WORLD TRADE  
ORGANIZATION  RESTRICTED 
S/WPDR/M/55 
6 November 2012 
 (12-6108) 
Working Party on Domestic Regulation  
  
REPORT OF THE MEETING HELD ON 4 OCTOBER 2012 
 
Note by the Secretariat
1 
   
1. The Working Party on Domestic Regulation (WPDR) held a meeting on 4 October 2012, 
which was chaired by Mr. Kerem Alp of Turkey.  The agenda for the meeting was contained in 
Airgram WTO/AIR/4004, dated 24 September 2012.  An annotated agenda for the meeting was 
circulated in RD/SERV/114.  The agenda was adopted as proposed. 
A. D
EVELOPMENT OF REGULATORY DISCIPLINES UNDER GATS  ARTICLE VI:4 
2. The Chairman noted that there were three sub-ite ms under this point of the agenda.  First, the 
technical discussion of the issues submitted by Members.  Second, consideration of the regulatory 
issues Note prepared by the Secretariat (S/WPDR/W/ 48); and third, consideration of the Note by the 
Secretariat on technical standards in services (S/WPDR/W/49). 
3. For the technical discussions the Chairman recalle d that like in past occasions this item would 
be discussed in informal mode so as to allow fo r an easier and more open exchange of views.  
Discussions on this sub-item continued in informal mode. 
4. Moving to the second sub-item, the Chairman recalled that in the last meeting the Regulatory 
Issues Note, contained in document S/WPDR/W/48, was introduced.  Given the comprehensive nature 
of the document, which covers many sectors and all modes of supply, he asked Members to consider 
what would be the best way to make use of the information provided in that Note.  
5. The representative of Australia thanked the Secr etariat for this rich document which they 
considered a very valuable resource.  She explaine d that their initial idea behind this document was to 
identify common issues across sectors so as to inform the development of horizontal disciplines.  The 
aim was to deepen the understanding of the subject  matter and analyse the various available options 
and issues in preparation of the right moment to re turn to negotiating disciplines.  She considered both 
the regulatory issues and the technical discussions could reinforce the negotiation of horizontal 
disciplines.  
6. Australia suggested undertaking the discussion on a sectoral and modal basis, where Members 
would share regulatory issues of concern and di scuss how the issues fall under the scope of the 
disciplines.  The Working Party would not be em bracing sectoral disciplines, but would instead be 
building a body of knowledge on common issues across sectors to inform the development of 
horizontal disciplines.  To ensure that there would be sufficient time for these discussions, the 
representative of Australia suggested having regulato ry issues as a separate agenda item.  She also 
proposed grouping related sector s in order to encourage the participation of experts.  
                                                      
1 This document has been prepared under the Secret ariat's own responsibility and without prejudice to 
the positions of Members and to their rights and obligations under the WTO. S/WPDR/M/55 
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  7. The representatives of Canada, New Zealand, Hong Kong China, and Chinese Taipei 
supported the Australian proposal to group sectors and modes for the discussion of the Note. 
8. The representative of Canada highlighted her de legation's interest in  exploring regulatory 
issues related to cross-border supply, modes 1 and 2.   She made reference to pages 65 and 66 in the 
Note, that touch on an objection often raised by Me mbers reluctant to take commitments under these 
modes and the perceived challenge of applying dom estic regulations to fo reign services suppliers on 
services supplied through these modes.  This would be a topic of interest for Canada due to the 
linkage to e-commerce aspects also mentioned in the Note. 
9. The representative of New Zealand noted that her delegation would be seeking to draw 
linkages between issues arising in individual sector s and the broader horizontal commitments being 
discussed under technical issues work plan.  
10. The representative of Hong Kong, China was flexible on how to group sectors or modes and 
on the order of discussion.  The objective would be to use the Note to find out more about real life 
examples and experiences of regulatory practices so as to inform the negotiation of horizontal disciplines.  
11. The representative of Chinese Taipei envisaged that the discussion of regulatory issues could 
help highlight areas of commonality, and could thus  be used to continue work on horizontal 
disciplines, as mandated in GATS Article VI.4. 
12. The representative of South Africa welcomed the clarification from Australia on the purpose 
of organizing discussions on a sectoral basis.  He considered that the Note provided useful 
background information on regulatory practices and i ssues in various sectors and modes.  However, 
he reiterated his delegation's concern with the lack  of a substantive discussion on development in the 
context of domestic regulation and horizontal disci plines.  He reminded Members that the March 2009 
text contains a development chapter, which recognizes the significant challenges that many 
developing countries are likely to face when implementing the disciplines.  He called on the Secretariat to revise the Note or to provide an addendum that would reflect the broad spectrum of 
interests of all Members.  
13. The representative of China commented on the m odal issues contained in part three of the 
Note.  First, he found there was generally a lack  of information on how to regulate cross border 
transactions and to fulfil policy objectives such as consumer protection and ensuring the quality of 
services.  He considered that in some developing countries, regulatory authorities might face greater 
challenges in regulating cross border transactions in  certain sectors, such as financial services, online 
information services and education services.  More  regulatory co-operation between authorities is 
required to regulate such transactions.  With re gard to commercial presence, he noted that in 
paragraph 271 of the Note, national security had been mentioned as one of the public goals for 
regulation.  In this regard, he noted that Chinese companies have faced very strict national security 
screening when seeking to invest in certain oversea s markets.  He considered this to be an 
unnecessary barrier to trade in services, and was a type of restrictions that would hamper FDI in 
services.  On presence of natural persons, he furthe r noted that Chinese services providers faced many 
regulatory barriers in addition to the requireme nts and procedures on visas and work permits.  
Unreasonable requirements on qualific ations and language skills were some of the main obstacles.  
Furthermore, tax policy and regulations on fees and charges in some countries could also constitute 
trade barriers. 
14. With regard to the concluding observations of  the Note, the representative of China recalled 
that paragraph 305 (d) noted that promoting good regulatory practice seemed common to all sectors.  
China had an interest in good regulatory practic es for mode 4.  He noted that the regulatory  S/WPDR/M/55 
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  distinction, which Australia and Canada applied between temporar y and permanent immigrants, was 
an attractive measure for foreign service providers .  In paragraph 305 (e), recognition had been 
highlighted as an area that has possibly seen the most regulatory co-operation.  Recognition of foreign education, professional experience and technical skills was important for international trade under mode 4 and his delegation would like to further th e discussion on this topic with other Members.   
15. The representative of Brazil thanked the Secretar iat for the Note, which was a good basis for 
the horizontal discussions.  He stressed that his dele gation did not believe that the time was ripe to 
undertake a sectoral approach.  His delegation was how ever open on how to structure the analysis of 
the regulatory issues Note.  While they were ope n to having discussions sector by sector, his 
delegation was not convinced that sectors should be grouped.  He supported South Africa's request for 
an addendum to the Note on development aspects.   
16. The representative of Japan stated that the No te should be used for the examination of 
horizontal disciplines.  
17. The representative of United States reminded Members that the word "agreed" should never 
be used in conjunction with any aspect of old dr afts.  On the approach to discuss the Note, he 
considered the Working Group was limited to Article  VI issues and should not look into the issues of 
other Working Groups.  If the Working Party were  to proceed on the basis suggested by certain 
Members, his delegation would need clarity on how discussions would be structured.  He urged the 
chairman to undertake consultations on the best way to move forward.  This would allow his 
delegation to give enough advance no tice to regulatory advisors that they might need to participate in 
these meetings. 
18. The Chairman noted that it might be necessary to  hold informal discussions, either at the next 
meeting or in another meeting, to define the st ructure of discussions and to address the addendum 
requested by South Africa and Brazil.  
19. The Secretariat welcomed further work to suppl ement the Note with additional information.  
It explained that development was not a structured part of the Note because the original idea was to 
compile sections of the Council's sectoral and modal Notes which referred to regulatory issues.  In 
undertaking this work, the Secretariat had updated those issues and included any others that might 
have arisen since the sectoral No tes were produced.  Throughout that process there was no mention or 
focus on development-related issues.  However, it s hould be noted that there were references in the 
Note to the capacity and regulatory challenges that  countries face in ensuring up-to-date regulations, 
establishing institutional structures and implemen ting regulations.  The absence of a specific 
development section went back to the origins of th e request and the design of the document from the 
beginning.  The Secretariat would be  ready to supplement the Note w ith more specific elements which 
the Chairman may gather in his informal consultations.  
20. The Chairman took note of all the statements and would revert to this item at the next 
meeting. 
21. The Chairman then moved to the third sub-item in the agenda, and invited the Secretariat to 
provide an introduction to the Technical St andards in Services Note (WPDR/W/49).  
22. The Secretariat explained that the Note had been prepared in response to a request from 
Members, and it had also been guided by the ques tions provided by Argentina.  The aim was to 
provide information on what are technical standards in services, how they are developed, as well as on how they are used.  An attempt was then made by wa y of concluding observations to relate all of this 
information to the discussions which Members ha ve been having in the Working Party.  The 
Secretariat highlighted some of the salient points contained in the Note.  Firstly, on terminology, S/WPDR/M/55 
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  discussions have sought inspiration from the goods paradigm, namely the Agreement on Technical 
Barriers to Trade.  Under that framework there is a distinction between voluntary standards and 
mandatory technical regulations.  While the discussion in services has not focused on such a 
distinction, it was interesting to note that in the development of standards th ere were two stages.  At 
the first stage the technical standard would be develo ped and then at a later stage, it may, or may not 
be, incorporated into a regulation and thus become a regulatory requirement.  This raises the question 
of what would be within the scope of the GATS.  After all the development of these disciplines would 
have to be on matters within the scope of the GATS.  On this point, the Secretariat reminded 
Members that the scope of the Agreement was limited to measures by Members affecting trade in services.  Measures by Members would in turn have  to be measures taken by governments and non-
governmental bodies in their exerci se of regulatory powers.  The Note provides some thoughts in the 
concluding observations on how to apply this GATS focus to the real world of technical standards, 
and what might be relevant for th e domestic regulation discussion.   
23. The other aspect raised in the Note is how goods and services st andards are sometimes 
intertwined.  The Secretariat gave some examples from a number of sectors where the standards on 
the service supplier require the use of certain equipm ent with specific specifications.  The challenge 
which arises is how to distinguish between goods and services standards.  In those cases, it was 
suggested that may be necessary to analyse the t ype of transaction which the standard was being 
applied.  For instance, was it being applied to the sale of a good, or to the sale of a service.  It was 
suggested that Members may want to look at  the instances where goods and services may be 
intertwined.   In the concluding observations, an a ttempt to bring all of this complexity back to the 
scope of the GATS, without attempting to provide any authoritative interpretation.  
24. The Secretariat invited Members to share th eir experiences on this issue, and welcomed 
comments on the content of the Note.  
25. The Chairman recalled that the questions on tec hnical standards were scheduled for the sixth 
meeting of the technical discussions, but Members were free to provide preliminary views on the 
document. 
26. All delegations thanked the Secretariat for an excellent Note which provided useful 
information on the complex issue of technical standards in services.  
27. The representative of United Stat es was particularly appreciative of the Secretariat's ability to 
complete an extremely comprehensive analysis of  a difficult subject.  He observed that there was 
necessarily a certain analogy that had to be drawn w ith rules applicable to goods, particularly when 
Members have not decided on how they wish these rules to apply.  A significant question is whether a 
particular standard is a services standard or a st andard for goods used in providing services.  He said 
that many of the examples in the paper had a significant goods component, and was not too sure 
whether the nature of the transaction would always answer that question.  The representative of the 
United States noted that his delegation had the most  concern with the description of the process to 
derive standards.  The Note mainly described a centralized system, such as the one used by the 
European Union.  This may not suit all regulatory situations, although it may produce results similar 
to the non-centralized system used in the United Stat es.  He recognized that a centralized system is 
easier to research but it must not  lead to the assumption that it wi ll necessarily produce better results 
or that it is less subject to inappropriate influences, which all Members must be on guard.  He considered there was a lack of clarity on potential implications of technical standards in services, 
contrasted with the goods context.   Further, he noted the explos ion of technology has proceeded 
without prescriptive rules on technical standards on services from the WTO, and where there had been 
problems other tools had been used to solve them.   S/WPDR/M/55 
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  28. The representative of Argentina explained that th e lack of information on technical standards 
in services had motivated their request for this Note, and considered it would improve knowledge on 
this subject and help Members have a more informed  debate.  On the specific issues contained in the 
Note, she explained that for Argentina the Intern ational Organization for Standardization (ISO), the 
International Electrotechnical Commission (IEC) and the International Telecommunication Union 
(ITU) are the only three international standard orga nizations.  She said that despite their different 
nature, these organizations were based on the prin ciple of one representative per country.  She 
highlighted the difference between these organizati ons with the other ones mentioned in the Note.  
Although the latter organizations de velop standards, they are entities which group together experts 
and enterprises.  
29. Argentina described how technical standards ar e developed by international standards bodies 
and referred to their experience implementing ITU re commendations.  First of all she pointed out that 
Argentina was one of the oldest Members of ITU.  It  had signed  the Sain t Petersburg International 
Telegraph Convention in 1889 and since then had contributed actively to  the work of the 
organization.  She explained that the National Co mmunication Commission is the competent authority 
for telecommunication services regulations in Arge ntina.  This Commission takes into account the 
ITU recommendations and issues technical regulati ons establishing minimal technical conditions for  
telecommunication equipment.  The industry a nd telecommunication operators respect these 
minimum conditions and in many cases observe the ITU recommendations setting stricter standards, or refer to issues related to interoperability of e quipment, or the need to have parameters permitting 
international large scale marketing.  
30. The representative of India appreciated the e ffort to include information on the capacity 
constraints and development related issues faced by developing countries.  He hoped that in preparing 
future Secretariat Notes, similar attention woul d be given to development and capacity related 
concerns, as far as possible. 
31. The representative of Canada consulted with key institutions, including the Standard Council 
of Canada (SCC).  She noted that figure 3 of th e Note was a good approximation of how the Canadian 
system worked with respect to technical standa rds.  She explained that SCC does not develop  
standards, but accredits the  development of volunt ary standards to the following organizations: the 
Canadian Standard Association, Canadian Standa rd Board, Bureau du normalisation du Quebec, and 
Underwriters Laboratories of Cana da.  Moreover, Canadian regulat ors at federal, provincial or 
territorial level may incorporate these standards into  regulations and laws, if they choose to do so.  
She explained that SCC is a federal crown corpora tion, mandated to promote efficient and effective 
standardization in Canada.  It is located in Ottawa  and reports to Parliament through the Ministry of 
Industry.  It carries a variety of functions intended to ensure effective and coordinated operation of 
standardization in Canada and also represents Canadian  interest in standard related matters in foreign 
and international forums.  
32. The representative of Egypt considered that standards may be difficult to apply to some 
sectors due to their nature and governments should exercise caution to avoid introducing technical 
barriers to trade in services.  
33. The representative of Switzerland valued the content and quality of the Note, which 
confirmed the existence of technical standards in  service sectors and considered it an important 
progress for the Working Party.  On the distincti on between services and goods standards, the criteria 
put forward by the Secretariat were relevant.  It was suggested that another similar criterion could be 
placement on the market.  In other words, the question would be whether the standard was a 
requirement for the marketing of a good or a service.   He noted that is sometimes difficult to know 
what services standards are if one is outside th e standards organization.  He hoped that Members 
could help the Secretariat to get the necessary information.  S/WPDR/M/55 
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  34. The representatives of Switzerland, Barbados  on behalf of the small and vulnerable 
economies (SVE's), and Brazil noted that they look ed forward to discussing technical standards in 
greater detail at the sixth session of the technical discussions.  
35. The representative of Brazil echoed the point made by India, and was satisfied with the fact 
that the Note included the analysis of development related issues.  In their view, the multiplicity of 
interest and needs across the membership should always be taken into account.  
36. The representative of Japan considered that the definition of technical standards was not clear 
and should be discussed.  He reminded Members of Japan's room document RD/SERV/37, circulated 
in February 2011, on how technical standa rds should be covered by the disciplines.  
37. The Secretariat explained the definition used fo r the preparation of the Note.  It took the 
Working Party's assumption that technical standards were requirements that relate to the 
characteristics of the service and/or the manner in wh ich they would be supplied.  In the preparation 
of the Note, the Secretariat had found that in eff ect this definition of services standards was not far 
from reality.  Given the intangibility of services, unl ike merchandises, the regulations for the supply 
of services have ex-ante  requirements designed to ensure that the output would conform with certain 
policy objectives, inter alia , quality of services, protection of the consumer, protection of the 
environment, public safety, etc.  
38. The Chairman took note of the statements made and would revert to this item at the next 
meeting. 
B. FUTURE WORK 
39. The Chairman informed Members that future work would be a continuation of the current 
endeavours, which included two comprehensive Secr etariat Notes.  His expectation would be to 
continue working in small steps, achieving progress where possible, in an in clusive and transparent 
manner.  
40. The representative of Hong Kong, China acknow ledged that negotiations in the Working 
Party had basically stopped due to the overall situa tion of the negotiations in WTO.  His delegation 
was however encouraged by the very active engagement  in this Working Party.  He considered that 
the technical discussions and the Secretariat Notes pr ovide useful material to continue discussions.  
The information exchange and the insights drawn-up have also been very helpful.  However, his 
delegation would like to find a way to capture t hose positive elements that have, so far, been 
generated by the discussions and to achieve progress where possible.  There ha ve been many useful 
inputs.  He reiterated their sugg estions to have Working Party m eetings, which would reflect on the 
insights that can be drawn from the technical discussions  for the text of the disciplines.  In particular, 
he urged the Chair when consulting on how to pr oceed with the regulatory issues Note to also 
consider holding informal meetings to reflect on the discussions of technical issues held during the 
year.  
41. The representatives of New Zealand, Australia, Chinese Taipei, Chile and Switzerland 
supported the intervention by Hong Kong, China. 
42.  The representative of Switzerland noted that hi s delegation would like to  continue with the 
technical discussions which have served as a stocktak ing of the situation in domestic regulation in 
some countries.  He found the engagement and inform ation shared to be very encouraging.  Referring 
to the various licensing and qualification procedures and requirements, which he had heard, he noted 
that his delegation was even more motivated to have disciplines on domestic regulation to improve 
international services trade.  There was considerab le work to be done to improve the situation for  S/WPDR/M/55 
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  service suppliers when negotiations picked up and he  encouraged Members to continue with these 
discussions.  
43. The representative of Canada shared the view th at the Working Party had already a very full 
agenda.  She asked what the reflection session would do, given that the conditions were not ripe to 
negotiate the text because there was a diversity of vi ews and a lack of consensus.  She would rather 
avoid additional meetings, without a more specific purpose, and said that the current set up already 
allows Members to reflect. 
44. The representative of Brazil supported the observati ons made by Canada.  He considered that 
the experience-sharing exercise on technical issu es was a success and would avoid putting this acquis  
in jeopardy.  Furthermore, Members were free to sh are whatever experiences and practices which they 
see fit and express their own views on pertinent parts of the 2009 Chair's March text.  All these views 
and information are captured in the Chairman's informal summaries.   
45. The representative of United States shared th e scepticism of Canada and Brazil about the 
purpose to be served by additional meetings with respect to reflection of discussions on the text.  
There was nothing to prevent Members from making su ch reflections in the technical discussions and 
some have already done so.  He recalled the even ts leading to the "non-text" in Easter 2011 and 
observed that there were problems inherent to the ne gotiation, and the only way to deal with that is 
through the type of discussions which the Working Party was currently undertaking.  As a result of 
the technical discussions.  Views and positions are evolving, both in terms of areas where there might be more flexibility and those which require greater ca ution.  He invited Members to look at this issue 
in a holistic way.  
46. The representative of Argentina suppor ted Canada, Brazil and United States. 
47. The representative of Hong Kong, China thanke d some delegations for their support for his 
proposal.  He explained that during the discussion of  technical issues his dele gation had attempted to 
gain insights into the draft text to focus the di scussion.  The experience-sharing and exchange of 
information on regulatory practices had been useful ; however his delegation w ould hope to have an 
opportunity where other Members would also react to their reflections on the insights gained from 
these discussions vis-à-vis  the draft text.  The reflections might also recall insights that were covered 
in the past, to ensure that they are not lost, or ra ise new insights that were not covered before.  Such a 
discussion would be useful for the Working Party's future work.  Neverthele ss, his delegation could 
be flexible and would not insist  on a particular format to ha ndle these observations.  If Members 
believed that this could be done in the context of the Working Party's formal meetings, his delegation 
would be happy to do so.  
48. The representative of Chile reminded Members in  the future there remains a negotiation for 
the Working Party to address.  Members need to establish a real link between the discussions in the 
Working Party and what might be done in future ne gotiations.  He considered that if this was not 
done, there would be a risk that Members might lose sight of the text and this would not be desirable. 
49. The representative of Australia highlighted that  for her delegation the main issue was how to 
capture progress in the discussions.  Australia had found some areas where, after further reflection, it 
would need to revisit its position on the draft di sciplines.  She hoped that in the exchange of 
information, other Members might also give though t to revisiting their positions.  It was for that 
reason her delegation had supported Hong Kong's proposal idea for further discussion to capture that 
progress or flexibility to approach the disciplines in a different way.  In addition to that, she also 
raised whether the Chairman would be able to provide some reflections on these discussions, and how 
it might have impacted on the Chair's text.  S/WPDR/M/55 
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  50. The representative of New Zealand noted that ther e were divergent views on the format of the 
reflections and as to whether the discussion of techni cal issues had been sufficient.  Nevertheless, her 
delegation was pleased to hear that some delega tions believed that certain  positions have evolved 
through the discussions.  While open on the format, her delegation would like to capture any such 
progress in text.  She also supported the Australian id ea of having, perhaps, some form of Chairman's 
reflection or summary.   
51. The Chairman took note of the comments made and would revert to this item at the next 
meeting.  On the proposal that he provide some reflections, he reminded Members that his objective 
was to continue the discussion following small steps,  and in an inclusive and transparent manner.  
Recalled that this should be a Member-driven pr ocess and, in this regard, some Members have 
requested more time to arrive to their own conclu sions.  As Chair he was obliged to give Members 
appropriate time to do so and it would not be for him to draw conclusions for them.  Once they have 
done so, this can be summarised in the usual way.  Scheduling of meetings should be demand-driven 
and also take into considerati on the concerns that have been expressed.  He was cognisant of the 
discussions in the General Council on budgetary restrictions.  
C. OTHER BUSINESS  
52. No items were raised under this agenda  item.  The meeting was adjourned. 
 
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