974 597 602 598 
Insurance 750 679 673 902 854 856 
Construction  34 87 106 0 0 0 
Computer & 
Information  1528 1,076 1,049 857 833 955 
Royalties 614 577 556 1,748 1,681 1,866 
Social  1,558 480 630 811 765 981 
Travel 14,524 15,529 15,834 10,526 11,021 11,217 
Government  822 779 796 650 639 671 
Other Business 
Services 3,127 33,010 3,589 2,905 3,670 3,718 
Total 32,130 32,246 32,976 31,699 32,767 33,265 
The Australian Bureau of Statistics 
 
 
Singapore’s Total International Trade in Services, 2000-2002 
(S$ million) 
 
Export Import Services 
2000 2001 2002* 2000 2001 2002*  
Transportation 20,501.9 20,530.3 21, 426.4 22,100.6 22,179.7 19,608.1 
Financial 2,397.0 2,122.8 2,334.6 687.8 642.0 770.4 
Insurance 867.5 1,189.4 1,391.1 2,591.1 2,648.9 2,727.0 
Construction  231.8 346.2 363.3 214.1 309.2 269.6 
Computer & 
Information  426.1 558.1 631.8 388.2 494.3 472.5 
Royalties 150.4 309.3 361.2 6,227.7 6,105.4 6,108.4 
Social  25.9 37.4 35.3 39.3 50.5 125.4 
Travel 9,014.6 8,272.0 7,992.1 7,823.9 9,808.3 11,304.1 
Government  168.4 180.4 177.2 198.5 247.1 256.7 
Other Business 
Services 16,948.1 18,632.6 20,121.8 7,504.4 9,032.5  9,983.9 
Total 50,731.6 52,178.5 54,835.0 47,775.6 51,518.1 51,626.1 
Singapore Department of Statistics * preliminary figures Figures presented in this table are compiled from the Singapore Trade in Services survey and supplementary 
sources. 
 
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