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S/C/W/ 369 
11 Novemb er 2016  
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Council for Trade in Services    
 
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ANNUAL REPORT OF THE  COUNCIL FOR TRADE IN  SERVICES  
TO THE GENERAL COUNC IL (201 6) 
Since its Annual Report of 201 5 to the General Council1, the Council for Trade in Services held five 
formal meetings, respectively on 15  October  2015, 2 November  2015 (Dedicated Session on the 
LDC services waiver) , 18 March 2016, 17 June 2016 and 7  October  2016.2 During the period 
covered by this report, the Council addressed the following matters.  
1  NOTIFICATIONS MADE T O THE COUNCIL PURSUA NT TO GATS ARTICLES  III:3 , V:7 
AND VII:4  
1.1.  The Council for Trade in Services took note, altogether, of the following notifications:  
(a) Notifications pursuant to Article III:3 of the GATS  
Russian Federation  S/C/N/814 -816 
Peru  S/C/N/826 -830 
Switzerland  S/C/N/831 , S/C/N/ 859 
Ukraine  S/C/N/832  
Paraguay  S/C/N/836 -838 
Lesotho  S/C/N/842 -852 
Egypt   S/C/N/862  
European Union  S/C/N/865 -867 
 
(b) Notifications pursuant to Article V:7 of the GATS  
Bahrain, Kuwait, Oman, Qatar, Saudi Arabia,  
 Singapore and United Arab Emirates  S/C/N/807/Rev.1  
Brunei D arussalam, Cambodia , India, Indonesia,  
 Lao PDR, Malaysia , Myanmar , Philippines ,  
 Singapore , Thailand , Viet Nam  S/C/N/822  
Kyrgyz Republic  S/C/N/823  
The European Union and Ukraine  S/C/N/744/Add.1 and Corr.1  
China and the Republic of Korea  S/C/N/854  
The Rep ublic of Korea and New Zealand  S/C/N/855  
The European Union  S/C/N/856  
Australia and China  S/C/N/858  
The Republic of Korea and Viet Nam  S/C/N/861  
China and Hong Kong, China  S/C/N/264/Add.9  
China and Macao, China  S/C/N/265/Add.9  
Mongolia and Japan  S/C/N/863  
Mexico and Panama  S/C/N/86 4 
 
The agreements notified in these documents were referred to the Committee on Regional 
Trade Agreements for consideration.  
                                                
1 S/C/48, dated 2 November 2015.  
2 Reports of these meetings are contained in documents S/C/M/124 to 128, and should be read in 
conjunction with this report.  S/C/W/36 9 
 
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  (c) Notifications pursuant to Article VII :4 of the GATS  
Russian Federation  S/C/N/817 -818 
 
1.2.  At the meeting  held in March 201 6, the Council took note of the updated annual Secretariat 
Note containing a statistical account of the notifications made under relevant GATS provisions.3 
1.3.  At the June and October meetings, the United States underscored the importance of timely 
and complete notifications of Economic Integration Agreements (EIAs) pursuant to GATS 
Article  V:7, and drew the Council's attention to services EIAs whose notification was outstanding.  
2  OPERATIONALIZATION O F THE LDC SERVICES W AIVER  
2.1.  The Council discu ssed the operationalization of the LDC services waiver during the entire 
reporting period. It also held a Dedicated Session , entirely devoted  to the LDC services waiver , on 
2 November  2015. 
2.2.  A total of 23 notifications of preferences for LDC services and se rvice suppliers  were 
submitted to the Council by the end of the reporting period .  Notifications  were submitted by:  
Canada  S/C/N/792/Rev. 1 
Australia  S/C/N/8 05 
Norway  S/C/N/806  
Republic of Korea  S/C/N/808  
China  S/C/N/809  
Hong Kong, China  S/C/N/810  
Chinese Taipei  S/C/N/811  
Singapore  S/C/N/812  
New Zealand  S/C/N/813  
Switzerland  S/C/N/819  
Japan  S/C/N/820  
Mexico  S/C/N/821  
Turkey  S/C/N/824/Rev.1  
United States  S/C/N/825  
India S/C/N/833  
Chile S/C/N/834  
Iceland  S/C/N/835  
Brazil  S/C/N/839  
European Union  S/C/N/840  
Liechtenstein  S/C/N/841  
South Africa  S/C/N/853  
Uruguay  S/C/N/857  
Thailand  S/C/N/860  
 
2.3.  As required by the Waiver Decision4, notified preferential measures that go  beyond 
Article  XVI of the GATS need to be approved by the Council.  At the Dedicated Session, the Council 
approve d all such preferences included in the notifications submitted until then . Pursuant to t he 
Decision on preferential treatment for LDCs adopted by Ministers in Nairobi5, which , inter alia, 
instructs the Council to expeditiously consider appro val of preferential measures beyond Article 
XVI, at its March meeting , the Council did consider, and  approve , all such preferences , which were 
contained in five of the notifications on the agenda for that meeting . 
2.4.  At the Dedication Session of 2 November, t he LDC Group presented its initial assessment of 
the notifications received up to that point. At the June and October 2016 meetings, t he Group  
offered a further, detailed assessment of the preferences notified by the European Union and 
South Africa, as wel l as of Turkey 's revised  notification.  The LDC Group indicated that it would 
continue , at future meetings of the Council,  to share its examination of the notifications received.  
                                                
3 Document JOB(09)/10/Rev. 6. 
4 WT/L/847.  
5 WT/L/982.  S/C/W/ 369 
 
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  2.5.  As stipulated in the relevant Nairobi Ministerial Decision, the Council is to  facilitate 
discussions on technical assistance aimed at promoting LDCs' participation in services trade. In 
line with that mandate , in March  the European Union, China, Australia and India shared 
information  on various technical assistance and capacity -building measures they had implemented 
or would undertake to promote the increasing participation of LDCs in services trade.  A t the June 
meeting,  furthermore, a representative of the World Bank  shared a preliminary assessment of the  
preferences granted; a di stinction was made between the  kinds of preferences that LDCs could 
take advantage of relat ively rapidly  and those for which more work w as required . The World Bank 
also provided an overview of the kind of skills, regulatory and connectivity assistance that  would 
likely be of greatest relevance to LDCs.   
3  WORK PROGRAMME ON EL ECTRONIC COMMERCE  
3.1.  In July 2015, Members had accepted China's  suggestion to embark on a structured 
information -sharing exercise under the Work Programme  through  the addition of  a standing  
agenda sub -item. Hence, at the October  2015 meeting China provided  the latest available 
information on the rapid expansion of e -commerce  in its market , developments with domestic 
e-commerce legislation  and the role  e-commerce had played in integrating Chinese SMEs into the 
world trading system. Nigeria also contributed information on the remarkable progress 
e-comme rce had enjoyed in its market.  
3.2.  Pursuant to the  relevant  Nairobi Ministerial Decision6, in 2016 the CTS continued with its 
deliberations under th e Work Programme.  In March , China presented the most recent  data on the 
continuous acceleration of e -commerce in its market, while Canada shared information on the e -
commerce provisions it had included in its trade agreements. A representative of UNCTAD up dated 
the Council on a number of activities UNCTAD was unde rtaking related to e -commerce.  
3.3.  After noting that existing WTO rules were already applicable to e -commerce, at the June 
meeting some delegations called on the Membership to consider whether and whic h additional 
disciplines might usefully complement the mult ilateral rulebook in the  area. One delegation 
reiterated, however, that Members' discussions under the Work Programme must not aim at any 
norma tive or prescriptive outcomes. The WTO institutional a rrangements for deliberations on e -
commerce were al so mentioned by a few Members. While one delegation viewed the fragmentation 
across different bodies as unhelpful, several others supported such multi -layered discussions, in 
light of the b road range of is sues involved. The MIKTA7 countries shared with the Membership the 
programme of the e -commerce seminar they were organising on 5 July.  
3.4.  Also at the  June meeting , Brazil proposed that the Secretariat update a 1998 Note produced 
to assist Members' examination  of the treatment of electronic commerce in the GATS legal 
framework.8 Many delegations welcomed the suggest ion but a few requested more time to 
consider the proposal. The Chairman organised open -ended consultations on the matter in July, 
but no consensus could be re ached and, at the October meeting, Brazil indicated that it did not 
intend to revisit its proposal.   
3.5.  Pursuant to the mandate  in the Nairobi Ministerial Decision , that the General Council 
periodically review s progress with the Work Programme bas ed on the reports that might be 
submitted by the WTO bodies entrusted with its implementation, in June the Council agreed that 
the Chairman would produce, under his own responsibility, a factual report of the essence of the 
discussion s the Council had had  under that agenda item  up to that point .9  
3.6.  In October , Members considered a proposal by Chinese Taipei et al. that the Council  hold a 
seminar on the services trade -aspects of e -commerce.10 Around 30 delegations took the floor to 
support the proposed seminar , with several referring to e -commerce a s a possible MC11 
deliverable. A few delegations, however,  indicated that they needed more time to consider the 
proposal and would revert to it.  While generally agreeable to  discussing e -commerce issues within  
                                                
6 WT/L/977.  
7 Mexico, Indonesia, Korea, Turkey and Australia.  
8 S/C/W/68, 16 November 1998.  
9 The report is contained in document S/C/4 9. 
10 RD/SERV/133/Rev.2, sponsored by Chinese Taipei with Australia; Canada; Colombia; Hong Kong, 
China; Israel; the Republic of Korea; M exico; Panama; Paraguay; Qatar; Singapore and the United States.  S/C/W/36 9 
 
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  the confines of the  Work Programme, these delegations recalled  that the Work Programme did not 
contain a  negotiating mandate , called for special attention to be paid to its developmental aspects  
and underscored the need to bridge the e -commerce knowledge and reg ulatory gap that 
developing countries faced before any discussion of trade  disciplines could be undertaken.  It was 
agreed that t he Chairman would  hold open -ended consultations  on whether to hold the proposed 
seminar and what its programme might  be. 
4  RECENT DEVELOPMENTS IN TRAD E IN SERVICES  
4.1.  Discussions under this agenda item took place at the October 2015  meeting, with  TISA-
partic ipating Members indicating their availability to share information  on progress with their 
negotiations with any interested Member .  
5  CERTAIN MEASURES REL ATED TO THE REFORM O F THE UNIFIED GAS 
TRANSPORTATION SYSTE M OF UKRAINE – STATEMENT BY THE RUS SIAN FEDERATION  
5.1.  At its October 2015 , March , June and October 2016 meetings,  the Council addressed certain 
measures related to the reform of th e Unified Gas Transportation System of Ukraine, at the 
request of the Russian Federation. The Council took note of the statements made by the Russian 
Federation, Brazil, the Plurinational State of Bolivia,  Argentina and  the Bolivarian Republic of 
Venezuela  at the October 2015  meeting;  the Russian Federation and  Ukraine at the March 
meeting; the Russian Federation, Ukraine, Armenia, Nicaragua and Cuba at the June meeting; and 
the Russian Federation, Ukraine, Armenia and Cuba at the October meeting . 
6  RE-OPENIN G OF THE FIFTH PROTO COL FOR ACCEPTANCE B Y BRAZIL  
6.1  At its March meeting, the Council agreed to re -open the Fifth Protocol to the GATS  on financial 
services  until 25  March  2016, to allow the Government of Brazil to deposit the instrument of 
acceptance that wo uld give legal effect to Brazil's commitments annex ed to that P rotocol.  
7  MODE 4 - ASSESSMENT OF BARRIE RS TO ENTRY – STATEMENT BY INDIA  
7.1.  At its March meeting, the Council addressed India's  assessment of barriers to entry in 
mode  4 of the GATS , on the basis o f a written communication  India had submitted .11 The 
communication refers, inter alia, to measures taken , or being considered , by the United States , 
Canada and the United Kingdom that India considers impede or may impede mode 4 trade.12 
7.2.  The United States stated that, since India had filed a request for consultations under the DSU 
on the US measure under discussion, India had chosen the WTO forum in which to address the 
issue, and discussions of the same  measure  in the  Council were procedurally inappropriate . The 
European Union and the United Kingdom stated that the Indian communication refer red to neither 
a measure nor a draft measure within the meaning of the GATS, but simply  to a recommendation 
from an independent consultative body . Canada indicated that Ind ia had misunderstood and 
misperceived its recent  reforms.  
7.3.  Several developing countries echoed India's  general  concerns  with respect to regulatory 
barriers that might impede mode 4 trade, while Australia noted that regulatory barriers could limit 
trade in other modes of supply.  
7.4.  India also proposed that the Secretariat update its 2009 Background Note on mode 4, to 
reflect , inter alia,  the increase in perceived obstacles to mode 4, but a  few Members expressed 
their opposition . The request was reiterated at th e June meeting, but yet again no consensus was 
arrived at.  
7.5.  At the June meeting,  the United Kingdom, Canada and the United States questioned  India's 
approach  in mentioning specific measures, rather than generic ba rriers, and expressed  their 
disappointment t hat the issue had been revisited in the Council in a manner they considered 
                                                
11 JOB/SERV/229.  
12 S/C/W/301.  S/C/W/ 369 
 
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  unconstructive.  Several developing countries echoed India's general concerns about the many 
barrie rs that hampered mode 4 trade.  
7.6.  When the  Council  took up  the issue again at its  October  meeting , India suggested that , 
rather than focusing on specific measures by specific Members, the Council organize either a 
dedicated discussion or a seminar to discuss generic mode 4 obstacles . Such obstacles included  
unclear definitions, non -portab ility of social security, non-recognition of qualifications, residency 
requirements and economic needs tests. While several  Members called o n India to provide more 
details  about its proposal,  in writing, a number nonetheless offered their preliminary suppo rt to 
India's suggestion. A few others  expressed an interest in discussing all services market access 
issues, across the board , and noted that no single mode should be singled out  when debating 
barriers to services trade, while  also observing that the sectoral scope and level of commitments 
Members had undertaken should also be considered  in such discussions . A couple of delegations 
indicated that the novelty of India's  proposal prevented them from reacting . It was agreed that , in 
light of India's most rece nt proposal  under this agenda item, the Chairman would hold 
consult ations  to better delineate the scope of th e Council's deliberations on the  issue.   
8  FOURTH REVIEW OF MFN  EXEMPTIONS  
8.1.  In light of the decision Members had taken in 2011 to  hold the fourth rev iew of MFN 
exemptions "no later than 2016 "13, at its March meeting t he Council  debated when exactly , in 
2016, it would  start the review . The decision was reached  to commence the review  at the  June 
Council meeting , with a discussion of procedural issues .  
8.2.  Consequently , at the June meeting Members started the fourth review of MFN exemptions , by 
discussing organisational issues. Delegations were in overall agreement that past practice could be 
adhered to , although many suggested that the review  should be stream lined and a  number of 
ideas were put forward  to that effect . At a subsequent  informal meeting , convergence emerged on 
the procedural arrangements  to be followed; these  were later outlined in detail in a Chairman's 
Note and agreed to by Members.14 The fourth  review of MFN exemptions will , accordingly,  be 
conducted on that basis.  
9  FUTURE WORK OF THE S UBSIDIARY BODIES TO THE COUNCIL FOR TRAD E IN 
SERVICES – STATEMENT BY BRAZIL  
9.1.  At the June meeting Brazil proposed that Members consider how to restructure the work of 
the subsidiary bodies  to the Council . Specifically, Brazil  suggested that the Committee on Trade in 
Financial Services be discontinued and the Workin g Party on GATS Rules and the Committee on 
Specific  Commitments suspended;  in lieu, a standing item would  be added to the agenda  of the 
Council , for Members to discuss the issues that were curren tly addressed in those bodies. T he 
Working Party on Domest ic Regulation (WPDR)  should  continue its work if Members engaged in 
text-based negotiations,  or also be suspended  otherwise.  
9.2.  Several Members asked Brazil to put its ideas in writing, so as to be able to consider them  
properly. One delegation found Brazil's proposal  of interest,  but a number of others  expressed  the 
view that, at a time of renewed interest in serv ices work, the Council's  subsidiary bodies should 
continue  with their work . However, m ost delegations  indicate d that they were open to 
reconsidering the frequency of meetings: not all subsidiary bodies would necessarily have to meet 
during each cluster , whereas the WPDR might need to meet more frequently.   The Council agreed 
that t he Chairman  would organise informal consultations  on the issue . Although at those 
consultations no consensus emerged on Brazil's proposal, an item entitled "Future Work and 
Timing  of the Next Meeting" was added to the agenda of each subsidiary body, to offer delegations 
an opportunity to discuss what future work might be undertaken and when  the next meeting might 
be organised.  
                                                
13 S/C/M/105, paragraph s 35-36. 
14 JOB/SERV/238.  S/C/W/36 9 
 
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  10  RECENT DEVELOPMENTS IN TRADE IN SERVICES  STATISTICS  
10.1.   At the October meeting of the Council, the Secretariat made a presentation on recent 
developments in trade in services statistics, which focus ed on data production and dissemination, 
technical assistance activities, specific projects and new areas o f work . The Council agreed that 
such an update would be organised on a yearly basis.  
11  WORK OF THE SUBSIDIA RY BODIES  
11.1.   The activities of the subsidiary bodies in 201 6 are reflected in their respective reports, which 
are annexed to this report, as follows:  
 Annex I Report of the Committee on Trade in Financial Services (S/FIN/ XX) 
 Annex II  Report of the Committee on Specific Commitments (S/CSC/ XX) 
 Annex III  Report of the Working Party on Domestic Regulation (S/WPDR/ XX) 
 Annex IV  Report of the Working Party on GATS Rule s (S/W PGR/XX). 
 
 
 
 
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