RESTRICTED
WORLD TRADE S/C/M/18
2May1997
ORGANIZATION(97-1918)
Council forTrade inServices
REPORT OFTHE MEETING HELD ON11AND 15APRIL 1997
Note bytheSecretariat
1. TheCouncil forTrade inServices heldaspecial meeting on11and15April 1997. Thepurpose
ofthemeeting wastoconclude theverification oftheSchedules ofCommitments andLists ofMFN
exemptions onbasic telecommunications. Themeeting wasconvened byairgram WTO/AIR/562.
Under other business twopoints wereraised. TheChairman invited arepresentative oftheSecretariat
tomake astatement concerning contacts between theWTO Secretariat andtheInternational
TelecommunicationUnion(ITU).TherepresentativeofJapanraisedanotherpointconcerningapplication
forlicenses byforeign telecommunication companies.
A. VERIFICATION OFTHE SCHEDULES INBASIC TELECOMMUNICATIONS
2. TheChairman recalled thataninformal meeting hadbeenheldon14and17March 1997 to
conduct theexamination oftheSchedules ofCommitments andLists ofMFN exemptions resulting
fromthenegotiations onbasictelecommunications. Almost alldelegations hadundertaken toconsider
possible improvements inthepresentation ortechnical accuracy oftheirSchedules, which hadbeen
proposed during theinformal meeting. TheChairman drewattention totheCompilation dated 11April
1997, theSchedule oftheEuropean Communities (inthethreelanguages), theSchedule ofColombia,
theSchedule ofDominica andtheSchedule andMFN Exemption ListofAntigua andBarbuda, which
incorporated thetechnical changes made during verification andrepresented thefinalresults ofthe
negotiations onbasic telecommunications.
3. TheChairman noted thatadifficulty hadarisen concerning thereference, contained inthe
Schedules ofsome Members, totheNotes oftheChairman oftheGroup onBasic Telecommunications
concerning ‘Market Access Limitations onSpectrum Availability '(S/GBT/W/3) and‘Scheduling Basic
Telecom Services Commitments '(S/GBT/W/2/Rev.1) (Chairman 'sNotes).
4. Therepresentative oftheUnited States saidthathisdelegation wasconcerned about changes
made during verification totheSchedules ofsome Members. Inparticular hewasconcerned with
thefactthatsome Schedules contained reference totheChairman 'sNoteonMarket Access Limitations
onSpectrum Availability. Hesaidthatitwould havebeenidealfromhispointofviewthatallreferences
totheNote were deleted from those Schedules which stillcontained them: otherwise hisdelegation
andperhaps others would feelitnecessary toinsert similar references. Alternatively hesuggested
thatastatement byChairman oftheServices Council might bedeveloped inorder toallow those
countries which stillhadthereferences todelete them from theirSchedules. Therepresentative of
theEuropean Communities saidthatonthebasis oftheunderstanding contained intheChairman 's
NoteonSpectrum Availability, theEuropean Communities andanumber ofotherMembers haddeleted
referencetofrequencyorspectrumavailabilityfromtheMarketAccessLimitationscolumnandexplained
inthecover page oftheir Schedules thatsuchdeletion hadbeen based ontheChairman 'sNote.
Subsequently, during verification ithadbeenagreed thatcover pages should disappear from allfinal
Schedules, provided thatanysubstantive elements thatneeded toberetained would beinscribed in
themainbodyoftheSchedule. Some delegations hadaccordingly transferred references toS/GBT/W/3
totheirschedules intheformofaheadnote. Healsosaidthathehadnoobjection iftheUnited States
andother delegations wished toinsert similar headnotes referring totheChairman 'sNotes intheirS/C/M/18
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Schedules. However, hesuggested thathisdelegation would favour asolution, where allreferences
tobothNotes would bedeleted following acommon understanding tobereflected inastatement by
theChairman oftheServices Council andrecorded inthisreport. Therepresentative ofArgentina
saidthatthecover pageofhiscountry 'sSchedule hadcontained substantive information, including
reference totheNoteonSpectrum Availability, which hadbeentransferred intotheSchedule during
technical verification. Henoted thatduring thecourse oftheinformal verification meeting nodelegation
raised anyobjection inthisregard.
5. Therepresentative ofJapan saidthathisdelegation hadserious timeconstraints duetotheir
internal ratification process. TheJapanese Dietneeded acopy oftheverified Schedules assoonas
possible inorder tobeabletoapprove theagreement intimeforitsentry intoforce, anditwasvery
much tobehoped thatthisquestion would notcause adelay thatwould make thisimpossible.
6. Therepresentative ofChile saidhisdelegation hadhadareference totheChairman 'sNotes
intheirSchedule since thebeginning andhence theywereindirectly affected bythediscussion which
wastaking place. Nevertheless, heagreed toconsult hiscapital ontheproposal toallow allMembers
todelete reference totheNotes. Venezuela saidthattheyalsohadincluded reference totheChairman 's
NoteonSpectrum Availability intheirSchedule before theendofthenegotiations butthattheywould
consult theircapital onthepossibility ofdeleting thereference following astatement fromtheChairman
oftheServices Council.
7. Morocco noted thateither therewasgoing tobeanagreement onastatement bytheChairman,
allowing forthedeletion ofallreferences totheChairman 'sNotes or,ifsuchreferences weretoremain
incertain Schedules, other delegations should beallowed toinsert thesame references. The
representative ofSingapore saidthathisdelegation wasamong those whohadagreed during verification
todelete thecover pagecontaining reference totheChairman 'sNote onSpectrum Availability. He
indicated thatastatement bytheChairman wasthepreferred solution. However, ifthere wasno
agreement onsuchstatement, hisdelegation would wishtoinsert reference totheChairman 'sNote
intheSchedule. Therepresentative ofMexico noted thatherdelegation deleted thecover pageduring
verification ontheunderstanding thatthesubstance contained initwould bemoved intotheSchedule
andthatatthattimeherdelegation hadreceived noobjections from other delegations. Sheagreed
toconsult hercapital onthematter ofastatement bytheChairman. Therepresentative ofHungary
stated thathisdelegation reserved itsrighttoinsert reference totheChairman 'sNotes intheSchedule
ifnoagreement wasreached onastatement bytheChairman. Therepresentatives ofCanada and
NewZealand argued thatitwould havebeencounterproductive ifdelegations hadgoneinthedirection
ofadding reference totheNotes intheSchedules andthatitwould bebetter tofocus onthestatement
bytheChairman asthemeans toallow those countries whohadreferences totheChairman 'sNotes
todelete them. Therepresentative ofBrazil saidthathisdelegation wasnotsurethatastatement by
theChairman would beasolution totheissue ofthereferences totheNotes andthathisdelegation
needed certainty onthematter. Headded thathisdelegation would probably accept asituation where
allreferences were tobedeleted inthelightofastatement bytheChairman, buthewould needto
consult hiscapital onthematter.
8. TheChairman noted thataconsensus seemed possible ondeleting allthereferences, ifan
agreement could bereached onastatement referring tothetwoNotes oftheChairman oftheGroup
onBasic Telecommunications relating to‘Market Access Limitations onSpectrum Availability 'and
to‘Scheduling Basic Telecom Services Commitments '.Adraftstatement wascirculated reflecting
theunderstanding bytheCouncil forTrade inServices thatalltheSchedules would bereadinthe
lightoftheNotes oftheChairman oftheGBT, andthatonthatbasis, references tosuchNotes in
particular Schedules would bedeleted. Some delegations suggested afewchanges tothedraftstatement
oftheChairman. TheChairman agreed toproduce arevised draftofhisstatement incorporating the
changes suggested. Healsonoted thatsome delegations needed toconsult theircapital before beingS/C/M/18
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abletoagree onthedeletion ofthereferences totheNotes. Hesuspended themeeting andreconvened
itforthe15thofApril at11am.
9. Themeeting wasresumed on15April 1997. Anumber ofdelegations announced thatthey
hadreceived instructions fromtheircapitals todelete references intheirschedules totheNotes ofthe
Chairman oftheGroup onBasic Telecommunications, provided thatthere wasanagreement onthe
statement bytheChairman oftheServices Council andprovided thatsuchreferences were deleted
from allSchedules.
10. Thedelegation oftheEuropean Communities expressed concern thatthispointhadbeenraised
attheveryendoftheverification procedure, butsaidthattheywereprepared todelete references to
thetwoNotes onthebasis ofthestatement from theCouncil Chairman, ifallsuchreferences were
todisappear from other Schedules. Therepresentative ofChile noted thatthereferences tothe
Chairman 'sNotes, which hisdelegation hadinserted before theendofthenegotiations, were a
substantive partoftheirSchedule andanelement ofadded value toChile'scommitments. Hesaid
thatalthough theverification exercise wasonlyofatechnical nature, Chile agreed todelete reference
totheNotes fromtheSchedule, ifallother Members wereprepared todothesame, andregarded this
deletion asanadditional contribution toChile'scommitments inbasictelecommunications. Hestressed
thatatthispoint itwasimportant tomove theprocess forward sothattheprotocol could enter into
force ontime. Therepresentatives ofBrazil, Dominican Republic andGuatemala saidthattheyhad
instructions todelete reference totheNoteonSpectrum Availability, butonlyifallother delegations
whohadsimilar references didthesame andifthestatement bytheChairman oftheServices Council
wasreproduced inthisreport. Therepresentatives ofArgentina andVenezuela agreed provisionally
tothedeletion ofthereferences totheChairman 'sNotes fromtheirSchedules, subject tofinalclearance
from theircapitals.
11. TheChairman issued thefollowing statement concerning theNotes oftheChairman ofthe
Group onBasic Telecommunications:
'There isapoint thatIshould draw toyourattention relating tothemanagement ofspectrum
orfrequency. Itwillberecalled thatalarge number oftheconditional offers tabled during the
negotiations contained references totheallocation ormanagement ofspectrum, reflecting thefactthat
spectrum isaphysically limited resource whose useissubject tocertain inevitable constraints. This
being so,itwasthegeneral viewofnegotiators thatthemanagement ofspectrum isnotameasure
which needs tobelisted under Article XVIasalimitation onmarket access, andthatsuchlimitations,
being unnecessary, should bedeleted from schedules. TheChairman oftheGroup onBasic
Telecommunications issued anoteon3February 1997 (S/GBT/W/3) which stated, interalia:
"Spectrum/frequency management isnot,perse,ameasure which needs tobelisted under
Article XVI. Furthermore under theGATS each Member hastheright toexercise
spectrum/frequency management, which mayaffect thenumber ofservice suppliers, provided
thatthisisdone inaccordance withArticle VIandother relevant provisions oftheGATS.
Thisincludes theability toallocate frequency bands taking intoaccount existing andfuture
needs. Also, Members which havemade additional commitments inlinewiththeReference
Paper onregulatory principles arebound byitsparagraph 6."S/C/M/18
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Inthelightoftheabove, averylarge number ofMembers haveremoved references tothe
availability ofspectrum from their schedules inaccordance withtheunderstanding contained in
S/GBT/W/3. Anumber ofschedules, however, contained references nottotheavailability ofspectrum,
butrather totheChairman 'snoteitself, which might betaken asanindication thattheChairman 's
notewastaken intoaccount indeciding nottorefer tothemanagement ofspectrum. Ithadbeen
suggested inthecontext oftheverification exercise thatthese references totheChairman 'snotemight
create apresentational problem, bysuggesting thatforthecountries making suchreferences, the
Chairman 'snotemight haveadifferent status thanforothers. Clearly, thiscannot bethecase. In
order toavoid anysuchimplications, itismade clear thattheCouncil 'sunderstanding isthatall
schedules, insofar asthematter ofspectrum management isconcerned, shallbereadinthelightof
theChairman 'snote.
There isalsoanother NotebytheChairman oftheGroup onBasic Telecommunications dated
16January 1997 (S/GBT/W/2/Rev.1) entitled "Notes forScheduling Basic Telecom Services
Commitments". Since itisofasimilar nature tothatoftheNoteonSpectrum Availability, itisthe
Council 'sunderstanding thatallschedules shall bereadinthelightofthatChairman 'sNote.'
12. TheChairmansuggestedthatonthebasisofthisstatement,ofthestatementsmadebydelegations
andinthelightoftheunderstanding thatreferences ineight Schedules totheChairman 'sNotes on
‘Market Access Limitations onSpectrum Availability '(S/GBT/W/3) andon‘Scheduling Basic Telecom
Services Commitments '(S/GBT/W/2/Rev.1) would bedeleted, theCouncil should formally takenote
oftheSchedules contained intheCompilation dated 11April 1997, theSchedules oftheEuropean
Communities (inthethree languages), theSchedule ofColombia, theSchedule ofDominica andthe
Schedule andMFN Exemption ListofAntigua andBarbuda werethefinalresults ofthenegotiations
onbasictelecommunications andwould beattached totheFourth Protocol totheGATS. TheSchedules
were unrestricted andwould bemade public.
13. TheCouncilsoagreed.ThisagreementbecamedefinitivefollowingconfirmationfromArgentina
andVenezuela thatthereferences intheirSchedules totheChairman 'sNotes hadbeendeleted.
14. TheChairman informed delegations thatasof15April 1997, theFourth Protocol totheGATS
would beopenforacceptance byMembers whohadannexed toittheirSchedules ofCommitments
onBasic Telecommunications. Thecertified copies oftheProtocol would beavailable onthesame
date. TheTreaty copyoftheProtocol would beavailable forsignature inRoom 2148 intheCentre
William Rappard.
B. OTHER BUSINESS
15. Therepresentative ofJapan made astatement totheeffect thatamajor trading partner was
withholding decisions onlicence applications ofJapanese subsidiaries oftelecommunication companies,
duetotrade policy concerns. Hestated thatsuchmeasures were inconsistent withtheprocess of
negotiations inbasictelecommunication andwiththespirit oftheWTO Agreement andnoted thatthey
would become impossible totakeaftertheentry intoforce oftheFourth Protocol. Forthisreason he
called fortheearliest possible ratification andimplementation oftheFourth Protocol.S/C/M/18
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16. TheChairman asked theSecretariat toinform theCouncil ofconversations which hadtaken
place between theSecretariat oftheWTO andtheSecretariat oftheInternational Telecommunication
Union. Arepresentative oftheSecretariat reported thattheITUhadapproached theSecretariat with
thesuggestion thatacooperation agreement should bedrawn upbetween thetwoorganisations. In
thediscussion theITUSecretariat suggested whattheyregarded could bethepossible content ofsuch
aco-operation agreement, including forexample exchange ofinformation andmutual access tomeetings.
TheWTO Secretariat hadmade itclear thatdecisions onthismatter were reserved totheGeneral
Council. TheSecretariat undertook tokeeptheCouncil forTrade inServices informed ofanyfurther
developments.