RESTRICTED  
  
S/C/W/385  
 
7 October  2021 
(21-7584) Page: 1/6 
Council for Trade in Services    
 
 
- DRAFT - 
ANNUAL REPORT OF THE COUNCIL FOR TRADE IN SERVICES  
TO THE GENERAL COUNCIL (20 21) 
Since its Annual Report of 20 20 to the General Council1, the Council for Trade in Services held three 
formal meetings, respectively on  4 December 2020, 5 March  2021 and 1 July 2021.2 During the 
period covered by this report, the Council addressed the following matters.  
1  NOTIFICATIONS MADE TO THE COUNCIL PURSUANT TO GATS ARTICLES  III:3 , V:7 AND 
VII:4  
1.1.  The Council took note, altogether, of the  following notifications:  
a. Notifications pursuant to Article III:3 of the GATS  
Mauritius  (S/C/N/1022);  
Brazil   (S/C/N/1023);  
Australia  (S/C/N/1042);  
Switzerland  (S/C/N/1044);  
Kazakhstan  (S/C/N/1045);  
Japan   (S/C/N/1046);  
Russian Federation  (S/C/N/1048  - S/C/N/ 1049);  
Egypt   (S/C/N/1050);  
Guyana  (S/C/N/1051);  
Macao, China  (S/C/N/1057);  
Thailand  (S/C/N/1058  – S/C/N/ 1059).  
b. Notifications pursuant to Article V:7 of the GATS  
Canada, Mexico and United States  (S/C/N/4/Add.1);  
United Kingdom  (S/C/N/ 1024);  
Antigua and Barbuda, Barbados, Belize, Dominica,  
 Dominican Republic, Grenada, Guyana,  
 Jamaica, Saint Kitts and Nevis, Saint Lucia,  
 Saint Vincent and the Grenadines,  
 Trinidad and Tobago, and United Kingdom  (S/C/N/1025);  
United Kingdom, Costa Rica, El Salvador, Guatemala,  
 Honduras, Nicaragua and Panama  (S/C/N/1026);  
United Kingdom and Chile  (S/C/N/1027);  
United Kingdom, Ecuador and Peru  (S/C/N/1028);  
United Kingdom and Republic of Korea  (S/C/N/1029);  
United Kingdom and Singapore  (S/C/N/1030);  
United Kingdom and Ukraine  (S/C/N/1031);  
United Kingdom and Viet Nam  (S/C/N/1032);  
United Kingdom and North Macedonia  (S/C/N/1033);  
United Kingdom and Republic of Moldova  (S/C/N/1034);  
United Kingdom and Georgia  (S/C/N/1035);  
 
1 Document S/C/60. 
2 Reports of these meetings are contained in documents S/C/M/ 144 to S/C/M/ 146, and should be read 
in conjunction with this repo rt. S/C/W/385  
 
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  United Kingdom a nd Japan  (S/C/N/1036);  
China and Mauritius  (S/C/N/1037);  
Australia and Indonesia  (S/C/N/1040);  
United Kingdom and European Union  (S/C/N/1041);  
Brunei Darussalam; Cambodia; Hong Kong, China;  
 Indonesia; Lao People's Democratic Republic;  
 Malaysia; Myanmar; Philippines; Singapore;  
 Thailand and Viet Nam  (S/C/N/1043) ; 
European Union  (S/C/N/6/Add.1);  
Costa Rica, El Salvador, Guatemala, Honduras,  
 Nicaragua, Panama and European Union  (S/C/N/680/Add.1);  
Australia, New Zealand, Samoa, Solomon Islands, Tonga  (S/C/N /1052);  
India and Mauritius  (S/C/N/1053);  
Costa Rica, El Salvador, Honduras, Nicaragua,  
 Panama, and Republic of Korea  (S/C/N/1054);  
United Kingdom and Albania  (S/C/N/1055);  
Antigua and Barbuda, Barbados, Belize, Dominica,  
 Dominican Republic, Grenada, Guyana, Jamaica,  
 Saint Kitts and Nevis, Saint Lucia,  
 Saint Vincent and the Grenadines, Suriname,  
 Trinidad and Tobago and United Kingdom  (S/C/N/1025/Add.1);  
United Kingdom  (S/C/N/1056).  
 
The agreements notified in these documents were referred t o the Committee on Regional 
Trade Agreements for consideration.  
c. Notifications pursuant to Article VII:4 of the GATS  
Switzerland and United Kingdom  (S/C/N/1039);  
Russian Federation  (S/C/N/1047).  
1.2.  At the meeting held in March , the Council took note of the upd ated Secretariat Note containing 
a statistical account of the notifications made under relevant GATS provisions.3  
2  OPERATIONALIZATION OF THE LDC SERVICES WAIVER  
2.1.  Following a suggestion by the LDC Group that the Council organize a webinar to bring together 
LDC service suppliers and consumers of LDC services, at the  meeting of the Council held in December  
Members considered an outline for the webinar circulated by the LDCs.4 Members generally found 
the LDC outline helpful in providing greater clarit y about the objective and scope of the webinar, 
and expressed broad support for the LDC proposal to hold an event that would enable an exchange 
of information and experiences. The Council agreed to task the Secretariat with the preparation of 
a draft progr amme for the event, to be submitted to Members for their consideration.   
2.2.  At the December meeting, the LDC Group also shared with the Council an account of the 
webinar on the impact of COVID -19 on LDC services trade it had organised on 2 December . 
2.3.  At the Co uncil meeting held in  March, Members deliberated the programme outline prepared 
by the Secretariat5 and agreed to organize the webinar  and decided to hold it towards the end of 
May.  
2.4.  The webinar, titled "Least Developed Country services export performance  and facilitating 
implementation of preferences notified under the LDC Services Waiver",  was held on 2 and 3 June .6 
 
3 Document JOB(09)/10/Rev. 11. 
4 Document JOB/SERV/CTS/2.  
5 Document JOB/SERV/CTS/3.  
6 https://www.wto.org/english/tratop_e/serv_e/webinar_june21_e.htm   S/C/W/385  
 
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  2.5.  At the March mee ting, the Council also took note of the UK's notification of preferences under 
the LDC Services Waiver.7 The notification was welcomed by the LDC Group.  
2.6.  At the July meeting of the Council, Members shared their reflections on and reactions to the 
event. All delegations who intervened expressed appreciation for the webinar. Many noted that it 
had helpfully illustra ted the opportunities and challenges faced by LDC suppliers in participating in 
global services trade, while also highlighting the significant gaps in LDC services trade data. The 
LDC Group put forward a number of suggestions for next steps and, following the request of several 
delegations, indicated that it would submit its ideas in writing, for Members' further reflection.  
3  WORK PROGRAMME ON ELECTRONIC COMMERCE  
3.1.  Deliberations at the December  meeting of the Council continued to be invigorated by the 
communic ation by a group of Members proposing exploratory discussions on supporting digital 
capabilit y of business and consumers.8 Several delegations presented in -depth information about 
their programmes and initiatives in this area.  
3.2.  The Chairman suggested comp iling the material shared by Members in a stand -alone  and 
structured  document, to facilitate access to the information and enhance transparency on the various 
initiatives taken in the e -commerce sphere. Many delegations welcomed and supported the proposal.  
A few sought clarifications, including about how the information would be compiled and presented, 
and one expressed reservations. The Chairman indicated that, to address the issues raised by 
delegations, he would provide further details about his proposal . 
3.3.  Various delegations called for the Work Programme to focus on the relationship between e -
commerce and development , and on the challenges faced by developing countries  in the digital 
sphere. A couple of  delegations reiterated their concern with the JSI pr ocess and its rule -making 
objective , which they considered as premature , and said that the extension of the Moratorium would 
be harmful to developing countries. Various  Members disagreed with these assertions ; they  noted 
that the JSI was inclusive, transpa rent and open to participation by all Members, that new rules on 
e-commerce were long overdue, and that evidence pointed to the Moratorium having had far -
reaching benefits for businesses and consumers.  
3.4.  A representative of UNCTAD briefed the Council about its recent work in electronic commerce, 
including studies on the impact of COVID -19 on e -commerce.  
3.5.  The joint communication on supporting digital capabilities  continued to generate substantive 
engagement in the Council, both at its March and July meetings . Numerous Members shared 
information about some of their programmes aimed at fostering an enabling environment for 
electronic commerce. Some delegations also presented the latest domestic developments related to 
e-commerce. At the March meeting, Members  who intervened  appreciated the Chair man's overview 
Note on the information shared by delegations about their initiatives to enhance digital capabilities.9 
3.6.  While welcoming the exchange of information , at the March meeting  a couple of delegations 
reiterated their call for Members to focus the discussion on the issues mandated by the Work 
Programme, including the scope of the Moratorium and the challenges faced by developing countries 
in e-commerce. In their view,  the extens ion of the Moratorium would be detrimental to developing 
countries  and the parallel JSI negotiations were damaging the multilateral trading system. On the 
other hand, numerous Members noted the extensive benefits of the Moratorium for both businesses 
and c onsumers. They reiterated that the JSIs were inclusive, transparent and open to participation 
by all Members, adding that new rules on e -commerce could foster renewed  momentum for the 
multilateral trading system.  
 
7 Document S/ C/N/1038. Since 2015, t he preferential treatment extended  by the United Kingdom to 
services and service suppliers of LDCs was contained in the European Union's notification under the Waiver 
(S/C/N/840).  The United Kingdom  ceased to be a Member State of the European Union  on 31 January 2020 . 
Immediately following the end of the transition  period  with the European Union  on 31 December 2020 , the 
United Kingdom submitted an independent notifi cation of  preferences under the LDC Waiver (S/C/N/1038) .  
8 JOB/SERV/296/Rev.4.  
9 JOB/SERV/ CTS/4. The Note was circulated under the previous Chairman's o wn responsibility.   S/C/W/385  
 
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  3.7.  At the July meeting, the LDC Group referred  to the services elements of the communication on 
the Work Programme it had submitted to the General Council. Some  delegations noted the 
challenges that developing countries faced in reaping the opportunities provided by the digital 
economy . They  underscor ed the importance of strengthening multilateral discussions under the 
Work Programme, including through structured discussions. One delegation also called for the scope 
of the Moratorium to be clarified, stated  that the e -commerce JSI negotiations damaged  the rules -
based multilateral trading system and indicated that it was working on a submission elaborating the 
treatment of electronic commerce in the GATS legal framework. A couple of Members  intervened to 
reaffirm  their commitment to the multilateral trad ing system and the Moratorium . One Member also 
contested the assertion that the e -commerce JSI negotiations negatively affected the WTO.  
4  UPDATE OF THE SECRETARIAT BACKGROUND NOTE ON MODE 4 
4.1.  The Council addressed this  agenda  item, upon India's request , at the December, March and 
July meetings . India reiterated its request that the Secretariat update the Background Notes on 
mode  4 and on the other  three modes of supply.  India's suggestion was echoed by some delegations.  
India indicated that it could also support the preparation of a further Note by the Secretariat , on 
intermodal linkages.  
4.2.  While affirming  that a Note on intermodal linkages might  be useful , one Member  stated that 
updating the Note  on mode 4  would be of no added value and thus could not support India's request.  
5  CYBERSECURITY  MEASURES OF CHINA AND VIET NAM  
5.1.  At the request of Japan and the United States, at its December, March and July meetings the 
Council addressed various cybersecurity measures adopted and under development by China and 
Viet Nam, respectively. The two requesting delegations shared their concerns with  various aspects 
of those measures , which they alleged could be inconsistent with  China and Viet Nam's respective 
WTO obligations,  and sought additional information and clarity on the same . The ir concerns  were 
echoed by a number of other Members .  
5.2.  In reply, China said that its measures had been drafted transparently and with reference to the 
practice of other Members,  and stakeholders' comments  had been taken into consideration . China 
stated that the purpose of the measures was the protect ion of  cybersecurity , an objective that all 
Members  shared.  
5.3.  Viet Nam noted that its legislative process was open and transparent, and that stakeholders' 
comments would continue to be reviewed as the process advanced.  
6  5G-RELATED MEASURES OF AUSTRALIA  
6.1  At the request of China, the Council addressed 5G -related measures of Australia at all the 
meetings covered by this Report. China expressed its concerns that the measures under discussion 
prevented Chinese companies from participating in 5G -related projects in Australia and run counter 
to Australia's WTO obligations.  
6.2  In reply, Australia stressed that its measures on 5G networks were fully WTO-consistent and 
stated that it continued to welco me foreign business  involvement  in the market.  
7  RUSSIAN FEDERATION FOREIGN -LICENSED FIXED SATELLITE OPERATORS  MARKET 
ACCESS  
7.1  At the request of the United States, at its December meeting the Council addressed a measure 
by the Russian Federation related to mar ket access for foreign -licenced fixed satellite operators . The 
United States  voiced  its concern s that the measure in question provided a preference for the use of 
Russian satellite systems  over foreign ones. Two other Members shared the US concerns .  
7.2  In reply, the Russian Federation said that the measure in question was consistent with its WTO 
obligation s. S/C/W/385  
 
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  8  SOFTWARE PRE -INSTALLATION MANDATE OF THE RUSSIAN FEDERATION  
8.1  At the request of the United States, at all the meetings covered by this Report the Council 
addressed a measure by the Russian Federation on the pre-installation of software . The United 
States shared its concern s that the measure in question  could run counter to the Russian 
Federation's WTO obligations  and sought additional clarity on the same . The US concerns were 
echoed by  a number of  other Members.  
8.2  The Russian Federation stated that , in developing the measure under discussion, it had taken 
into account  the comments submitted by stakeholders and that the measure was fully consistent 
with its WTO obligations.  
9  MEASURES OF THE UNITED STATES RELATED TO CERTAIN  APPLICATIONS  
9.1  At the request of  China, the Council addressed US measures  concerning Chinese mobile  
applications  at all the meetings covered by this report . At the December and March meetings, China 
expressed  its concern that the measures  in question  were trade -restrictive and inconsistent with the 
United States' WTO obligations . At the July meeting, China noted the revoking of t he measures, 
adding that it was a positive step in the right direction.  
9.2  The United States stated that its actions  served to protect its national security and  had been 
taken to mitigate specific and identified national security risks.  
10  MEASURES OF INDIA RELATED TO INVESTMENT APPROVAL AND CERTAIN  
APPLICATIONS  
10.1  At the request of China, at its December, March and July  meetings the Council addressed 
Indian measures on investment approval and banning the use of certain  applications . China voiced  
its concerns that the measures in question were trade restrictive and  inconsistent with India's  WTO 
obligations .  
10.2  India replied that its measures were fully compliant with  its obligations  at the WTO  and had 
been taken to ensure the protection of privacy, data security and national security .  
11  RUSSIAN FEDERATION TAX BENEFITS FOR DOMESTIC SUPPLIERS OF IT SERVICES 
AND DOMESTIC SOFTWARE PRODUCTS  
11.1  At the request of the United States, at the December meeting the Council addressed a measure 
by the Russian Federation providing  certain tax benefits to domestic suppliers of IT services and 
domestic software products. The United States expressed  its concerns that the measure in question 
could run counter to the Russian Federation's WTO obligations and sought additional information  on 
the same.  
11.2  The Russian Federation stated that  the measure  in question  was fully consistent with its WTO 
obligations and only applied to certain developers of specific importance for the sector . 
12  SAUDI ARABIA LOCALISATION OF CUSTOMER SERVICES  
12.1  At the req uest of the United States, at the July meeting the Council addressed a  measure by 
Saudi Arabia requiring the localisation of customer services activities . The United States shared its 
concerns that the measure , due to enter into force on 31 July, would  impose significant costs  on 
many companies in Saudi Arabia and would affect various services sectors in which Saudi Arabia 
had undertaken relevant GATS commitments.  The US concerns were echoed by another Member . 
12.2  Saudi Arabia stated  that its measure fully conform ed with its WTO commitments and would  
not change or modify existing market access conditions . 
13  WORK OF THE SUBSIDIARY BODIES  
13.1.  The activities of the subsidiary bodies in 20 21 are reflected in their respective reports, which 
are annexed to this report, as follows:  S/C/W/385  
 
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   Annex I  Report of the Committee on Trade in Financial Services (S/FIN/ XX) 
 Annex II  Report of the Committee on Specific Commitments (S/CSC/ XX) 
 Annex III  Report of the Working Party on Domestic Regul ation (S/WPDR/ XX) 
 Annex IV  Report of the Working Party on GATS Rules (S/W PGR/XX). 
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