WORLD TRADE
ORGANIZATIONS/CSS/W/46
14 March 2001
(01-1402)
Council for Trade in Services
Special SessionOriginal:  English/
French
COMMUNICATION FROM CANADA
Canadian Initial GATS Sectoral/Modal/Horizontal Negotiating Proposals
The attached communication has been received from the delegation of Canada with the
request that it be circulated to Members of the Council for Trade in Services.
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1. Canada submits this paper, in accordance with the “Roadmap” document agreed upon by the
Council for Trade in Services (CTS), Special Session, on May 26, 2000. It proposes principles and
objectives for the current General Agreement on Trade in Services (GATS) negotiations, as well as
elements for inclusion in the negotiating guidelines and procedures.
I. PRINCIPLES
2. We recognize the increasingly global nature and importance of service industries, and the
growing contribution of services exports to the world economy, and specifically to the Canadianeconomy. This underlines the importance of a successful conclusion to the current services
negotiations to increase market access for service providers. Expanded, transparent, and predictable
markets benefit countries, businesses - small, medium and large - and consumers. Services
particularly contribute to the development of the knowledge-based economy.
3. While recognizing the importance of a libera lized services trade environment, it is an
underlying tenet of the GATS, found in both the Prea mble and Article XIX of the Agreement, that the
process of progressive liberalization shall take place with due respect for national policy objectives. In
particular, the GATS emphasizes the right of Members to regulate, and to introduce new regulations,
on the supply of services within their territories, in order to meet national policy objectives. These are
important principles of the GATS as they ensure th at each Members’ ability to implement social and
cultural policies is maintained.
4. The GATS cannot be interpreted as requiring governments to privatize or to deregulate any
services.  We recognize the right of individual countries to maintain public services in sectors of their
choice: this is not a matter for the GATS negotiations. However, in sectors where countries have
chosen to undertake specific commitments under the GATS, the mutually-agreed rules of GATSshould apply.
5. Canada also recognizes that the process of progressive liberalization must respect the level of
development of individual Members, and facilitate increased participation of developing countries in
trade in services. Particular account must be taken of the serious difficulties faced by the
least-developed countries. It is in the interest of all Members that developing countries are activeparticipants in, and beneficiaries of, these negotiations.S/CSS/W/46
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II. OBJECTIVES
6. Canada reaffirms that the objective of these negotiations is to liberalize trade in services
through increased transparency and predictability in services trade regimes and through the provision
of effective access to markets while giving due respect to national policy objectives.
7. Specifically, Canada’s objectives at this initial stage of the negotiations are:
(i) To obtain improved access to international markets for Canadian service providers.
(ii) To consider the particular situation of small- and medium-sized service suppliers, in
the negotiations.
(iii) To preserve the ability of Canada and Canadians to maintain or establish regulations,
subsidies, administrative practices or other measures in sectors such as health, public
education,  and social services.
(iv) To recognize the importance of the framework of rules in enhancing transparency and
predictability for Canadian service exporters: in particular, to continue the work of the
“built-in agenda” of the emergency safeguard mechanism, subsidies, government
procurement and domestic regulation (as set out in GATS Article VI.4).
(v) To explore ways to address the interests and concerns of developing countries; in
particular, to consider the serious challenges  faced by least-developed countries in
these negotiations .
8. Canada also believes that a systematic process of identifying and evaluating likely and
significant environmental impacts of trade negotiations is essential, and to this end, will undertake
domestically an environmental assessment of the GA TS in accordance with Canada’s “Framework for
Conducting Environmental Assessments of Trade Negotiations”.
9. Canada will also not make any commitment that restricts our ability to achieve our cultural
policy objectives until a new international instrument, designed specifically to safeguard the right of
countries to promote and preserve their cultural diversity, can be established.
III. NEGOTIATING GUIDELINES AND PROCEDURES
A. SCOPE
10. The negotiations shall be conducted within the existing architecture of the GATS, which
allows each Member to choose - through its specific commitments - which service sectors, which
modes of service delivery and to what extent they wish to open to foreign service providers.  Canada’s
choices will be guided by the principles and objectives noted above.
11. The negotiations shall seek to secure an overall balance of rights and obligations over a broad
range of sectors.
12. The negotiations shall preserve the right of Members to regulate and to introduce new
regulations in order to meet national policy objectives and will not cover those services specifically
excluded by the GATS: i.e., services supplied in the exercise of governmental authority, as well as air
transport services excluded from the GATS under the Annex on Air Transport Services.S/CSS/W/46
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13. Special attention shall be given to sectors and modes of supply of interest to developing
countries.
B. REVIEWS
14. Negotiations should take into account the results of ongoing reviews of the “Annex on Air
Transport Services” and the “Understanding on Acc ounting Rates”. As specified in the “Annex on
Article II Exemptions”, Most-Favoured Nation (MFN ) Exemptions taken by Members shall be subject
to negotiation.
C. AUTONOMOUS LIBERALIZATION
15. Recognizing transparency and predictability as two cornerstones of the GATS, Canada
believes that it is in the interest of all Members to take note of the autonomous liberalization of other
Members and to give credit as appropriate.
D. ASSESSMENT
16. Much assessment work has been completed, but Canada recognizes the value of ongoing
assessment of trade in services work.
E. STARTING POINT
17. The starting point for negotiations on liberalization should be the existing level of
commitments as contained in the GATS schedules
F. DEVELOPING COUNTRIES
18. Members should consider how to support the negotiating capabilities of developing countries
and consideration should be given to providing special treatment for the least developed countries.
G. NEGOTIATING APPROACHES
19. The request-offer approach should form the basis of the negotiations. Horizontal, formula,
model schedule or cluster negotiating approaches could be considered as appropriate, as long as they
are consistent with the GATS  architecture, which allows Members to individually decide which
commitments to undertake.
H. TECHNICAL REVIEW
20. Existing provisions of the GATS may be subject to a technical review as agreed, by Members,
to improve the clarity and legal consistency of the text. Any technical changes should not alter the
structure, meaning or principles of the GATS.
I. ORGANIZATION OF THE NEGOTIATIONS
Members should take practical decisions on the appropriate initial organization required for
consideration of the various negotiating proposals, taking into account the diversity of interests,
representation from capitals, resource implications, and the limited capacity of smaller missions.
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