RESTRICTEDWORLD TRADE
ORGANIZATIONS/WPDR/M/18
3 December 2002
(02-6675)
Working Party on Domestic Regulation
REPORT ON THE MEETING HELD ON 22 OCTOBER 2002
Note by the Secretariat1
1. The Working Party on Domestic Regulation (WPDR) held its eighteenth meeting on
22 October under the chairpersonship of Mr. Sérgio Santos from Brazil.  The agenda for the meeting
is contained in Airgram WTO/AIR/1929.  As with  the previous meeting on 16 July, discussion
focused on the examination of regulatory measures, based on a new Chairperson’s Note and a revised
paper from the Secretariat.
2. Before moving to the agenda items, the Chairperson noted for the record that the Working
Party had held an informal meeting on 9 October.  He stated that significant progress was made
during the discussions, the outcomes of which were summarized in his latest Chairperson’s Note,circulated as JOB(02)/147, dated 16 October 2002.
3. The Chairperson also reminded Members that, following the presentation by the OECD at the
meeting on 16 July, the Working Party had agreed to have the presentation circulated as a room
document.  Also available at the back of the room was a strikeout version of the Summary  of
Discussions on the Checklist of Issue for WPDR  (JOB(02)/3/Rev.2, dated 4 October 2002), which had
been updated from the previous WPDR formal meeting.
A. DEVELOPMENT OF REGULATORY DISCIPLINES UNDER GATS ARTICLE VI:4
1. Discussion of Concepts Relating to the Development of Disciplines
4. The Chairperson noted that the first item on the agenda was the Development of Regulatory
Disciplines under GATS Article VI:4 , with the first sub-item being the Discussion of Concepts
Relating to the Development of Disciplines .  At the previous formal WPDR meeting on 16 July,
Members had commenced initial discussions of the measures listed in Annex I of the Examples  paper
(Examples of Measures to be Addressed by Disciplines under GATS Article VI:4 ), starting with the
first category, Transparency .  Comments were also made on other measures, including residency
requirements.
5. The Chairperson observed that, during the informal meeting on 9 October, Members had
agreed to add a detailed resume of discussions as a new annex to the Examples  paper.  The Secretariat
subsequently circulated the revised version of the Examples  paper as JOB(02)/20/Rev.2, dated
18 October 2002.  At the Chairperson’s request, a representative of the Secretariat introduced the
revised paper.  The representative noted that including a detailed resume of discussions to theSummary  would have made that document too long, therefore Members had agreed to add Annex III
to the Examples  paper.  Together with the Annex III, a short introduction had been added at para 12.
6. The Chairperson also observed that he had emphasized strongly in his Chairperson’s Note
that the most important element of the examination of regulatory measures was the full participation
                                                     
1 This document has been prepared under the Secretariat's own responsibility and without prejudice to
the positions of Members and to their rights and obligations under the WTO.S/WPDR/M/18
Page 2
of all Members, particularly developing countries.  As previously noted, many of the regulatory
examples lacked enough specific detail to enable a more precise assessment according to the
methodology agreed by Members.  Consequently, it  was suggested that the Members who faced such
regulatory issues supply more details.
7. Moving to the discussion of regulatory examples, the Chairperson observed that, in his Note,
he had suggested that Members continue examining the measures listed in the Examples  paper,
starting with the second and third categories of Annex I, i.e. Licensing requirements  and Licensing
procedures .  He had proposed that the Licensing examples under both Parts A and B of Annex I be
discussed.  This would be followed by further comments on Transparency  measures, and then on any
other measures.  He also pointed out that Part A of Annex I concerned types of measures presumably
not addressed by the Accountancy Disciplines  (Disciplines on Domestic Regulation in the
Accountancy Sector , S/L/64 dated 17 December 1998), while Part B concerned types of measures that
would seem to already be dealt with by the Accountancy Disciplines .
8. In terms of methodology, the Chairperson noted that he had suggested in his latest Note that
the Working Party add a fourth question to the three used in the examination of regulatory examples.
The three questions Members had agreed to asking when looking at each measure individually were:
(a) Is the measure already covered by Articles XVI and/or XVII?
(b) If not, is it addressed by any other provisions of the Agreement (e.g. Articles II, III,
VIII, IX)?
(c) If not, does it fall clearly within the scope of Article VI, in particular VI:4 (licensing
requirements, qualification requirements, technical standards, licensing procedures
and qualification procedures)?
While already implicitly mentioned in his previ ous Notes, the Chairperson suggested that the
Working Party add the following question to the above examination:
(d) If so, is the measure adequately addressed by the relevant provisions of the
Accountancy Disciplines , or are modifications required?
9. Before opening the floor, the Chairperson stated  that, as with the July meeting, Members
should indicate if they wished their interventions to be recorded in the Minutes;  otherwise, the
examination would be on an informal basis followed by a summary of discussions from the
Chairperson.
10. Summarizing the informal discussions, the Chairp erson stated they had been interesting, and
useful comments were made on a number of the regulatory measures under consideration by the
Working Party.  He noted that comments were made, and questions raised, on the issue of national
treatment and de facto  discrimination.  Members also pointed out the possible need to look at the
clarification of the definitions of the five types of regulatory measures covered by Article VI:4.  The
Chairperson concluded by reminding Members that Annex III of the Examples  paper would be
updated to reflect the contents of the informal discussions.
11. Returning to formal mode, the Chairperson asked if there were comments on any of the issues
covered under the Summary  of Discussions (i.e. General Issues, Transparency, Equivalence and
International Standards), or under this agenda sub-item as a whole.  He noted that, since the last
WPDR meeting, Japan had submitted an informal paper, JOB(02)/150, dated 21 October 2002.  He
then asked if Japan wished to introduce their paper.S/WPDR/M/18
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12. The delegation of Japan said they had presented a short informal paper in order to give some
material for further reflection and analysis regarding possible future regulatory disciplines.  The paper
highlighted two issues regarding the factual analysis of existing GATS disciplines.  The first was a
factual analysis of the relationship between the existing disciplines or obligations under the GATS,
and the types of measures, laws or regulations to which such disciplines or obligations applied.  Adiagram on the third page of the paper illustrated the relationship.  Japan’s preliminary observations
were contained in sub-paragraph (c) of para 1 of the paper, and showed how some disciplines and
obligations applied across the board, and how others only applied to sectors where specific
commitments had been made.  Although such observations were already known, Japan believed a
structured analysis was useful.  The second part of Japan’s paper highlighted the relationship between
any future disciplines and measures falling under GATS exceptions provisions.  The delegation
stressed that disciplines under Article VI:4 should not prevent measures under the exceptionsprovisions.  The paper contained Japan’s preliminary observations, and they wished to hear the views
of other Members.
13. The Chairperson then opened the floor for comments on Japan’s paper.  The representative of
Hong Kong, China stated that Japan’s paper was very useful and pertinent, and noted that the
Working Party in recent months had moved away from debating the scope of legal application.
Japan’s paper pointed out the need to take a very pragmatic approach, and to actually take a look at
the individual elements of any disciplines to be created and the reasons behind their legal application.
The representative pointed out that Japan had previously mentioned the possibility of a different scope
of application for disciplines on such aspects as transparency and necessity.  Members needed to take
a practical look at the use and purpose of disciplines, the representative stated, both with and withoutspecific commitments.
14. The representative of India stated that important issues had been raised in Japan’s paper.  In
India’s view, any future horizontal disciplines under Article VI:4 should be applied only where
commitments had been undertaken.  The representative also stated that India needed time to study
both Japan’s paper and the Examples paper in greater detail.
15. The representative of Uruguay made preliminary comments regarding para 1 (c) of Japan’s
paper, stating that all obstacles to progress by th e Working Party needed to be carefully analyzed by
Members.  He reiterated his delegation’s position, i.e. that, pursuant to Para 1 of Article VI as well as
the interpretation of all the paras of Article VI, it must be concluded that disciplines should be
applicable only where specific commitments had been undertaken.  He noted that this was the basis on
which the Accountancy Disciplines  had been reached, and that this agreement had been reached by all
Members.  He also noted that the Decision on Professional Services  stated that disciplines were
intended to give operational effect to specific commitments.  The representative emphasized that his
delegation wished to move the work forward, and said that the only way to reach consensus was to
accept the reality that disciplines must be applicable only where specific commitments had been
undertaken.
16. The Chairperson asked Members to refer to the Summary , noting that pages three and four
contained a summary of the Working Party’s extensive previous discussions of both the scope of
applicability of any future disciplines and the relationship between GATS Articles XVI & XVII and
Article VI:4.
17. The representative of Brazil thanked Japan for their pragmatic approach.  Referring to the
fifth para on page 4 of the Summary , he cautioned that the “bottom-up” approach of the GATS could
be undermined, if disciplines were to be applicable regardless of whether specific commitments had
been undertaken.  This would especially be the case if disciplines were to address the issue of de facto
discrimination, he stated.S/WPDR/M/18
Page 4
18. The representative of the European Communitie s said she particularly liked the diagram in
Japan’s paper.  On Brazil’s comments, she found them slightly surprising, but did not want to
prejudge the question of the applicability of disciplines.  The representative noted her delegation’s
impression that Article VI:4 concerned the administration of regulatory measures, and not actual
liberalization in the sense of Article XVI.
19. The delegate from Hong Kong, China, regarding Brazil’s comments, said that Japan’s paper
had attempted to put the issue in a practical context.  It was clear from the diagram in the paper that
certain aspects of possible disciplines, for example those regarding transparency, could relate to
existing GATS provisions such as Article III that applied irrespective of whether specific
commitments had been taken.  Closer examination of the issues raised in Japan’s paper would
therefore be useful, the delegate stated, without prejudging the question of applicability.
20. The Chairperson observed that Members were bringing back previously discussed issues.  In
the end, he stated, it was up to Members to decide on the applicability of disciplines.  He noted that
Uruguay had mentioned the Marrakesh ministerial decision on professional services, while other
delegations had raised arguments for possible general applicability.  Members should not lose sight of
the debate which the Working Party had already had for several months, he stated, in order to avoid
repetition.
21. The delegation of Brazil elaborated up their earlier statement, stating that the implications of
Article III rules might be somewhat different from those under Article VI.  The market access aspect
was directly related to the possibility of discussing de facto  discrimination under Article VI, he stated.
22. The Chairperson concluded the debate by stating that the Working Party would take note of
the statements made, and revert to the issue at the next meeting.
2. Development of Disciplines for Professional Services
23. The Chairperson then turned to the other main aspect of the work on regulatory disciplines,
the Development of Disciplines for Professional Services .  As noted in the Minutes, he stated,
Members had made extensive comments at the 16 Ju ly formal meeting regarding the issue of the
Secretariat consultations with international professional services organizations.  The Working Partyagreed to have the Secretariat prepare a draft letter for the consultations, which was discussed at
length at the 9 October informal meeting.   As reported in his latest Chairperson’s Note, the
Secretariat had prepared a revised letter on the basis of the comments received, circulated as
JOB(02)/139/Rev.1, dated 16 October 2002.
24. The Chairperson had proposed in his Note that Members adopt the revised letter at the current
meeting, for circulation initially to the international professional services organizations previously
selected by Members.  The fifth revision of this list of international organizations was circulated asJOB(01)/98, dated 28 June 2001.  As he had noted, any responses to the letter would be circulated
informally to Members.  Subsequently, the letter could also be sent to any regional or other
professional services organizations as selected by Members.  He also pointed out a typo in footnote 9
of the English-languge version of his Note, which should have refered to JOB(01)/98.
25. Before opening the floor for comments on the revised letter and the proposal for circulation,
the Chairperson observed that it was an appropriate moment to point out that Australia had recently
requested the circulation of two documents from the Union Internationale des Architectes (UIA)
regarding their recent work on domestic regulation.  These were JOB(02)/146, dated 21 October 2002
and JOB(02)/151, dated 22 October 2002.  He noted that the documents were exactly the type of
regulatory information to be requested in the letters to international professional organizations. TheChairperson then asked if Australia wished to introduce its papers.S/WPDR/M/18
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26. The delegation of Australia recalled that Australia had facilitated and hosted a presentation by
the UIA that was an add-on activity to the work pr ogramme of the WPDR.  The two papers submitted
for the meeting were the direct result of the semina r held in July.  The first paper was a presentation
by the Australian CEO of the Royal Australian Institute of Architects on the UIA Accord on
Recommended International Standards of Professionalism in Architectural Practice .  The second
paper presented the actual UIA Accord  in detail.  Examining the two papers made clear that the UIA
had a strong vision for a globalized architectural profession that respected national and cultural
differences.  Australia believed that the chal lenge for the WTO generally, and for the WPDR in
particular, was to engage with organizations such as  the UIA, and to utilize their work, knowledge and
experience to further develop trade rules for professional services in the WTO.
27. The Australian delegation noted that much of the UIA’s work was reflected in the Accord ,
which the XXIst UIA Assembly in Beijing, China had unanimously adopted in June 1999.  TheAccord  underpinned the UIA’s work with national registration, licensing, certification and
accreditation agencies – work aimed at developing more detailed guidelines that could eventually
become the standard for the architectural profession.  The representative mentioned that the UIA now
represented over one million architects in 108 countries.  The Accord  was particularly sensitive to
national sovereignty and to the need to tailor guidelines to local conditions.
28. Put simply, the Australian delegation stated, the Accord  contained a statement of principles of
professionalism and a series of policy issues/statements. The principles of professionalism were
covered under four headings:  expertise, autonomy, commitment and accountability. The UIA was
interested in engaging with the WTO in relation to its rules work and, more broadly, with market
access negotiations.  Australia considered that the UIA work was highly relevant to the WorkingGroup’s efforts to develop disciplines for professional services, and responded to delegations’
requests to work more closely with regulators and professional associations.  Australia welcomed the
decision of the WPDR to initiate consultations with international professional organizations, and
hoped the Secretariat letter would be finalized and circulated as soon and possible.
29. The Chairperson then opened the floor for comments on both the revised letter and his
proposal for circulation.  The representative of the European Communities hoped the revised letter
could be sent out as quickly as possible, and that  the input from professi onal associations would
provide additional expertise to trade negotiators.
30. The delegation of Chinese Taipei said they had begun domestic consultations in August, and
expected to deliver results by the next meeting or soon after.  The delegation thanked the Secretariat
for incorporating their comments in to the revised letter.  Regarding criteria, they recommended that
the list include regional organizations to enlarge participation.  On their domestic consultations, thedelegation noted that some professional associations were not familiar with Accountancy Disciplines ,
and suggested that a symposium might be held to facilitate consultations.
31. The Chairperson stated that, regarding domestic consultations, he and the Secretariat had
prepared a Note for use by delegations that was circulated at the July meeting as JOB(02)/80, dated 12
July 2002.  He also noted that the Secretariat consultations did not mean that domestic consultationswere concluded, and that Members could report on them at any moment.
32. The delegation of Japan stated that Members should send out the letter as early as possible to
the organizations listed in JOB(01)/98, and then to consider sending additional letters to regional
organizations and other international organizations.  The delegation of Australia also endorsed the
letter and attachments, and said it should be sent as soon, and as widely, as possible.
33. The delegation of Thailand also agreed on the letter.  They would have liked to have an
additional element on necessity, but felt that question 1 should be broad enough as stated.  Thailand’s
position was that the Working Party should endeavour to develop only any necessary disciplines, andS/WPDR/M/18
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that there was no agreement on strengthening the Accountancy Disciplines .  The delegation
emphasized that Thailand was not trying to delay the consultations or the discussions on disciplines.
Thailand’s position was that if any disciplines were to be created under Article VI:4, they wished for
horizontal disciplines negotiated at the multilateral level, rather than sector disciplines at the bilateral
level.  The Chairperson thanked Thailand for their flexibility and constructive participation, and
clarified that a necessity element was not added in order to avoid confusion with the necessity test.
34. The representative of Uruguay also agreed on the letter and proposal for circulation.  He
suggested a pragmatic approach regarding broadening the circulation, with the two basic criteria being
the footnote to Article VI:5 and the listing of organizations submitted by Members.  He stated the
letter should be sent to the current list of organizations, without reopening the debate on the listing
which would remain open to future additions.  The Chairperson said that was exactly his idea, i.e. to
send the letter to the current list of associations, and then later, subject to Members’ consensus, to
regional and other types of organizations.
35. The delegation of Colombia concurred with Uruguay’s position.  The delegation of Korea
urged that the letter be sent as soon as possible in order to give more time for deliberation.  They
noted that Korea at the informal meeting had suggest ed attaching the circulation list to the letter to
enhance transparency, and again urged that it be considered.  The delegation of Switzerland said they
associated themselves with the revised letter and the proposal for circulation.
36. The delegation of Hong Kong, China joined in approving the letter and proposal for
circulation, noted that the listing continued to be open for further additions.  In parallel, they appealed
to Members to press ahead with domestic consultations, noting that three years had already passed
since consultations were initially proposed.   The delegation of Indonesia associated themselves with
the views of Uruguay, and reiterated that they could go along with the Secretariat consultations, for
the purpose of obtaining addition information for consideration by Members.  The delegation agreed
that the listing of international organizations should remain open.
37. The delegation of the United States gave strong support to the letter and proposal for
circulation, and said they would not be opposed to  reviewing additional international or regional
organizations to be added to the listing.  They also wished to keep discussions open to both horizontal
and sectoral disciplines.  The work was based on the premise of making progress on multilateral
negotiations, the delegation indicated, but the U.S. was not closed to advances on bilateral
negotiations as well.
38. The Chairperson, regarding Korea’s idea of at taching the circulation list to the letter,
submitted the idea to Members, reminding them that the listing would remain open.  Members agreed
to attach the circulation list, as contained in JOB(01)/98.
39. The delegation of India stated they also agreed on the letter and proposal for circulation.
Regarding additions to the listing, Uruguay had reminded Members on the criteria previous agreed by
the Working Party.  On this basis, Members could suggest whom to send the letter to in the second
stage, the delegation stated.
40. The delegation of Hong Kong, China, regarding the points raised earlier by Thailand, noted
that Members were free to raise any relevant issues , including those arising from bilateral discussions.
This was important, as there could be synergy between ideas emerging from bilateral consultations
and the work of the WPDR, the delegation stated, and therefore it should be open for Members to
raise such regulatory issues in the Working Party.  The Chairperson agreed, stating that Members
were not prevented from raising any issues in the Working Party under the Article VI:4 mandate.
41. The delegation of Thailand said that perhap s they needed to clarify their previous
intervention.  They understood fully that the Working Party may develop any sectoral disciplines, butS/WPDR/M/18
Page 7
Thailand would prefer that work at the current stage of negotiations be concentrated on the
development of horizontal disciplines.
42. The delegation of Mexico, in rereading the letter, questioned the lack of a time reference to
the negotiations.  The Chairperson agreed that was a good point, but noted that a reference was made
to that effect in para 4 of the background section of the letter.
43. The delegation of Guyana made two points.  First, Guyana could support the letter and the
existing list.  In order to obtain a broad persp ective, however, the listing needed to reflect both
regulatory organizations and those representing services providers.  The delegation of Uruguay shared
Guyana’s point, and emphasized that Guyana or any other Member could propose organizations foraddition to the listing.  The delegation said Members also needed to be practical, and to send the letter
out.
44. The Chairperson, regarding Mexico’s point, agreed it might be useful to have an indicative
deadline for responses, such as February 2003 to allow the compilation of responses.  He suggested
adding a sentence to the final paragraph of the letter.  The delegation of the United States agreed that
a deadline was needed, but said it should not be limited to 2003, and the letter should note that the enddate for the current negotiations was 2005.
45. The delegation of Guyana, returning to their previo us point, said that their services providers
were not represented in some international professional services organizations.   Guyana in the future
might therefore have to insist upon additions to the listing, the representative stated. The Chairperson
observed that Guyana would probably not be the only delegation insisting that additions be made to
the listing.
46. The delegation of Uruguay said Mexico’s proposal was useful, and Members should give the
Chairperson flexibility in setting a deadline.  The Chairperson stated that the Secretariat could add a
deadline to the letter, and circulate the new version for ad referendum approval by Members.  A
representative of the Secretariat, responding to Members’ comments, agreed that the Working Party
needed to add a sense of the desirability of a timely response to the letter.  Therefore, it was useful to
indicate that it would be helpful if responses were received by February 2003, but to also refer to theoverall timeframe of the negotiations.  The delegation of Korea proposed that an initial deadline, of
February 2003, be indicated in the letter.
47. The Chairperson suggested that the Secretariat revise the letter, and if no substantial
comments were received in writing within one week, Members would be considered as having
approved the circulation of the revised letter to the international organizations listed in JOB(01)/98.
48. It was so agreed.
49. The Chairperson then noted that the other major element of the work on professional services
was the review of the Synthesis  paper (JOB(01)/162, dated 27 November 2001).  In his Chairperson’s
Note, he had observed that the Working Party on 16 July began initial discussions of the General
Comments  section of the Synthesis  paper.  Although the comments received were not extensive, he
had stated in his Note that he intended to open the floor again for comments on the Synthesis  paper at
the formal meeting, starting with Part III, Results by Profession , followed by any additional
interventions on the General Comments  section.  The Chairperson indicated that discussions would
again be on an informal basis, followed by his Chairperson’s summary.
50. The delegate from Hong Kong, China, after asking that his statement be included in the
Minutes, said the Synthesis paper indicated that an important element in the development of
disciplines on professional services was the recognition of qualifications.  He emphasized that the lackof a mechanism to recognize qualifications obtained in another country, even where market accessS/WPDR/M/18
Page 8
commitments had been made, was a key issue that could restrict the access of foreign suppliers.  The
issue was especially important for services suppliers from developing countries, as they were less
likely to be party to established recognition arrangements.
51. Particularly for suppliers under Mode 4 and SMEs, proving the equivalency of qualifications
each time they wished to provide services was a significant burden, the delegate from Hong Kong,China stated.  Although some Members might point to Article VII as a solution, he questioned the
extent to which it could actually address the issue.  Article VII was an enabling clause for recognition
agreements to be created, he noted, and did not in itself impose any obligations for the establishment
of recognition arrangements.  Recognition of qualifications was essential to ensure that market-access
commitments were meaningful for foreign suppliers, the delegate stated, and putting the burden of
proof solely on the suppliers could be too burdensome.  The development of disciplines on
professional services under Article VI:4 was therefore essential, to ensure that the recognition ofqualifications was not overly burdensome and would not be unduly denied to developing country
suppliers.
52. The delegate from Hong Kong, China noted that para 19 of the Accountancy Disciplines
provided some disciplines for taking account of the qualifications acquired in the territory of another
Member.  In addition, Article VI:6 required Members to provide for adequate procedures to verify thecompetence of professionals of any other Member in professional services sectors where they had
undertaken commitments.  His delegation was open to further deliberations as to whether such
disciplines could be strengthened for horizontal application to professional services and possibly other
sectors so as to ensure meaningful market access commitments.
53. The Chairperson summarized the informal discussions by stating that there had been a very
interesting debate on the basis on the Synthesis  paper and Members’ domestic consultations.  He again
emphasized the importance of the full participation of Members, and urged those Members that have
not yet reported on their domestic consultations to provide progress reports orally.
B. DATE OF NEXT MEETING
54. Returning to formal mode, the Chairperson noted that the next item on the agenda was the
date for the next meeting.  In accordance with the practice of grouping meetings of subsidiary bodies
close to meetings of the Council, he suggested th at the next meeting be held during the week just
before the next CTS and Special Session meetings, i.e. in early December.  Members approved the
Chairperson’s suggestion.
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