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S/CSC/M/78  
 
1 May 2017 
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Committee on Specific Commitments    
 
REPORT OF THE MEETIN G HELD ON 15 MARCH  2017 
NOTE BY THE SECRETARIAT1 
The Committee on Specific Commitments (CSC) held a meeting on 15 March  2017 chaired by 
Mr. Changtian Han from China . The agenda for the meeting was contained in document 
WTO/AIR/CSC/7. The chairperson  indicated that since the consultations on the appointments of 
chairpersons were still under way , the handover of the c hair of the Committee due to take place at 
the end of the  meeting  would be postponed pending the outcome of such consultatio ns. He 
suggested therefore that the Committee did not address the  agenda  item on the appointment of 
the new chairperson. With that modification, the  agenda was adopted.  
 
1  ITEM A - SCHEDULING  ISSUES  
1.1.  The Chairperson  recalled that a proposal from the delegatio n of Turkey (contained in 
document JOB/SERV/224, dated 29 February 2016) had previously been  submitted to the 
Committee under this item . This document  was aimed at reviving the Committee's discussion on 
Economic Needs Tests (ENTs).  The proposal had receive d general support, as Members had 
recognized that numerous ambiguous ENT entries in schedules had undermine d the value of 
specific commitments under the GATS. While the need for fu rther work on ENTs had been  noted, 
there had been  no agreement on how to pro ceed with Turkey's proposal. At the previous  meeting, 
a number of delegations expressed their willingness to engage in an information exchange exercise 
on ENTs as suggested by Turkey. This exercise would depend on Members' initiative s. Noting  
general suppo rt for further work on ENTs during his consultations, the chairperson  hoped that such 
support could  be turned into concrete progress.  
1.2.  As already indicated by Members, numerous ambiguous ENT entries in schedules had put into 
question the legal certainty of specific commitments , especially  due to lack of transparency and 
predictability. He therefore invite d Members  to consider how the Committee could  contribute to 
overcoming or minimizing this problem, taking into consideration the proposal from Turkey. One 
option might be  to make  entries clearer and provide more transparency to the application or 
administration of scheduled ENTs.  Recalling the interest shown  by delegations at previous 
meetings, he also encouraged Members to consider other  scheduling issues, bearing in mind the 
role of the Committee in the overall services agenda.  
1.3.  The representative of Turkey  stated that her delegation's paper on ENTs , submitted for  the 
meeting  of March 2016 , aimed at bringing clarity to ENTs inscribed in Members’ schedules  so that 
they did not become indirect barrier s to trade in services. Turkey was of the view  that Article 5 of 
the Trade Facilitation  in Services  Agreement  (TFS)  propos ed by India adequately addressed  
problems arising from scheduled  ENTs due to lack of clarity , transparency and predictability.  
Turkey  suggested  that the Committee focus ed on the acceptability a nd formulation of Article 5 of 
the proposed TFS. Turkey  invited other  Members to express their positions and views  on this 
article.  
1.4.  Supporting Turkey's st atement, t he representative of Brazil  noted  that the best way forward 
to pursue the discussion on ENTs , and to clarify  related entries , was to focus on  Article 5 of the 
proposed TFS.  
                                                
1 This document has been prepared under the Secretariat's own responsibility and is without prejudice 
to the positions of Members or to their rights and obligations under the WTO.  S/CSC/M/7 8 
 
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  1.5.  The representative of India stated that Article 5 of the proposed TFS had been inspired  by 
document JOB/SERV/224  and discussions with Turkey. While looking forward to discussing  ENTs, 
India would approach such a discussion  in the context of its TFS proposal. India welcomed 
Members'  comments to fine -tune the text a nd take the discussion forward .  
1.6.  The representative of Brazil  agreed with India that Article 5 of its proposal  should rather be 
reviewed during the general discussion on the proposed TFS . He did not see a  need to discuss it in 
the context of the CSC.   
1.7.  The Chairperson  suggested that the Committee take  note of the statements made and revert 
to this item at its  next meeting . 
1.8.  It was so agreed .  
2  ITEM B - CLASSIFICATION  ISSUES  
2.1.  The Chairperson  recalled  that divergent views had been  reiterated at the previous  meeting 
with respe ct to the issue of "new services". For a  number of delegations , the Committee had 
exhaust ed the discussion on this topic.  Nevertheless,  some others expressed  interest in further 
exploring related issues.  Despite the divergence of views , the discussion at t he previous  meeting , 
as well as  consultations held with delegations , suggest ed that there was still interest in having 
discussions on ICT related classification issues , and other matters , especially in the context of the 
e-commerce agenda. He invited  Membe rs to consider whether and how the Committee could 
undertake meaningful work in this area . 
2.2.  The representative of China  referred to two issues rel ating to classification. First, China took 
issue with the view  that the discussion on "new services " had been e xhausted . In China's view, t he 
classification of "new services " was far from clear and warranted  further discussion. China noted 
that in W/120 a sub -sector with the title  “other”  appeared  under various sectors and sub sectors. 
By analogy, one could regard a  sub-sector named “othe r” as an anonymous person and sub-
sector s with specific labels  as persons  with names. Some view ed subsectors entitled  “other” as a 
catch -all title for services related to that sector or subsector,  but not elsewhere classified. The 
problem was that the scope and coverage  of these so -called “other” sub sectors were not  clearly 
defined. T herefore, multiple scenarios were possible : (1) a "new service " might  fall under one 
particular sub sector named “other” as listed in W120 ; (2) a "new ser vice" might be  a combination 
of several sub sectors named “other” as listed in W120 ; or ( 3) a "new service " might be  a 
combination of on e sub sector named “other” and subsector s with specific name s as listed in W120. 
Given the complexity of this  issue and it s direct relevance to the implementation of specific 
commitments by Members , it would be useful, important and appropriate to continue in -depth 
discussion s in the CSC on how to classify "new services ". He therefore proposed that the 
Secretariat further stu dy the issue of "new" services and prepare a report before the next meeting 
of the CSC.  
2.3.  Second , China noted that some Members  frequent ly used the term “digital trade” in WTO 
discussion s on e-commerce . In certain instances both terms were used together , while in other 
cases only "digital trade" was used, as if it was synonimous  with "e-commerce ". China took this 
opportunity  to bring to the M embers' attention the distinction between the two terms . The 
General Council decision establishing the Work Programme on Ele ctronic Commerce (WT/L/274) 
defined “ e-commerce” as “the production, distribution, marketing, sale or delivery of goods and 
services by electronic means”, and mandated the General Council  and relevant WT O subsidiary 
bodies to examine e-commerce. In o rder to fulfil th at mandate, discussion s should  respect this 
definition , and use the commonly -agreed term as such.  
2.4.  Noting that there  was no WTO mandate on digital trade  per se, let alo ne rule -making on 
digital trade, China expressed the  concern that  the interchangeable  use of those two terms might 
cause misunderstanding and confusion in the future work on e-commerce.  During internal 
consultations, stakeholders, including business  representativ es, had questioned the distinction 
between the two  terms, as they appeared in some Members ' communications. China had heard 
diverging views . Some experts considered that  electronic commerce , as defined in the WTO , was a 
much broader term than "digital trade ". In their view, the term "electronic commerce " cover ed 
both t rade in goods and trade in services, while "digital trade" potentially related to only some S/CSC/M/7 8 
 
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  aspects of e-commerce. Some other experts were of the view that these two terms had  different 
scope s, albeit with some overlap. China expressed the interest in hear ing other Members' view s on 
this issue.  China proposed that Members refrain from using the term "digital trade" in the context 
of WTO discussions on e-commerce , and that  the Secretariat study the distinction between e-
commerce and digital trade  and prepare  a report before the next meeting of the CSC to be 
considered under the agend a item on classification issues . 
2.5.  The representative of the European Union  reiterated  his delegation's position that the  CSC 
had exhausted the discussion  on the issue of "new servi ces". "New services" meant "new ways to 
provide services" , which  could be linked to subsectors  in the classification. It was important not to 
confuse two separate concepts . Even if  there were to be a concept of "new service " – that the 
European Union conte sted – it was not because a service was delivered differently or provided 
through the Internet that the serv ice became "new " and could not be classified in the existing 
classification  system . One of the  good examples put forward in the past was mobile bank ing, which  
was provided in a manner different from traditional banking  but remained a banking  service.  His 
delegation  failed to see value in further discussions  or in another  report  by the Secretariat on the 
issue of "new services " as requested by China .  
2.6.  The European Union also had concerns with respect to China's request for discussion on the 
distinction between "e-commerce" and "digital trade" . There was no need for such discussion  and 
Members were  free to choose terminology to describe their trade objec tives. The indicative 
definition of e-commerce contained in  the Work Programme  was useful  and comprehensive . E-
commerce  or digital trade  was a form of trading  goods  and services, embedded in all WO trade 
agreements . It was unclear  where a discussion on the  definition , as requested by China,  would 
lead. 
2.7.  The representative of Brazil  also questioned the usefulness of  China's first request . With 
respect to China's second request , he asked why it was raised in the CSC. In addition, the only 
definition of e-comme rce in the WTO was the one contained in  the Work Programme, and no 
delegation had attempted  to change it . The use of a different wording would not necessarily imply 
a change of definition. He sought clarification from China on the reasons for its concern  when the 
work on e-commerce was being conducted in the WTO based on  the available definition . He also 
asked why discussions should be detracted by trying to find a definition before moving  forward.  
2.8.  The representative of Canada  thanked China for its efforts  to stimulate some substantive 
discussion in the CSC. With respect to the issue of "new services", the value of services 
commitments was that they create d a predictable trading environment. In order to achieve that, 
the GATS operate d under some important pr inciples, notably  that obligations under  the GATS , 
including commitments undertaken by Members,  were technologically neutral . Another important 
principle wa s that the classification under W /120, based on the Central Product Classification 
Provisional , was an exhaustive list covering all services. No service fe ll outside the scope of the 
classification used  by Members . Canada went further in its FTAs, where a negative list approach to 
scheduling ha d been adopted , which  eliminated uncertainty . Canada  was not convinced that 
further discussion  on the issue of "new services" , as requested by China,  would add value to the 
work of the Committee. With  regard to the issue of "e-commerce" versus "digital trade", Canada  
agreed with Brazil. It was unclear why China broug ht this proposal to the CSC rather than  raising it 
in the dedicated discussion under the e-commerce Work Programme. This proposal did not relate 
to scheduling or classification issues. Canada ha d great interest in participating in substantive 
discussions o n e-commerce in the WTO and w as pleased that Members were ready to engage on a 
bottom -up exploration of the relevant trade policy issues. These discussions should prove useful in 
narrowing the knowledge gap and building trust amongst WTO Members around e-commerce . As 
mentioned in the mapping paper  co-sponsored by Canada (JOB/GC/116) , the definition of e-
commerce contained in  the 1998 General Council Decision establishing the e-commerce Work 
Programme  was sufficient  to cover all the concepts that  Members wan ted to address in the W TO. 
At th is stage , Canada preferred  to proceed with work on concrete issues rather than debating 
definitions.  
2.9.  The representative of the Plurinational State of Bolivia noted  some merits in China's  proposal 
for work on the distinction  between the two terms . In various workshops and seminars  on 
electronic commerce , terms such as digital trade, electronic commerce, and cross-border transfer 
of data were used almost as synonyms. He did not think that these were synonyms. An academic 
exerc ise would be useful to clarify the meanings of these terms . He questioned however whether S/CSC/M/7 8 
 
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  the CSC was the right body to discuss this topic. All such proposals , including those on definitions , 
should be made in the framework  of the e-commerce  Work Programme . 
2.10.   The representative of Australia  stated that  W/120 wa s an exhaustive list of service  
sectors/subsectors and that any new m eans of delivery  could  be linked to an identifiable service in 
W/120. Australia  shared the view that  there was no  value in further Se cretariat work on the  issue 
of "new services ", which  had been well covered in previous CSC discus sions. On the second issue  
raised by China,  Australia echoed other delegations' comments that there was no need to examine  
a potential distinction between "e -commerce" and "digital trade" . In Australia's view, China's  
suggestion  was not helpful for advancing either the services or the e-commerce agenda  in the 
WTO. The Work Program me on electronic commerce had already defined the term  "e-commerce " 
for its use wit hin the WTO.  
2.11.    The representative of Korea  echoed  Australia, the European Union and Canada in statin g 
that the Work Programme 's definition agreed in 1998 was sufficient . She did not see the value  that 
might be  added to the discussion by making a further distinction between e-commerce and digital 
trade.  
2.12.   The representative of Argentina  also referre d to the question of definition , indicating that it 
was probably not appropriate to consider the terms  when a definition  was already available  in the 
Work Program me on electronic commerce. Such discussion  would not contribute to any progress in 
services, nor in e-commerce.  
2.13.   The representative of Mexico  support ed the views of  other  delegations  on this issue.  Mexico  
did not see the need to deepen debates on the definitio n of electronic commerce. The definition in 
the Work Program me was sufficient for work in the WTO context. The discussion proposed  by 
China could d ivert attention from the main objectives.  
2.14.   The representative of China  responded to delegations' questions and  comments . First, 
China's interest in learning more about "new services " was not to challenge W /120. On the 
contrary, China relied  on this important document. Due to rapid technological development, 
regulators had difficult y in defining a "new service " and linking that to specific commitments. 
Businesses kept using  new and innovative terms to describe the services they want ed to offer . It 
was challe nging for regulators  to understand what they mean t and relate those services  to China's 
specific commitments . This was the reason why China w anted  to improve its u nderstanding on 
how to address this  classification issue.  
2.15.   Second , the reason for requesting  the Secretariat to build on its previous work was that the 
existing informal note entitled "Compilation of the  Discussions on Classification Issues", dated 14 
March 2014 , touched only briefly upon the issue of "new services" and failed to provide sufficient 
guidance on how to address it in reality . China therefore thought it meaningful and appropriate for 
the CSC to provide further guidance and  ask the Secretariat to assist in improving  Members' 
under standing.  
2.16.   Third, China had doubts on the argument  that "new services " were new ways of delivering 
services . "New services " might  involve  new forms or ways of delivery , but there might  be other 
possibilities. For example, a new service  might  be a combination of existing subsectors named 
"other" and part of another subsector with a specific name. A new service  might  also be a 
combination of differen t things. New ways of delivery wa s only one out of many options. China was 
not convinced by the arguments provided, but took note  that Members had  diverging views.   
2.17.   Fourth, with respect to the concern that  a debate  on the distinction between digital trade 
and e-commerce would d erail or distract discussions on e-commerce , he explained that the sole 
purpose of China's proposal was to facilitate  the discussion. The proposal  was based on China's 
experience in soliciting input from domestic stakeholders . China found that the random u se of 
terms had caused a lot of confusion and had rendered  domestic stakeholders  hesitant  to engage in 
WTO discussions on e-commerce. Stakeholders wanted to be reassured that all WTO Members 
would  respect the agre ed de finition adopted in 1998 .  
2.18.   Finally , China questioned the argument  that the negative listing approach could solve the 
problem of uncertainty . Most recent negati ve list approach agreements referred to  "new financial S/CSC/M/7 8 
 
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  service s." If "new services " could  be addressed effectively by using a negative list approach, he 
wondered why there was a need to use the terminology "new  financial services" . The issue of "new 
services" was not limited  to the f inancial sector. It also appeared  in ICT related services . In 
conclusion, China was mindful of Members' concerns and would seek further inputs from domestic  
stakeh olders. If necessary, China would  table a written proposal to clarify its position.  
2.19.   The representative of Canada  reiterated  the points made in previous  meetings  on the 
definition of "new services " and the U nderstanding  on Commitments in Financial Services . He 
stated  that the reason new financial services were defined in the Understanding was because there 
was a positive obligation to allow people to provide new services. Outside of that context, there 
was no value in trying to come up with a definition of "new services". He was concerned that 
Members might start interpret ing their commitments as only applying to services that had 
previously been supplied in their territory. This would severely narrow th e scope of commitments 
and was therefore undesirable.   
2.20.   The representative of South Africa  agreed with China that a better understand ing on the 
classification of "new services " was needed. Her delegation  was open to  a discussion on this 
subject. The fact th at there was no agreement meant that a discussion was necessary, bearing in 
mind the several non -paper s that were on the table on the  issue. On the definitions of "e-
commerce " and "digital trade ", South Africa also observed that there were references in th e 
various non -papers by Members to terms such as digital trade, digital economy or digital product s. 
These terms were used interchangeably with the term e-commerce by some Members. South 
Africa viewed the term digital trade as being  much broader than e-commerce as def ined under  the 
Work Program me. She urged proponents to restrict their non -papers and proposals to those  terms  
agreed in the WTO . Her delegation  favoured a more detailed discussion on  the issue  at the 
following  meeting, and looked forward to Ch ina's submission in writing.  
2.21.   The representative of Australia  noted  that there were indeed challenges for translating the 
work of the  WTO when discussing with service suppliers  as the language used in the WTO context 
did not necessarily reflect commercial t erms.  But that did not require theoretical  discussions . Some 
issues might deserve more in -depth  consideration  between interested Members. Those Members 
could come up with issues that might warrant further  discussion in the CSC. At this stage,  
Australia was not sure  whether  there was something to add  to the  discussion . While recognizing  
the value of previous discussions on "new services ", Australia did not believe that further 
discussion would be useful as there were clearly diverging views among Members on this topic. 
Further thinking between interested Members would be required to work out how to reframe 
constructive discussions in the future.  
2.22.   The representative of Brazil  echoed Australia's statement . No one questioned that 
classification was fundamental . Members needed to be cautious  before entering into theoretical 
discussions. It was important to make the best use of the remaining time up to MC11 . 
2.23.   The representative of the Secretariat  first recalled  the need to distin guish  legal definitions 
from working d efinitions. Those  raised in the meeting were the working definitions within the Work 
Program me, which were different from the legal definitions that determine d the rights and 
obligations of Members under WTO agreements, including the GATS. Legal definition s could  only 
be found in legal instruments , such as the GATS . He noted that t he terms "e-commerce " or "digital 
trade " did not appear in the GATS.  
2.24.   Second, Member s' deliberations and conclusions regarding the application of the GATS to e-
commerce activities  could be found in a report adopted by  the Services Council in July 1999  
(S/L/74) . This docu ment reflect ed the collective understanding of the membership  on the  topic. It 
reviewed  the prov isions of the GATS and clarifie d their application to e-commerce act ivities. The 
definition of trade in services , i.e. the production , distribution, marketing, sale  or delive ry of 
services , was what prevailed . Anything captured by  this definition  fell within the scope of the 
GATS, whether it was called e -commerce, e -trade,  digital trade or something different.  These 
terms did not  define Member s' rights and obligations. There was always a need for translation 
from WTO legal terminology into business reality .  
2.25.   Finally, it was important to keep in mind that the classification system adopted  by the 
drafters of the GATS  was product -based, guided by the Central Product Classification system. One S/CSC/M/7 8 
 
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  of the confusions arising  from technology and evolving business models concerned the distinction  
between a business model that m ight comb ine a number of services and the service itself as a 
single product. A business model might  encompass several services  products but this did  not mean 
that this kind of combination or this kind of package in itself was a new product. The conceptual 
distinct ion between a business model and a single product might help determine, in a particular 
situation , whether  a "new service"  was genuinely new, o r was, rather, a business model consisting 
of a package of a few other products.  
2.26.   The representative of China  referred to document S/L/74.  China made the proposal to 
further examine this issue based on three paragraphs  of that document . The last sentence of 
paragraph 4 state d that " [s]ome delegations expressed a view that these issues were complex and 
needed further e xamination."  Paragraph 5 mentioned  that " [i]t was recognized that services could 
be supplied electronically under any of the fo ur modes of supply. However, there was particular 
difficulty in making a distinction between supply under modes 1 and 2 in the ca se of electronic 
commerce, and no conclusion was reached as to how to clarify the matter, and it was agreed that 
further work is necessary". Finally, paragraph 6 indicated that " [s]everal delegations expressed the 
view that all products delivered electroni cally are services and that in the context of the Work 
Programme it would be useful to make clear that the GATS applies to all products delivered 
electronically.  Other delegations said that it was not clear to them that all electronically delivered 
produc ts are services and that if there were some which would not be considered services, rules 
other than those of the GATS would app ly to them. It was suggested that further work on this 
issue was necessary". These paragraphs mandate d Members to work  further  on the issues.  
2.27.   In conclusion, t he Chairperson  noted diverg ent views on whether to continue the discussion 
on "new services ", as well as  on the distinction between e-commerce and digital trade.  There was 
no consensus on China's request  for a study by the Sec retariat on  these issues either . He 
suggested that the Committee take note of the statements made and revert to this item at  the 
next meeting.  
2.28.   It was so agreed .  
3  ITEM C – OTHER BUSINESS  
3.1.  No delegation made  interventions under this item.  
3.2.  The Chairperson  suggested that he would hold consultations on the timing of the next 
meeting and inform Members of that in due course.  
3.3.  The meeting was adjourned . 
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