RESTRICTED
WORLD TRADE S/FIN/W/12/Add.17/Rev.1
10December 1997
ORGANIZATION(97-5433)
Original: English Committee onTrade inFinancial Services
COMMUNICATION FROM THE CZECH REPUBLIC
Revised Offer onFinancial Services
Revision
Thefollowing communication iscirculated attherequest oftheCzech Republic toMembers
oftheCommittee onTrade inFinancial Services.
_______________
Further toourinitial offer contained inS/FIN/W/12/Add.17 dated 15September 1997, the
Czech Republic ispleased tosubmit theattached Draft Schedule ofSpecific Commitments inFinancial
Services under theGeneral Agreement onTrade inServices.
Thisdraftschedule isconditional. Inaccordance withtheSecond Decision onFinancial Services
of21July1995, asamended bytheDecision of29May1997, theCzech Republic reserves theright
tomodify orwithdraw allorpartofthespecific commitments onfinancial services andtolistMFN
exemptions, atanytimeprior totheconclusion ofnegotiations onfinancial services.
TheCzech Republic further reserves theright tomake technical changes, amendments and
corrections totheSchedule.S/FIN/W/12/Add.17/Rev.1
Page2CZECH REPUBLIC
DRAFT SCHEDULE OFSPECIFIC COMMITMENTS -OFFER OFFINANCIAL SERVICES
Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
II. SECTOR-SPECIFIC COMMITMENTS
7. FINANCIAL SERVICES
Measures applicable toallsectors infinancial services:
1. Commitments inthisChapter arebased ontheUnderstanding onCommitments inFinancial Services ("the Understanding").
2. Notwithstanding note1.above, thepurchase andacquisition offinancial services bypublic entities oftheCzech Republic aregoverned inthisschedule by
Article XIIIoftheGeneral Agreement onTrade inServices.
3. Commitments aresubject tothelimitations onmarket access andnational treatment inthe“allsector ”section ofthisschedule andtothose relating tothe
sub-sectors listed below.
4. Only those sectors andsub-sectors listed intheschedule aresubject tomarket access andnational treatment commitments, moreover themarket access
commitments inrespect ofmodes (1)and(2)apply onlytothetransactions indicated inparagraphs B.3andB.4ofthemarket access section ofthe
Understanding respectively.
5. Theadmission tothemarket ofnewfinancial services andinstruments maybesubject totheexistence of,andconsistency withthedomestic regulatory
framework aimed atachieving theobjectives indicated inArticle 2(a)oftheAnnex onFinancial Services.
6. Asageneral ruleandinanon-discriminatory manner, financial institutions incorporated intheCzech Republic must adopt aspecific legal form.S/FIN/W/12/Add.17/Rev.1
Page3Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
Insurance and
Insurance-Related Services
(a) Lifeinsurance
(CPC 81211)
(b) Non-life insurance
(CPC 8129)
(c) Reinsurance and
retrocession
(d) Services auxiliary to
insurance (CPC 8140,
excluding pension funding:
81402, 81409)Monopoly rights asindicated inparagraph
B.1oftheUnderstanding: Compulsory
motor third party liability insurance is
provided byanexclusive supplier.*
Compulsory health insurance isprovided
bylicensed Czech owned suppliers only.
(1),(3)None other than:
Foreign financial services suppliers may
establish aninsurance company withthe
seatintheCzech Republic intheform of
ajoint stock company ormayexercise
insurance activity through their branches
withregistered office intheCzech
Republic under theconditions established
intheInsurance Industry Act.
Commercial presence andauthorization is
required fortheprovider ofinsurance
services:(1),(3)None
-toprovide such services including
reinsurance, and
-toconclude intermediation contract
withanintermediary aimed atthe
conclusion ofinsurance contract
between theprovider ofinsurance
services andthird party.
*When monopoly rights concerning compulsory motor third party liability areremoved, providing thisservice willbeopen onanon-discriminatory basis toCzech
established service providers.S/FIN/W/12/Add.17/Rev.1
Page4Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
Authorization isrequired forthe
intermediary incaseofitsintermediation
activity tobeexercised forabranch with
registered office intheCzech Republic.
(2) None other than:
Insurance services asdefined below may
notbepurchased abroad.(2) None
-Thelifeinsurance ofpersons with
permanent residence intheCzech
Republic,
-theinsurance ofproperty onthe
territory oftheCzech Republic,
-theinsurance ofliability forlossor
damage caused bytheactivity of
natural andlegal persons onthe
territory oftheCzech Republic.
(4) Unbound except asindicated inhorizontal
section(4) Unbound except asindicated in
horizontal sectionS/FIN/W/12/Add.17/Rev.1
Page5Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
Banking andOther Financial
Services
(a) Acceptance ofdeposits and
other repayable funds from
thepublic (CPC 81115,
81116, 81119)(1) Unbound forservices described in
subsector (g),(i)and(j)andfor:
-transferable securities (CPC 81321),
-other negotiable instruments and
financial assets (excl. bullion)
(2) Unbound forservices described in
subsector (i).(1) None
(2) None
(b) Lending ofalltypes
(CPC 8113)
(c) Financial leasing
(CPC 81120)
(d) Allpayments andmoney
transmission services, incl.
credit, charge anddebit
cards, travellers cheques
andbankers drafts(1),(2) None other than:
Only Czech established banks and
branches offoreign banks having a
corresponding licence may:
-provide deposit services
-trade inforeign exchange assets
-effect non-cash cross-border
paymentsS/FIN/W/12/Add.17/Rev.1
Page6Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
(e) Guarantees and
commitments
(f) Trading forownaccount or
foraccount ofcustomers,
whether onanexchange, in
anover-the-counter market
orotherwise asfollows:
-money market
instruments (cheques,
bills, certificates of
deposits)
-foreign exchange
(CPC 81333)
-exchange rateand
interest rate
instruments, incl.
products such as
swaps, forward rate
agreements
-transferable securities
(CPC 81321)Foreign exchange permit issued bythe
Czech National Bank orMinistry of
Finance isrequired incaseofCzech
non-bank residents for:
(a)opening andfunding ofanaccount
abroad byCzech residents,
(b)capital payments abroad (except
FDI),
(c)granting financial credits and
guarantees,
(d)operations infinancial derivates
(e)purchase offoreign securities except
forthecases asdescribed bythe
Foreign Exchange Act,
(f)issue offoreign securities forpublic
andnon-public trade intheCzech
Republic ortheir introduction onthe
domestic market.S/FIN/W/12/Add.17/Rev.1
Page7Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
-other negotiable
instruments and
financial assets (excl.
bullion)
(g) Participation inissues ofall
kinds ofsecurities, incl.
underwriting andplacement
asagent (whether publicly
orprivately) andprovision
ofservices related tosuch
issues
(i) Asset management such as
cashorportfolio
management, allforms of
collective investment
management, pension fund
management, custodial,
depository andtrust
services
(j) Settlement andclearing
services forfinancial
assets, excl. derivative
products(3) None other than:
Banking services maybeprovided only
byCzech established banks orbranches of
foreign banks having alicence granted by
theCzech National Bank inagreement
withtheMinistry ofFinance.
Thegranting ofthelicence isbased on
theconsideration ofcriteria which are
applied consistently withGATS.
Mortgage loanservices maybeprovided
onlybyCzech established banks.
Banks may beestablished asjoint stock
companies only. Thepurchase ofshares
ofexisting banks issubject toprior
approval oftheCzech National Bank.
Securities may betraded publicly onlyif
relevant authorization hasbeen granted
andprospectus covering thesecurity has
been approved.(3) NoneS/FIN/W/12/Add.17/Rev.1
Page8Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
(k) Provision andtransfer of
financial information, and
financial dataprocessing
andrelated software by
suppliers ofother financial
services
(l) Advisory, intermediation
andother auxiliary
financial services onall
activities listed in
subparagraphs above, incl.
credit reference and
analysis, investment and
portfolio research and
advice, advice on
acquisition andon
corporate restructuring and
strategyTheauthorization shall notbegranted ifpublic
trading insecurities isinconflict withthe
interests ofinvestors, isinconsistent withthe
government financial policy orifitdoes not
conform withthefinancial market
requirements.**
Theestablishment andactivities ofsecurities
dealers, stockbrokers, oftheStock Exchange or
organizers ofanover-the-counter market,
investment companies andinvestment funds
aresubject toauthorization granting ofwhich
isrelated toqualifications, personal integrity,
management andmaterial requirements.
Settlement andclearing services forallkinds of
payments aremonitored andreviewed bythe
Czech National Bank toensure their smooth
andeconomical operation.
(4) Unbound except asindicated inthe
horizontal section.(4) Unbound except asindicated inthe
horizontal section.
**Legislation covering theabolition ofthecriterion offinancial market requirements isnowbeing discussed intheParliament.