RESTRICTEDWORLD TRADE
ORGANIZATIONS/C/M/41
3 April 2000
(00-1387)
Council for Trade in Services
REPORT OF THE MEETING HELD ON 25 FEBRUARY 2000
Note by the Secretariat
1. The Council for Trade in Services held a meeting on 25 February 2000.  The agenda for the
meeting is contained in document WTO/AIR/1244.
2. Under Other Business, the Chairman said that he would make a statement about a request
from the Universal Postal Union to conclude a cooperation agreement with the WTO, about a
communication from the Marine and Fire Insura nce Association of Japan and about the draft
cooperation agreement between the WTO and the ITU.  He also suggested that the order of items Hand I on the agenda be reversed.
3. The Council so agreed.
4. The Chairman informed Members of a request from the World Tourism Organization for
observer status in the meeting of the Council, to hear the discussion under item E of the agenda on
tourism services.  He asked the indulgence of the Council in inviting a representative of the WorldTourism Organization to attend the meeting as an observer.  As to the possibility of the World
Tourism Organization attending future meetings, he recalled that the Council had agreed to invite
ICAO on an ad hoc basis when subjects of interest to them were being discussed and might want to
consider this possibility further.
5. The representative of Nicaragua requested to make a statement under Other Business,
concerning her authorities' notification of measures taken under Article XIV bis of the GATS and XXI
of the GATT and circulated as document S/C/W/11 5 and S/C/W/115/Corr.1 a nd as document G/C/4
in the Council for Trade in Goods.  The representatives of Colombia and Honduras  also requested to
make statements on Nicaragua's notification.
6. The Chairman proposed that the Council adopt the agenda as circulated, with the reversal of
items H and I and the addition of the three items he had raised under Other Business and of the
statements by Nicaragua, Colombia and Honduras on Nicaragua's notification.  He also proposed thatthe Council agree to the representative of the World Tourism Organization attending the meeting.
7. The Council so agreed.
A. ASSESSMENT OF TRADE IN SERVICES
8. The Chairman recalled that, at its last meeting, the Council had had a very useful discussion
of the paper presented by the delegation of Norway, entitled "Liberalization of Trade in Producer
Services – The Impact on Developing Countries" an d that it had been agreed that the Council would
revert to it for further discussion.  He also recalled that the delegation of Venezuela had suggested that
the documents circulated at the WTO/World Bank seminar on developing countries be made availableS/C/M/41
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to the Council.  The Secretariat had prepared a list of all such documents, and included the Internet
address from which they could be downloaded.
9. The representative of Pakistan suggested that, as Article XIX was on the agenda of the
Special Session of the Council for Trade in Services, the discussion of the assessment be moved to the
agenda the Special Session, so as to facilitate the establishment of negotiating guidelines andprocedures.  The representatives of India and of the Dominican Republic
 concurred.
10. The Chairman proposed therefore that item A on the assessment of trade in services be taken
up under the Special Session of the Council for Trade in Services.
11. The Council so agreed.
B. REVIEW OF ARTICLE II (MFN) EXEMPTIONS (JOB NO. 6116 AND CORR.1)
12. The Chairman recalled that, at its last meeting under this agenda item, the Council had
addressed an updated compilation of MFN exemptions produced by the Secretariat, contained in
document Job No. 6116.  Subsequently, the Secretariat had issued a corrigendum to this document,
dated 10 February 2000.
13. At the informal Council meeting on 11 February, delegations had exchanged views on how
the review should be conducted.  There seemed to be  agreement that the exercise should be primarily
of an educative nature, designed to provide more  information on Members' MFN exemptions and in
particular, as paragraph 4 of the Annex states, on whether the conditions which had created the need
for an exemption still prevailed.  There was a general feeling that the exercise should not be one of
finger pointing.  There also seemed to be agreement that the Secretariat reconstruct the compilation of
MFN exemptions along sectoral lines, without changing  their actual content, in order to allow for a
sector-by-sector examination of the exemptions.  Delegations also seemed to be in favour ofsubmitting questions and responses in writing, where possible, prior to the multilateral examination of
exemptions.  However, the way in which such questions should be responded to, whether in writing or
orally at the meeting, would be left to each delegation.  At the end of the informal discussion, it
appeared that more reflection was needed on the question of how many meetings should be envisaged
for completion of the review and over what period of time.  One possibility in this regard was toschedule one special session of the Council devoted to the review, at the end of which the Council
would decide on how to proceed further.  Another option was to split exemptions into two groups and
schedule two meetings.
14. The representative of Japan stressed the importance of the review.  He noted that there were
around 270 exemptions and hence sufficient time was necessary to prepare for the review and
especially to prepare written questions.  His delegation was in favour of scheduling three meetings,
each dealing with around 90 exemptions.
15. The representative of Ecuador also favoured having more than one meeting, but his
preference was for the review to be concluded before the summer break.
16. The representative of Cyprus concurred with the Chairman's introduction that the review be a
factual exchange of information, to be conducted sectorally on the basis of the adequately revised
Secretariat compilation and with a question-and-answer process well in advance of the meeting.  Thereview would in no circumstance conclude with a recommendation, nor should Members be expected
to reduce or eliminate exemptions.  It would be restricted to a single session within six months and
could be conducted over several days if necessary.S/C/M/41
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17. The representative of Mexico suggested that, as paragraph 3 of the Annex on MFN
exemptions stated that the review should cover al l exemptions granted for more than 5 years, the
Council take note of all exemptions granted for 5 years or less.  He was in favour of scheduling
possibly two or three special meetings, to allow for interaction.  He agreed to having the Secretariat
reconstruct the compilation of exemptions by sector.  In his view, the review should examine whetherthe conditions which had created the need for the exemption still prevailed, with the burden of proof
resting on the Member having listed the exempti on, and, in view of paragraph 6 of the Annex,
particularly so in the case of those Members with exemptions of unlimited duration.  The Council was
also required to decide on the date of a further review, as mandated by paragraph 4(b) of the Annex;
Members thus needed to agree on a date, whether in 5 years' time or on a case-by-case basis or on
linked to the negotiations.  He also suggested that during the review process, some consideration
might be given to the establishment of a multilateral mechanism to monitor MFN exemptions, with aview to their elimination.
18. Responding to Mexico's question, the Chairman informed Members that only one MFN
exemption had a duration of 5 years or less.
19. The representative of Switzerland concurred with the Chairman on the purpose of the review.
He stressed that the Annex on MFN exemptions contained no concept of "burden of proof" or any
notion which went beyond the Chairman's suggestions.  He also noted that the Annex referred to "the
date of any further review" and therefore a decision on whether to have a further review was still
required.  On modalities, he agreed to a question- and-answer process, so long as the answers did not
have to be provided in writing.  He was also in favour of one special meeting, over as many days as
necessary, with the possibility of deciding then on the need for an additional meeting.
20. The representative of the European Communities agreed with Switzerland that the review be
conducted in a single meeting, perhaps in July, with the possibility of a follow-up, and that Members
choose the preferred format when answering questions.  He was also in favour of the Secretariat
rearranging the compilation of MFN exemptions.  He stressed that no outcome, conclusions or
summary report should result from the review proces s;  it was up to Members to reach their own
conclusions and take them into the negotiations.  Responding to Mexico's comments, he said that any
discussion on the phasing out of MFN exemptions would stem from the negotiations, not from the
review.
21. The representative of Norway said that MFN principle was the main pillar of the WTO and
the GATS and that exemptions should be kept to a minimum.  His delegation was flexible on
modalities for the review, but wished to see the process finished within six-months.  He added that the
review should try to identify general trends and examine whether the conditions which had created the
need for the exemptions still prevail.
22. The representative of Indonesia, speaking on behalf of ASEAN, said that the review was to be
conducted by the Council, should aim to facilita te Members' understanding of the MFN exemptions,
to fulfill the mandate of paragraphs 3 and 4 of th e Annex, and should not affect Members' rights under
Article II.  On modalities, he was in favour of a question-and-answer process, with writtencommunications to be circulated to all Members, and of discussing in informal mode on the basis of
the Secretariat compilation rearranged by sectors.  As to the number of meetings, he was flexible, but
sufficient time should be allowed and capital-based experts' participation should be facilitated.
23. The representative of Korea supported Japan's comments and was in favour of conducting the
review over 3 meetings and conclude it by early 2001.
24. The representative of Hong Kong, China suppo rted the Chairman's introductory statement.
His delegation was in favour of conducting the review over more than one meeting, but could beS/C/M/41
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flexible.  The suggestion that the meeting be conduc ted in informal mode required more reflection, as
he felt that a record of the discussion, even in the form of a non-attributable summary, would be
useful.  He asked how long it would take the Secretariat to produce the compilation by sectors.  A
representative of the Secretariat answered that it would take about ten days.
25. The representative of Hungary supported the Chairman's introduction.  His delegation was in
favour of a sectoral approach to the review, of a question-and-answer process, in writing whenever
possible and with a 6 to 8 weeks interval between questions and answers, and of a single special
meeting, to be scheduled within 6 months, with the possibility of a follow-up.  He said that the review
was a Member-driven process, and that the number of meetings would depend on the interest shown
by Members.
26. The representative of Pakistan said he was in favour of conducting the review over
3 meetings, on the basis of the Secretariat compilation rearranged by sectors, with a question-and-
answer process.  He stressed that paragraph 4 of the Annex required the Council to "examine"
whether the conditions for the exemption still prevailed, and hence the review was no pro-forma
exercise, but at the same time it should not result in finger-pointing.
27. The representative of the Czech Republic said that the MFN principle was a pillar of the
multilateral trading system, but that the purpose of the review was distinct process from the
negotiations.  In his delegation's view, no new procedures should be envisaged for the review, and a
question-and-answer process was the most efficient wa y of conducting the review.  He agreed that the
Secretariat rearrange the compilation of exemptions by sector, but no priority amongst sectors should
be established during the review.  He added that deadlines should be set only after the modalities had
been agreed.
28. The representative of Poland said that the scope of the review was limited to what was stated
in paragraphs 3 and 4 of the Annex;  any reduction or elimination of exemptions would take place in
the negotiations.  He agreed that the Secretariat compilation be rearranged by sector.  He also said that
one meeting was not sufficient for the review.
29. The representative of Colombia observed that the scope of review was clear from the Annex,
and that MFN exemptions could only be removed th rough negotiations.  Further reviews were also
possible, as stated in paragraph 4(b) of the Annex.  His delegation was in favour of a question-and-
answer approach to the review, and was flexible as to the number of meetings.
30. The representative of the United States concurred with Colombia, Poland, the Czech
Republic, Switzerland, the European Communities, Norway, Hungary and Indonesia (on behalf of
ASEAN) on the purpose of the review.  On modalities, he said that Members should be free to present
questions and answers both in writing and orally.  His delegation was in favour of scheduling a singlemeeting and of deciding on that occasion about any additional meetings.
31. The representative of New Zealand noted that consensus seemed to be emerging that the
review was an educative process, aimed at examining if the conditions which had created the need for
the exemptions still prevailed, that a sectoral approach be adopted on the basis of the rearranged
compilation and on a question-and-answer process in ei ther oral or written format.  Divergences still
existed about the number of meetings;  his delegation was of the view that more than one meeting was
needed, but was prepared to agree to a single one with the possibility of deciding on further ones once
the questions and the sectoral compilation were available.
32. The representative of Brazil said that the objective of the review was clear.  He added that his
delegation was flexible as to the number of meetings, which could be decided upon on the basis of the
number of questions posed.S/C/M/41
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33. The representative of Australia concurred with the Chairman's introduction that the review be
conducted by sector, on the basis of the rearranged compilation by the Secretariat and with question-
and-answer in flexible format.  Her delegation was in favour of scheduling 2 to 3 meetings, but was
flexible.  She concurred with Hong Kong, China's comment that some report of the discussion would
be useful.
34. The representative of Chile stressed that the review was a factual exercise to examine if the
conditions for the exemptions still prevailed and that it was independent of the negotiations.  He
supported an approach based on questions, to be distributed before the meetings, and oral answers at
the meeting.  His delegation was in favour of 2 to 3 meetings, to allow for greater interaction and
follow-up.
35. The representative of Argentina said that the paragraph 4 of the Annex delimited the scope of
the review and required Members to agree on the date of a further review.  He agreed to a question-
and-answer process and to the Secretariat rearranging the compilation of exemptions by sector, in
alphabetical order.  He was in favour of scheduling one long meeting, and deciding then whether an
additional one was required, and of having some record of the discussion.
36. The representative of Mexico was surprised to hear that, according to some Members, the
Annex did not mandate a further review.  In his vi ew, paragraph 4(b) was linked to the existence of
exemptions and to paragraph 4(a).  The conditions which had created the need for the exemption were
important and his earlier comment about the "burden of proof" was motivated by the observation that
it was those Members having listed the exemptions who were in the best position to explain such
conditions.  He was in favour of the question-and-answer approach, but felt that it was important to
agree on whether questions would or would not be preceded by a presentation by those Membershaving listed exemptions, to provide information on whether the conditions which had created the
need for the exemptions still prevailed.  He also concurred that having a record of the discussion, and
especially of divergent views, was important, as in the event of a dispute such a record would be
useful.  As the MFN principle was a basic principle of the multilateral trading system, the review was
important and even if no joint recommendations would be issued, a clear record of the discussion wasessential.
37. The representative of Canada said that the review had to be guided by the Annex.  On the
question-and-answer process, Members should be allowed to choose the format in which to respond.
In order to have a meaningful exchange of information, he considered it preferable to conduct the
meeting in informal mode and not to produce a detailed report of the discussion, but would be giving
the issue further consideration.  As to the number of meetings, he noted that even those Members in
favour of 2 to 3 meetings were envisaging a time-frame of around 6 months.  Hence he suggestedscheduling one meeting around July, to allow sufficient time for questions and answers, and deciding
then whether to schedule additional meetings.
38. The representative of Uruguay said that the review was an information exchange process, to
be based on the mandate contained in the Annex, and supported the proposal that the Secretariat
reconstruct the compilation of exemptions by sector.  He agreed that time was needed to preparequestions and answers and was in favour of scheduling one meeting and decide then if more were
needed.
39. The representative of Venezuela noted that the purpose of the review was clearly stated in
paragraph 4 of the Annex.  She was in favour of the reconstructed compilation of exemptions by
sector and was flexible as to the number of meetings.  She concurred with Mexico that it was useful ifall Members explained the reasons for their exemptions.  As concerned the format of the question-
and-answer process, her delegation did not have a final position.S/C/M/41
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40. The representative of Egypt concurred with the Chairman's introduction that the review
examine if the conditions which had created the need for the exemption still prevailed and that it be
conducted by sector, on the basis of the rearranged compilation by the Secretariat.  He was flexible as
concerned the question-and-answer process, the dura tion of the review and the number of meetings, as
long as these were consistent with the objective of the review.
41. The representative of Turkey favoured scheduling more than one meeting, but completing the
review process by the end of 2000, and preferably within 6 months.  He agreed to the Secretariat
reconstructing the compilation of exemptions by sector and to a question-and-answer process
conducted in written format.  He was flexible as to the formal or informal mode of the session.
42. The representative of Slovenia agreed with the Chairman's introduction in its entirety and, as
concerned the number of meetings, was in favour of scheduling one session over a number of days
and decide at that stage if more were needed.
43. The representative of India concurred with the Chairman's introduction that the review
examine if the conditions which had created the n eed for the exemption still prevailed, that it be
conducted by sector, on the basis of the reconstructed compilation, with a question-and-answer
process in flexible format, and favoured the production of a report of the proceedings.
44. The representative of Japan said that one meeting was not practical to prepare for the review
and could not agree to it.  His delegation's position was that three meetings should be scheduled, but
was prepared to agree to two if a consensus was reached.
45. Summarizing the discussion on this item, the Chairman said that Members seemed to agree
that the review was a substantial information ex change exercise, in particular on whether the
conditions which had created the need for the exemptions still prevailed, that it should involve nofinger-pointing, that it be conducted by sector, on the basis of the reconstructed Secretariat
compilation, with questions in writing and answers pr ovided in flexible format at the meeting, and
also allowing for oral questions at the meeting.  Divergences still existed on the number of meetings
and on the duration of the review.  He appealed to  delegations to compromise, while recognizing that
any decision could still be changed, and proposed that  one meeting be scheduled in two parts, of two
days each, around mid-May and around mid-July, and that the possibility of scheduling further
meetings be retained.  His thinking was that the re view needed sufficient time to be prepared and that
the participation of capital-based experts would be facilitated if a clear indication existed of when a
particular exemption would be discussed.
46. The representative of Canada supported the Chairman's suggestion and the representative of
Japan said that his delegation could also agree with it.  The representative of Mexico  suggested that, at
the end of the two parts of the meeting, at the request of a Member another meeting could be
scheduled in the second part of the year.  He also proposed that Members envisage the possibility of
discussing the need for a report of the review.
47. The representative of Mauritius asked what the intended order of work would be, in terms of
allocating sectors to the two parts of the meeting.  The representative of Hong Kong, China suggested
that that issue be discussed further, along with other procedural ones such as the mode of the meeting
and the production of a report, at the next Council meeting.
48. The Chairman suggested that the review of MFN exemptions remain an item on the Council
agenda, for Members to agree on modalities, on the record of the discussion, on the mode of the
meeting and of the allocation of sectors to the two parts of the meeting based on the services sectoral
classification list contained in document MTN.GNS /W/120.  As concerned Mexico's comment aboutS/C/M/41
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a further meeting, he said that such a request would be considered by other Members with the usual
goodwill.
C. REVIEW OF AIR TRANSPORT SERVICES UNDER PARAGRAPH 5 OF THE
ANNEX
49. The Chairman recalled that the discussion on the review of air transport services had started at
the Council meeting of September 1999, with the submission of a paper by the delegations of
New Zealand, Chile and Singapore circulated as document S/C/W/113.  A paper had also been
prepared by the Secretariat, entitled "Recent trade- related activities of international intergovernmental
organizations in the field of air transport", contained in document S/C/W/129.  He drew Members'
attention to a communication by Japan on the work  programme for the review of air transport
services, contained in document S/C/W/134, a nd to a communication from New Zealand on the
review of the Air Transport Annex, circulated as Job No. 753.
50. He then informed Members that the Secretariat had received two papers from the
International Civil Aviation Organization:  a resolution adopted by the Council of ICAO on
22 November 1999, concerning the negotiations on trade in services in the WTO, and an extract from
resolution A32/17 of the Assembly of ICAO dated 31 October 1998, referring to the same subject.  He
said that that the two papers contained information useful for Members' discussions and suggestedthat the Secretariat circulate them in an informal note (Job No. 679).
51. The Council agreed.
52. The Chairman then recalled that at the inform al meeting held on 11 February there seemed to
be agreement that the air transport review was likely to be a substantial piece of work.  It involved
considering developments in the air transport sector and reviewing the operation of the Annex.  Theobjective of the review, as stated in the Annex, was to consider the possible further application of the
GATS in the sector of air transport, which, in simple terms, implied considering whether additional
air services should be added to the coverage of the GATS.  The Annex excluded from the coverage of
the Agreement measures affecting traffic rights and services directly related to the exercise of traffic
rights.  Three services - aircraft repair and maintenance, selling and marketing of air transport servicesand computer reservation systems (CRS) – were explicitly included, as exceptions to the exclusion of
services related to traffic rights.
53. At the 11 February meeting there seemed to be agreement that an information gathering
exercise was needed, for Members to be better informed about developments in the sector.  There also
seemed to be a widely held view that it would be desirable to hold special meetings with the
participation of capital-based experts.  Some delegations had suggested that such meetings could be
held back-to-back with regular Council meetings.  Th ere was some divergence as to the length of the
process and the number of meetings likely to be needed.  The Chairman suggested, however, that such
a decision might not be possible, or necessary, at that stage.  He felt that it might be wisest to get the
review under way and leave it to the Council to take  any further decisions that might be necessary in
the light of progress.
54. The representative of New Zealand concurred with the Chairman's summary.  He then
presented the paper by his delegation, circulated as Job No. 753, which set out some further thoughts
on the conduct of the review of air transport services.  As concerned the scope and objective of the
review, paragraph 5 of the Annex on air transport services offered guidance; as to a possible end-
product to the review, no prescriptions were made.  As far as the organization of the initial stages of
the review, two special meetings were su ggested for2000, possibly in June/July and
October/November.  The work programme should initia lly address the latest developments in the air
transport sector and the operation of the Annex.  The paper also emphasised the importance of a solidS/C/M/41
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information base;  it suggested that additional material be prepared, beyond the Secretariat note
circulated as S/C/W/129, which would be useful for the review.  On the communication by the
delegation of Japan, document S/C/W/134, he noted that it usefully complemented the paper by his
delegation and that it similarly stressed the importance of analysing latest developments in the sector
and of clarifying classification issues.  His delegation was also of the view that issues such as code-sharing and fares in relation to tariffs warranted discussion and would also add traffic rights to the list.
55. The representative of Japan presented the pa per by his delegation, document S/C/W/134.  The
note proposed a work programme to pursue the mandate in paragraph 5 of the Annex, setting out the
objectives and background to the review.  It noted the need to examine whether and how recent
progress in liberalization in the sector could or needed to be made consistent with the GATS; current
competition policies, and the possibility of coordinating such policies, also needed to be studied in
this respect.  The review should also address the definition of services directly related to the exerciseof traffic rights, so as to reach a clearer understanding on what air transport services the GATS
currently applied to.  The initial stages of the review should therefore deal with classification issues
and examine those agreements concerning traffic rights and/or services directly related to the exercise
of traffic rights, as well as current competition policies.  His delegation supported conducting the
review in one or two special Council meetings a year, but further discussion on modalities was still
needed.
56. The representative of Cyprus expressed support for the mandated review, with the
understanding that it would focus on developments in the sector, as mandated by the Annex.  Her
delegation supported the holding of two special m eetings, at a maximum, with the participation of
capital-based experts, as well as the matrix proposed by New Zealand and the suggestion that thereview address definitional issues.  She also sought confirmation that countries with no commitments
in air transport would not be expected to schedu le any upon the end of the review process, as this
would at any rate not fall within the scope of the mandated review.
57. The representative of Norway concurred with the Chairman's introduction on a preliminary
basis and also fully supported the paper submitted by the delegation of New Zealand, in particular
with respect to ensuring the participation of aviation experts, including representatives from
international aviation organizations, at the review meetings.
58. The representative of Mexico supported scheduling two meetings in 2000 and leaving open
the possibility of additional meetings later on;  the first meeting would discuss developments in the air
transport sector, while the second one would deal with the operation of the Annex.  As a more general
comment, he stressed the importance of not confusin g the review process with the negotiations and
the related fora.
59. The representative of Mauritius supported the Chairman's introduction.  He considered it
useful to develop a matrix of information which would need to be gathered both by Members and by
the Secretariat, but noted the need for additional consultations, probably informally, on the nature of
such information.
60. The representative of Indonesia, speaking on behalf of ASEAN, welcomed the Chairman's
introduction, supported the participation of capital-based experts and announced contributions in due
course.
61. The representative of Argentina agreed with the main lines set out in the New Zealand paper,
and considered that the work programme therein described was a useful way to start the review.  His
delegation was flexible with respect to the issues to be discussed, which related to developments in airtransport services and the mandate in the Annex.S/C/M/41
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62. The representative of Venezuela said that the focus of the review was set out in the Annex,
but that it could be expanded to cover other issues.  She agreed with the objectives of the review as
mandated by the Annex and as illustrated in the New Zealand paper, as well as with the suggested
participation of capital-based experts, but added that the review should take place in special sessions
of the Council, and not in special meetings.  She proposed that a study be undertaken of the impact ofair transport on the development of other services sectors and of its implications on economic
development in general.  She also agreed with New Zealand that additional work be requested of the
Secretariat.
63. The representative of Brazil stressed the importance of not confusing the review with the
negotiations.  He sought clarification on the reference, in the Japanese paper, to the examination of
treaties and of competition policy, as the Services Council might not be the appropriate forum for
such an examination.  As concerned the matrix proposed by New Zealand, his view was thatdeveloping such a matrix might be time-consuming and delay the review process.
64. The representative of the European Communities expressed support for the Chairman's
introduction.  He was in favour of scheduling two meetings in 2000, possibly in July and October,
back-to-back with the Council's meetings and with  the involvement of capital-based experts.  He
agreed with the issues suggested for the review work programme by New Zealand and Japan, and feltthat more could be added, including ancillary services to air transport, notably ground handling,
leasing and catering, air cargo, charter flights, ownership and control, and traffic rights, with special
attention to transit and technical landing.  He also concurred with Japan on the suggested examination
of treaties.  As concerned additional work by the Secretariat, he was in favour of a background paper
similar to the one which the Secretariat had drafted for the work programme on electronic commerce.On classification, his view was that Members' understanding of the issue could be improved, but that
it was not necessary to arrive at a common understa nding.  He was opposed to the idea of a matrix, as
it seemed to imply a very heavy workload and as the objective that it was pursuing was also unclear.
65. The representative of the United States expressed support for the Chairman's introduction and
for the participation of capital-based experts in the review meetings.  As concerned the paper by
Japan, he was in favour of more classification work being undertaken;  the Secretariat paper contained
in document S/C/W/59 was a useful starting-point, and Members might also want to submit proposals
on the matter.  He felt that the examination of treaties was possible and had to be governed by
paragraph 5 of the Annex, whereas the examination of competition policies was not productive and
should not be carried out.  He wondered whether the suggested review of MFN exemptions in air
transport was intended as separate from, or additional to, the review mandated by the Annex on
Article II exemptions.  He also noted that "open-sk y" agreements had not been concluded just by the
United States government.  As concerned the paper by  New Zealand, he said that developments in the
air transport industry should be examined starting from the end of 1993, when the Uruguay Round
negotiations were concluded.  He agreed with the proposal that regulatory developments in the sector
be examined, but only insofar as they concerned economic regulation, and not safety or security
regulation.  On the proposed matrix, he stressed that it should address all agreements adopted after1993.  He also noted that the matrix under development in the APEC Transportation Working Group
was being compiled on the basis of confidential and anonymous submissions, and hence differently
from standard WTO practice.  He added that it would be useful to see the APEC matrix once it had
been finalised.  He stressed that the review was different from the negotiations, which might or might
not ensue once the review was completed.
66. He then proceeded to inform Members of matters discussed at the recent Chicago conference
on liberalization of air transport.  The conference was widely attended and two panels were of
particular interest to WTO Members; panel A, which dealt with regional and world-wide
developments in the sector, and panel B, which looked beyond bilateral aviation agreements.  In panel
A, participants generally agreed that there was a need to move beyond bilateral agreements butS/C/M/41
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differences still existed on how to proceed.  Some favoured an "open-sky" discussion while others
endorsed the proposal for a transatlantic common aviation area, which would start with the United
States, the European Union and other European countries and be open for accession by any other
interested countries.  Several African speakers sa id that country-by-country solutions to aviation
problems would not be practical or successful, and that regional approaches were required.  It wasreported that Central and Eastern European countries had stared discussions on air transport matters
with the European Union.  A speaker from India had referred to the need to look at ownership and
control issues.  In panel B, five of the ten speakers endorsed the transatlantic common aviation area
proposal, to extend existing open-skies regimes to more countries and to take up new issues, such as
ownership and control and the right of establishment.  One speaker suggested that after regional and
plurilateral arrangements had been perfected, they could be inscribed in GATS schedules.  All the
panelists wanted to achieve progress and recognized the danger of backsliding.
67. The representative of the Czech Republic said that the review was tasked with the
examination of developments in the sector and the operation of the Annex.  His delegation was in
favour of scheduling two special sessions, one for each task, to allow for the participation of capital-
based experts and ICAO representatives.
68. The representative of Switzerland said the review was an important and substantial exercise.
He was in favour with the proposed proceedings, the scheduling of special sessions and the
information gathering exercise.  He agreed with the thrust of the New Zealand paper and expressed
interest for discussing the issues proposed for the matrix.  He shared the European Communities'
suggestion on items to be included in the review work programme.  As concerned the paper by Japan,
he concurred that classification work was important, not only to define those services related to trafficrights but also those currently covered by the GATS, and noted the unusual combination of negative
and positive listing in the Annex.  On the suggestion that competition policies be examined, he
concurred that the issue was of relevance, but premature.
69. The representative of Ecuador supported information gathering on the part of the Secretariat.
He stressed that the mandate for the review was clear and that the review was distinct from the
negotiations.  He also noted the importance of including for discussion issues mentioned by some
Members at the informal consultations.  He was in favour of scheduling two special sessions in 2000,
in conjunction with Services Council meetings to facilitate the participation of capital-based experts.
70. The representative of Poland said the review should take into account the position of other
international organizations and allow for the participation of capital-based experts.  He supported
New Zealand's proposal that two special sessions be scheduled, in July and October, over one or two
days, and that the review work programme address developments in the sector and the operation of
the Annex.  His delegation would also be circulating an informal paper on the review.
71. The representative of Chile supported the New Zealand paper, which usefully complemented
the communication by Japan.  The proposed matrix wa s a useful tool to discuss the various issues of
interest to Members.
72. The representative of Hong Kong, China supported the Chairman's introduction and the
suggestion that more analytical work be carried out by the Secretariat.  His delegation was flexible
with respect to the format and number of meetings for the review.  He said that the papers by Japan
and New Zealand were useful contributions, but that the analysis of competition policies suggested by
Japan was not appropriate and that the matrix proposal by New Zealand required further reflection; it
could be given favourable consideration if it foll owed APEC lines, as otherwise it might delay the
review process.S/C/M/41
Page 11
73. The representative of Australia sought clarification about the reference to competition in the
paper by Japan and suggested that their proposed examination of treaties could be incorporated in the
matrix suggested by New Zealand.  Her delegation was in favour of including air cargo services, non-
scheduled services and ownership and control issues  in the work programme for the review.  On the
organizational side, she supported scheduling two m eetings, with the participation of capital-based
experts, before the end of the year, while retaining the possibility of future meetings in 2001.
74. The representative of Korea said that the papers by Japan and New Zealand shared a number
of similarities.  He supported the examination of competition policies suggested by Japan, but found
the matrix proposed by New Zealand ambitious, as the WTO had many more Members than APEC
and the workload involved could be tremendous.  His delegation was flexible as concerned the timing
and frequency of meetings.
75. The representative of Colombia noted that the review, which was distinct form the
negotiations, did not consist of a single exercise, as the Annex provided for periodic reviews.  As
concerned the scope of the review, the papers by Japan and New Zealand were interesting starting-
points for discussion.  He agreed that it was not necessary to schedule more than two meetings in
2000, but added that there was no hurry to conclude the review process and that any issues not
covered in those two meetings could be carried over for discussion, thus allowing more time forauthorities to study Members' proposals and notes by the Secretariat.  In this respect, he suggested that
the Secretariat draft a paper explaining the background to the Annex on Air Transport Services.
76. Summing up the discussion on this item, the Chairman said that it was clear that the review
would be a substantial process, that it would invo lve an information gathering exercise, even though
there was as yet no complete convergence on the work to be asked of the Secretariat, and that it wouldtake place in special meetings with the participa tion of capital-based experts.  He suggested that
further discussion was necessary on the kinds of papers to be requested of the Secretariat, on the date
and agenda for the first meeting and on how to proceed beyond the first meeting.  He proposed that
the Council revert to this agenda item at its next meeting, leaving open the possibility for informal
consultations to reach further convergence.
D. REVIEW OF THE UNDERSTANDING ON ACCOUNTING RATES (S/GBT/4)
77. The Chairman recalled that the report of the Group on Basic Telecommunications, circulated
in document S/GBT/4, contained an understanding in paragraph 7 to the effect that the application of
differential accounting rates "would not give rise to action by Members under dispute settlement
under the WTO".  The report also provided that the Understanding be reviewed "not later than the
commencement of the future round of negotiations on services commitments".  He observed that the
Understanding was of a "political" nature and not legally binding.  He said that the main questionMembers needed to decide on at the end of the review was whether to continue the Understanding
and, if so, for how long.  At the informal Council meeting on 11 February, Members had expressed
different views concerning the objective of the review and its timeframe.  Some delegations had noted
that the ITU was working on possible reforms of the accounting rates system and had proposed that
the review take account of the ITU work.  The Chairman said that the review could figure as a normalitem on the Council agenda, for as many meetings as proved to be necessary.  He also drew
delegations' attention to the informal note prepared by the Secretariat, circulated as Job No. 765,
which provided a brief factual background on the circumstances which had lead to the adoption of the
Understanding.
78. The representative of Mexico said that the main purpose of the review was not to decide
whether to continue the Understanding, but to examine if the circumstances which had lead to its
adoption still prevailed.  In this regard, it had been the possibility that different accounting rates be
considered as violating the MFN principle which had lead five Members to list MFN exemptions, andS/C/M/41
Page 12
the Understanding had been adopted to avoid massive recourse to MFN exemptions.  Therefore, in his
view the review should acknowledge that the reasons  for the Understanding still prevailed and seek a
definitive solution which would make the Understanding unnecessary.  He agreed that the review
figure as an item on the Council's agenda, but stressed that it was clear that its purpose was not to
decide if the Understanding should be continued, as in reality a decision would be needed to terminate
the Understanding.
79. In view of the lateness of the hour, the Chairman suggested that the Council revert to this item
at its next meeting.
80. The representative of the European Communities agreed, but also suggested that the Council
ask the ITU to provide a progress report on their work on reforming the accounting rates system
before the next Council meeting.  The Chairman said that the request would passed on.
81. The representative of Indonesia, speaking on behalf of ASEAN, said that progress in the ITU
could facilitate the Council's work and therefore suggested that the Council wait for the ITU to
conclude its work before embarking in the review, and that the participation of capital-based experts
be facilitated.  He added that the Understanding on accounting rates continued to apply unless in the
review it was otherwise decided.
82. The Chairman said that the Council would take note of the statements made and revert to this
agenda item at its next meeting.
E. TOURISM SERVICES – COMMUNICATION FROM THE DOMINICAN
REPUBLIC, EL SALVADOR AND HONDURAS (S/C/W/127 AND CORR.1)
83. The Chairman recalled that at the last Council meeting, under Other Business, the delegation
of the Dominican Republic had presented a paper on its behalf, as well as the delegations of El
Salvador and Honduras, on tourism services, contained in document S/C/W/127 and Corr.1.  It had
been agreed that this item be placed on the agen da of the following meeting for a more detailed
discussion.
84. The representative of the Dominican Republic observed that this was an area of possible
cooperation between the WTO and UNCTAD, as the initiative for an Annex had come from the 1998
UNCTAD Expert Meeting on Tourism, which had concluded that a different way of dealing with
tourism services was needed.  This item had been placed on the agenda of the regular Service Council
because it was not yet known that negotiations would take place in a special session of the Council,
but he felt that this was not necessarily the best way to deal with the subject.  As concerned the paper
tabled by his delegation and the delegations of El Salvador and Honduras, it was divided in two parts.
The first one explained the rationale and need for an Annex on tourism.  Tourism services comprised
a heterogeneous cluster of sectors and a better methodology was necessary to monitor progressiveliberalization in tourism, so as to meet the objectives of Article IV of the GATS.  Without prejudice to
negotiating modalities in other sectors, a request and offer approach might not achieve the desired
scope in tourism services and ensure overall liberalization in a series of tourism-related sectors.
Besides, additional disciplines were required to ensure a pro-competitive environment in the sector,
and the Reference Paper in telecommunications could be used as an example.  The second part of thepaper contained a draft text for the Annex.  This was similar to other GATS Annexes, in that it
contained definitions and reclassifications in order to embrace the cluster of sectors involved.
85. The representative of the United States noted that tourism was the largest service sector for all
countries, in balance-of-payment terms, and one of the most interesting sector for developing
countries.  Hence, he supported the proposal for a concerted approach on tourism services.  As theissues raised straddled different bodies, including the Working Party on Domestic Regulation and theS/C/M/41
Page 13
Committee on Specific Commitments, there was a need to consider whether some issues should be
referred to such bodies or be discussed in the Council.  He felt that the issue was timely and could be
taken up in the special session of the Council.
86. The representative of the European Communities concurred with the United States that the
submission was timely and that it cut across different issues.  He found the cluster concept attractive
and would reflect further on the matter.  He wondered whether the cluster was intended as a
negotiating checklist of all sectors where commitments needed to be taken or as a model schedule.
He also supported the idea of a reference paper applicable to tourism and the mention of pro-
competitive principles.  He agreed that this was a negotiating issue which, should be taken up in the
special session of the Service Council.  There was no need for strict formalities in this respect, but
discussions could be usefully pursued in the negotiations.
87. The representative of Turkey welcomed the proposal, which was useful from a classification
prospective and offered an opportunity to negotiate on establishing competition rules in tourism
services.
88. The representative of Switzerland said that different activities could be dealt together to
advance liberalization and improve the user friendliness of the GATS, but also that the paper raised a
number of questions, on classification, regulatory disciplines and on the structure of specificcommitments which required further thought.  He nonetheless supported the general lines of the
proposal.
89. The representative of Japan said that tourism services had a priority role for developing
countries, which needed to be considered fully.  He also observed that the nature of the proposal
related to the negotiations, and hence prudence was needed.  Tourism services presented importantheterogeneity and further reflection was needed on the concept of an Annex and on the need for a
cluster approach to tourism.
90. The representative of Venezuela said that the paper demonstrated the interrelation amongst
different service sectors and that the proposal should be studied in light of the implications it could
have on other sectors.
91. The representative of Colombia welcomed the content and scope of the paper.  He said that
developing countries had a comparative advantage in tourism and that the proposed Annex could
improve their access.
92. The representative of Uruguay said that he would be studying the paper in further detail, but
noted that the objective of the proposal was to give a preferential place to tourism services, a sector in
which there was relatively greater liberalization and where increased participation of developing
countries could be achieved, in line with Article IV of the GATS.
93. The representative of Norway said that tourism was a large sector, of great potential interest
for developing countries, and that it was high time that it had come on the international agenda.  He
requested more time to study the paper, which touched on market issues, as well as technical ones,
and contained suggestions with respect to other international organizations.
94. The representative of Jamaica welcome the paper and said that, while further reflection was
needed, the proposal could be beneficial for all countries, and especially developing countries.
95. The representative of Australia said that her authorities were still studying the proposal and
that she would provide comments at the next meeting.S/C/M/41
Page 14
96. The representative of New Zealand said that the paper was timely and needed to be
considered further.  It addressed cross-cutting issues which could be dealt with in several fora.  He
found the cluster approach interesting and felt that model schedules could possibly be used also in
other sectors.
97. The representative of Egypt said that more study of the proposal was needed, but supported
the initiative and the cluster approach, but warned against the dangers of duplication.  He found that
increased cooperation between the WTO and UNCTAD and other international organization on these
issues could provide a good input to the negotiations.
98. In view of the lateness of the hour and the need to revert to the issue at the next meeting, the
Chairman urged delegations to be brief.
99. The representative of India welcomed the proposal and the development of a specific
approach to deal with the special nature of tour ism services.  She would revert to some of the
comments made about the cluster approach, pro-competitive principles in the reference paper and
about procedural questions at the next meeting.  The representative of Ecuador expressed interest in
continuing discussion of this agenda item at the next meeting.
100. The representative of Hong Kong, China said that tourism was an important sector and that a
cluster approach could be useful, but that further analysis of the proposal was needed and that he
would revert to the matter.  The representative of Brazil agreed that tourism was a key sector, but said
that the proposal raised a number of regulatory and procedural questions which needed to beexamined further and that her delegation would revert to it.  The representative of Indonesia, speaking
on behalf of ASEAN, noted that tourism was an important sector for developing countries, butconcurred that some suggestions in the paper required further examination and would revert to them atthe next meeting.
101. The representative of Hungary welcomed the paper and stressed that tourism was an
important sector also for developed countries.  He had found a number of suggestions interesting,
such as the reference to a cluster approach and pro-competitive disciplines, but needed more time to
study the proposal further and would revert to it.
102. A representative of the World Tourism Organization delivered a statement, which is
contained in the document circulated as Job No. 1690, dated 15 March 2000.
103. The representative of the Dominican Republic said he welcomed and was grateful for
Members' comments.  He added that it was important to look at the proposal and decide what
concerned the negotiations and what fell under the regular work of the Council or its subsidiary
bodies.  He was agreeable to discussing this item in the special session of the Council.
104. Summarising the discussion on this item, the Chairman said that the paper presented by the
delegations of the Dominican Republic, El Salvador and Honduras had generated considerable interest
and contained a number of suggestions for further consideration.  As several Members were still
examining the proposal, the Council would take note of the statements made and revert to the matter
at its next meeting.  He suggested that the item be placed on the agenda of the next meeting of the
special session of the Services Council.
105. The Council so agreed.S/C/M/41
Page 15
F. REQUESTS FOR OBSERVER STATUS – WORLD HEALTH ORGANIZATION,
ISLAMIC DEVELOPMENT BANK AND LEAGUE OF ARAB STATES
106. The Chairman recalled that, at the last meeting of the Council, he had made a statement under
Other Business drawing Members' attention to three requests for observer status in the Council, from
the World Health Organization, the Islamic Development Bank and the League of Arab States.  Twoof these organizations were regional, while the other was universal; he recalled that, insofar as
regional organizations were concerned, the Council had consistently postponed decisions on observer
status while awaiting for guidance from the General Council.  He also drew Members' attention to the
list prepared by the Secretariat, contained in document S/C/W/19/ Rev.2, of all outstanding requests
from regional organizations.  He suggested that, in vi ew of the lateness of the hour, the Council revert
to this item at its next meeting.
107. The Council so agreed.
G. APPOINTMENT OF THE NEW CHAIRPERSONS FOR THE SUBSIDIARY BODIES
- STATEMENT BY THE CHAIRMAN
108. The Chairman said that he had held informal consultations on the chairmanships of the
subsidiary bodies of the Council for Trade in Services and could report that good progress had been
made towards achieving a consensus.  He had proposed a slate of names in his informal consultationsand suggested that any delegation having difficulties in agreeing to such a list contact him by 1 March
by end of play.  He was aware that a number of delegations were not in a position to agree until
decisions were reached on appointments in other WTO Councils.  However, his intention was to try to
arrive at a firm slate of names by 1 March, which would stop just short of a formal approval pending
agreement in other bodies, but which would be more difficult to unravel.
H. OTHER BUSINESS
109. The Chairman drew Members' attention to the informal note circulated as Job No. 865, which
contained a communication from the Universal Postal Union, addressed to the WTO Secretariat,
requesting the cooperation of the WTO Secretariat in the drafting process of a cooperation agreement
between the two organizations.  The document was based on a resolution by the UPU Congress
(resolution C 9/1999), and suggested that the cooperation arrangement take the form of a
memorandum of understanding.  No action had been taken on the request, apart from
acknowledgement of the letter and an explanation of the fact that decisions on such matters were
taken by the Membership.  He suggested that no substantive decision be taken at the meeting, but that
the Council request the Secretariat to consult with the Secretariat of the UPU, so as to obtain further
information, and to report back to a future meeting of the Council.
110. The Council so agreed.
111. The Chairman also informed Members that the Secretariat had received a communication,
containing a statement on the new round of services negotiations by the Marine and Fire Insurance
Association of Japan, Job No. 752.  The statement a ppeared to contain useful information concerning
the interests of the association in the services nego tiations and he proposed that the Secretariat make it
available to Members of the Council.
112. The Council so agreed.
113. The Chairman recalled that the Council had agreed the draft of a cooperation agreement
between the WTO and the International Telecommunications Union, which had then been submitted
to the Council of the ITU.  The ITU Secretariat had reported that several suggestions had been madeS/C/M/41
Page 16
for the amendment of the draft.  The WTO Secretariat was about to consult on the matter with
colleagues in the ITU, and would report back to the Council at its next meeting.
114. The Council so agreed.
115. The representative of Nicaragua informed the Council of the measures taken by her
authorities, and notified in the communication circulated as document S/C/N/115 and G/C/4, for
transparency purposes.  She indicated that a corrigendum, document S/C/W/115/Corr.1, had
subsequently been issued, to correct the reference in paragraph 2 from 130 square kilometres to
130.000 square kilometres.  She explained that in 1986, Honduras and Colombia had signed a Treaty
on Maritime Delimitation in the Caribbean Sea, the Ramírez-López Treaty, which infringed the
sovereign rights of Nicaragua in the Caribbean Sea by seeking to impose limits unilaterally and in
contradiction with the provisions of international law.  Nicaragua was surprised when, on
30 November 1999, the Honduran Congress started the ratification procedure by approving theTreaty, and was followed a few days later by Colombia.  Her authorities had resorted to the Central
American Court of Justice, which had ordered the suspension of the ratification process.  However,
Honduras had continued the process, ignoring th e Court's recommendation.  The implementation of
the Treaty created a complex situation and, as a result of actions by Honduras and Colombia, could
produce unpredictable results which might jeopardize peace and stability in the region.  Nicaragua hadrequested an emergency meeting with the permanen t Council of the Organization of American States,
in which it had been decided by consensus that a special representative of the Secretary General of the
OAS be appointed to assess the situation, facilitate dialogue and draw up recommendations to dispel
tensions.  In light of the situation, and on the basis of Article XXI of GATT 1994 and XIV bis of
GATS, paragraph b(iii), Nicaragua had been compelled to take a series of measures, as set out in thenotification;  the relevant texts had been provided to the Secretariat and were available to Members.
In adopting such measures, Nicaragua had duly taken into consideration the interests of third parties.
116. The representative of Colombia voiced his delegation's great surprise at the notification by
Nicaragua, which tried to justify the adoption of measures which discriminated against exports from
his country and from Honduras.  Such measures had been adopted on the basis of Articles XXI ofGATT 1994 and XIV bis of GATS in response to the ratification by the Congresses of Colombia and
Honduras of the Ramírez-López Treaty, as it was claimed that such ratification violated the
sovereignty of Nicaragua and created serious international tensions.  In his delegation's view, such
measures were merely a way for Nicaragua to side-step its multilateral trade obligations, and a form
of retaliation against the ratification of a sovereign treaty of maritime delimitation.  His authorities
believed that acts of sovereignty and actions such as boundary delimitation should not be discussed in
the WTO.  Similarly, he believed that a solution to a border dispute could not be achieved throughdiscriminatory trade measures.  The WTO was only competent to address the situation of Nicaragua
with respect to measures which it had adopted and which nullified or impaired the trade rights of other
Members; two different negotiating fora should not be confused.  Nicaragua had also stated that the
Colombian government had dispatched war planes to the border, trying to convey the impression that
a belligerent attitude had been adopted by his authorities.  However, such alleged belligerence did notexist;  Nicaragua was a friendly country towards which Colombia was very well disposed and with
which differences should be solved in the appropriate fora.  In view of the measures adopted by
Nicaragua, Colombia had resorted to the Dispute Settlement Understanding, communicating on
17 January 2000 its request for consultations, as contained in document WT/DS188/1.  These bilateral
consultations had taken place on 4 February and, although they had not led to a satisfactory solutionof the dispute, Colombia had hoped that, within the 60 days provided, Nicaragua would revise the
measures and comply with its obligations.  However, Nicaragua was notifying the Council after
consultations had taken place, and the sequence of events suggested a last-minute attempt to legally
justify measures which Nicaragua had adopted in violation of WTO rules.  His delegation further
requested that the delegation of Nicaragua explain how they intended to apply duties on the import ofservices.S/C/M/41
Page 17
117. The representative of Honduras said that her delegation was saddened by Nicaragua's
notification, where her authorities were being accused of moving troops to the border with Nicaragua
and of creating a situation which could endanger peace and security in the region.  In 1986, Honduras
and Colombia had signed the Ramírez-López Treaty on maritime delimitation in the Caribbean Sea,
which in no way could be claimed to impose any maritime limit on Nicaragua or violate itssovereignty or political independence, as maritime space between Honduras and Nicaragua had been
delimited by the International Court of Justice by parallel 15.  Honduras had not sent military troops
to the border with Nicaragua; rather, the contrary had happened.  In its notification, Nicaragua also
stated that the Central American Court of Justice had issued a decision providing for the suspension
by Honduras of the ratification procedure;  howev er, the notification omitted to mention that the
statute of that Court excluded such issues from its competence.  The Central American Court of
Justice had however issued a resolution establishing the illegality of the discriminatory trade measuresadopted by the government of Nicaragua, which were causing serious damage to the economies of
Honduras and Colombia.  Such unilateral measures affected central American integration, violated
regional community law and had no direct or indirect relationship with, or corresponded to, a solution
of the maritime dispute, which was being reviewed in the International Court of Justice of the Hague.
Nicaragua's notification was an attempt to side-step compliance with its obligations under the WTO.She added that her delegation was confident that misunderstandings would be overcome;  her
authorities had attempted by all possible means resolve the problem, without having to recourse to a
trade forum, to avoid damaging the image and credibility of the countries involved.
118. The representative of Guatemala said that her authorities had a spirit of peace and regretted
the situation of which the Council had been informed.
119. The Council took note.
I. APPOINTMENT OF THE NEW CHAIRPERSON FOR THE COUNCIL
120. The Chairman indicated how much he had enjoyed working with Members of the Council for
Trade in Services and with members of the Secretariat.  He said that, while differences did exist
amongst Members, delegations had shown a constr uctive spirit towards resolving them.  The Council
faced important challenges in the future, with the reviews and the negotiations, as well as with its on-
going work, and he was delighted that the General Council had approved the appointment of
Ambassador Sergio Marchi of Canada to take up the post of Chairman of the Council for Trade in
Services.  Ambassador Marchi was an international figure of considerable stature, who had already
made his mark on the WTO and would undoubtedly continue to do so.  His experience and wisdom
were a great and substantial asset to the Services Council in the current important juncture in its
activities.  He said that Ambassador Marchi would be giving the Council's work added substance andprofile precisely when it was needed, upon entering the negotiating phase.  He was thus very pleased,
based on the consensus in the General Council, to propose that Ambassador Marchi be appointed by
acclamation as the Chairman of the Council for Trade in Services.
121. The Council so agreed.
122. The new Chairman, Ambassador Marchi of Canada, thanked Ambassador Harbinson for his
kind words and wishes and closed the regular session of the Council.
__________