RESTRICTED  
  
S/C/W/ 375 
6 November 2017  
(17-6027) Page: 1/7 
Council for Trade in Services    
 
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ANNUAL REPORT OF THE  COUNCIL FOR TRADE IN  SERVICES  
TO THE GENERAL COUNC IL (201 7) 
Since its Annual Report of 201 6 to the General Council1, the Council for Trade in Services held five 
formal meetings, respectively on  25 November 2016, 16 -17 March  2017, 17  March  2017 
(dedicated to the review of Article II (MFN) exemptions), 16  June 2017 and 6  October  2017.2 
During the period covered by this report, the Council addressed the following matters.  
1  NOTIFICATIONS MADE T O THE COUNCIL PURSUA NT TO GATS ARTIC LES III:3 , V:7 
AND VII:4  
1.1.  The Council for Trade in Services took note, altogether, of the following notifications:  
(a) Notifications pursuant to Article III:3 of the GATS  
Norway  S/C/N/ 869 
Dominican Republic  S/C/N/ 872 
Switzerland  S/C/N/ 873 
Hong Kong, China  S/C/N/874 -5 
Gabon  S/C/N/87 7-887 
Republic of Korea  S/C/N/8 92-4 
 
(b) Notifications pursuant to Article V:7 of the GATS  
Colombia and the Republic of Korea  S/C/N/868  
Costa Rica and Colombia  S/C/N/8 70 
Colombia, Chile, Mexico and Peru  S/C/N/871  
Colombia, Peru, Ec uador and the European Union  S/C/N/876  
Republic of Moldova  S/C/N/8 88 
Russian Federation, Armenia, Kazakhstan,  
 the Kyrgyz Republic and Viet Nam  S/C/N/8 89 
China and Hong Kong, China  S/C/N/264/Add.10  
Georgia, Iceland and Norway  S/C/N/8 91 
Chile and Thailand  S/C/N/8 95 
Canada, of the one part, and the European Union  
 and its Member States, of the other  S/C/N/8 96 
 
The agreements notified in these documents were referred to the Committee on Regional 
Trade Agreements for consideration.  
1.2.  At the meeting held in March 2017, the Council took note of the updated annual Secretariat 
Note containing a statistical account of the notifications made under relevant GATS provisions.3 
                                                
1 Document S/C/50.  
2 Reports of these meetings are contained in documents S/C/M/12 9 to 133, and should be read in 
conjunction with this report.  
3 Document JOB(09)/10/Rev. 7. S/C/W/3 75 
 
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  2  OPERATIONALIZATION O F THE LDC SERVICES W AIVER  
2.1.  The Council discussed the operationalization of the  LDC services  waiver at all regular 
meetings held during the reporting period.  The LDC Group shared with the Membership its 
assessment of  the waiver preferences notified  by Canada at the meeting  held in November  2016, 
and of those notified  by Brazil at the  March meeting. The Members concerned provided some 
answers at these meetings and indicated their willingness to follow -up bilaterally on any 
outstanding questions.  
2.2.  At its June meeting , the Council took note of an additional notification of preferences in 
favour  of LDC services and service suppliers , submitted by Panama .4 After expressing their 
gratitude to Panama for the preferential measures notified, LDCs encouraged other Members in a 
position to do so to notify  preferences under the Waiver . LDC s then shared their appraisal of the 
preferential measures just notified by Panama, as well as of those notified by Thailand.  Recalling 
the relevant Nairobi  Ministerial  Decision, LDCs urged notifying Members to undertake specific 
technical assistance and capacity -building measures to enable LDC service suppliers to u tilise the 
preferences granted.  They also called on Members to share information on such technical 
assistance measures  with the Council . 
2.3.  At the CTS meeting held in October, the LDC Group presented  its assessment  of the 
preferential measures notified by Liechtenstein and Uruguay , respectively, thereby concluding  its 
review of the preferences notified under the Waiver  up to that point . Panama  reverted to its 
notification , to provide detailed answers to the questions LDCs had posed at the Council meeting in 
June.  
2.4.  After stating that  the Waiver preferences were "a success", the LDC Group called on Members 
to help  LDC suppliers avail themselves of th ose preferences. Members were urged to develop  
projects in  LDCs that built  supply capacity on the ground  and to raise awareness  of the Waiver  
among their respective domestic constituencies.  Recalling paragraph 1.6 of the  relevant  Nairobi 
Ministerial  Decision, LDCs also advocated that Members explore what recommendatio ns the 
Council may make "on steps that could be taken towards enhancing the operationalisation of the 
Waiver".  
2.5.  The Council has received a total of 24 notifications of preferences in favour of LDC services 
and service supplier s, on the part of 51 Members.5 As the Operationali zation of the LDC Services 
Waiver is a standing item on its agenda, the Council will take it up again in 2018 .  
3  WORK PROGRAMME ON EL ECTRONIC COMMERCE  
3.1.  At the November  2016 meeting, the Council agreed, in principle, to hold a seminar on th e 
services -trade  aspects of e -commerce that had been proposed by a group of Members .6 At the 
meeting, several delegations offered comments and suggestions on the proposed agenda. Many 
called for the event to focus on the development dimension of electronic  commerce, address 
exclusively services issues , serve as an experience - and information -sharing exercise, remaining 
within the m andate of the Work Programme and without any negotiating implications. Some 
delegations asked for  consistency in the way Members  approached all seminars proposed to be 
held under the Council's auspices. The Secretariat was asked to prepare  a draft agenda  that took 
into account all the concerns and observations made on the co -sponsors' proposal . However, 
Members' agreement was condi tioned on the Council also approving the proposal for another 
thematic seminar, on mode  4. 
3.2.  At the March meeting, the Council came to an agreement on the seminar on mode  4. As a 
consequence, it also agreed to the seminar on e-commerce,  and tasked the Secret ariat with the 
preparation of a draft agenda  that would reflect all the concerns raised and comments made  on 
the co -sponsors'  proposal. The draft Secretariat programme was prepared and circula ted to all 
                                                
4 Documen t S/C/N/890.  
5 Notifications  were submitted by: Canada; Australia; Norway; China; Korea; Hong Kong, China; 
Chinese Taipei; Singapore; New Zealand; Switzerland; Japan; Mexico; Turkey; the United States; India; Chile; 
Iceland; Brazil; the European Union; Lie chtenstein; South Africa; Uruguay; Thailand and Panama.  
6 Document RD/SERV/133/Rev.2.  S/C/W/ 375 
 
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  Members for approval .7 By the prescribed deadline, t he Secretariat received su ggested changes 
from some delegations.  Given the nature of the suggestions, it was decided that Members would 
revert to the Council for further discussion of the draft programme. At the June meeting, however, 
Members  agreed  that, i n the interest of time, consideration of the draft Secretariat programme 
would be taken up in informal consultations.  The informal Council meeting held on 20 July 
revealed that there was no convergence of views among Members  to proceed  at that point . Given  
the focus on preparations for MC11, it was considered that the organization of the thematic 
seminar on e -commerce  would be best taken up again in 2018.  
3.3.  At the March meeting, t he delegation of China presented a communication , co-sponsored 
with Pakistan,  on the e -commerce Work Programme.8 All Members welcomed the communication, 
with many calling for the tabling of more submissions on e -commerce. Several  delegations sought 
various clarifications on the communication . Numerous Members  favoured the paper's sug gestion  
to enhance transparency and exchange information on measures concerning, inter alia, digital 
certificates and electronic signature and authentication. A few Members also called for the 
moratorium on custom duties on electronic transmissions to be m ade permanent. As for the 
paper's suggestion that Members discuss e -commerce issues in an informal joint meeting of the 
General Council and its relevant subsidiary bodies, most delegations indicated that they were 
flexible, but a few called for discussions  to take place in the subsidiary bodies first and be referred 
to the General Council only when sufficiently mature.  
3.4.  At the meetings held in March and June, Members reverted to the communication from China 
and Pakistan and also considered a number of other communications on e -commerce on the  
Council 's agenda. Specifically, delegations addressed communications from Argentina, Brazil and 
Paraguay9, the European Union and co -sponsors10, Singapore and co -sponsors11 and ASEAN 
Members12. The communications generated a very high level of engagement among  Members, with 
more than  30 delegations intervening at each meeting. Members' comments were mainly  of a 
general nature. Many delegations emphasized the transformative role of e -commerce, its positive 
impact on growth an d development , and its potential to reduce transaction costs especially for 
MSMEs.  
3.5.  A number of Members shared information about their own domestic regulatory frameworks 
relating to e -commerce, as well as their experience with negotiating e -commerce provisi ons in 
regional trade agreements. All delegations welcomed the exchange of information on national 
experiences with regard to e -commerce, with many underscoring the particular  relevance of 
hearing about the experiences of developing countries.   
3.6.  Numerous M embers signalled their readiness to wor k towards an outcome for MC11. Various 
said that many of the submissions tabled offered useful information and a structured approach 
that could facilitate discussions. Recognising that Members' views on a Ministerial outcome on e -
commerce differed, some delegations argued for a gradual approach that would initially focus on 
less controversial issues. In particular, several delegations called for attention to be given to areas 
that would enhance consumer and business co nfidence with electronic transactions and, as such, 
facilitate e -commerce. The elements that were mentioned most frequently by these delegations, as 
possible areas where progress could be achieved, include electronic signatures and authentication, 
e-paymen ts, transparency , and extending the duration of the moratorium on electronic 
transmissions. A handful of delegations also mentioned that e -commerce would be further 
enhanced by pursuing market access liberalization in services, particularly with respect to  mode  1, 
alongside a facilitation agenda.  
3.7.  Several Members, however, argued against any rule -making on e -commerce under the Work 
Programme or as pa rt of any Ministerial outcome. These delegations stated that some of the 
communications tabled went beyond the  purely exploratory mandate of the Work Programme, 
particularly with the mention of market access issues. They also opined that a number of the 
issues raised in submissions were being addressed in other competent multilateral organisations, 
                                                
7 Document JOB/SERV/256.  
8 Document JOB/SERV/243/Rev.1.  
9 Document JOB/SERV/247 . 
10 Document  JOB/SERV/248/Rev .2. 
11 Document JOB/SERV/249.  
12 Document JOB/SERV/260.   S/C/W/3 75 
 
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  which were the appropriate fora, and did not belong in the WTO. They called on the proponents to 
redraft their submissions, to make them more development -focused, specific to the body 
concerned and consistent with the scope of the Work Programme.   
3.8.  These delegations also  underscored the need for the Work Programme to put the needs of 
developing countries and LDCs at the centre of the debate and to address, as a matter of priority, 
the development, industrialisation and employment implications of e -commerce. Amongst the 
specific issues mentioned were the digital divide, access to infrastructure, connectivity, technology 
transfer, workforce skills, regulatory capacity and, more generally, the challenges faced by 
developing countries in becoming "e -commerce ready". The Member s in question also referred to a 
number of elements that should be clarified in the Council's discussions, including definitional and 
scope issues, measurement challenges, the distinction between modes 1 and 2 in a digital context, 
the classification of di gital products and the question of "new services".  
3.9.  A couple of delegations called for the Secretariat to update the Background Note it had 
produced in 1998 to assist the Council with its deliberations of the treatment of electronic 
commerce in the GATS leg al framework, as per the relevant mandate in the Work Programme. 
One delegation, however, argued that the update was not warranted, given that the GATS legal 
framework had not undergone any changes.  
3.10.   A few delegations referred to the institutional arrangeme nts for the Work Programme 
deliberations. While some welcomed that submissions had been tabled, and were being discussed, 
in the various subsidiary bodies entrusted with the Work Programme, including the Council, a few 
others called for a more consolidated  approach to deliberations, to be held possibly in a joint 
meeting of all the relevant bodies.  
3.11.   The Chairman  invited delegations to reflect on how the Council could best structure its 
future discussions and make the most productive use of its time. It was agreed that the question 
would be taken up at  an informal meeting , which was convened on 20 July. At that meeting, there 
was a general appreciation of the value of continuing with the exchange of information and 
experiences relating to electronic commerce in the Council. Also, a number of Members re iterated  
their position that the remit of the Council under the Work Programme did not call for any 
negotiation s. Some delegations suggested that any such negotiations should take place in the 
Special Session of the Council for Trade in Services. Regarding the discussion of the submissions 
tabled by Members, several delegations stressed that the work of the Council should focus on the 
services -related aspects contained in the communications while discussions on cr oss-cutting issues 
should take place in the General Council.  
3.12.   At the October meeting, t he Council addressed two new communications , submitted by 
Chinese Taipei.13 The papers were generally well received, with many delegations stating that they 
contributed t o Members' deliberations and provided a  novel and  useful analytical framework for 
future discussions  on e-commerce . One delegation sounded a more cautious note , however, saying  
that under the Work Programme Members should  only discuss the trade -related asp ects of e -
commerce, and not digital trade per se , and  should focus on areas of common interest where 
progress could be realistically  achieved. A couple of other delegations underscored the purely 
exploratory, experience -sharing nature of the Work Programme  and reiterated the  importance of 
placing the needs of developing countries and LDCs at the centre of those deliberations.  
3.13.   Under the Work Programme's exchange of information sub -item, at the March meeting  
China shared with the Council an informative prese ntation on the commercial evolution of e -
payment services in its market and the applicable regulatory regime.  At the October meeting, 
China reported on the commercial and regulatory evolution of courier services  in its domestic 
market, highlighting the sup portive role th at courier sector had played for the development of e -
commerce, and vice versa.  
3.14.   The Nairobi Ministerial Decision mandates that the Gene ral Council periodically review  
progress with the Work Programme based on the reports that might be submit ted by the WTO 
bodies entrusted with its implementation . Pursuant to that mandate,  in November  2016, and again 
in June 2017, the Council agreed that the Chairman would produce, under his own responsibility, a 
                                                
13 Documents JOB/SERV/264 and 265 .  S/C/W/ 375 
 
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  factual report of the essence of the discussion s the Council had had under that agenda item up to 
the respective points in time .14  
4  CERTAIN WTO -INCONSIST ENT MEASURES APPLIED  BY UKRAINE  
4.1.  At its November  2016, March , June and October 2017 meetings, the Council addressed 
certain measures related to the refo rm of the Unified Gas Transportation System of Ukraine, at the 
request of the Russian Federation. The Council took note of the statements made , respectively,  by 
the Russian Federation, Ukraine, Armenia and Cuba at the November 2016 meeting;  and by  the 
Russian Federation and Ukraine at the March , June and October  meeting s. 
5  MODE 4 - ASSESSMENT OF BARRIE RS TO ENTRY   
5.1.  At its November  2016 meeting , Members  addressed a communication by India15 proposing 
that the Council organize a thematic seminar on mode 4. While most delegations could support the 
proposal, subject to clarifications and am endments to the suggested agenda, no consensus could 
be found  at that meeting. Consultations were organised to try to find a way forward, and following  
deliberations  amongst deleg ations, India circulated a revised proposal for the seminar ,16 which was 
discussed in March. At that meeting, the Council decided to  move forward with the organization of 
the seminar and tasked the Secretariat with the preparation of a draft programme for t he event  
that would take into account all the concerns and observations made on India's proposal . 
5.2.  The draft Secretariat programme was prepared and circulated to all Members for approval.17 
By the prescribed deadline, the Secretariat received suggest ed chang es from some delegations . 
Given the nature of the suggestions, it was decided that Members would revert to the Council for 
further discussion of the draft programme. At the June meeting, however, Members agreed that, in 
the interest of time, consideration of the draft Secretariat programme would be taken up in 
informal consultations. The informal Council meeting held on 20 July revealed that there was no 
convergence of views among Members  to proceed  at that point . Given the focus on preparations 
for MC11, i t was considered that the organization of the thematic seminar on mode 4  would be 
best taken up again in 2018. 
5.3.  In October, India reiterated its interest in the Council organising  the seminar  on mode 4 after 
MC11, underlined that the event would be held in  an experience -sharing mode  and stated its 
readiness to engage with  any interested Members on the programme  for the seminar .  
6  TRADE FACILITATION A GREEMENT FOR SERVICE S 
6.1.  At the March meeting, India presented to the Council a proposal for a Trade Facilitation 
Agreement for Services (TFS), which had previously been introduced also in the Working Party on 
Domestic Regulation.18 Members engaged in an extensive discussion of the proposal. In addition to 
making a number of general  comments, delegations posed several detailed questions, shared  
specific observations  and sought numerous clarifications . Reactions to the proposal were mixed , 
with some delegations register ing their interest in certain  of the elements proposed, and many  
raising concerns, of both a general an d specific nature. At the end of the discussion , India offered 
some  responses to the questions and observations raised by Members.  
6.2.  At the June meeting, the Dominican Republic circulated a communication with further  
questions on India's proposal19, while other delegations also shared  fresh or follow -up comments 
and questions . India indicated that it would submit a revised  draft for the proposed TFS, which it 
hoped would address the comments it had received.   
                                                
14 The report s are contained in document S/C/51 and 52 . 
15 Document RD/SERV/135.  
16 Document RD/SERV/135 /Rev.1  
17 Document JOB/SERV/ 255. 
18 Document S/C/W/372.  
19 Document JOB/SERV/263.  S/C/W/3 75 
 
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  7  FOURTH REVIEW OF MFN  EXEMPTIONS  
7.1.  The Council held a  meeting dedicated to the fourth  review of Article II (MFN) exemptions on 
17 March , at which  it examined, as per the mandate in paragraph 3 of the  relevant  GATS Annex, 
all exemptions granted for a period of more than 5 years. The reafter, the  Council  pursue d its 
review discussion s under an  item on the  agenda of the June meeting .   
7.2.  For the purpose of the review, the Secretariat circulated three background documents: two 
updated compilations of MFN exemptions, one organised by sector (JOB/SERV/29/Rev.1), and o ne 
organised by Member (JOB/SERV/30/Rev.1), and a document providing updated statistical 
information on the number of MFN exemptions listed (JOB/SERV/31/Rev.1).  
7.3.  Two sets of  questions  were submitted  in writing in advance of the  dedicated  meeting : one set 
by Hong Kong, China; Japan; the Republic of Korea; and the Separate Customs Territory of 
Taiwan, Penghu, Kinmen and Matsu20; and  another by  Australia21. In addition, the Council  received 
a communication from Costa Rica22 presenting its written answers to the qu estions received.  
7.4.  Pursuant to the mandate in paragraph 4(b) of the relevant GATS Annex that the Council 
determine "the date of any further review", at its June  meeting the Council agreed to close the 
fourth  review of MFN exemptions and to reconvene to deci de on the date of  the next review at its 
first meeting of 2022 .   
8  CYBERSECURITY  MEASURES OF CHINA AN D VIET NAM  
8.1.  At the request of Japan and the United States, at its October meeting the Council addressed 
the cybersecurity measures recently adopted and under  development by China and those that Viet 
Nam was developing. The United States also submitted a communication under that agenda 
item.23 The two requesting delegations shared  their concerns with the measures at issue, many of 
which were echoed by European U nion, New Zealand, Australia and Chinese Taipei . India and 
Brazil also intervened under that agenda item. Both China and Viet Nam took the floor to provide a 
number of clarifications , while also underscori ng their respective government s' right to regulate in 
pursuit of relevant public policy objective s. 
9  FUTURE WORK OF THE COUNC IL 
9.1.  In June, the CTS Chairman announced that he intended to organize informal consultations to 
consider  how Members could respond to Ministers' pronouncement in paragraph 11 of the Nai robi 
Ministerial Declaration.24 Accordingly, a t the informal meeting  held on 20 July , the Chairman 
shared  some of his ideas on possible elements for future work of the C ouncil , while calling on 
Members to put forward all suggestions they might have  in that regard. H is introductory remarks 
were later circulated in writing , to facilitate Members' consideration and in view of  a further 
exchange of views .25 At the October meeting, the Council took up the issue but  decided, due to 
lack of interest on Members' part , that it wou ld revert to the item  only if Members so requested.  
10  RECENT DEVELOPMENTS IN TRADE IN SERVICES  STATISTICS  
10.1.   At the October  meeting of the Council, the Secretariat made a presentation on recent 
developments in trade in services statistics, which focused on data production and dissemination, 
specific projects, new areas of work and technical assistance activities . 
                                                
20 Document S/C/W/370/Rev.1.  
21 Document S/C/W/37 1. 
22 Document S/C/W/373.  
23 Document S/C/W/374.  
24 Paragraph 11 of the Nairobi Ministerial Declaration contain s a reaffirmation of "the importance of work 
in regular bodies in furthering the objectives of the WTO Agreements and in facilitating meaningful exc hange of 
information and sharing of experiences regarding the effective implementation and operation of their 
provisions"  
25 Document JOB/SERV/266 . S/C/W/ 375 
 
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  11  WORK OF THE SUBSIDIA RY BODIES  
11.1.   The activities of the subsidiary bodies in 201 7 are reflected in their respective reports, which 
are annexe d to this report, as follows:  
 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 Regulation (S/WPDR/ XX) 
 Annex IV Report of the Working Party on GATS Rules (S/W PGR/XX). 
 
 
 
 
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