RESTRICTED  
  
S/CSC/M/72  
 
2 April 2015  
(15-1839)  Page: 1/4  
Committee on Specific Commitments    
 
 REPORT OF THE MEETING HELD ON 18 MARCH 2015 
NOTE BY THE SECRETARIAT1 
The Committee on Specific Commitments (CSC) held a meeting on 18 March 2015, chaired by Mr. 
Felipe Sandoval Zamorano from Chile. The agenda  for the meeting, contained in WTO/AIR/CSC/1, 
was adopted.  
1  ITEM A - CLASSIFICATION ISSUES 
1.1.  The Chairman recalled that at the la st meeting in September 2014, the Committee had 
started to review the issue of "new services" at the request of Members. Also upon request, the 
Secretariat had prepared an illustrative list of se rvices identified in the past by Members as not 
being explicitly referred to in the Services Sectoral Classification List (MTN.GNS/W/120), without 
prejudice to Members' positions. The illustrative list was contained in document JOB/SERV/189. The Secretariat Note also provided a brief back ground on the issue of "new services", which 
covered the discussion in the Committee in the 1990s, the definitions of new services adopted in 
the Understanding on Financial Services and some preferential trade agreements. With a view to 
stimulating meaningful and constructive discussi ons, the Note suggested a number of general 
questions for consideration. Members had been engaged in a substantive and inspiring discussion 
at the last meeting with different views expressed.  One view had been that there was no need to 
have a definition of "new services", suggesting that the negative list approach could solve the scheduling problems involved. The implications of so-called "new services" for existing 
commitments should be left to WTO dispute settlement to handle on a case-by-case basis. 
However, according to another view, it might be a g ood idea to try to define "new services" in the 
application of W/120 and the CPC provisional. Some had also suggested updating W/120 or at 
least clarifying the undefined residual categories of "Other" therein. The Chairman noted that the 
essential question underlying "new services" was how a service should be classified and scheduled when it appeared that the existing classification  systems did not provide clear guidance. Some so-
called "new services" might be mapped into the existing classification based on their nature, as in 
the case of cloud computing presented by some Members at the last meeting. However, constantly evolving technologies had often made it highly challenging to determine the nature of services, especially in the case of hybrid or bundled services. It would be educational for all if Members 
could share their experiences in the classification of some specific and complex services, such as 
search engines, social media, digitally delivered  content (e.g. music, games, videos, e-books). 
1.2.  The representative of Brazil cautioned about the implications of the discussion. It should be 
ensured that the legal certainty of existing commitments was not affected and that the scope of 
the existing commitments was not artificially expa nded. He stressed this as he was concerned that 
any document resulting from the discussion might be used as a supplementary means for 
interpretation in future WTO disputes.   
1.3.  Referring to the nature of cloud computing, the representative of China said that its 
consultations with the relevant domestic industry  and regulatory bodies in China indicated that 
cloud services consisted of three categories: So ftware-as-a-Service (SaaS), Platform-as-a-Service 
(PaaS) and Infrastructure-as-a-Service (IaaS). These services had different functions; it would be 
problematic if they were all classified as computer and related services. Cloud computing services 
which were based on a network in many cases were of the nature of telecommunication services. 
                                               
1 This document has been prepared under the Secret ariat's own responsibility and is without prejudice 
to the positions of Members or to thei r rights and obligations under the WTO. S/CSC/M/72 
 
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  China noticed that CPC Version 2 had introduced some new services into the categories of 
computer and telecommunication services. Before de termining whether a definition of new services 
was needed, Members might need to understand the gap between CPC Provisional and CPC Version 2. It might be useful to invite experts from UNSD to make a presentation on this in the 
Committee for the purpose of information sharing.  The exercise might inspire Members to better 
deal with the issues related to new services raised in the Secretariat Note. The exercise would be undertaken in an impartial way and without prejudic e to the interpretation of Members’ existing 
services commitments in the WTO. 
1.4.  The representative of the United States echoed the caution raised by Brazil about the 
implications of the discussion. One of the unsettled issues was about digitally delivered content 
(e.g. video, music, e-books) which, in his delegati on's view, should not be classified as services, 
though there were services involved in the delivery of such products. Commenting on China's 
statement on cloud computing, he indicated that the fact that a service using telecommunication did not make it a telecommunication service. Concerning China's proposal, he invited the Chairman 
to hold consultations, as the CPC was established for statistical purposes rather than for trade 
negotiations.  
1.5.  The representative of India noted that new services and related classification issues were 
complex. She wanted to make two points. First, echoing the previous statements, she cautioned 
about the implications of the exercise for ex isting commitments. The discussion should not 
describe any particular interpretation of existing commitments. New services should not affect the scope of existing commitments. Members had und ertaken commitments based on the positive list 
approach and their stage of development, with the services committed according to the 
classification in W/120. The fundamental philosop hy of the GATS was to provide flexibility to 
Members to choose services to be committed from th e list of services available, based on their 
readiness to do so. In accordance with this flexibility, Members had undertaken services 
commitments based on their choices. If an existing commitment was made applicable to new services, it might be contrary to the fundamenta l philosophy of the GATS. Second, to say that 
W/120 and by implication the CPC covered everything  that could be the object of a transaction 
was not entirely correct. W/120 was the basis for classifying services for the purposes of scheduling commitments. As W/120 was based on the 1991 CPC Provisional, it classified the services that had existed at the time the CPC Prov isional had been devised. Services that had not 
existed at that point of time were not mentioned in either W/120 or the CPC Provisional. If that 
were not the case, the CPC would have been a static, not an evolving and dynamic, classification system. The later versions of the CPC covered the existing services in greater detail and included 
new services that had not been mentioned in the earlier versions of the CPC. "New" was a relative 
concept. Therefore, while considering that a service was new or not, one needed to examine whether it had existed at that point of time and whether it had been mentioned in the classification 
system that had been used at that point of time. In the Secretariat Note, some interesting 
examples of FTAs had used a similar approach to new services. Lastly, with respect to the Chairman's suggestion for Members to share experiences in classifying complex services, she noted that a large amount of work had been done in the Committee in the discussions on the 
Secretariat Notes with respect to classification issues arising in various sectors. Those discussions 
had been well documented and could be referred to by any Member.  
1.6.  The representative of Ecuador echoed the caution raised by others with regard to the legal 
certainty of existing commitments and the pote ntial ramifications of extending the existing 
commitments in an artificial manner. Concerning China's proposal, he suggested that the Chairman hold consultations on the scope of the proposed presentation. 
1.7.  The representative of Canada recalled the statement made by his delegation at the last 
meeting. On how to classify and schedule complex services as raised in the Annotated Agenda, he 
noted that his delegation's perspective for scheduling computer related services was captured in the Understanding on the Scope of Coverage of CPC 84 Computer and Related Services 
(TN/S/W/60, S/CSC/W/51). The latter was a communication by a group of Members, which 
provided an accurate and reader-friendly clarific ation of the scope of coverage of CPC84, and 
might be used by Members for the scheduling of commitments in this sector.  
1.8.  Recalling his delegation's intervention at th e last meeting, the representative of the European 
Union reiterated that there was no case established for new services in the context of negotiations 
under the GATS. The examples listed in the Secretaria t Note could be linked to specific sectors. In S/CSC/M/72 
 
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  the Understanding on Financial services, new servic es referred to services that were new in the 
territory of a given Member. The discussion on classification should be focused on the substance of services. The distinction between enabling and en abled services was important. The supply of a 
service involving the provision of the telecommunication network did not make the service a 
telecommunication service. Members needed to be  careful about the identification of service 
sectors. For example, a lot of services delivered  through telecom means were banking services or 
professional services or other types of services. The seminar on mobile banking was illuminating, 
which demonstrated that technological means of de livery did not change the nature of services 
which remained financial services. A point of time would not define what a service was and the coverage of the commitments in the schedule was defined by the services inscribed in the first column, not by a given date. In this respect, he supported the intervention by Canada with respect 
to the Understanding on the Scope of Coverage of Computer and Related Services which provided 
a good example that the sectoral coverage could be broadly defined. In that context, CPC 84 clearly included such services as cloud computing even if it had not been used in 1991 as much as 
today. The nature of the services remained the same.     
1.9.  The representative of South Africa recalled his delegation's intervention at the last meeting 
that the definition of new services would be nece ssary. He noted that a number of delegations had 
cautioned about this. His delegation had also indicated previously that the existing commitments 
should not be affected. He supported China's propos al to invite UN experts to make a presentation 
which might enable Members to get to the definiti on of new services without interfering with the 
existing commitments.   
1.10.  The representative of Uruguay agreed that Members should be cautious when discussing the 
issue of new services which involved technological changes. The only way to approach it was from 
the statistical point of view and at a general level.   
1.11.  The representative of Australia echoed the points made by the United States, the European 
Union and Canada. A new way of delivering services did not render services new. The fact that a 
service had not been provided in a particular manner at the time the commitments had been 
undertaken did not necessarily imply that there were no commitments on the service. There was a 
distinction between enabling and enabled services. 
1.12.  Echoed the statements made by the United States, the European Union and Australia, the 
representative of Pakistan also cautioned about any changes brought into classification, which 
might have impact on the existing commitments. He wondered whether modes of delivery would change the nature of services. He sought clarification from the Secretariat about the residual categories contained in W/120, i.e. "Other" services in various sectors.    
1.13.  The representative of China indicated th at cloud computing was only one example of new 
services and that other examples included search engine, social media, etc. His delegation's 
proposal was aimed to enhance Members' unde rstanding by knowing how the UN statistical 
department were dealing with these new services and how they were classified in the CPC Version 
2. Developing countries needed to know the coverage of their commitments, for instance, CPC 84 and telecommunications. Absence of clarity in this regard would make it difficult to persuade domestic stakeholders to support liberalization in  the forthcoming negotiations. Knowledge of the 
classification work of other international organizations would be helpful. He supported the 
suggestion that the Chairman hold consultations on his delegation's proposal.    
1.14.  The representative of Australia said that her delegation had no objection to China's 
proposal, though she was not sure what impact the classification work for statistical purposes 
would have on the classification issues in th e WTO. After all, the undertaking of specific 
commitments was up to Members' decision.  
1.15.  The representative of the European Union sought clarification from China on its proposal.  
1.16.  The representative of China explained th at compared to the CPC Provisional, the CPC 
Version 2 contained certain new categories, for instance, in computer and telecommunication 
services. He hoped that experts from the UN statistical department could help Members better 
understand the gap between the different versions of the CPC. After that, the Committee might be 
better informed so as to discuss the issue of new services.   S/CSC/M/72 
 
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  1.17.  In responding to the enquiry from Pakistan, the representative of the Secretariat recalled 
that W/120 had been prepared in 1991 to assist governments in undertaking the services 
negotiation in the Uruguay Round. At that time, there were three main classification systems under consideration, i.e. transaction-based (e.g. ba lance-of-payment classification), activity-based 
(e.g. the ISIC) and product-based (e.g. the CPC).  The product-based CPC had been chosen as the 
basis for W/120 as it had been considered as the most suitable to serve trade negotiations. It had been agreed at that time that there would be no mandatory classification system and that 
governments needed to ensure the clarity of the se ctoral scope of commitments in their schedules. 
Later, this had been reflected in the Scheduling Guidelines (S/L/92). "Other" categories contained W/120 should be understood in this context.  
1.18.  The Chairman noted the point by the United States about digitally delivered content, which, 
in his view, showed that there were valid classification issues for discussion in the Committee and 
that the discussion could serve future negotiations. He suggested that he hold consultations on China's proposal and that the Committee take note of the statements made and revert to this item 
at its next meeting.   
1.19.  It was so agreed.  
2   ITEM B - SCHEDULING ISSUES 
2.1.  The Chairman recalled that there had been no substantive discussions on scheduling issues in 
the past two or three years. Th i s  m i g h t  b e  d u e  t o  l a c k  o f  p r o g r e s s  i n  D D A  n e g o t i a t i o n s .  H e  
however pointed out that as the services component in the Post-Bali Programme was shaping up, this agenda item would become highly relevant. He welcomed any ideas or suggestions.  
2.2.  There was no intervention under this item. 
2.3.  The Chairman suggested that the Committee revert to this item at its next meeting.  
2.4.  It was so agreed.  
3   ITEM C - OTHER BUSINESS 3.1.  There was no intervention under this item.  4  ITEM D - APPOINTMENT OF TH E CHAIRPERSON FOR THE COMMITTEE 
4.1.  The Chairman noted that the handover of the chairmanship of the Committee should 
normally take place at the end of this meeting.  However, since the consultations conducted by the 
out-going Chair of the Council for Trade in Servic es were still under way, the handover would be 
postponed until the conclusion of the consultations. 
4.2.  The Chairman then adjourned the meeting.  
 
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