WT/REG351/2  
 
16 September 2015  
(15-4727)  Page: 1/5  
Committee on Regional Trade Agreements  Original: English  
 
FREE TRADE AGREEMENT BETWEEN SWITZERLAND AND CHINA 
(GOODS AND SERVICES) 
QUESTIONS AND REPLIES 
 The following communication, dated 10 Septem ber 2015, is being circulated at the request 
of the delegations of Switzerland and China.  
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   This document reproduces the questions addressed to the parties and the responses 
submitted. 
 Question from the delegation of Australia 
 
1.1.  Sector specific commitments 4.4.1.1  and Table 4.1 – Australia commends 
Switzerland for its comprehensive coverage of services in its FTA with China and notes 
that Switzerland has improved on its GATS  commitments on a significant number of 
specific services sectors, including in prof essional services. Could Switzerland provide 
more details as to the scope and extent of the GATS improvements it has made in the 
China-Switzerland FTA relating to professional services? 
Response from the delegation of Switzerland 
 
4.4.1.2 – It is correct that Switzerland has improved its GATS commitments on professional 
services. The coverage has been enlarged in respect of some forms of legal services. GATS 
limitations are relaxed for instance in respect of architectural services, where prior professional practice in Switzerland is no more required by the Canton of Lucerne (Modes 1 and 3); same 
improvement occurs in engineering services, wher e in addition the nationality requirement for 
survey activities for official public purposes ha s been replaced by a Swiss licence. Market access 
for highly qualified providers of short term contractual services is facilitated through the broadening of the scope of professional activiti es to architectural, integrated engineering and 
urban planning services.  
 Questions from the delegation of Canada 
 1.2.  Paragraph 3.29, Canada understands th at Annex V to the Agreement on labelling of 
textiles sets out some limitations and prin ciples to follow relating to mandatory 
permanent labelling requirements  for textiles and clothing. 
a. Could the Parties explain what specifica lly are the limitations and principles? 
Both Parties wish to limit the number of ma ndatory permanent labelling requirements for 
textiles in order to reduce technical barriers to trade. Mandatory information requirements shall be 
limited to size, fibre content and care instructions. In case Switzerland or China would introduce 
additional information requirements to those set out in para (a) and (b) of Annex V of the FTA, 
Switzerland and China would have to notify each other and explain how such requirements are not 
more trade restrictive than necessary to fulfil a legitimate objective in accordance with Article 2.2 
of the TBT Agreement.  WT/REG351/2 
 
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  b. Furthermore, are the limitations and prin ciples either partly based or fully 
based on the GINETEX labelling scheme? 
As set out in para (b) of Annex V of the FTA relevant ISO standards shall be accepted for 
textile's care labelling instructions. Switzerland considers in particular ISO 3758:2012 as a 
relevant international standard in this regard. 
 1.3.  Paragraph 3.32, Canada recognizes that  in Section II the Parties agreed to their 
own disciplines on the application of bilatera l safeguards rather than using WTO global 
safeguards. 
 Could the Parties explain why they deci ded on using their own safeguards as 
opposed to the WTO standard? 
 
The Parties confirms that Art. XIX of the GATT and the WTO Safeguards Agreement continue 
to apply for both Parties regardless of the Free Trade Agreement (FTA) concluded between them. 
By creating a bilateral safeguard mechanism based on WTO standards, the Parties target adverse 
effects due to an increase in imports which is the specific result of additional trade liberalization measures under the FTA. 
 
1.4.  Paragraph 5.11, Canada notes that Article 13.4 of the Agreement provides for 
specific transparency obligations rela ting to government procurement.  
Please identify what are the sp ecific transparency obligations? 
 
According to paragraph 2 of Article 13.4 of the Agreement the Parties shall publish, or 
otherwise make publicly available, their laws, regulations and administrative rulings of general 
application as well as their respective international agreements that may affect their procurement 
markets. 
 
Questions from the delegation of the European Union 
 
China – commitments (Table 4.2)  
 
1.5.  According to the information summa rized in Table 4.2, China's sectoral 
commitments in trade in services are sometimes improved compared to its GATS commitments.  
 Please explain how the improvements between GATS commitments and the China 
– Switzerland FTA were assessed, sector by  sector, in order to demonstrate China's 
improved commitments.  
 
The improvements were assessed through sector-by-sector comparison between China's 
specific commitments under the China-Switzerland FTA and China's GATS commitments; both commitments are available at the WTO website. Since the improvements involve many service 
sectors, as it shows in Table 4.2 in the Fa ctual Presentation, we suggest members who are 
interested in this respect make concrete comparison. According to our analysis, those improvements in many cases are related to Mode 3, such as in the Computer and Related 
Services, the Environmental Services, Travel Agencies and Tour Operators Services.  
 1.6.  Then, with reference to specific sect ors: "1.B Computer and Related Services" the 
EU notes that China is undertaking more lib eralized commitments compared to its GATS 
ones.  
 Please explain in detail to what extent  are China's commitments consistent with 
the new draft Chinese Cyber Security law. 
 
China's specific commitments on the Computer and Related Services under the 
China-Switzerland FTA are consistent with China's improved offer in the Doha Round.  
 
 WT/REG351/2 
 
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  1.7.  With reference to "7. Fi nancial services", the EU notes that China is undertaking 
more liberalized commitments compared to its GATS ones.  
 Could China clarify whether the level of liberalization for the securities services 
granted under the Agreement is equivalent to the one granted under the FTAs?  
 
Compared with the China-Switzerland FTA, amon g all the other FTAs signed by China, China 
only undertakes more liberalized commitments under the China-Australia FTA. 
 
1.8.  The EU understands that the increased le vel of liberalization refers to the securities 
services.  
 Could China clarify whether there are also improved commitments for banking and 
insurance services?  
There are no improved commitments for banking and insurance services. 
1.9.  With reference to "10.D. Sporting and other recreational services", the EU notes 
that China is undertaking a new commitment.  In EU's understanding, the improvements 
refer primarily to sports.  
 Could China clarify to which extent do es the Agreement set any liberalization 
commitments for "other recreational services"? 
 China's new commitment on "10.D. Sporting and other recreational services" is limited to 
Sporting only; and among sporting, China's commitment only limited to CPC 96411, 96412, 
96413, 96419, meanwhile excluding golf. China doesn't take any new commitment on other 
recreational services under the China-Switzerland FTA. 
 
Questions from the delegation of Japan 
 
Labour and employment 
 1.10.  Regarding "the Agreement on Labour  and Employment Cooperation" signed in 
parallel to the FTA between Switzerland and China, Japan would like to inquire of the parties about the following points: 
a. What is the objective of signing "the  Agreement on Labour and Employment 
Cooperation"? 
 The Agreement on Labour and Employment Coop eration reaffirms ILO principles and rights 
at work and aims to improve working conditions, promote decent work and protect and enhance 
basic workers' rights in the two countries, taking into account the different domestic contexts, as well as to strengthen bilateral cooperation to contribute to sustainable development. 
 
b. Is "the Agreement on Labour and Empl oyment Cooperation"  a legally binding 
document under international law? Is it  considered as a non-legally binding 
document such as a Memorandum of Understanding or a legally binding 
document such as a treaty? 
 The Agreement on Labour and Employment C ooperation is a binding agreement signed by 
the competent Ministries of the respective Governments. 
 
c. What is the relationship between "the  Agreement on Labour and Employment 
Cooperation" and the FTA? Does the Agreement recognize the linkage of trade, 
investment and labour? 
 Article 13.5 of the FTA relates to the Agreemen t on Labour and Employment Cooperation. In 
the Preamble of the Agreement, the Parties note that the promotion of the social dimension of sustainable development is essential for long te rm economic prosperity. In Article 2 of the 
Agreement it is recognized that it is inappropriate to encourage trade or investment by weakening WT/REG351/2 
 
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  the levels of protections afforded in domestic labour laws, regulations, policies and practices and to 
set or use such domestic instruments for trade protectionist purposes.  
d. Why were the provisions of "the Ag reement on Labour and Employment 
Cooperation" not directly included in the FTA, for example, as part of an 
independent chapter? 
 The provisions and their placement are th e result of the negotiation process.  
 
e. Have you ever held the meeting based on Chapter 4? If so, what kind of issues 
were picked up as an agenda an d discussed between the parties? 
 Assuming that the question relates to Articl e 4 of the Agreement, no party has requested a 
relevant meeting to date. 
 
f. Have there been any specific merits and demerits of "the Agreement on Labour 
and Employment Cooperation"? 
 Among the merits of the Agreement is an intensification of the dialogue and of the 
cooperation on labour and employment issues between the Parties. 
 
Questions from the delegation of Thailand 
 1.11.  Paragraph 4.37: Under the Agreement, China replicates its horizontal limitations 
in its GATS Schedule of specific commitmen ts, which essentially limit foreign service 
suppliers in relation to the constitution of  specific legal forms of natural persons (in 
relation to commercial presence). With regard to mode 4, China undertakes 
commitments for certain contractual service suppliers (medical and dental services, 
architectural services, engineering services , urban planning services, computer and 
related services, construction and related en gineering services, education services and 
tourism services) as well as for installers an d maintainers. The conditions applicable to 
the entry and temporary stay of business visi tors have been relaxed (duration of stay 
extended to six months). 
 Paragraph 4.37 remarks that "The conditions applicable to the entry and 
temporary stay of business visitors have be en relaxed (duration of stay extended to 
six months)." 
 Please kindly confirm whether the dura tion of stay has been extended to 
six months for business visitors. In addition , could the representatives of China please 
provide the current Laws and Regulations governing the validity of the six months 
duration of stay? 
 
 It is one of the results reached through China-Switzerland FTA negotiations that China shall issue business Visa valid for 6 months to business travellers of Switzerland. The FTA facilitates future personnel flow for the categories of persons covered by and clearly defined in the FTA from 
both sides and lay solid foundation for the development of bilateral tie and all-round 
communication and cooperation. The relevant provisions about the Visa duration has been provided in <Exit and Entry Administration Law of the People's Republic of China>  and 
<Regulations of the People's Republic of Chin a on Administration of the Entry and Exit of 
Foreigners> . For those who apply for Chinese Visas from countries that have not signed related 
agreements, China's Embassies & Consulates will de termine the duration of stays of their M Visas 
in accordance with the Laws & Regulations based on their purposes of trip and their agenda in 
China.  1.12.  Paragraph 5.15(g): In connection with ge ographical indications (GIs), the level of 
protection defined under Article 23 of the TRIPS agreement (additional protection for 
wines and spirits) is extended to all prod ucts. The parties may require a GI to be 
registered in accordance with their respective GI legislation and regulations to enjoy 
legal protection. WT/REG351/2 
 
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   What is the scope of "additional protection  for geographical indications (GIs) to all 
products?" Do all products include agricultur al products, non-agricultural products and 
handicraft? Please clarify the definition of "all products" and explain the benefits of 
extension for the protected GIs to additional protection. 
 
 All products including agricultural products, no n-agricultural products and handicrafts benefit 
from the effective protection defined under the agreement." 
 
Question from the delegation of the United States 
 1.13.  Table 5.1 Switzerland and China: Pa rticipation in other RTAs (notified and 
non-notified in force), as of 20 April 2015 indicates that the Cross-Straits Economic 
Cooperation Framework Agreement (ECFA) ente red into force on 12 September 2010 but 
has not been notified yet to the WTO by the Parties. While the United States appreciates 
that the Parties have submitted an Early Announcement, we note that according to 
paragraph 3 of the Transparency Mechanism:  
 " t h e  r e q u i r e d  n o t i f i c a t i o n  o f  a n  R T A  b y  M e m b e r s  t h a t  a r e  p a r t y  t o  i t  s h a l l  t a k e  
place as early as possible. As a rule, it w ill occur no later than directly following the 
parties' ratification of the RTA or any part y's decision on application of the relevant 
parts of an agreement, and before the applic ation of preferential treatment between the 
parties."  
 
 According to Articles 7 and 8 of the ECFA Agreement, the two Parties have agreed 
to implement an Early Harvest Program with respect to both goods and services, as set 
out in Annex I and Annex IV of the Agreemen t within six months after entry into force 
for goods and expeditiously after entry into fo rce for services. Therefore, it appears that 
preferential treatment is currently being a pplied between the Parties under the terms of 
the Agreement. We note that a published summary of the 7th Regular Meeting of the 
Cross-Strait Economic Cooperation Committ ee from 15 February 2015 notes that:  
  "the fruits of ECFA early harvest further stood out. The value of beneficial products 
of both sides has maintained constant gr owth and cross-straits industries have 
benefited a lot from the ECFA early harvest si nce it was implemented four years ago. On 
trade in goods, the combined tariff reduction of Taiwan's export of ECFA early harvest 
products to the mainland totalled US$2.2 b illion and that of the mainland to Taiwan 
registered US$220 million. On trade in serv ices, more than 340 Ta iwan enterprises and 
137 investment projects in Taiwan made by the mainland have benefited from the early 
harvest
." 
http://english.mofcom.gov.cn/article/news release/significantnews/201503/20150300908372.sht
ml 
 
 In light of paragraph 3 of the Transparen cy Mechanism, can China please indicate 
when it will provide a full notification to  the WTO for the Cross-Straits Economic 
Cooperation Framework Agreement (ECFA)?  
The Economic Cooperation Framework Agreem ent (ECFA) was signed by China and the 
Separate Customs Territory of Taiwan, Penghu, Ki nmen and Matsu on 29 June 2010. The relevant 
agreements on trade in goods and dispute settlement under the ECFA are still under negotiations. According to the RTA Transparency Mechanism of the WTO, and considering the special conditions 
of the ECFA, the Parties have made an Early Announcement to the WTO based on their consensus. 
The Parties are both in the view that it is appropriate to make the Early Announcement to the WTO at present stage.  
 
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