RESTRICTED  
  
S/C/M/132  
 
28 August 2017  
(17-4552) Page: 1/33 
Council for Trade in Services    
 
 
REPORT OF THE MEETIN G HELD ON 16 JUNE 20 17 
NOTE BY THE SECRETAR IAT 
The Council for Trade in Services held a meeting on 16 June 2017, opened by Ambassador 
Gustavo Vanerio  (Uruguay) and chaired by Ambassador Julian Braithwaite (United Kingdom). The 
agenda was contained in document WTO/AIR/CTS/12.  
 
The Chairman  indicated that , under Other Business, the incoming Chairman would be making a 
statement about future work in the Council and its role in furthering the objectives of the GATS.  
 
The representative of the Republic of Korea  wished to add an item under Other Business, to 
provide an update on the issue his delegation had raised at the previous meeting of the Council 
held on 16 and 17 March.  
 
The representative of Japan  wished to raise, under Other Business, an item regarding China's 
measures on the Internet and cybersecurity.  
 
The representative of Qatar  also wished to add an item to Other Business regarding certain WTO -
inconsistent measures applied by some Members.  
 
The agenda was adopted as modified . 
 
1  ITEM A - APPOINTMENT OF THE N EW CHAIRPERSON  
1.1.  The Chairman  said that, based on the consensus reached in the General Council, he was very 
pleased to pass on the Chairmanship of the Council for Trade in Services to Ambassador Julian 
Braithwaite of the United Kingdom.  He was confident that, with his experience and wisdom, 
Ambassador Braithwaite would guide the work of the Council over the following year skilfully and 
efficiently.  
1.2.  As outgoing Chairman, he said that he had truly enjoyed working with Members over the 
previous year and had appreciated delegations ' cooperative spirit in f ulfilling the mandate of the 
Council. He proposed that the Council elect Ambassador Braithwaite by acclamation as its new 
Chairperson.  
1.3.  The Council elected  Ambassador Braithwaite by acclamation.  
1.4.  The new Chairman , Ambassador Braithwaite, thanked Ambassador V anerio for his kind words 
and hard work during the previous year.  He had set the bar very high.  He also thanked Members 
for their trust and support and said that he would do his best to chair the Council for Trade in 
Services in the most efficient way poss ible. He was confident that, with Members' cooperation and 
the Secretariat's assistance, they would be able to move the work of the Council forward smoothly 
and fruitfully.  
1.5.  All delegations wh ich intervened  thanked Ambassador Vanerio for his hard work and 
congratulated Ambassador Braithwaite on his appointment as Chairman of the Council, welcoming 
him to his new position.  S/C/M/132  
 
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  2  ITEM B - NOTIFICATIONS PURSUA NT TO ARTICLES III:3  AND V:7 OF THE GATS  
2.1.  With regard to the notifications made pursuant to GATS Article III: 3 (transparency), the 
Chairman  drew the Council's attention to the communications received from Gabon, in documents 
S/C/N/877 -887.  
2.2.  By way of general remark, the representative of Switzerland  thanked the Secretariat for the 
update it had produced of its annual Note titled "Overview of notifications made under relevant 
GATS provisions", a regular information -sharing practice that had been proposed by Switzerland 
years back. He appreciated the notifications recently submitted by Members, such as Gabon, the 
Dominican Republic and Hong Kong, China. Switzerland had been a strong supporter of the 
transparency obligation enshrined in Article III:3 of the GATS since the entry into force of the 
Agreement, and regarded obligation s of that nature  as crucial for a trans parent and well -
functioning multilateral trading system. Therefore, his delegation had made efforts , over previous 
years , to encourage Members to notify legislative developments pursuant to Article III:3. However, 
in recent times, Switzerland had noticed a trend towards lower activity under that transparency 
obligation. Th is might be connected to on -going negotiations in the area of services trade in which 
many Members were involved. He was confident that, encourage d by the number of measures 
already notified in 2017, that trend would be reversed if delegations made a collective effort, since 
many Members appreciated and valued the notifications made to the Council. Therefore, he 
encouraged all Members to work toward s further improving transparency in services trade.  
2.3.  The Chairman  suggested that the Council take note of the notifications and the statement 
made.  
2.4.  It was so agreed .  
2.5.  Concerning the notifications made pursuant to GATS Article V:7, the Chairman  drew the 
Council's attention to the communications received from, respectively, the Republic of Moldova, in 
document S/C/N/888, and the Russian Federation, Armenia, Kazakhstan, the Kyrgyz Republic and 
Viet Nam, in document S/C/N/889.  
2.6.  The representative of the Republi c of Moldova  indicated that the Organisation for Democracy 
and Economic Development (GUUAM) Free Trade Agreement established a free trade area between 
the Republic of Moldova, the Republic of Azerbaijan, Georgia and Ukraine, within the meaning of 
Article X XIV of the GATT 1994 and Article V of GATS. In line with its WTO transparency 
commitments, her delegation had notified the FTA on 3 April 2017 to the relevant Committees. 
Regarding trade in services, Article 17 of the GUUAM Agreement stipulated that "the C ontracting 
Parties shall create conditions for liberalization of the national markets of services, and on the 
basis of reciprocity, shall strive for gradual removal of limitations with a view of creation of 
conditions for free rendering of services within the territory of the free trade area".  The factual 
presentation of the FTA, which was due in August 2017, would provide more detailed information 
in that regard.  
2.7.  The Chairman  suggested that the Council take note of the notifications and the statement 
made,  and that the agreements notified be referred to the Committee on Regional Trade 
Agreements for consideration.  
2.8.  It was so agreed .  
3  ITEM C - OPERATIONALIZATION O F THE LDC SERVICES W AIVER  
3.1.  The Chairman  recalled that, at the March 2017 meeting, the LDC  Group had reviewed the 
preferential treatment in favour of LDC services and service suppliers notified by Brazil. Brazil had 
provided some answers at that meeting, indicating that it would  follow -up on the outstanding 
questions. In addition, the LDC Group  had called on all preference -grantors to provide technical 
assistance aimed at building supply capacity in LDCs, and to undertake initiatives to raise domestic 
awareness of the waiver preferences.  
3.2.  He then drew the Council's attention to a new notification , from Panama,  on preferential 
treatment in favour of LDC services and service suppliers, contained in document S/C/N/890.  S/C/M/132  
 
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  Panama's notification was very welcome and brought the tally of notifications received by the 
Council pursuant to the LDC Waiver to 2 4, accounting for 51 Members.  
3.3.  The representative of Panama  indicated that, pursuant to the Bali Ministerial Decision, her 
delegation had carried out an exhaustive analysis of its services regime in order to provide 
preferential access to LDCs. Her delegati on had taken into account those areas of particular export 
interest to LDCs, as identified in their Collective Request, to grant preferential treatment and thus 
facilitate services trade between LDCs and Panama.  
3.4.  The sectors and sub -sectors in which prefere ntial treatment had been provided for LDCs were 
the following.  Under "business services " in its GATS Schedule, Panama had committed in computer 
and related services only in certain activities  (namely CPC 841, CPC 842, CPC 84310, CPC 84320, 
CPC 84330, CPC 844 and CPC 845). The preferential treatment granted to LDCs covered, instead, 
all services within CPC 84, with restrictions only for mode 4, which remained unbound except as 
indicated in the horizontal section.  As concerned rental/leasing services without operators, 
preferential treatment was granted under mode 3. In Panama's Schedule, commitments had been 
limited to leasing or rental services concerning other means of transport without operat or and 
exclusively for the rental of cars without driver. The preferential treatment, therefore, was granted 
with respect to rental services without operator including for other means of transport, under 
mode 3, for CPC 83103 relating to ships, CPC 83104 r elating to aircraft, CPC 83101, CPC 83102 
and CPC 83105 relating to other transport equipment, CPC 83106, 83107, 83108 and 83109 
relating to other machinery and equipment, and CPC 832 concerning personal and household 
goods.  
3.5.  As concerned "other business se rvices ", personnel placement and supply services had not 
been committed under Panama's Schedule, but preferential treatment was granted for placement 
services of office support personnel and other workers (CPC 87202), and supply services of office 
support personnel  (CPC 87203). With regard to  maintenance and repair of equipment (rail 
transport), which had not been committed by Panama, preferential treatment was granted 
regarding maintenance and repair of rail transport equipment (part of CPC 88682). The sam e was 
the true for building -cleaning services (CPC 874), photographic services (CPC 875) and packaging 
services (CPC 876). With regard to printing and publishing services (CPC 88442), except printing 
of national written media, preferential treatment was gr anted under mode 1, which was unbound 
under Panama's Schedule. For mode 3, no restrictions would apply to LDCs (i.e. "none"), except 
for printing of national written media.    
3.6.  Turning to tourism and travel -related services, Panama's Schedule covered only pa rt of 
CPC 7471, exclusively to promote, organise, operate and sell tour packages to Panama. The 
preferences additionally covered tour guide services (CPC 7472) and travel agencies and tour 
operator services (whole of CPC 7471).   
3.7.  For recreational, cultural and sporting services, preferences were granted under sporting 
services (CPC 9461), which had not been committed by Panama in its Schedule. The preferences 
granted under this sub -sector, which had been identified in the LDCs Collective Request, would 
provide opportunit ies in sporting services of interest to LDCs and Panama.  
3.8.  Under transport services, preferences were granted under rail transport services for 
passenger transportation (CPC 7111), freight transportation (CPC 7112), and pushing and towing 
services (CPC 7113). Those preferences had taken into consideration the domestic development of 
the sector and its importance for Panama 's logistics services and presented, as such, an important 
opening that LDC suppliers could take advantage of.  Services auxil iary to all means of transport 
(limited to supporting services for railway transport) had not been committed under Panama's 
Schedule; preferences granted in this area covered cargo -handling services (part of CPC 741), 
storage and warehousing services (part  of CPC 742) and freight transport agency services (part of 
CPC 748).  
3.9.  Finally, Panama had included in the notification, under professional services, legal services 
concerning legal consultancy services on international law only, as a reaffirmation of Pana ma's 
commitments in its Schedule.  
3.10.   The representative of Brazil  said that, at the previous C ouncil meeting in March, he had 
provided some preliminary answers to the clarifications sought by the LDC Group on the S/C/M/132  
 
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  preferences notified by Brazil. On the outstanding questions, he had not received formal answers 
from capital yet, but would continue working on th ose issues.  
3.11.   The representative of Uganda , speaking on behalf of the LDCs group, said that he would 
provide comments on the notifications received fr om Thailand and Panama. The Groups' approach 
was to highlight areas where the notifications had provided preferences in market access measures 
under Article XVI, but also beyond market access measures. The latter include d national treatment 
measures and me asures to remove regulatory hindrances as preferential treatment for LDCs, in 
response to sections B and C of the LDC Collective Request.  In addition, the Group might seek 
clarifications to better understand the preferences notified. He would also request notifying 
Members to explain how their preferences would be implemented and how they would operate in 
those instances where they appeared to be the same as in existing GATS Schedules in light of 
those Members' applied regime. Finally, he would request Memb ers to explain how they were 
building awareness of the preferences granted with their consumers, and assisting LDC suppliers 
"to orient themselves to preference benefits available so that such suppliers can utilise the 
preferences granted." In short, how p aragraph 1.4 of the Nairobi Ministerial Decision on the LDC 
Services Waiver was being implemented.  
3.12.   Thailand's notification, submitted in February 2016, contained both market access and 
national treatment measures, although national treatment was only provi ded for mode 2. No 
preferences had been provided regarding sections B and C of the LDC Collective Request. In six 
sectors the treatment notified appeared to be less open than Thailand's DDA offer, although it was 
better than Thailand's existing GATS commit ments.  The six sectors concerned were: camping and 
site services; theme parks and amusement parks; foreign language tuition services; holiday 
centre s and holiday home services; maritime agency services; and maritime cargo handling. 
Further, preferences cov ered mostly modes 2 and 3, with limitations. Mode 4 access was only 
provided for business visitors and intra -corporate transferees. All but the maritime and foreign 
language preferences were less than the corresponding entries in Thailand's DDA offer. The 
representative asked Thailand to explain why those entries were less than its DDA offer to all 
Members, and whether the DDA offer reflected Thailand's applied regime.  If this was the case, 
LDCs would be getting less than Thailand's applied regime. In this context, he wondered how the 
preferences notified would operate, taking into account paragraph 1 of the LDC Services Waiver 
Decision of 2011 and particularly the fact that LDCs would be provided preferential access as 
compared to like services and services  suppliers of other Members. Finally, he enquired whether 
any of the sectors in question were, in practice, already open, and if so, how Thailand would 
implement the preferential treatment granted to LDC service suppliers.   
3.13.   Turning to Panama 's notification , the representative welcomed Panama's preferential 
treatment and encouraged other Members in a position to do so to notify preferences. He noted 
that Panama 's notification covered only Article XVI measures, which meant that no preferences 
had been provide d concerning national treatment measures and sections B and C of the LDC 
Collective Request. There were approximately 18 sectors and sub -sectors that related to sectors 
identified in the LDC Collective Request . These included: legal services;  computer and related 
services; rental/leasing services without operators (relating to ships, relating to aircraft, relating to 
other transport equipment, relating to other machinery and equipment, and concerning personal 
and household goods); personnel placement and su pply services (placement services of office 
support personnel and other workers, supply services of office support personnel); maintenance 
and repair of rail transport equipment; building -cleaning services; photographic services; 
packaging services; printi ng and publishing services; travel agencies and tour operators services; 
tour guide services; sporting services; passenger transportation; freight transportation; pushing 
and towing services; cargo -handling services; storage and warehouse services; and fre ight 
transport agency. Modes 1 to 3 had been listed as "none" in terms of the application of GATS 
Article XVI measures.  
3.14.   The representative sought clarification from Panama on the manner in which the 
preferences notified would be implemented and how the pre ferential treatment would work. He 
requested Panama to explain the difference between the preferences notified, the existing applied 
regime and Panama's GATS commitments. He noted, for example, that the access for legal 
consultancy services was practically  the same as Panama's existing scheduled commitment. The 
LDC Group wished to better understand how Panama would implement the notification as 
preferences for LDC services suppliers. For computer and related services, the notification referred 
to CPC 84, at  the two digit -level, while the GATS commitments had been taken at 3 and 5 digit -S/C/M/132  
 
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  levels. He enquired to what extent this openness in the notification reflected Panama's already 
applicable actual regime and how the preference would operate for LDC suppliers  in keeping with 
paragraph 1 of the LDC Services Waiver Decision of 2011.  
3.15.   As to travel agencies and tour operator services (CPC 7471), while in the existing schedule 
the sector was committed at the same four -digit level, it was covered only partly. He tha nked 
Panama for grating to LDCs preferential treatment in this sector that was of priority interest to  LDC 
suppliers . He also thanked Panama for the other sectors which appeared not yet to be committed 
in Panama's GATS Schedule, nor in its most recent DDA offer. These appeared to be : maintenance 
and repair of rail transport equipment; building -cleaning services; photographic services; 
packaging services; printing and publishing services; tour guide services; sporting services; rail 
transport services for pa ssenger transportation, freight transportation, and pushing and towing 
services; and supporting services to rail transport services in cargo -handling services, storage and 
warehouse services, and freight transport agency. He requested Panama to confirm tha t those 
sectors and CPC categories were not currently scheduled in Panama's GATS schedule.  He enquired 
whether those areas were in actual fact already open to all service suppliers in Panama, and, if so, 
how Panama would implement the preferences in favour  of LDC suppliers as required pursuant to 
paragraph 1 of the Waiver Decision of 2011. Finally, he enquired whether Panama would build 
awareness of the preferences granted to LDCs so that Panamanian consumers would be informed 
of the potential services from  LDCs that could be supplied to the Panamanian market under the 
preferential scheme, which would be consistent with paragraph 1.4 of the Nairobi Ministerial 
Declaration.  
3.16.   The LDC Group wished to comment on what the Council and the Secretariat could do about  
the implementation of paragraph 1.5 of the Nairobi Ministerial Decision. That paragraph stipulated 
that "the Council for Trade in Services shall : maintain a standing agenda item to review and 
promote the operationalization of the Waiver; expeditiously con sider approval of notified 
preferences relating to measures other than those described in GATS Article XVI, in accordance 
with the Waiver; with a view to furthering the objectives of GATS Article IV, facilitate an exchange 
of information by Members on tech nical assistance measures undertaken to promote the 
increasing participation of LDCs in world services trade; initiate a process to review the operation 
of notified preferences, on the basis of information provided by Members and, in support of that 
proces s, Members could request WTO Secretar iat inputs, as appropriate; and  further discuss any 
issues that might facilitate benefits provided under the notified preferences ". The first two items of 
that paragraph had been observed and, to some extent, so had the  fourth item.  However, LDCs 
wondered what had happened regarding the remaining items. The Group had requested each 
notifying Member to share with the Council the steps it had taken, particularly with respect to 
paragraph 1.4 of the Nairobi Decision. Howeve r, LDCs were yet to get any responses on how 
Members were implementing their notifications and how LDC suppliers were becoming aware, and 
taking advantage, of the benefits of the preferential treatment notified. The Waiver Decisions had 
always recognised t he need for supply -side and other capacity building for LDC service suppliers. 
In addition, more needed to be done to assist LDC suppliers benefit from the notifications in a 
concrete and specific manner, rather than just by wa y of general assistance progr ammes that 
might or might not be geared to the preferences .  
3.17.   LDCs applauded the notifications of preferential treatment in favour of their suppliers as a 
success for all Members. However, Members had to build the necessary assistance to enable LDC  
suppliers to avail themselves of the relevant benefits. He recalled that, at a CTS meeting in 2016, 
the LDC Group had brought to the attention of the Membership the case of a psychologist who 
could not benefit from a notified preference because of residen cy requirements in the EU that had 
interrupted the further processing of her application. In reply, it had been pointed out that 
psychologists were permitted access only as contractual service suppliers and that the individual in 
question was an independen t professional not covered by the EU notification. However, the EU 
could have provided assistance to enable a CSS structure to be put in place in the LDC country so 
that the psychologist could utilise the preference in question. In addition, the profe ssional could 
have been helped obtain a residency permit if her application had been successful; the residency 
requirement should not have acted as a barrier to proceed with the evaluation of her qualifications 
as a candidate for the position of  psychologist.   
3.18.   The representative of Thailand  reaffirmed her delegation's commitments to provide 
preferential treatment to services and service suppliers from LDCs, as provided for in the LDC 
services Waiver Decision. Thailand was a developing country and its services se ctors were at an S/C/M/132  
 
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  infant stage of development. Nevertheless, Thailand had tried its best, based on domestic 
consultations, to provide unilateral preferential treatment to LDCs in the sectors requested. As a 
result, at that juncture, her delegation could off er preferences in six sectors, as mentioned by 
Uganda. She clarified that the preferential treatment provided by Thailand to LDCs was not less 
than Thailand's DDA offer. Regarding mode 4, Thailand's WTO DDA offer covered only business 
visitor s and intra -corporate transferees. She also emphasised that the preferential treatment 
notified was not below Thailand's applied regime. The DDA services negotiations were ongoing 
and, as such, Thailand's offer was not final and was still subject to negotiations. Howeve r, the 
preferential treatment provided by Thailand to services and service suppliers from LDCs had 
already entered into force; hence, LDCs service suppliers could already utilise , and benefit from , 
that preferential treatment. She requested LDCs to update to the Council on the obstacles and 
challenges their service suppliers were encountering in utilising the preferences granted so that 
the Members concerned could consider improving them in the future.  
3.19.   The representative of Panama  indicated that she would r evert to the questions raised by the 
LDC Group at a later stage.  
3.20.   The representative of the European Union  said that the case of the phycologist was an 
individual and very specific case. His delegation had consulted internally and had concluded that 
the cas e in question was outside the scope of the preferences notified by the EU under the Waiver. 
He was puzzled as to what was expected from his delegation. On technical assistance, the 
European Union had already various programmes in place in favour of LDCs.   
3.21.   The representative of Uganda  expressed his appreciation to Thailand, Panama and the 
European Union for their responses. He looked forward to further engagement with the 
Membership.  
3.22.   The Chairman  thanked Panama once again for its notification of preferential  treatment in 
favour of LDC services and service suppliers. The preferences notified under the LDC Waiver were 
one important avenue to foster greater participation of LDCs in world services trade.  Increasing 
LDCs' export potential for services was not only  key with regard to the net revenue earned, but 
also in view of the strategic role that services played for development overall.  He suggested that 
the Council take note of the statements made and said that Members would revert to that item at 
its next meet ing. 
3.23.   It was so agreed . 
4  ITEM D – TRADE FACILITATION A GREEMENT FOR SERVICE S – COMMUNICATION FROM 
INDIA  
4.1.  The Chairman  indicated that the item had been added to the agenda of the Council at the 
request of the delegation of India, which had submitted a communica tion titled "Trade Facilitation 
Agreement for Services" (S/C/W/372). As delegations knew, India's proposed TFS was also being 
considered in the Working Party on Domestic Regulation, where it had first been introduced, and in 
the Special Session of the Coun cil. India's presentation of its proposal had been circulated in 
document RD/SERV/137.  
4.2.  At the March meeting, Members had engaged in an extensive discussion of India's proposal.  
In addition to making a number of general comments, delegations had also posed  several detailed 
questions and raised specific observations.  When the TFS proposal had been discussed next, in the 
CTS Special Session on 3 May, India had provided a number of responses to the various issues 
raised by Members. India's responses had been l ater circulated in document RD/SERV/139.  
4.3.  For that day 's meeting, the delegation of the Dominican Republic had circulated a 
communication containing an additional set of questions on India's proposal, contained in 
document JOB/SERV/263.   
4.4.  The representative of the Dominican Republic  said that the proposed TFS was  still being 
reviewed in capital . His delegation was re viewing the proposal carefully , given the importance 
conferred to transparency and, at that juncture, he wished to seek certain clarifications from India.  
Regarding Article  2.1 of the proposal, he wished India to clarify whether the information would be S/C/M/132  
 
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  published on the website of each institution concerned or in the Official Journal. As to Article 3.5 
on appeals and review, he requested India to clarify sub -paragraph 5.3 , as he found the wording 
confusing. Similarly, on Article 3.6 on information and verification requests, sub -paragraphs a) and 
b) used relative terms and thus required further clarification. Regarding paragraphs 1 and 2  of 
Article  5, his delegations asked India what requirements would be taken into consideration for the 
economic needs test, a nd whether the level of development of the country concerned would be a 
factor considered. Finally, he sought clarification on Article 10 rela ting to cooperation among 
competent autho rities: concerning subparagraph a), he wondered what would be the m eans of 
information exchange and , with regard to sub -paragraph d),  he asked  which institution would be 
responsible for providing information on trad e in services.   
4.5.  The representative of Thailand  provided her delegation 's preliminary views on the existing 
draft text of the TFS, which m ight not be very clear in all instances and for which, therefore, 
further clarification was needed.  
4.6.  In Article 3 (Administration of Measures), sub -paragraph 4.1(a) on Processing of 
Applications, India proposed that "the competent authorities of a Member shall expeditiously 
process all application ", while sub -paragraph 4.1 (b) stated that the competent au thorities "shall 
provide an indicative timeframe for processing of an application ". Thailand wished to understand 
the rationale for using the term "expeditiously ", given that the competent authorities already had 
an obligation to establish an indicative timeframe under sub -paragraph 4.1(b).  In addition, sub -
paragraph 6 of Article 3, on Information and Verification Requests, indicated that "each Member 
shall ensure that all information and verification request pertaining to requirement and procedures 
are s imple and expeditious ". Thailand wondered about the meaning of the term "simple and 
expeditious" and how the information and verification requests would be considered as meeting 
that condition.  
4.7.  Article 6 (Provisions pertaining to Recognition), sub -paragra ph 1.3 on Qualification and 
Licensing Requirements, indicated that "where examinations are required for fulfilment  of 
qualification and licensing requirements, each Member shall ensure that they are scheduled at 
reasonably frequent intervals ". Thailand sou ght clarification on how a Member could justify that 
the schedule of examinations was "at reasonably frequent interval s". 
4.8.  The representative of Ecuador  indicated  that his delegation was still reviewing the proposed 
TFS. He added that the TFS would create new obligations that could generate an additional burden 
on Members who had undertaken commitments in many service sectors, as was the case for 
Ecuador. As his delegation did not have an  offensive interest in services , new disciplines, such as 
on notificati ons, single window and the like, as well as on visa fees, could create  an additional 
burden  for national authorities . While the proposal seemed to include some provisions on special 
and differential treatment, it would be difficult for some Members to dete rmine how much time 
national authorities would need for the implementation of the TFS disciplines . He noted that the  
TFA was a complex agreement but it only concerned the operation of customs. The situation in 
services was very different, as responsibiliti es were spread out across many differ ent Ministries 
and agencies. Some aspects of the  proposed TFS , such as visa fees, ENTs and qualification 
requirements,  had the potential to reduce Members ' policy space and their right to regulate . 
Furthermore the TFS w ent beyond the scope of the GATS.  
4.9.  The representative of Ukraine  recalled his delegation 's statement at the Special Session on 
3 May. Ukraine supported India 's proposal from a systemic point of view and welcomed the 
approach of building on trade facilitation principles also in the area of trade in services. However, 
he stressed that provisions related to mode 4 were very sensitive and Members usually considered  
the liberalisation of this mo de of supply very cautiously. H e also underlined that India 's proposal 
included disciplines that were also found in the WPDR proposal by Australia and co -sponsors on 
administration of measures  (JOB/SERV/239/Rev.2), which his  delegation already supported.  
4.10.   He underscored that Members should give proper consideration to the implementation of 
the commitments they had already undertaken, levelling them across Members, and take into 
account the extensive services obligations adopted by Article XI I Members in the context of their 
accession negotiations. H e indicated that he might revert with more concrete comments on the 
proposed TFS.  S/C/M/132  
 
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  4.11.   The representative of Turkey  reiterated that her delegation saw the Indian TFS proposal as 
a balanced package and welcomed it.  Turkey hoped to see the text discussed in detail as soon as 
possible, to work towards a final version by MC11. The proposed TFS was especially valuable in 
that it addressed areas of interest to developing countries, such as the mov ement of natural 
persons or cross -border issues, whose contribution to trade in services for developing economies 
was evident. Turkey was a proponent of strong disciplines in those areas and was ready to 
contribute in detail to discussions aimed at finalis ing the TFS text; to that end, her delegation had 
already sent detailed comments to India and hoped to see a revised version of the text as soon as 
possible.   
4.12.   The representative of China  appreciated that India had circulated its responses to the issues 
raised by Members on its proposed TFS ( in document RD/SERV/139) and that it was holding 
consultations with Members. With regard to the proposed provisions on facilitating cross -border 
flow of information, social security contributions and facilitating the mov ement of natural persons, 
China suggested that India take into full consideration other Members ' opinions.  As for  the less 
contentious issues of cooperation among competent authorities, S&D and technical assistance, 
China was supportive of further discussi on. Since MC11 was approaching, her  delegation hoped 
that India could adopt a pragmatic approach and narrow down elements of the proposed TFS to 
facilitate wider consensus among Members.  
4.13.   Specifically, China provided the following comments. Regarding Artic le 2.1 on publication 
and Article 2.2 on opportunity to comment and information before entry into force, it suggested 
using soft law language or best -endeavour wording considering Members ' different legal systems. 
As for Article 3.2 on application timefram es, it proposed changing "at any time " to "within legal 
time period ".  
4.14.   Turning to Article 3.4(d), China suggested inserting "and consistent with the legal format " 
between "in case an application is considered complete " and "under the domestic laws and 
regulations ". With regard to Article 3.4(e), it recommended changing "provide without undue delay 
information concerning the status of the application " into "provide, in a timely manner and 
according to law, the processing status of the application ". Concerning Article 3.4(g), China 's 
suggestion was to change "inform the applicant of the procedures for resubmission of an 
application " into "the applicant will have the possibility of deciding on its own to resubmit a new 
application where the reason for termination or denial has already been resolved ". Regarding 
Article 3.6 on information and verification requests, it hoped that India could clarify the specific 
purpose of this provision; alternatively, China suggested deleting "and are not applied in a ma nner 
that would constitute a restriction to trade in services " in (a) and "completed without undue delay " 
in (b). With regard to Article 3.7 on fast -track procedure, since administrative licensing procedures 
had clear statutory time limits and processes, f ast-track handling might go beyond the existing 
laws and regulations; as such, China suggested deleting Article 3.7.  
4.15.   As for Article 4(a), it advocated changing the word "reasonable " in line 1 into "legal". 
Regarding Article 5, given the complicated nature  of Economic Needs Tests (ENT) and the difficulty 
in reaching consensus on the issue, it recommended deleting the article.  
4.16.   With reference to the first paragraph of Article 6.1 on qualification and licensing 
requirements, it suggested deleting the last sen tence "where the competent authority considers it 
relevant, it shall give due consideration to relevant professional experience of the applicant and 
membership in a relevant professional association in the territory of another Member ". As for the 
second pa ragraph of Article 6.1, the proposal was to change "allow applicants to fulfil such 
requirements in the home country, host country or any third country jurisdiction " into "provide 
applicants with the opportunity of correcting any deficiency identified ". 
4.17.   Regarding Article 7, China advocated the orderly flow of cross -border information, on the 
precondition that national security, fair opened -up environment, cybersecurity, business secrets 
and personal privacy were all safeguarded. Since the discussion on cros s-border information flow 
created big difficulties for many Members, it recommended removing th at article.  
4.18.   Moving on to Article 8.1, China could not agree to extend the coverage of its basic medical 
insurance to the medical expenditures incurred overseas. As for Article 8.2, China deemed it 
necessary to provide, within the allowed policy scope of each Member, convenience for consumers S/C/M/132  
 
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  with real needs for medical services, and was willing to exchange with other Members regulatory 
practices in that regard.  
4.19.   Coming to Article 9.2, China might grant multiple entry visas to those natural persons who 
had met prescribed requirements, according to multilateral and bilateral agreements and domestic 
laws and regulations. As for Article 9.3, social security was a servic e supplied in the exercise of 
governmental authority according to the GATS Annex on Financial Services; therefore, it should 
not be discussed in the context of domestic regulation. The suggestion was to delete th at article.  
4.20.   As for Article 10(c), China coul d agree to exchange information and share best practices on 
methodologies for the collection and compilation of data relating to trade in services, and to 
collaboration among statistical organisations, as areas for cooperation among competent 
authorities. Regarding Article 10(e), China agreed that technical assistance and capacity building 
be strengthened in order to support and help developing countries, and especially LDCs, and their 
SMEs better integrate into Global Value Chains, as an area for cooperati on among competent 
authorities.  
4.21.   Finally, with regard to Articles 11 and 12, China was supportive of the elements of S&D 
treatment for development countries, and improved technical assistance and capacity building.  
4.22.   The representative of Kazakhstan  acknowled ged the importance of the objectives of the 
proposed TFS agreement in facilitating trade in services. At the same time, the proposed 
agreement looked quite broad in scope and went beyond the GATS, and in particular Article VI:4 of 
the GATS. The draft TFS p roposed comprehensive disciplines with regards to mode  4, social 
security and medical insurance.  Those were sensitive issues for Kazakhstan and her delegation 
was not ready to take on additional disciplines in those areas.  However, Kazakhstan was ready to 
discuss the development of disciplines on domestic regulation within the existing scope of Article 
VI:4 of the GATS.  
4.23.   The representative of South Africa , speaking with Rwanda on behalf of the African Group, 
said that the Group had addressed the TFS text at  the Special Session on 3 May , was looking 
forward to India's revised text and would revert at that stage.   
4.24.   The representative of Brazil  said that his delegation was also waiting for India 's revised text 
and echoed Turkey 's statement about the text being balanced overall, although some issues were 
of particular sensitivity. In order to address the substance with specific comments, he said that it 
would be helpful to have an article -by-article reading of the text once India had circulated it in its 
revised version.  
4.25.   The representative of Nigeria  said that he would revert with specific comments once the 
revised text of the proposed TFS became available.  
4.26.   The representative of Australia  said th at her delegation welcomed India's efforts to respond 
to some of the questions raised by Members but still considered that there was no common 
understanding of what trade rules could be developed to facilitate trade in services and that 
further dialogue was required before moving to any text -based or article -by-article disc ussions.  
4.27.   Australia appreciated India 's clarification that the intended scope of the proposal was only to 
cover specific commitments; however, her delegation wished to better understand the interaction 
with scheduled horizontal limitations, which was not cl ear from India 's draft text.  
4.28.   The representative noted India 's ambition to include cross -border data flows provisions that 
were TPP -plus. She reiterated that there were many other elements beyond privacy concerns that 
would also need to be considered as pa rt of an appropriately balanced outcome on data flows, 
including for example how to deal with government information, consumer protection, localisation 
of computer facilities, and looked forward to seeing how those e -commerce issues would be 
comprehensivel y addressed as discussions progressed.  
4.29.   Australia was also interested in India 's view that localisation disciplines were unnecessary 
because any localisation requirement was a limitation on national treatment that had to be listed 
where a Member had schedul ed specific commitments. Her delegation was aware of a number of S/C/M/132  
 
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  Members that applied data localisation requirements on a sectoral or even horizontal basis where 
the relevant limitations had not been listed in their GATS schedules, either under mode 1 and/ or 
mode  3. Could India confirm that it was India's view that, where a Member had not listed a 
localisation requirement, maintaining such a measure would be inconsistent with the relevant 
GATS commitments? If India considered, as stated in its responses to Australia's questions, that 
localisation disciplines were not required because those measures were national treatment 
limitations, could India explain the difference with economic needs tests, which were a limitation 
that had to be scheduled in accordance with GATS Article XVI where a Member undertook specific 
commitments?  
4.30.   On m ode 4, she reiterated her delegation 's view that GATS commitments were outdated. 
Australia 's immigration system had evolved significantly and had also been influenced by improved 
comm itments and trade rules adopted in RTAs. To demonstrate compliance with 20 -year old 
commitments was not dealing with mode 4 issues of relevance, which included lack of 
transparency in visa processes and outcomes, economic needs tests and numerical limitati ons, 
lengthy processing times, nationality and residency restrictions. For Australia, the key to 
facilitating movement of natural persons lay in tools that were of current relevance to service 
suppliers, such as good regulatory practices and transparency i n decision -making, complemented 
by improved market access commitments, both in terms of ambition and clarity in how they were 
scheduled.  
4.31.   In concluding, t he representative thanked India for its continued efforts to foster a 
discussion on TFS and the constru ctive participation of other Members.  
4.32.   The representative of Uganda,  speaking on behalf of the LDC Group, said that the Group 
had presented its views on the proposed TFS at the Special Session on 3 May. At that meeting, 
after expressing support for the inte rvention of the African Group, the LDC Group had observed 
that exports of commercial services from LDCs had reached US$36 billion in 2015, while imports 
where valued at US$75 billion. LDCs accounted for 0.8 % of world exports and 1.6 % of world 
imports of co mmercial services. The LDCs' overall services trade deficit had widened from US$16.3 
billion in 2005  to US$39 billion in 2015. At the same time, 70% of the population in LDCs 
depended on agriculture for their livelihood. The objective of the LDCs was to in crease the 
participation of their suppliers in the benefits that services brought to LDC economies, in particular 
with regard to competitiveness, diversification of exports, increased employment and reduction of 
poverty, improving availability and access t o basic services, and ensuring sustainable 
development.  This informed efforts in relation to the LDC services waiver.  
4.33.   The representative believed that trade rules were primarily designed to ensure market 
access, and not to promote efficiency or social welfare. There was a growing preoccupation about 
the intrusiveness of disciplines that required trade considerations to pr evail over other policy 
objectives. This could constrain the capacity to effectively regulate in the pursuit of public interest. 
For this reason, the LDC group appreciated the inclusion of LDC -related provisions on special and 
differential treatment in Ind ia's proposal, specifically Article 11.2 which provided that LDCs would 
not be required to implement the provisions of the TFS. LDCs were nevertheless encouraged to 
apply these disciplines to the extent compatible with their special economic situation and their 
development trade and financial needs. He welcomed the inclusion in the proposal of some 
elements of the LDC collective request, for example in relation to the reduction of fees and 
charges. Such reductions should take the form of preferences in favo ur of LDCs. It was important 
to help suppliers from LDCs compete with suppliers from countries with greater capacity and 
resources.  
4.34.   The representative noted that LDCs had proposed that their natural persons supplying 
services through temporary contracts s hould not be charged social security contributions. India's 
ideas were therefore of interest. Attempts to reduce obstacles to mode 4 through multiple entry 
visas and a GATS visa were useful. He asked how India envisaged these provisions being 
implemented.  He also wondered whether it was realistic to expect progress on such issues in the 
current environment. The representative also asked the delegation of India to clarify why Articles 2 
and 8.2 would apply to all sectors  and not only to sectors where commitm ents had been 
undertaken. With respect to the single window, he observed that India had drawn a distinction 
between competent authorities for authorizations and those for immigration and other matters. He 
wondered whether the delegation had conducted cost analysis on the application of a single 
window in services, given the number of competent authorities involved. Moreover, did the S/C/M/132  
 
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  provisions on ENTs, as well as those on modes 1, 2, and 4, modify the flexibilities available to 
developing countries under GA TS Articles IV and XIX? He wondered why India felt that a distinct 
committee to monitor the TFS would be necessary. Finally, he asked India how it envisioned 
reaching consensus on this proposal by MC11.  
4.35.   Despite the importance of mode 4 to LDC suppliers, t he representative believed that the 
proposal was not covered by existing mandates. While there was no negotiating mandate in the 
WTO on e -commerce, the proposal sought to initiate negotiations on this topic without a specific 
mandate from Ministers. The Indian proposal would also lead to  the introduction of issues that had 
been explicitly prohibited through paragraph 1(g) of the 2004 July Framework, such as 
investment. In contrast, issues of negotiating interest to the LDCs were rooted in some mandate, 
whether cotton, the services waiver,  or the reduction of domestic support in agriculture. The most 
vulnerable Members of the WTO relied on the organization's rules for protection and these should 
not be set aside.  
4.36.   The representative of the Republic of Korea  said that her delegation had deliv ered its 
position with regard to India 's proposal at the Special Session on 3 May. Korea agreed in principle 
that trade facilitation was important for trade in services as well as for goods trade. Her delegation 
appreciated India 's proposal and saw it as a  good basis on which Members could start discussing 
trade facilitation in services. Korea had already raised its concerns regarding certain elements of 
India's proposal, such as health insurance service s, cross -border flow of information and mode 4 
issues.  Korea hoped that India could consider them fully in drafting its revised proposal and was 
ready to engage in further discussions.  
4.37.   The representative of Peru viewed India 's proposal with interest.  Her delegation was 
especially keen on the elements of the p roposal relating to the movement of natural persons, 
particularly with regard to contractual service suppliers, independent professionals and 
technicians. It would be useful to have more clarity and develop disciplines for mode 4; once that 
area had been a ddressed, discussions in other areas would be easier to pursue. It was difficult to 
discuss the issue of Economic Needs Tests without identifying the mode to which ENTs would 
apply. Another issue of great interest were cross -border data flows, which should  be discussed 
within a broader context alongside other proposals, such as the one the EU had tabled on e -
commerce in the Special Session. Peru stood ready to work with India to advance its proposal in 
those areas.  
4.38.   The representative of Mexico  registered h er delegation 's interest in the mode 4 and the 
health services elements in India 's proposal. She looked forward to receiving India 's revised text 
and engaging in more detailed discussions.  
4.39.   The representative of India thanked the Dominican Republic for its  comments and questions 
and indicated that his delegation would respond  to the specific elements raised  in detail and 
engage with the Dominican Republic bilaterally. He also thanked all other delegations which  had 
provided comments and said that they would  be considered carefully. He indicated that his  
delegation was planning to circulate a revised draft for the p roposed TFS in the near future, which 
it hoped  would address delegations ' comments , and  looked forward to further engagement by 
Members.  
4.40.   The Chairman  suggested that the Council take note of the statements made and revert to 
the issue at its next meeting.  
4.41.   It was so agreed . 
5  ITEM E - CERTAIN WTO -INCONSISTENT MEASURE S APPLIED BY UKRAINE  
5.1.  The Chairman  indicated that the item had been added to the age nda of the Council at the 
request of the delegation of the Russian Federation.  
5.2.  The representative of the Russian Federation  regretted that her delegation had to raise once 
again its repeatedly expressed concerns as regard s the measures related to the refor m of the 
unified gas transportation system of Ukraine.  S/C/M/132  
 
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  5.3.  Since November 2014, the Russian Federation, at different levels, both bilaterally and 
multilaterally, had sought clarity from Ukraine in respect of reasonable justifications for the 
adoption and impl ementation of the Law of Ukraine No. 1645 -VII "On amendments to some 
legislative acts of Ukraine on reforming the management system of the Unified Gas Transportation 
System of Ukraine" and the Law of Ukraine No. 329 -VIII "On the Natural Gas Market" as of 9  April 
2015 which had invalidated the Law of Ukraine No. 1645 -VII as of 14 August 2014.  
5.4.  Her delegation again wished to draw the attention of the Membership to the fact that the 
Law, which was a clear violation of the fundamental principles of the General A greement on Trade 
in Services, MFN and national treatment, as well as of the specific commitments undertaken by 
Ukraine under the GATS, remained applicable.  
5.5.  It was disappointing and regrettable that all of her delegation 's efforts to obtain clear and 
adequ ate clarifications from the Ukrainian side on that matter had been unsuccessful.  In that 
regard, the Russian Federation reiterated its request to Ukraine to bring the Law of Ukraine No. 
329-VIII "On the Natural Gas Market" as of 9 April 2015 in full confor mity with its obligations 
under the WTO Agreements.  
5.6.  The representative of Ukraine  thanked the delegation of the Russian Federation for its 
continuing interest in the services sector 's legislation of Ukraine. With regard to the multiple 
concerns previously raised by the Russian Federation at the CTS and taking into account its  
statement that day, Ukraine wished to put in systematic order all issues voiced by the Russian 
delegation and to underline the following.  
5.7.  First, concerning the complex set of the measu res related, in particular, to trade in services,   
which were competence of the Council, on 19 May 2017 the Russian Federation had filed a request 
for consultations with Ukraine (Dispute Case 525), in accordance to Article 4 of the Dispute 
Settlement Under standing. The relevant request covered the whole range of issues related to 
Ukrainian foreign trade and economic policy under the current severe security challenges. 
According to Article XXII of the GATS, such consultations had to be held under the Dispute  
Settlement Understanding rules. Ukraine had confirmed to the Russian Federation its readiness to 
enter the consultations in a good faith.  
5.8.  Second, the whole complex issue of transit was already being examined in Dispute Case 512 
following the Ukraine 's complaint.  
5.9.  Third, concerning the reform of the unified gas transportation system of Ukraine, he 
reiterated that Ukraine adhered to the principles and rules of the WTO and had made every 
reasonable effort to clarify the provisions of national legislation on  the issues raised. 
Demonstrating respect for the transparency principle, Ukraine had already provided detailed 
answers to the set of questions just raised by the Russian Federation.   
5.10.   Ukraine 's Government recognised the importance of the multilateral servi ces trading system 
and reaffirmed Ukraine 's full commitment to the international rules and principles as embodied in 
the WTO Agreements. His delegation would appreciate if the Russian Federation could provide the 
explicit identification of its concerns whi ch went beyond the above -mentioned issues, in order to 
give them fruitful consideration. Once again, he thanked the Russian Federation for its continuing 
interest in issues related to access to Ukrainian services markets.  
5.11.   The Chairman  suggested that the C ouncil take note of the statements made.  
5.12.   It was so agreed . 
6  ITEM F – WORK PROGRAMME ON EL ECTRONIC COMMERCE  
6.1.  The Chairman  indicated that there were several elements to be addressed under that agenda 
item. First, he invited any delegation wishing to share info rmation under the "exchange of 
information and experiences" sub -item, to do so at that juncture.  S/C/M/132  
 
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  6.1  Exchange of information and experiences based on submissions by Members  
6.2.  The representative of China  said that the exchange of information and experiences not only 
facilitated a better understanding of the submissions on the table, but also enriched Members ' 
comprehension of e -commerce and its role in inclusive economic development in general, which 
was why her delegation supported such an exchange.  
6.3.  At the meeting of the Committee on Trade in Financial Services (CTFS) held on 13 June, 
China had presented its domestic developments in e -payment services, including relevant 
regulatory practices. E -payment s ervices were not only an indispensable link in the e -commerce 
ecosystem of cross -border trade in goods enabled by the Internet, but also an efficiency enabler of 
payment services at large, a cost reducer for social transactions, and a contributor to financ ial 
inclusion and sustainable economic growth.  
6.4.  Given that a number of delegations had shown interest in the topic after the CTFS session, 
China recalled the statement i t had delivered in the Committee. At the CTFS, her delegation had 
recalled that, on 4 November  2016, China  had formally summited its e -commerce commun ication 
to the General Council , the Council for Trade in Services , the Council for Trade in Goods and the 
Comm ittee on Trade and Development. China's communication proposed  focusing discussions on 
how to further facilitate cross -border trade in goods enabled by the Internet, together with 
services directly supporting such trade in goods, such as  payment and logi stics services. Payment 
services were an indispensable link in the e -comm erce ecosystem of cross -border trad e in goods 
through the Internet;  no transaction could  be completed without payment service s. China  also 
referred to such online payment service s that support ed the successful completion of e -commerce 
activities as electro nic payment service s, or e-payment service s. The rapid development of e -
payment service s had greatly improved the efficiency of payment services, reduced the cost of 
social transactions, promoted the development of consumption and e -commerce, and stimulate d 
economic growth.  
6.5.  At the CTFS meeting that had been held in March, China  had encouraged M embers to share 
information on the development and regulation of payment services related to e -commerce. Her 
delegation  believe d that, in an era where traditional fin ance and Internet -based finance 
intertwined in a revolutionary manner , in-depth discussion s of e-payment service s would help 
Members understand and compare notes on the development trend under  those  new 
circumstances, so as to better achieve the goal  of letting finance serve development. At the June 
CTFS meeting , China was willing to "throw a sprat to catch a whale " by sharing  information on  the 
state of play of its e -payment market  as we ll as its regulatory practices and welcome d Members ' 
comment and inter action.  
6.6.  China was  one of the regions in the world that had witnessed  the most dynamic progress of 
the e-payment business  in recent years . With the rapid development of non -cash payment 
instruments and swift transformation from traditional paper bills and card-based payment to e -
payment, the newly emerging electronic payment  (i.e. internet payment, mobile payment and 
others ) had reflected the development direction of non -cash payment instruments. The providers 
of payment services had also extended from the traditional banking financial institutions to non -
banking payment institutions. In 2016, China 's banking financial institutions had handled a total of 
140 billion e -payment dealings, with a cumulative amount of RMB yuan  2,494 trillion , while non -
banking pa yment institutions had completed 164 billion network payment dealings, realizing an 
amount of over RMB yuan  99 billion , with the year -on-year growth rate hitting 99.5% and 100.7% 
respectively.  
6.7.  In general, the development of China 's e-payment ha d demonstrat ed the fol lowing features. 
First, e -payment by non -banking payment institutions was growing rapidly. Since the People 's 
Bank of China had promulgated the  Administrative Measures for the Payment Services Provided by 
Non-financial Institutions in 2010, the s o-called third-party payment business had  developed  fast, 
where non -banking payment institutions growing  swiftly, e -payment innovation emerging  
constantly, customer experience s getting  refreshed continuously, and the business scale enlarg ing 
ceaselessly. T his ha d tremendously facilitated the daily retail payment activities of the general 
public, and turned out to be one of the highlights in the development of China 's payment industry. 
From 2013 to 2016, the total transaction batches of non -banking payment i nstitutions  had 
increased from RMB yuan  37 billion to 185 billion and the amount handled had risen  from RMB S/C/M/132  
 
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  yuan 17.6 trillion to 119.6 trillion, with an annual compound growth rate of 70.9% and 89.5% 
respectively.  
6.8.  Second, th e inclusiveness of e -payment had been markedly enhanced. The rapid 
development of electronic payment s in China has benefi tted from the propagation of account 
business es. As of 2016, per capita personal bank settlement accounts had reached 6 in China and 
3.9 in rural areas, making  it possible for the vast number of long -tail customers  to access financial 
services . In addition, widespread bank outlets, ATMs, POSs and other bank card processing 
equipment, as well as the easily accessible mobile phones, PCs and ot her network login terminal s, 
had provided technical foundation for the convenient availability of e -payment service s to the 
public. Promoted by these favorable conditions, e -payment s had  been widely accepted and favored 
by the public, including by the more vulnerable groups.  
6.9.  Third, the application s cenarios of e -payment services we re increasingly diversified. Along 
with the rapid development of e -commerce and mobile internet in China, online services ha d 
rapidly  penetrated into the fields of life services. As a result, innovation in payment service s had 
evolved from the product side to the application side, the application scenarios of payment 
service s had  been continuously enriched, with online business es and offline business es increasingly  
converged. The demand for fragmented payme nt services could  be satisfied anytime , anywhere, 
and e -payment service s were  much more  closely integrated with people' s life.  
6.10.   As to the newly emerging payment institutions and e -payment service s, on the one hand 
support should be actively accorded to enco urage innovati on in payment service s, especia lly to 
bring into full play the  advantages  they offered of small amount, expeditiousness and convenience 
for consumers, as well as their catering to e-commerce development;  on the other hand, efforts 
had to be made to safeguard the legitimate rights and interests of relevant parties against 
payment risks.  
6.11.   The Chinese government has worked hard to establish and perfect the institutional 
arrangement s for e -payment  services . The People 's Bank of China has promulgat ed, among 
others, the Electronic Payment Guidelines (No.1), Administrative Measures for the Payment 
Services Provided by Non -Financial Institutions, Administrative Measures for the Online Payment 
Services of Non -Banking Payment Institutions. This ha d conso lidated the institutional basis for e -
payment s, and provided an important institutional guarantee for the regulation of the e-payment 
service market and the promotion of innovative development in e-commerce. It was noteworthy 
that there was a dedicated sec tion named "Electronic Payment " in Chapter Three , Transaction and 
Services in E -commerce , of the draft Electronic Commerce Law of China, which was currently 
deliberated by the National People 's Congress. Th at section provided  for the rules of core business  
in the non -banking payment fields, including the concept of e -payment, supervision and 
regulation, real -name account system, obligations of e -payment service providers, payment orders 
and management of excess reserves. Chapter Seven , Legal Liability , provided for  the punishment 
of non -compliant conduct of e-payment service providers. Those systematic arrangements had  
ensured the sound development of e -payment service s, and had further facilitated cross -border 
trade i n goods enabled by the I nternet.  
6.12.   Moreove r, to facilitate the e -commerce transactions of Chinese domestic institutio ns and 
individuals through the I nternet, the State Administration of Foreign Exchange had promulgated 
the Guiding Opinions on the Pilot of Cross -border Foreign Exchange Payment Busi ness provided by 
Payment Institutions, encouraging payment institutions to provide both parties of an e-commerce 
transaction  with services of centralized receipts and payments of foreign exchange funds, and 
relevant foreign exchange settlement s and sales i nvolved in cross -border I nternet payment s 
through banks.  
6.13.   Her delegation hoped that the case of e -payment development in China would  enable a 
better understanding among Members of how that  financial service had emerg ed under novel  
circumstances. If one regard ed e-payment service as a giant sailboat appearing on the horizon, it 
not only opened  a quick route between financial institutio ns and consumers, but also helped  the 
ship of cross -border  trade in goods enabled by the I nternet to set sail. In particu lar, it would  
facilitate the journey of developing Members to speed up their economic development and get 
better integrated into the global trading system.  S/C/M/132  
 
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  6.14.   China encouraged other Members to share their own experiences regarding e -payment 
services. Her del egation hoped to contribute more information  at the following  CTS meeting , 
probably on logistic  service s directly supporting cross -border trade i n goods enabled by the 
Internet . 
6.15.   All delegations which  took the floor  thanked China for its presentation.  
6.16.   The representative of Switzerland  welcomed the various initiatives taken by WTO Members 
with respect to the work of the Council on e -commerce. Sharing experiences and practices through 
submissions was one way of enhancing Members' common knowledge on the matte r. Holding 
thematic seminars was another way of helping Members deepen understanding of e -commerce 
issues. In the past, both approaches had contributed to fruitful discussions among the 
Membership.  
6.17.   The representative of Nigeria  said that sharing informatio n and experiences would facilitate  
a better understanding of the submissions on the table. He hoped to share his country's 
experience on the matter in the future, as appropriate. He  then sought further clarification from 
China on the nature of the e -commer ce Law, which was currently being deliberated, in relation to 
electronic payments and liability, and whether it contained any provisions on data localisation. He 
also enquired whether China could share information and experiences on cross -border trade, 
particularly the deployment of the Internet.  
6.18.   The representative of China  responded that China's draft e -commerce Law, which was under 
deliberation in the National People's Congress, contained in Chapter 3 a section on electronic 
payments that provided the rul es for business in the non -banking field. Likewise, Chapter 7 on 
legal liability referred to the conduct of e -payment service providers. As to the cross -border flow of 
information and data, other laws and regulations contained provisions on how to safeguar d 
national security and cybersecurity. China encouraged other Members to share their own 
experiences on how to facilitate trade in goods enabled by the Internet. China's experience had 
shown that the robust development of e -payment services had helped incr ease access for SMEs 
providers, including individual dealers on the Internet, and enabled them to benefit from e -
commerce.  
6.19.   The representative of the European Union  considered e -payments an important topic to 
facilitate trade in both goods and in services. Her delegation would welcome more discussion and 
exchange of practices on the matter, preferably in the CTFS.  
6.20.   The representative of Nigeria  had a follow -up question for China, on whether legal liability 
was limited to non -complying conduct, and if not, whether China could elaborate or provide 
examples of non -complying conduct.  
6.21.   The representative of China  said that she would revert with a res ponse to Nigeria at a later 
stage.  
6.2  Communications on the E -commerce Work Programme  
6.22.   The Chairman  recalled that, at the March meeting, the Council had held an extensive and 
rich discussion of the four communications on the agenda for that meeting.  As severa l delegations 
had indicated that they were still examining the submissions, he suggested reverting to them. 
Before doing so, however, he dr ew Members' attention to the communication submitted by 
Singapore, on behalf of the ASEAN members, and contained in d ocument JOB/SERV/260.  
6.23.   The representative of Philippines , on behalf of ASEAN, said that ASEAN had organised a 
panel, during UNCTAD 's E-Commerce week, aimed at exploring synergies on issues discussed in 
the WTO and UNCTAD on the development aspects of e -comm erce. The event featured panellists 
from the WTO, Singapore, Cambodia, the Global Express Association and the International Trade 
Centre. The Thai Vice -Minister of Commerce, H.E. Mr. Winichai Chamchaeng, had given the 
introductory remarks. The panel had he ld a broad discussion, including on existing WTO rules that 
applied to e -commerce and the common types of e -commerce rules found in RTAs. The panellists 
had also presented how e -commerce had enabled more MSMEs to better integrate into the global 
economy. T he panel had heard that interest in e -commerce cut across development levels in S/C/M/132  
 
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  ASEAN. Having already committed to e -commerce disciplines, such as in the ASEAN -Australia -New 
Zealand FTA, it had also been shared that ASEAN Members were looking to negotiate an ASEAN e -
commerce agreement. The document that ASEAN had tabled summarised the reflections and key 
conclusions of the event. ASEAN looked forward to engaging constructively with other Members on 
how to take forward the work on e -commerce.  
6.24.   The Chairman  then opened the floor on all the communications on the agenda.  He recalled 
that, in addition to the one from ASEAN, communication s had been submitted to the Council by: 
China and Pakistan, on "Aiming at the 11th Ministerial Conference" (JOB/SERV/243/Rev.1);  
Argentina, Brazil and Paraguay, on "Electronic signatures" (JOB/SERV/247); the EU and co -
sponsors, on "Trade policy, the WTO, and the digital economy", which had just recently been 
revised to add the Republic of Moldova and Ukraine as a co -sponsors (JOB/SE RV/248/Rev.1 and 
Revision 2, respectively); and Singapore and co -sponsors, on "Electronic commerce and 
development" (JOB/SERV/249).  The communications on the table were many and covered a 
variety of issues.  He encouraged delegations to offer any reflection s on how, in the future, the 
Council might best structure its discussion of those submissions.  For instance,  he wondered if 
delegations wished to continue discussing the papers separately, focus on the services -specific 
elements of each or try to identify themes to structure the Council's discussions.   
6.25.   All delegations which  spoke  thanked the proponents of their submissions.  
6.26.   The representative of  the Plurinational State of  Bolivia  indicated that the proposals 
circulated continued being reviewed in capital. B y way of general comment, he said that, for 
Bolivia, as well as for all Members, the Internet and e -commerce were important. His delegation 
was moving forward several initiatives on e -commerce with the support of different international 
organisations, incl uding UNCTAD, ITU and the Andean Community.  
6.27.   It was clear that the degree of use of e -commerce was directly linked to a country's level of 
development and that the Internet and e -commerce had developed dynamically. However, the way 
in which the matter was being dealt with in some proposals raised con cerns for his delegation. The 
WTO was a rules -based organisation and Article III:2 of the Marrakesh Agreement stated that the 
WTO "shall provide a forum for negotiations among its Members concerning their multilateral trade 
relations in matters under the a greements in the Annexes to this Agreement ". It also stated that 
"the WTO may also provide a forum for further negotiations among its Members concerning their 
multilateral trade relations ". The WTO was not a forum for addressing issues which were of 
intere st to only one or more Members, as that would require a decision adopted by all Members. 
Many of the proposals on the table addressed issues outside the scope of the WTO, such as e -
commerce governance, cybersecurity, consumer protection, which belonged to other fora with 
more expertise on those issues.  
6.28.   The 1998 Work Programme provided for the examination of e -commerce in the context of 
the GATS legal framework; it did not foresee an open mandate to discuss any issue related to e -
commerce. The ITU was the m ost appropriate forum to deal with those issues within the UN, 
providing a broader and democratic scope for relevant discussions. For Bolivia and other 
developing countries, important issues to be discussed included infrastructure development, which 
was wi thin the scope of the Work Programme, technology transfer and education/skills 
development. It was crucial to preserve policy space to deal with issues affecting directly Bolivia 
and other developing countries.     
6.29.   The representative of Hong Kong, China  said that ASEAN 's paper was in line with his 
delegation 's thinking that e -commerce could create new opportunities, expand exports and open 
markets, especially for MSMEs. Hong Kong, China recognised that issues such as lack of 
infrastructure and knowledge, dig ital divide and gaps in access to information, as mentioned in the 
paper, were some of the difficulties faced by MSMEs in engaging in e -commerce. There was a large 
number of MSMEs in Hong Kong, China, and his delegations supported any initiative that could  
help create a reliable business environment for MSMEs to leverage on e -commerce as a means to 
tap into global markets.  
6.30.   The representative of China  said that, since the formal submission of China and Pakistan 's 
communication to the General Council, the Cou ncil for Trade in Services, the Council for Trade in 
Goods and the Committee on Trade and Development, her delegation had already delivered 
detailed interventions to Members at the previous two CTS meetings and had reiterated its position S/C/M/132  
 
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  on e-commerce, na mely that discussions on e -commerce in the WTO should be based on the 
existing mandate, uphold the development dimension and focus on the areas of common interests 
to Members. H er delegation hoped that the exchange of information and experiences under the 
various subsidiary bodies would help developing Members achieve a better understanding of e -
commerce, explore what positive progress might be made at MC11 and reflect the inclusiveness of 
the multilateral trading system.  
6.31.   China welcomed and appreciated the pragmatic work done by the proponents, which 
provided valuable information and a useful basis to continue work. Turning to the various 
communications on the agenda, and starting with JOB/SERV/247, he thanked the proponents for 
the information shared, which  not only shed light on the practices of Mercosur, but also furthered 
Members ' understanding of e -signatures. With the rapid development of information technology, 
cross-border e -commerce was playing an important role in improving the efficiency and loweri ng 
the cost of transactions in trade. One of the main features of cross -border e -commerce was the 
digitisation  of transactions. Issues such as the legal recognition of electronic signatures concerned 
their application in e -commerce and the development of e -commerce itself. Therefore, there was a 
need to address problems relating to the legal effect of electronic transaction documents, in order 
to eliminate barriers to e -commerce development, th us preserving the legitimate rights and 
interests of participant s and safeguarding the security of electronic transactions. China would 
welcome further exchanges of information by Members in th at regard.  
6.32.   The detailed communication from EU et al. enumerated the possible elements in the e -
commerce discussions, covering s uch areas as trade in goods and trade in services, thus providing 
a broad space for Members ' discussions. However, some of the elements therein were sensitive 
issues for many Members, such as disciplines concerning cross -border data flows and localisation,  
tariffs elimination for goods, legally binding prohibition on the imposition of custom duties on 
electronic transmissions, and liberalisation commitments in services.  
6.33.   As far as China was concerned, aiming at practical outcomes on e -commerce at MC11, and 
considering the different development levels of Members, discussions at that stage should focus on 
the areas of common interests to Members, starting with easier issues in a progressive manner 
and setting the appropriate level of ambition. This was the onl y way to get more Members 
engaged in the discussions and move those forward sustainably.  
6.34.   The non -paper from Singapore et al . took a development perspective to e -commerce, which 
China appreciated as it was pragmatic and meaningful. H er delegation had repeat edly said that 
development had to be at the core of the e -commerce discussions. It was based on China 's own 
successful experience in developing e -commerce as a developing country that China had proposed 
to focus the discussions on cross -border trade in goo ds enabled by the Internet, and stood ready 
to share its experience with Members. The four potential areas outlined in the non -paper, i.e., 
"trade facilitation and e -commerce ", "infrastructure gaps to enable e -commerce ", "access to 
payment solutions " and "online security " were well identified, but lacked detail.  
6.35.   Development was a core element that could cover many factors and Members needed to 
consider how to embody it, get it substantiated and enriched in the issue of e -commerce 
multilaterally. China was willing to continue discussions in that area.  
6.36.   Turning to the communication submitted by ASEAN, China thanked the proponents for 
sharing what had happened outside the WTO, which was very meaningful. It was undoubtable that 
e-commerce could not only assist d eveloping Members to achieve leapfrog development, but also 
enable more and more developing Members, as well as their MSMEs and disadvantaged groups, to 
embark on the development highway.  
6.37.   When it came to whether and how the existing multilateral rules appl ied to the e -commerce, 
it seemed that consensus was yet to be achieved among Members, and clarification was needed. 
Therefore, his delegation suggested that Members base their discussions on the existing Work 
Programme  mandate, i.e. "examine all trade -related issues relating to global electronic 
commerce ", and avoid unnecessary misunderstanding by using confusing concepts other than "e-
commerce ". 
6.38.   China encouraged Members to share information and exchange views in all relevant WTO 
subsidiary bodies, similarl y to what had happened at the CTFS meeting two days earlier and at the S/C/M/132  
 
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  CTS meeting that day with regard to payment services facilitating e -commerce. China welcomed 
further discussions on payment and logistics services directly supporting cross -border e -
commerce, with a view to strengthening the capacity of developing Members to participate in, and 
benefit from, e -commerce. Furthermore, China wished to continue communicating with Members 
and jointly explor ing what progress might be made within the framework of the WTO.  
6.39.   The representative of Brazil  said that, as a co -sponsor  of one of the communications on the 
table, he felt that all submissions had been discussed at length and that it was difficult to see what 
else was left to consider. Turning to the Chairm an's question, it was hard to consider the services 
components in isolation, in light of the fact that e -commerce was being addressed broadly  in the 
lead-up to MC11. He therefore suggested that the Chairman hold informal consultations for 
Members to consid er how best to structure e -commerce discussions in the CTS.  
6.40.   The representative of Costa Rica  said that the communications had contributed to enhancing 
Members' understanding of e -commerce and of the potential of the topic for WTO work. E -
commerce was the m ost efficient way of allocating resources for both producers and consumers, it 
could help MSMEs emerge globally and allowed to overcome geographical, political, economic and 
technological obstacles. That was way Costa Rica actively supported discussions on  e-commerce. 
The document co -sponsored by his delegation included elements that should be considered to help 
developing countries bridge the existing gaps and take advantage of e -commerce opportunities. 
The relationship between trade and e -commerce, the in frastructure gaps/digital divide, access to 
e-payment solutions and cybersecurity were topics of priority interest for all Members. As the 
communication did not include an exhaustive list of all development -related topics, he invited 
Members to examine the  Roadmap elaborated by the Friends of E -commerce for Development in 
the context of UNCTAD 's E-Commerce Week, which referred to other relevant topics, such as the 
development of regulatory frameworks or the strengthening of transparency, that his delegation  
also considered should be addressed in the WTO, with pragmatism. He reiterated his delegation 's 
interest in the e -commerce seminar, which he hoped would take place soon.  
6.41.   The representative of Ecuador  said that the proposals should not imply new market acc ess 
commitments and should fall within the scope of the Work Programme given the digital gap that 
existed among Members. The lack of physical and social infrastructure should be addressed by the 
Membership, with a view of finding concrete solutions in ligh t of the financial and development 
needs of developing countries. The objective of the proposals on e -commerce should be to 
promote the sharing of experiences, without laying the foundations for future negotiations , and 
should stay within the scope of the Work Programme.    
6.42.   Replying to the question by the Chairman, the representative of Nigeria  said that his 
delegation could broadly agree with the suggestion by Brazil for the Chairman to hold informal 
consultation s regarding future work of the CTS, in the context of the Work Programme and in 
relation to the various proposals on the table which were cross -cutting in nature. As a cosponsor of 
one of the proposals, Nigeria wished to acknowledge the intervention by China, which was 
particularly constructive in terms in going forward. His delegation was also especially interested in 
the develop ment dimension of e -commerce, and underscored the need to take into account some 
of the challenges and concerns that had been express ed previously by the African Group . Nigeria 
shared some of the same challenges, such as the issue of the digital divide, digital rights, 
localisation, high market concentration, and legal and regulatory issues. Lastly, his delegation was 
very open to an ou tcome at MC11. Although the nature of this outcome was still unclear, its 
elements would have to be discussed and Nigeria stood ready to continue to engage positively in 
that regard, to see how far Members could go to achieve a realistic outcome at MC11.  
6.43.   The representative of New Zealand  said that her delegation agreed with the message of the 
panel organised by ASEAN during the UNCTAD's E -commerce Week and, more generally, the 
broader deliberations  that had taken place in UNCTAD on that occasion. This  had shown  the 
relevance and importance of e -commerce discussions to the WTO agenda  and the need for further 
work o n the WTO 's liberalisation and f acilitation agenda as  it affected, and was affected , by e-
commerce. Her delegation believed that there was still a  possibility to make progress towards 
MC11 and was willing to work constructively with other delegations to achieve that objective. In 
response to the Chairman 's question, she was not sure that Members were making the best use of 
their time by repeating th e same conversation across all bodies and continuing to look at papers 
that had been on the table for a long time. She believed that re -focusing discussions on what could S/C/M/132  
 
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  be achieved at MC11 would be helpful and New Zealand would continue to reflect on thi s. She 
looked forward to engaging in informal consultations as suggested by Brazil.  
6.44.   The representative of Canada  indicated that his delegation saw strong interest from 
Members for substantive work on e -commerce in the Council. Members had had fruitful disc ussions 
covering a wide range of issues, including electronic authentication, consumer protection, 
transparency, co -operation and the custom duty moratorium. As information and communication 
technologies continued to advance, those issues were becoming eve n more relevant to trade in 
services.  Canada looked forward to continuing those discussions in future meetings of the CTS.  
6.45.   The representative of Australia  noted that many of the papers on e -commerce had been 
discussed on more than one occasion in the Counc il and in other Committees, and wished to recall 
her delegation 's previous detailed interventions, particularly in the Council, on the papers. 
Australia welcomed the ongoing engagement by many Members in e -commerce issues and 
reiterated the role of e -commerce in promoting inclusive global growth.  
6.46.   Having participated i n the several rounds of discussions on the papers in the Council, she 
wished to share a number of general observations. First there were several common e -commerce -
related issues that many delegations had highlighted as areas of interest, including those wh ich 
related to the facilitation of e -commerce. Second, many delegations, including Australia, had also 
recognised the need to consider the development dimension of e -commerce. Finally, sev eral 
delegations, including her  own, had flagged their interest in a chieving pragmatic outcomes on e -
commerce at MC11. She encouraged Members to focus their efforts on coming up with pragmatic 
and concrete suggestions in that regard . Australia looked forward to continuing to work with all 
interested Members and participati ng in any consultations which m ight take place to try to 
advance th ose efforts.  
6.47.   The representative of the European Union  said that the communication submitted by the 
ASEAN Group highlighted the needs of MSMEs in e -commerce and stressed the importance of le gal 
certainty in regulatory frameworks. As co -sponsor of JOB/SERV/248, her delegation welcomed the 
new co -sponsors, Moldova and Ukraine. The European Union had been satisfied with the 
discussions generated by its communication, since the purpose was to tri gger an exchange of 
views and practices. She joined those delegations which  had asked for consultations on the way 
forward.  
6.48.   The representative of Chinese Taipei  said that the panel organised by ASEAN at UNCTAD 's 
e-commerce week had been very successful, an d had provided plenty of food for thought. E -
commerce had undoubtedly changed the way of doing trade. At the same time, it had allowed 
MSMEs, as well as young entrepreneurs, to gain access to global markets for the very first time. 
Chinese Taipei firmly be lieved that the WTO could, and should, play a crucial role in the promotion 
and facilitation of e -commerce in that regard.  
6.49.   Cross-border e -commerce provided a unique opportunity for MSMEs to reach global 
markets. It was imperative to find ways of bridging the digital divide, in particular by helping 
developing and least -developed country Members to access ICT infrastructure and services, thus 
enhancing their e -commerce readiness. The most useful way of analysing the topic was by looking 
at the fundamental d ifferences between e -commerce and traditional trade. The availability and 
efficiency of digital transmissions had created new methods of trading, and many more 
opportunities to trade, such as through e -books, 3D printing, telemedicine, cloud computing and 
the like. One of the most significant impacts of e -commerce was that customs borders were 
becoming blurred. The various forms of barriers to traditional trade, like customs duties, non -tariff 
barriers and others, usually took effect at, or just after, the border.  
6.50.   Barriers to digital trade via the Internet, however, were quite different. Most cyberspace 
trade barriers were applied during the early stages of the transaction, which were usually devoted 
to comparing the price or considering placing an order. Th is meant that when certain barriers were 
applied, which restricted access to data or information on the Internet, they actually prevented 
potential buyers from even noticing the existence of the foreign offering. If the necessary data or 
information was no t transmitted efficiently, then any comparison of goods and services, and any 
order, shipment or customs check  just could not happen. Those  kinds of cyberspace trade barriers 
could often completely wipe out all trade opportunities at an early stage, which was especially 
serious for MSMEs  as they probably had no other channels of access to potential foreign buyers.  S/C/M/132  
 
- 20 - 
 
  6.51.   That was why her delegation considered it very important and fundamental for the WTO to 
ensure that all Members had reciprocally equal access to the Internet. Furthermore, this equality 
had to apply at all stages of a transaction, in particular in communications and access before any 
transaction was made and any matching of consumers and suppliers was done. Chinese Taipei 
would shortly be sharing i ts views in more detail by circulating written papers,  and looked  forward 
to fruitful discussions with Members.  
6.52.   The representative of Chile indicated that the Council had been give n a mandate under the 
Work Programme, namely to examine and report on the tr eatment of e -commerce within the GATS 
legal framework. In November 1998, to assist the Council in its task, the Secretariat had prepared 
a Background Note, contained in document S/C/W/68. Almost 20 years had passed since the Work 
Programme had started and the Secretariat had drafted its Note, during which time e -commerce 
had greatly developed. Therefore, Chile considered it important that the Secretariat update the 
Background Note concerned and suggested as much.  
6.53.   While reserving her delegation 's right to re vert to the proposals in the future, the 
representative of Cuba reiterated that there was no mandate to develop disciplines on market 
access under the Work Programme. Consumer protection and cybersecurity were dealt with in 
other specialised agencies of the UN, which were the appropriate fora to discuss such issues. A s 
for the suggestion that Trade Policy Reviews should include information on those matters, th e idea 
had already been proposed in the context of the TPR review and it had not made any progress .  
6.54.   Some of the proposals on the table included aspects on transp arency and trade facilitation 
that were burdensome, at times intrusive  and addressed regulatory issues that were not of a trade 
nature and went beyond the scope of the WTO. She also had some comments on the development 
aspects of the proposals. As to MSMEs , it would be useful to hear from interested Members how 
WTO rules could address issues related to enterprises, including , for instance, providing special 
treatment to those enterprises. In the General Council , Members had agreed that WTO work on 
MSMEs wou ld take place in an informal dialogue, outside the WTO formal structure. Therefore, the 
Council was not the appropriate forum to discuss those issues. On infrastructure gaps, the 
proposals on capacity building lagged behind, as capacity building  and financ ial assistance  were 
needed to help developing countries overcome the digital divide. Cybersecurity was clearly outside 
the scope of the WTO. Finally, as to whether e -commerce was a "new issue", it was evident that 
there was no consensus amongst Members on the matter. For Cuba, the proposals on the table 
went beyond the scope of the Work Programme, which contained an exploratory mandate, not a 
negotiating one. Therefore, to the extent that disciplines went beyond the current mandate, they 
would constitute "n ew issues ", while priority had to be given to the DDA negotiations. It was also 
necessary to deal with the growing digital divide, to help developing countries and LDCs take 
advantage of e -commerce opportunities, before developing any new disciplines.   
6.55.   The representative of the Russian Federation  indicated that the number of submissions on 
the table was a clear indication of Members' interest in e -commerce. Almost all papers had been 
submitted horizontally to all relevant WTO bodies tasked with the Work Pro gramme, which showed 
that e -commerce issues were of a cross -cutting nature. The papers presented in the CTS contained 
topics that were particularly interesting and were worth exploring further, such as consumer 
protection, spam, electronic authentication, e-signatures, personal data protection, e -payment 
systems and cybersecurity. However, those specific issues did not fall exclusively within the 
services context and might also relate to e -commerce in goods, IPRs and development issues. She 
reiterated her d elegation's view that such topics should be dealt with horizontally in a holistic 
manner by identifying cross -cutting issues and the proper way to discuss them substantively, 
including in the CTS.  
6.56.   The representative of Paraguay  said that, as co -sponsor of various communications on e -
commerce, his delegation supported carrying out informal consultations on future work, including 
on possible concrete outcomes at MC11.  
6.57.   The representative of the Republic of Korea  said that his deleg ation wished to see concrete 
and pragmatic outcomes on e -commerce at MC11. It was encouraging that Members had actively 
discussed the proposals tabled; Korea wished to build on those discussions to bring more focus on 
specific issues where an outcome could  be achieved at MC11. For example, Members might set a 
goal of upgrading the 1998 Work Programme, or aim for consensus on a small package of issues 
that they felt comfortable with. In that regard, Korea also welcomed Brazil 's suggestion for the S/C/M/132  
 
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  Chair to ho ld consultations on future work in the Council. Korea was willing to engage in 
discussions to achieve concrete outcomes in e -commerce at MC11.  
6.58.   The representative of Singapore  stated that the WTO had a role to play in continuing the 
conversation on e -commer ce and development, and particularly how to unlock the full potential of 
e-commerce for smaller players, including MSMEs. In the services context, that could include a 
discussion on facilitating the regulatory framework in the areas of e -payments, e -authen tication, 
the customs duty moratorium, regulatory cooperation and regulatory transparency. His delegation 
welcomed continuing to exchange information on domestic experiences and best practices under 
that agenda item in the CTS. Singapore also supported the  suggestion that the Chairman 
undertake informal consultations on the way forward.  
6.59.   The representative of South Africa , speaking on behalf of the African Group, said that the 
Group welcomed the fact that submissions had been tabled in the CTS, which was in accordance 
with paragraph 1.1 of the Work Programme, and had been most recently reaffirmed in 
paragraph  1 of the Nairobi Ministerial Decision.  
6.60.   She recalled that the African Group had approached the exploratory discussions under the 
Work Programme from a pe rspective that gave paramount importance to "the development 
implications of e -commerce, taking into account the economic, financial, and development needs 
of developing countries... ". The African Group was interested in an exchange of views and 
experience s on the basis of the current Work Programme. The Group believed that of immediate 
priority should be a fuller assessment of the wide -ranging disruptions that would result from the 
fourth industrial revolution, the growth of digital trade and e -commerce. A s Members embarked on 
those discussions under the Work Programme, the African Group wished to see the CTS take up 
issues that placed the needs of developing and least developed countries at the centre , especially 
the "challenges to and ways of enhancing th e participation of developing countries in electronic 
commerce, in particular as exporters of el ectronically delivered products, the  role of improved 
access to infrastructure and transfer of technology, and of movement of natural persons ". 
6.61.   In past meetings , the African Group had set out the issues that it thought should be taken 
up by the CTS. In addition to those, the African Group had deliberated on a number of issues 
emanating from the submissions on the table and had identified some critical areas of in terest to 
the Group for further consideration by the Membership. These included: the reality of increasing 
digital inequality; the importance of digital rights, now that data was the raw material of the digital 
economy, and that there was value embedded in  its control, management and flow; the extremely 
high market concentration levels existing in the current global e -commerce space, which was 
evident both in terms of how e -commerce trade was distributed across the global economy, and in 
terms of the number  of firms that dominated the space in terms of their capitalisation; the range 
of attempts at a national level to shape digital flows in order to influence trade and affect national 
digital catch -up. 
6.62.   Members could frame the discussion around measures that foster ed inclusion and equitable 
development for all developing and least developed countries. The Group reiterated its 
encouragement to Members to share their experiences on the specific policy, regulation, and 
measures they had used to derive benefit at the national level from greater participation in the 
evolution of global e -commerce. The Group would greatly benefit from a discussion of those issues 
as it explored policy options in response to the profound changes brought on by the so -called 
'Fourth Ind ustrial Revolution ' vis-à-vis Africa 's longstanding developmental objectives of industrial 
development, structural transformation and employment.  
6.63.   The representative reminded Members of the African Group statement delivered on 16 
March 2017, when it had said that, after listening carefully to the introduction of the submissions 
in the CTS, there were a number of issues that would be better suited for a discussion in the other 
relevant bodies, such as the CTD, CTG and TRIPS Council. Some of the  issues raised in some of 
the submissions fell outside the scope of the Work Programme or were being taken up extensively 
in other multilateral organisations. The Group therefore strongly urged the proponents to refine 
their proposals specific to the body where they wanted discussions to take place, as per the Work 
Programme. " 
6.64.   The representative of Uganda,  on behalf of the LDC Group, recalled the statement delivered 
at the March Council meeting, when he had welcomed the communication submitted by the S/C/M/132  
 
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  Europe an Union and co -sponsors, which had taken  into account the process  suggested  by the 
Group  during the Dedicated Discussion on e-commerce. In this regard, the LDC Group had 
suggested , inter alia , that submissions should be taken to the relevant bodies as set  out in 
paragraphs 2 to 5 of the Decision on the E -commerce Work Programme . Only once the discuss ions 
in the relevant bodies had  matured, they should be reported to the General Council.  The Nairobi 
Ministerial Declaration, in p aragraph 1, instructe d Member s to continue the work under the Work 
Programme  based on the existing mandate and guidelines and on the basis of proposals submitted 
by Members in the relevant WTO bod ies as set out in paragraphs 2 to  5 of the Work Programme. 
In addition, the General Counc il shall take up consideration of any trade related issue of a cross -
cutting nature . It was  also important to acknowledge the non-negotiating m andate es tablished in 
the Work Programme, which was  exploratory in nature.  
6.65.   He had only preliminary comments on t he proposal at that juncture. In the near two 
decades after the adoption of the Work Programme,  the digital divide for LDCs had  widened. The 
e-commerce  phenomenon, in theory, provided  a critical gateway for consumers and businesses in 
weaker countries , allowing them to surmount obstacles faced when competing domestically, and 
with enterprises in stronger markets  in the world trading system. However, in reality, most LDCs 
faced a number of constraints , due to insufficient basic infrastruc ture, inadequate access to 
electricity and the Internet , and high cost s of broadband c onnectivity, amongst others, as well as  
bottlenecks that hinder ed LDCs from taking advantage of opportunities theoretically available 
through e -commerce platforms.  
6.66.   Three things were critical for LDCs to be able to benefit from e -commerce: access, 
affordability and availability . In a ddressing these issues, it was  important to contextualize the LDC 
Group's situation. According to the  ITU "Facts and Figures" for 2016,  75% of the entire population 
in Africa was  offline. Only 20  million households in LDCs had  Internet access , out of 1 billion 
households in the world. While more t han 50% of the LDC population was covered by a mobile 
broad band signal, only 15% use d the I nternet. F ixed-broadband penetration remained  below 1% 
in Africa and among the LDCs; and only fi ve LDCs had achieved the target on affordability set by 
the Broad band Commission  on Sustainable Development. The rest could not  afford  it. 
Infrastructure and connectivity  were another major issue. By early 2016, total international 
Internet bandwidth had reached 185 '000 Gbit/s, up from 30'000 in 2008. Africa, which was home 
to two -thirds of LDCs, had  the lowest international conne ctivity of all regions: there was  twice as 
much bandwidth per inhabitant available in Asia and the Pacific, four times as much in the 
Commonwealth of Independent States region, eight times as much in the Americas and more than 
twenty times as much in Europe. Lack of international connectivity was  a major bottleneck in the 
Internet infrastructure of LDCs. Wit h this low penetration rate in I nternet use, LDCs would not be 
in a position to adequately take advantage of the benefits of e -commerce. Indeed , without 
meeting the basic requirements, many LDC e ntrepreneurs and consumers would  not be able to 
effectively participate in e -commerce and take advan tage of its benefits . The discussions under the 
Work Programme should therefore focus on over coming challenges that were  impeding L DCs from 
being e -commerce -ready, including, access to electricity,  access to digital  infrastructure, 
inadequate IT s kills, access to cheap and fast broa dband and technology transfer.  
6.67.   As a way forward, the LDC Group agreed with the African Group that most of t he 
submissions on the table were outside the scope and m andate of the Work Programme. Therefore, 
Members should  narrow their  submissions to  the issues specific to  each particular body; and in the 
event that this was not possible,  they should focus on the development -related aspects of the 
Work P rogram me, such as improved access to infrastructure, transfer of technology,  movement of 
natural persons and use of information technology in the integration of  developing countries. 
These were  issues at the heart of the digital divide  that needed to be resolved with the view to 
building LDCs' e-commerce readiness.  
6.68.   As Members might recall, the African Ministers of Trade , in their  Decla ration issued in 
November 2016, had directed that any work undertake n within the WTO should be consiste nt with 
the African Union's Agenda 2063 , with a view to structural transformation and i ndustrialization in 
building "The Africa we want ". Therefore , work in WTO had to complement , and not undermine, 
that Agenda. It was important to examine the implications  of e-commerce on the structural 
transformation and industrialisation of Africa, including the transforma tions to traditional 
production  and supply chains most devel oping countries were involved in, as well as  the impact on 
LDCs' domestic markets, manufact urers and service suppliers.  S/C/M/132  
 
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  6.69.   On the promise of technical assistance or aid for trade, it was important that M embers, 
especially the proponents , adopt an approach of consistency in message and practice. As LDCs had 
stated in July, there was no reconciliati on at all in that  endeavour.  All indications were that aid for 
trade was on a down ward trajectory and most of it went  to non -LDCs. In a seminar organised by 
the Friends of E -Commerce for Development in December 2016 , Members  had heard a harrowing 
tale from  the Secretary General of the I nternational Telecommunications Union (ITU). The ITU had  
a plan to connect 1.5  billion  people to the Internet  by 2020. This strategy required  USD 450  billion  
to be operationalize d. While the ITU had been trying to mobilise  the requisite resources, the 
Secretary General  had been told that there was no money. In  the ITU Secretary General's view, 
and LDCs agreed with him, unless people were connected, e -commerce would not benefit  them; it 
would be like playing music to  the deaf.  
6.70.   At that meeting of the Council, after associating with the statement by South Africa on 
behalf of the African Group, he highlighted that t he starting point for discussions was the 1998 
Work Programme , which  allowed Members sufficient space to have an exte nsive and exhaustive 
discussion on e -commerce.  The Work Program me had no negotiating mandate and was only 
exploratory in nature.  
6.71.   The e -commerce phenomenon, in theory, provided a critical gateway for consumers and 
businesses in weaker countries, allowing th em to surmount obstacles faced when competing 
domestically, and with enterprises in stronger players, in the trading system. However, in reality, 
most LDCs faced a number of constraints due to insufficient basic infrastructure and access to 
electricity, In ternet, high cost of broadband connectivity, amongst others, and bottlenecks that 
hindered LDCs from taking advantage of opportunities theoretically available through the e -
commerce platforms.  
6.72.   During the previous few weeks, the Group had benefitted from d iscussions in seminars 
organised by different agencies. It had also become apparent that there were Members, including 
developing countries, that had generated a lot of revenue from the enterprise. What had not been 
clearly spel led out, however, was the ki nd of domestic regulatory policy frameworks that had been 
adopted by those countries, especially developing countries, which  had afforded their domestic 
industries the requisite policy space, and protection, to grow and thrive until such a time that they 
had become strong, emerging and dominant players. It was therefore necessary for LDCs to 
request that major players share their experience on the kind of digital industrial policies that they 
had put in place that, inter alia, had helped guarantee their dig ital rights and ensured their current 
prosperity.  
6.73.   As a way forward, as previously stated , most of the submissions on the table fell outside the 
scope and mandate of the Work Programme. LDCs therefore requested, and suggested, subject to 
further consultati on with the LDCs Group, that Members narrow their submissions to issues specific 
to each particular body. In the event that this was not possible, the proponents should focus on 
the development -related aspects of the Work Programme, with a view to examinin g improved 
access to infrastructure, transfer of technology, the movement of natural persons and the use of 
information technology in the integration of developing countries. These were the issues at the 
heart of the digital divide that had to be resolved in order to build LDCs ' e-commerce readiness. In 
the meantime, the Group would also support informal consultations by the Chairman on how to 
continue the CTS work on the basis of the 1998 Work Programme.  
6.74.   The representative of Cameroon  indicated that the i ssues discussed were extremely 
important for all countries and for international trade as a whole, as well as for his own delegation. 
His delegation  aligned itself with the statement of the African Group and expressed its support for 
the statement s of the LDC Group and Cuba. Discussions on e -commerce had to be undertaken 
based on rules and a mandate that were well known and clear, namely in an exploratory fashion. 
If Members wished to undertake a discussion to arrive at an agreement, at new rules for Buenos  
Aires, that was going to take a lot more time.  Members had a very clear mandate and their 
discussions should take place under that exploratory mandate; this would pave the way to think 
about what might come afterwards, which might even include an agreemen t. Instead, discussing 
an agenda immediately was not a fruitful avenue.  
6.75.   For his delegation, an important subject to be discussed was the digital gap. The WTO 
Director -General, in his statement at the meeting of Friends of E -Commerce for Development, had 
said that half of the world population did not have access to the Internet. Against that background,  S/C/M/132  
 
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  what trade were Members going to discuss with that half of the world? What disciplines were going 
to be relevant if there was no connectivity? With any new disciplines, Members would be exceeding 
the mandate conferred to them and would be rendering the WTO less credible.   
6.76.   As for the way forward, Chile had proposed that the 1998 Secretariat Background Note be 
updated. He believed the suggestion to be very impo rtant, because the Note had been around for 
a long time, and the Secretariat would probably have some new information to present to 
Members that would clarify the situation with regard to global e -commerce, such as the  ITU's 
reports. He therefore supported  the suggestion to update the Secretariat Note. As to the 
suggestion that the Chair hold informal consultations, his delegation was also supportive, as 
consultations might allow for some progress. Regardless of how the consultations were organised, 
he unde rscored that they should remain text -based, as Members ' discussions should be structured 
on the basis of text and rules that had been agreed upon.   
6.77.   The representative of the United States  said that his delegation had ambitions for e -
commerce work in the WTO, which comprised the importance of ensuring free data flows across 
borders, preventing discriminatory or unnecessarily restrictive requirements on the location of 
computer facilities an d avoiding customs duties on electronic transmissions, including digital 
products.  
6.78.   He echoed concerns raised by other delegations that discussing the same proposals in 
various fora was not the most effective way of identifying areas of convergence among M embers. 
The cross -cutting venue had been deemed unacceptable because of the specificities of the 
proposals, but at the same time, the specific bodies were being criticised for discussing cross -
cutting issues. Members could take advice from the delegate of Rwanda, who had said in a 
previous meeting that engaging in a process was to legitimise it, and probably Members did not 
want to do that.  
6.79.   His delegation would welcome finding a process that gave comfort to Members in the CTS to 
advance common goals. It wa s clear for many Members that the digital reality would continue to 
advance, regardless of where they were situated in the world economy. He appreciated that the 
African Group had clearly identified what it wanted to see addressed in the Council; he would ask 
whether there was any space within that for the desires and priorities of other Members. Members 
had heard of several elements of interest, and it was debatable whether all of them would end up 
in the WTO, such as, in particular, the interest in compet ition policy. Members could make 
progress on finding some common ground if everyone's rigidities were relaxed a bit. His 
delegation's assessment of the conversations was that the timeline to find areas of convergence 
went long beyond MC11. Members should r eassess what to focus on for the Ministerial, while 
looking well beyond that.    
6.80.   The representative of Kenya  expressed his delegation 's appreciation for the discussions 
Members were having in the Council on the basis of the current mandate of the Work Progr amme. 
The experiences that some delegations had shared on various aspects of e -commerce had been 
helpful in deepening Members ' understanding, particularly on the trade -related aspects of e -
commerce. Kenya was also contemplating sharing its experience and c hallenges with regard to e -
commerce at an appropriate time in the future. As for next steps, his delegation was ready to 
engage in consultations on how to structure the Council 's work on the basis of the existing 
mandate of the Work Programme. As for discu ssions beyond the current mandate , looking at 
MC11, it was his delegation 's view that such discussions would have to be carried out on the basis 
of a political decision to be taken elsewhere.  
6.81.   The representative of Uruguay  said that her delegation welcomed  the strong support for e -
commerce in the WTO, and considered that the contribution made by ASEAN very interesting, as it 
highlighted the importance of having disciplines on e -commerce to help MSMEs in developing 
countries. Uruguay, as member of the Friend s of E -commerce for Development, was convinced of 
the potential of e -commerce for development and supported updating the 1998 Secretariat 
Background Note. Her delegation stood ready to work towards achieving concrete results at MC11. 
She supported the idea  of the Chairman holding informal consultations with the aim of starting 
substantive discussions on the proposals on the table that addressed issues that were of interest 
to her delegation.  S/C/M/132  
 
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  6.82.   The representative of Peru said that the WTO was the appropriate f orum to discuss issues 
that could restrict trade in services, and particularly e -commerce. E -commerce was especially 
relevant for developing countries, wh ose firms often could not supply services under mode 3 and 
for whom, therefore, the supply of services  under mode 1 was very important. Besides, investors 
also benefitted from cross -border trade in services. It was important to address the digital divide, 
which referred not only to infrastructure but also regulatory issues, a nd to discuss how different 
Members were dealing with regulatory matters. In its RTAs, Peru had included e -commerce 
chapters that had encouraged the development of a regulatory framework to safeguard e -
commerce. While the CTS might not be the only forum to address e -commerce matters, it  was 
important to discuss the issue in the Council. It was because of  the exploratory nature of the 
debate that Members should be open to discussing e -commerce issues that might be relevant at 
that moment, with the view of achieving consensus in the future . 
6.83.   The representative of Colombia  expressed his delegation 's support for e -commerce 
discussions, particularly for the reasons that had been mentioned by the Philippines and by Costa 
Rica. He agreed that the different submissions and the fruitful discussions  that had taken place in 
the Council and other bodies  had shown the existence of cross -cutting topics that required 
horizontal consideration to arrive to concrete outcomes in the future. His delegation supported the 
suggestion made by Chile to update the 1 998 Secretariat Note, as well as the suggestion for the 
Chairman to hold informal consultations on the way forward.    
6.84.   The representative of the Bolivarian Republic of Venezuela  said that she only had 
preliminary comments at that stage, as the proposals continued to be reviewed in capital , together 
with other documents and events on the subject, and reserved her delegation's right to revert to 
the discussion. E -commerce was a wide -ranging and complex matter, for which not all Members 
were prepared on equa l terms. Therefore, it was important to act with caution, within the scope of 
the Work Programme, and take a development perspective, as a means of addressing the digital 
divide. Her delegation was firmly against discussing topics related to e -commerce gov ernance that 
went beyond the scope of the existing WTO Agreements. The WTO was a negotiating forum and 
not a forum for "exploring" subjects. Before negotiating, all Members should be equally able to 
take part in the digital revolution.  
6.85.   The representative o f Zimbabwe  echoed the statements made by South Africa on behalf of 
the Africa n Group, Uganda on behalf of the LDC  Group , Cuba, Bolivia, Cameroon, Kenya and 
Venezuela.  She underscored the importance of exchanging information in line with the mandate of 
the Work Programme, which was to examine and report the development implications of e -
commerce , taking into account the economic, financial, and development needs of devel oping 
countries.  
6.86.   Members should avoid discussing internet governance issues, which were currently high on 
the agenda  of other international organisations such as the ITU, WSIS and others. The WSIS had 
had its 2017 forum that week and had addressed, amongs t the key issues discussed, how to build 
trust in order to change internet users ' perceptions and increase their awareness and 
understanding of the risks and opportunities of the Internet, data privacy and security, 
safeguarding personal identity by use of  e-signatures and encryptions. WSIS discussions had 
acknowledged that data was important and was becoming the most important asset. Against this 
background, it was essential that developing countries had the policy space to store their own data 
locally and  had the capacity to develop platforms, and not just a few. WSIS had also acknowledged 
that some of the major challenges that Africa faced regarding connectivity were energy shortages 
and access to the connectivity grid . Zimbabwe was concerned that the dig ital divide between 
developed and developing countries continued to grow as the digital economy expanded and 
discussions should therefore focus on how to increase capabilities and bridge the digital divide.  
6.87.   In line with the Work Programme, she called on Me mbers to discuss transfer of technology 
to developing countries, improvements in infrastructure, how to promote the development of 
digital industrial policies in developing countries, how to address the extremely high market 
concentration in global e -comme rce and classification issues. She called upon the sponsors of the 
proposals to streamline their papers in line with the mandate of the Work Programme for each of 
the relevant Committees. Elements that we nt beyond the scope of the GATS legal framework or o f 
the mandate of the Work Programme should not be included in the proposals.  S/C/M/132  
 
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  6.88.   The representative of Swaziland  echoed the statements made by South Africa and Uganda, 
inter alia. There was no mandate for e -commerce in the GATS, including under Article XVIII.  
Furthermore, h e could not agree with some Members ' suggestion to update the 1998 Secretariat 
Note. That Note had looked at e -commerce under the GATS legal framework ; as nothing had 
changed in the GATS legal framework, it was difficult to imagine what an up dated Note would 
discuss .  
6.89.   The representative of Ghana  associated his delegation with the statement delivered by 
South Africa on behalf of the African Group, to which he wished to add a few points. He reiterated 
that discussions on e -commerce should be bas ed on the existing mandate only. As the Work 
Programme was only exploratory, it would be premature to discuss any rule -making, as some 
proponents had suggested.  Creating binding rules on an emerging and dynamic area such as e -
commerce, and doing so as earl y as at MC11, would be contrary to the mandate and be too 
burdensome for developing countries like his own. In th at regard, he supported the suggestion for 
Members that had developed their digital economy to share their digital industrial policy 
experience s with other Members who had not yet developed it and were still struggling with 
problems such as lack of electricity, inadequate access to computers, lack of access to the 
Internet, no postal delivery to home addresses and lack of access to infrastructure  such as 
transportation. He also agreed with those delegations which had said that some of the issues 
raised did not fall under the ambit of the WTO and were being handled by other competent UN 
bodies, which should be allowed to do their job. In the face o f the apparent threat to data 
protection and privacy, as well as the danger of invading countries ' policy space by requiring new 
rules, his delegation reiterated the African Group's position that Members should concentrate 
efforts on issues that addressed Africa's long standing objectives of industrial development , 
structural transformation and economic diversification.  
6.90.   The representative of Turkey  said that, regardless of whether e -commerce was a priority or 
not for a country, its importance and impact in  today's economy was a reality. E -commerce was 
being discussed by academics, business representatives, policy -makers, and studied by many 
international organisations. Discussions on e -commerce in the WTO were inevitable and the 
Organisation could not affor d to be left behind; the WTO was the right forum to develop standards, 
disciplines and provisions governing e -commerce.  
6.91.   The paper co -sponsored by her delegation (JOB/SERV/248 /Rev.2 ) comprehensively outlined 
e-commerce -related issues, which had been already dealt with in RTAs. The fact that those issues 
had not been addressed in the WTO had created a growing set of different rules and disciplines 
that was getting harder to navigate. The mapping in the submission was useful for Members to 
consider all the elements before they start ed discussing them one by one, focusing on the least 
controversial ones. In her delegation's view, issues such as data transfers, data localisation and 
access to source -code were more pressing, but at the same time more contro versial. Instead, 
consumer protection, building consumer confidence and authentication issues could be good 
starting point s for discussion.  
6.92.   Turkey recognised e -commerce as a way for MSMEs to integrate in world trade and to 
promote growth, particularly in developing countries. Another paper co -sponsored by Turkey 
(JOB/SERV/249) reflected her delegation's ideas on e -commerce for development.  While the paper 
focused on the linkage s between e -commerce and development, it was relevant both for 
developing and de veloped countries. Indeed, many issues, such as online security payment 
solutions, logistics, trade facilitation of goods traded electronically, had also been identified as 
priority issues in other papers submitted to the Council. The fact that the submiss ion focused on 
development and complemented other  submissions made it relevant. Her  delegation looked 
forward to receiving feedback from Members on what should be prioritised in e -commerce 
discussions, from a development perspective and especially with a v iew of facilitating the 
integration of MSMEs.  
6.93.   The representative of India said that his delegation saw value in discussions in the Council, 
not only procedurally but also substantively. He thanked China for sharing its experience and for 
stressing the impo rtance of existing mandates and the development dimension. As Uganda had 
said, sharing national experiences with digital industrial policies might be useful to understand the 
challenges ahead. Several proposals had reiterated the importance and continued r elevance of the 
Work Programme in Members ' current discussions; India agreed that, 18 years later, the original 
Work Programme remained relevant. In Nairobi, Ministers had committed to continue work based S/C/M/132  
 
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  on existing mandates and guidelines. The representa tive stressed that the Work Programme had 
an exploratory, non -negotiating mandate.  
6.94.    He reiterated that e -commerce was becoming a major driving force of international 
economic activity, including international trade. E -commerce in India was transforming the  way 
business was done and was one of the fastest growing segments, having witnessed exponential 
growth over the last few years. However, as with any new emerging area of technology, the 
regulatory frameworks and institutions were still at an evolutionary stage.  Therefore, India saw 
great value in continuing to discuss proposals in the CTS, particularly on the relation between e -
commerce and the GATS framework, and would continue to engage in the Council on all the 
proposals. As for future work, he agreed t hat informal consultations would be useful at that stage.  
6.95.   The Chairman  thanked all delegations that had made submissions and also those that had 
taken the floor for their comments. The discussion had been rich and useful. A number of issues 
had been raised  on which Members might wish to reflect further. In terms of possible ways 
forward, many delegations had suggested that informal consultations could be held. He therefore 
proposed to organise such consultations, and suggested that the Council take note of all 
statements made and revert to the item at its next meeting.  
6.96.   It was so agreed . 
6.3  Thematic Seminar on e -commerce  
6.97.   The Chairman  recalled that, at the March meeting, the Council had agreed to hold the 
thematic seminar on e -commerce, as well as the proposed th ematic seminar on mode 4, and had 
tasked the Secretariat with the preparation of a draft programme.  On 13 April, the Secretariat had 
circulated its draft programme for the e -commerce seminar to all Members for any comments.  The 
relevant document was JOB/SE RV/256.  However, as delegations had  been informed via the fax 
dated 9 May, by the deadline of 25 April the Secretariat had received comments from some 
delegations, on the basis of which consultations were held with the Secretariat.  Following those 
consulta tions, it was concluded that, given the nature of the comments, there was a need for 
Members to revert to the draft programme collegially, in the Council, for further discussion to 
consider the comments. Accordingly, the Secretariat draft programme, in JOB /SERV/256, had 
been reinstated on the agenda of that meeting.  
6.98.   The representative of the United States  suggested that, in the interest of time, for that 
agenda item and the following one, which were both related to thematic seminars, the Chairman 
hold informal consultations on the way forward, given that the topics had already been discussed 
at length in the Council.  
6.99.   The representative of Canada  supported the US suggestion and indicate d his readiness  to 
participate in any consultations on the two seminars.  
6.100.   The representative of South Africa  said that her delegation was one of the Members who 
had submitted comments in writing as well as orally at two prior meetings. She could agree to t he 
US suggestion and was ready to take part in consultations to find the best way forward.  
6.101.   The representative of Uganda  said that, as one of the delegations that had submitted 
written comments within the deadline, he could agree to consultations and was r eady to 
participate.   
6.102.   The representative of the Plurinational State of Bolivia  said that his delegation had also 
submitted comments and could agree with the suggestion to have informal consultations on the 
matter.   
6.103.   The representative of Cameroon  said that his delegation had not submitted any comments 
but wished to participate in the consultations.  
6.104.   The representative of Chinese Taipei  echoed the proposal for the Chairman to hold 
informal consultations to find a way forward.  S/C/M/132  
 
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  6.105.   The representative of India also supported previous statements in favour of having  
informal consultations.  
6.106.   The Chairman  thanked all delegations that had submitted contributions and those who had 
participated in the debate. Given that delegations seemed to agree on the usefulness of havin g 
consultations, he would organise such informal consultations.  
6.107.   It was so agreed . 
6.108.   The Chairman  recalled that the Nairobi Ministerial Decision on the Work Programme on 
Electronic Commerce (document WT/L/977), instructed the General Council to periodically review 
progress with the Work Programme, based on the reports that might be submitted by the WTO 
bodies entrusted with the implementation of the Work Programme. The next such review was 
scheduled for July. Therefore, in line with past practice, he would be  producing, under his own 
responsibility, a Chairman's Report to the General Council of the discussions the Council had had 
under the Work Programme since December 2016. The report would be purely factual, reflecting 
the essence of Members' deliberations a t that meeting and back in March.  
6.109.   It was so agreed . 
7  ITEM G – MODE 4 – ASSESSMENT OF BARRIE RS TO ENTRY  
7.1.  The Chairman  suggested that, in light of what had been agreed under the previous agenda 
item, the thematic seminar on mode 4 be addressed as part of his informal consultations.  
7.2.  It was so agreed . 
8  ITEM H – FOURTH REVIEW OF MFN  EXEMPTIONS – DETERMINATION OF THE  DATE OF 
ANY FURTHER REVIEW  
8.1.  The Chairman  recalled that, on 17 March, the Council had held a meeting dedicated to the 
fourth review of Article II (MFN) exemptions.  At the end of that meeting, it had been decided that 
discussions under the review would continue under an item on the Council's agend a, rather than in 
dedicated meetings.  Hence, agenda item H on the agenda addressed the review of MFN 
exemptions.   
8.2.  Paragraph 4 of the Annex on MFN Exemptions called on the Council, in a review, to: examine 
whether the conditions which had created the need f or the exemptions still prevail ed; and to 
determine the date of any further review. At the March meeting, the Council had carried out the 
first part of the mandate.  Members had examined all the MFN exemptions listed, on the basis of 
written questions that had been circulated in advance by Hong Kong, China and co -sponsors (in 
document S/C/W/370/Rev.1) and by Australia (document S/C/W/371).   
8.3.  Turning to the second part of the Council's mandate for the review, i.e. to determine "the 
date of any further review ", he recalled that, although in March some initial views on the issue had 
been put forward and discussed, it had been agreed to continue discussions at th at meeting.   
8.4.  The representative of Hong Kong, China  welcomed the opportunity to revert to the MFN 
Exemp tion Review subsequent to the dedicated session held in March 2017, and thanked Members 
for their constructive participation in the Review and co -sponsors ' support, and the Secretariat for 
their efforts in preparing the Review.  
8.5.  His delegation appreciated M embers ' replies to its questions in the dedicated session, and 
thanked particularly those Members who had indicated that some of their exemptions were no 
longer needed or already under internal review. He encouraged those Members to take further 
steps to w ork towards the elimination of those exemptions.   
8.6.  With regard to the reasons provided by a number of Members for maintaining their 
exemptions, some had helped understand better those exemptions and the reasons why they 
needed to  be maintained. Nevertheless , whether those reasons could really justify the deviation 
from the MFN principle for such a prolonged period of time was a question. Indeed, Hong Kong, S/C/M/132  
 
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  China believed that the conditions for invoking some exemptions no longer prevail ed. For example, 
the fact that relevant measures had not been put into use could already reflect that the conditions 
for creating the exemptions might no longer exist. His delegation was also disappointed that some 
answers had not fully elaborated on the reasons for maintaining  the exemptions.  
8.7.  The MFN principle was the cornerstone of the multilateral trading system; any deviations 
were not meant to last forever and should be taken seriously. According to the GATS framework, 
MFN exemptions were squarely one -off, time -limited and  subject to review. This reflected the 
transitional and exceptional nature of MFN exemptions. Hong Kong, China called on Members to  
regularly and critically review their scheduled exemptions to ensure non -discriminatory trade 
among WTO Members, especially as many of the exemptions had already been maintained for 
more than 20 years and the factors and circumstances which had necessitated their listing in the 
first place might no longer be relevant with the lapse of such a long period of time.  
8.8.  Turning to the next review, two elements in the Annex on Article II Exemptions were 
relevant: paragraph 3, which stated that "the Council for Trade in Services shall review all 
exemptions granted for a period of more than five years ", and paragraph 6, which stated that "in 
principle, such exemptions should not exceed a period of 10 years ". It was a clear goal under the 
GATS to abolish all MFN exemptions by way of trade liberalisation, and all exemptions granted for 
a period of more than 5 years were subject to review.   
8.9.  In fact, apart from the vast number of exemptions covered in that review, quite a number of 
"new" exemptions, i.e. those reaching the 5 -year timeline, could be caught by the next review.  
According to the statistical information on MFN exemptions compiled by the Secretariat in 
JOB/SERV/31/Rev.1, such "new" exemptions would come from 11 newly acceded members 
representing over 10% of all existing exemptions.  
8.10.   Hong Kong, China was certainly disappointed by the consistent lack of progress in reducing 
the number of  MFN exemptions over the last two decades. For his delegation, it was precisely for 
that reason that further reviews were essential and should continue to be carried out, so that 
Members had an opportunity to gather together to critically examine whether the conditions 
creating the need for those exemptions still existed. The only situation w here there would not be a 
need for another review was when all exemptions had been terminated.  
8.11.   Hence, as mentioned in the dedicated session, Hong Kong, China considered that further 
reviews were necessary and proposed that the next review be held no later  than five years from 
the present one, i.e. by 2022. As regarded the format, his delegation was flexible and open -
minded on any suggestions by Members. What was important was that the review could contribute 
to the ultimate goal of eliminating MFN exemptio ns. 
8.12.   Having said that, at the dedicated session his delegation had heard the suggestion that the 
CTS could agree to discuss in five years ' time whether to hold another review, instead of agreeing 
already at that juncture that a new review be conducted in 20 22. In other words, under that 
proposal, the CTS would have an obligation to discuss in 2022 whether and when to have another 
review. Hong Kong, China was a demandeur when it came to the review of MFN exemptions, but 
they were also pragmatic. If Members co nverge d on that suggestion, his delegation would not 
stand in the way  of consensus .  
8.13.   Echoing the statement by Hong Kong, China, the representative of China  called on Members 
to live up to the letter and spirit of the GATS and endeavour to eliminate in a ti mely manner those 
MFN exemptions that were no longer necessary. He supported Hong Kong, China 's suggestion for 
the CTS to decide the date of the next review in 2022.  
8.14.   The representative of the Republic of Korea  reaffirmed that MFN was one of the 
fundamental  principles of the multilateral trading system; as such, MFN exemptions should be 
exceptional and transitional, and granted only under specific conditions. The review process was 
necessary to ensure the eventual elimination of MFN exemption measures when t he conditions 
which had created the need to list them no longer prevailed. In terms of the date of the next 
review, Korea echoed Hong Kong, China 's comment: if Members reached consensus on discussing 
the date of the next review in 2022, then Korea could go  along with that consensus.  S/C/M/132  
 
- 30 - 
 
  8.15.   The representatives of Canada  and Chinese Taipei  said that could go along with Hong Kong, 
China 's compromise suggestion. The representative of the United States  recalled his delegation 's 
argument that Members needed to maintain flexibility in setting the timing of the next review and 
should not agree to a date certain ; as such, he could agree with the suggestion that the Council 
reconvene in 2022 to decide on the date of the next review.  
8.16.   The representative of Oman  echoed the sta tement made by Hong Kong, China on the 
importance of eliminating MFN exemptions when the conditions that had required their listing no 
longer prevailed and also support ed having the next MFN exemption review in 2022.   
8.17.   The representative of the European Union  expressed his delegation 's support for the Council 
reconvening in 2022 to decide on the date of a next review.  
8.18.   The representative of Australia  supported the statement of Hong Kong, China. MFN was a 
core WTO principle and her delegation wished to see the next review scheduled for 2022.  
However, she could also be flexible and agree to reconven e within five years to decide the date of 
the next review.  
8.19.   Similarly to previous speakers, the representative of Switzerland  saw a lot of value in 
having MFN exemp tion reviews on a regular basis, as had been common practice in the past based 
on the GATS; this would mean holding the next review in 2022.   
8.20.   The representative of Norway  thanked Hong Kong, China for its hard work in preparing the 
March dedicated session o n the review as well as the observations it had just shared. Her 
delegation was in favour of deciding at that meeting on the date of the next MFN review, namely 
agreeing to hold it in 2022.   
8.21.   The Chairman  summarised that two proposals had been put forward : the first was to hold 
the next review in 2022; the second  was to meet in 2022 to decide when to hold the next review.  
8.22.   The representative of Australia  suggested that the second proposal be recast as the Council 
agreeing to meet within five years, i.e. befo re five years had elapsed from that day. In response, 
the representative of the United States  said that 'within five years ' would not work as it could 
imply a timing as early as the following week. If Members were suggesting a shorter timeframe to 
decide o n the date of the next review, then his delegation would want to add a criterion of there 
being ongoing market access negotiations at that juncture. Absent ongoing market access 
negotiations, he did not see the need for another review.  
8.23.   The representative of Brazil  proposed that Members meet in March 2022 to decide if they 
wanted to have another review before July 2022, for instance. The representative of China  
suggested rather that Members agree that the Council would decide at the first meeting of 2022 
the date of the next review.  
8.24.   The Chairman  said that the Council would take note of the statements made and suggested  
that the Council agree to reconvene to decide on the date of the next review at its first meeting of 
2022.  
8.25.   It was so agreed . 
9  ITEM I – OTHER  BUSINESS  
9.1.  The representative of the Republic of Korea  wished to update the Membership on the current 
situation regarding China 's trade -restrictive measures in tourism and distribution services, an  issue 
that his delegation had already raised under "other b usiness " at the previous meeting of the 
Council in March.   
9.2.  Korea believed that the measures of the Chinese government, which were inconsistent with 
the MFN, National Treatment and Market Access disciplines of the GATS, still existed. The Korean 
Government was making an effort to solve the issue bilaterally with the Chinese Government and 
hoped that the issue would be settled amicably as soon as possible.  However, if no progress was S/C/M/132  
 
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  made on the current situation, Korea planned to bring up the issue as an off icial agenda item at 
the following meeting of the Council.  
9.3.  The representative of the United States  thanked Korea for its update on the issue. If China 
was indeed restricting the sale of tourist packages to another WTO Member, it would be an issue of 
concer n, particularly given China's mode 1 and mode 2 commitments in the sector. Obviously, 
such a measure would mostly affect Korea, but it would also affect any WTO Member whose 
suppliers were invested in Korea or providing cross -border services that benefitte d from travel and 
tourism between the two countries, such as hotels, airlines or travel agencies. In addition, while 
Korea might be the target of such a measure at that moment, any Member could be the target of a 
similar measure in the future; it was there fore important for all Members to understand the basis 
of the restriction s, and how China justified them in the context of its trade commitments.  
9.4.  The representative of Japan  thanked Korea for bringing the issue to the attention of the 
Council; his delegati on had taken careful note of the remarks made. Japan had a strong interest in 
the matter, which had been reported on major media outlets in Japan. Japan was concerned, from 
a systemic viewpoint, that China's restrictive measures in tourism and distribution  services could 
be inconsistent with China's existing obligations under the GATS. His delegation was interested in 
knowing more about the development of the matter and welcomed more information and 
explanation from Korea and China at future meetings of the  Council.  
9.5.  The representative of China  referred the Korean delegation to China 's intervention under 
"other business " at the last CTS meeting. Following that meeting, upon the request of Korea, his 
delegation, in the spirit of transparency, had met with the Korean delegation both in Beijing and in 
Geneva and had reiterated China 's position. China was not aware of the existence of the 
"measures " mentioned by Korea, and regretted that Korea had raised the issue under "other 
business " once again.  
9.6.  The Chairman  said that the Council would take note of the statements made.  
9.7.  Turning to the second issue of other business, the representative of Japan  said that, in view 
of the fact that the Council on Trade in Services had the function of monitoring the operation of 
the GATS, his delegation wished to register its strong interest and concern regarding China 's 
Cybersecurity Law, enacted on 1 June 2017.  
9.8.  Japan had been paying attention to China 's recent legislative activity on the Internet and 
cybersecurity. Japan had grave concerns that the new Law, and the contents of related legislation 
that China intended to enforce, could prevent the free flow of data, hinder foreign suppliers from 
entering China 's market, and potentially lead to information technology being leaked.  
9.9.  Japan had taken every opportunity to express its concerns, including by submitting its public 
comments in 2015 and 2016 to make its concerns known. In particular, as "critical information 
infrastructure " was not clearly identified and could come under many different service sectors, 
Japan considered that some services would be covered by the national treatment commitments 
made by China under the GATS. In this connection, as Japan had repeatedly pointed ou t to China 
in its public comments, if, in practical terms, foreign suppliers could not operate on the same level 
playing field as China 's domestic suppliers as a result of Article 37 of the Cybersecurity Law, this 
would be inconsistent with China 's existin g obligations under GATS Article XVII on National 
Treatment.  
9.10.   In response to Japan 's concerns so far, China had explained to that the Law would not 
cause any difficulties when foreign enterprises pursue d an investment or business venture in 
China. Therefore , Japan hoped that it would indeed not cause any practical difficulties and urged 
China to ensure that its enforcement of the Cybersecurity Law and all other relevant legislations 
was fully consistent with China 's WTO and other multilateral and bilateral t rade commitments, 
including under the GATS.  
9.11.   The representative of the United States  said that he appreciated Japan raising China 's 
cybersecurity measures as an item of concern with respect to services. His delegation 's shared 
concerns started with the rece ntly-enacted Cybersecurity Law and included CAC's network S/C/M/132  
 
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  products and services security review measures. The United States also continued to engage with 
China on a range of draft implementing measures, both sectoral and cross -cutting.  
9.12.   Given the breadth of  measures and their impact on foreign service suppliers, including for 
cross-border services, as well as for commercial presence, the United States believed that the 
issue might be appropriately discussed as an own agenda item at the following CTS meeting,  by 
which time his delegation hoped that China could be prepared to answer Members ' questions.  In 
that spirit, he wondered if China would be in a position to notify recent measures that most 
affected foreign service suppliers, consistent with the GATS tran sparency provisions, including 
those that implicated Article V(c) of the Telecommunications Annex affecting cross -border 
movement of data.  
9.13.   The representative of the Republic of Korea  thanked Japan for the information and indicated 
that his delegation was a lso interested in the issue and would be paying close attention to the 
enforcement of China's Cybersecurity Law.  
9.14.   The representative of Australia  thanked Japan for raising the issue in the CTS and other 
Members for their statements. Her delegation welcomed  Members raising issues that were relevant 
to trade in services in the CTS, as discussion of such measures was an important transparency 
function of the Council. Australia had an interest in discussing China 's Cybersecurity Law further, 
given its effect on  trade in services, and encouraged Members wishing to discuss such measures to 
put them on the formal agenda of the Co uncil so that they could be substantively discussed.  
9.15.   The representative of China  said that, in the Internet age, the economy and society o f WTO 
Members hinged heavily on the information network, and cybersecurity was a common challenge 
for all Members. Safeguarding cybersecurity to ensure national security and protect the immediate 
interests of the general public was critically important and  a legitimate regulatory right that any 
Member was entitled to.  
9.16.   China formulated its cybersecurity related laws and regulations with the exact purpose of 
guaranteeing cybersecurity and information security, in a manner compliant with international 
practice . China had in place relevant institutional arrangements for public comment on laws and 
regulations, among other transparency requirements, and the drafting process of the legislation at 
issue had been open and transparent. In this regard, he noted the poi nt made by the Japanese 
delegation that, in response to Japan 's public comments, the Chinese side had already provided 
replies.  
9.17.   In the formulation of its cybersecurity review system, China had drawn upon the practice of 
other WTO Members. The review was no t targeted at any particular country or region, nor did it 
differentiate among countries or regions. There was no such issue as discrimination.  
9.18.   The representative of Chinese Taipei  thanked Japan for bringing the issue to the attention of 
the Council. Her d elegation believed that the measure at issue might make it harder to do business 
by increasing costs and creating unnecessary barriers for foreign companies. Chinese Taipei 
concurred with Japan and other Members and noted that reciprocally equal access was  indeed 
important to ensur e fair trade opportunit ies over the Internet. Furthermore, the Internet was 
particularly important to MSMEs, as Internet access was crucial to being seen by potential buyers. 
Her delegation would welcome more information about the  details of the measure at the following 
meeting.  
9.19.   The Chairman  said that the Council would take note of the statements made.  
9.20.   The representative of Qatar  expressed its profound regret regarding actions taken earlier 
that month by three members: the Kingdom of Saudi Arabia, the United Arab Emirates and the 
Kingdom of Bahrain. Those actions included numerous measures that prejudiced Qatar 's WTO 
rights in rel ation to trade in services. The measures were unexpected, unannounced and 
unnecessary. They appeared to give rise to numerous violations of the GATS. The measures, and 
the manner in which they had been imposed, should be of grave concern to all Members.    
9.21.   The relevant measures included bans on the ability of Qatari nationals to travel to , and 
remain in the territories of , the three Members concerned in order to provide services. In addition,  S/C/M/132  
 
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  they included bans on the supply of digital services from Qatar to  consumers in the Members 
concerned. And they also comprised prohibitions on nationals of those countries to travel to , and 
remain in , Qatar in order to consume services. The measures thus imposed strict limitations to or 
blocked market access for Qatari s ervices and service suppliers. They prevented the supply of 
services in a variety of services sectors, ranging from transportation, tourism, communication 
services to financial services.  
9.22.   Qatar reminded the Members concerned that they were bound by the obl igations contained 
in the GATS. They also had to abide by the specific commitments that they had made. The severe 
restrictions directed, in a discriminatory manner, towards services and service suppliers of Qatar 
evidently failed to accord with the GATS ob ligations of the Members concerned.  
9.23.   Against that background, his delegation wished to pose the following two questions to the 
respective delegations of Saudi Arabia, the UAE and Bahrain. First, how did the respective 
delegations consider that their measur es could be reconciled with their obligations and specific 
commitments under the GATS? Second, when would those measures of general application be 
properly published in accordance with the GATS? He added that , since the item had been brought 
up late, his d elegation would be willing to review the replies in written format  should that be 
necessary.  
9.24.   In closing, Qatar emphasised that it reserved all of its rights under the WTO Agreements.  
9.25.   The representative of  the Kingdom of S audi Arabia , speaking on its behalf  as well as on 
behalf of the Kingdom of Bahrain and the United Arab Emirates, said that they had taken the 
measures at issue in a manner that did not contradict WTO Agreements and had exercised their 
sovereign rights in the case of emergency and internatio nal relations with any Member to limit 
actions that would affect their countries' essential security interests.  
9.26.   The representative of Turkey  expressed his delegation 's hope that the situation in the Gulf 
would come to a close as swiftly as possible. Qatar  had raised some valid points from the 
viewpoint of regional trade and the dynamics of the multilateral trading system. It was important 
to maintain and preserve the predictability of the system and protect the system itself; there was 
also the humanitaria n dimension to take into account. His delegation had made a statement to 
that effect that was available on the Foreign Ministry 's website. A valid discussion might be 
necessary if the current situation continued and if it impacted regional trade ties and t he 
international trade dynamic. Having said that, his delegation hoped, and reiterated its hope, that 
the situation would come to a close as swiftly as possible.  
9.27.   The Chairman  said that the Council would take note of the statements made.  
9.28.   As he had indicated at the start of the meeting, he also wished to raise an item of Other 
Business. He  recalled that paragraph 11 of the Nairobi Ministerial Declaration contained a 
reaffirmation, on the part of Ministers, of "the importance of work in regular bodies  in furthering 
the objectives of the WTO Agreements and in facilitating meaningful exchange of information and 
sharing of experiences regarding the effective implementation and operation of their provisions".  
That was not the first time that Ministers had underlined the importance of work in regular WTO 
bodies, as paragraph 3 of the Elements for Political Guidance of MC8, in 2011, also reminded 
delegations . That paragraph did in fact affirm that "Ministers underline the importance of the work 
of regular WTO  bodies […] ". Against that background, it was his intention to organise informal 
consultations over the following weeks, with the aim of discussing how the Membership might 
respond to the pronouncement Ministers had made in Nairobi. Efforts in that sense h ad been 
undertaken in the past, but it was time to renew those efforts, in light of new challenges that had 
emerged. He would greatly appreciate if delegations could respond favourably to his convening of 
meetings, and looked forward to Members ' constructi ve engagement and any suggestions 
delegations might like to put forward in that regard.  
9.29.   He said that the Council would take note of the statement he had made.  
9.30.   The meeting was adjourned . 
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