RESTRICTED  WORLD TRADE  
ORGANIZATION  S/C/M/90 
10 December 2007 
 (07-5471) 
Council for Trade in Services  
  
 
REPORT OF THE MEETING HELD ON 16 NOVEMBER 2007 
 
Note by the Secretariat
1 
  
1. On 16 November 2007, the Council for Trade in Services held a meeting under the 
chairmanship of Ambassador C. Trevor Clarke (B arbados).  The agenda was contained in document 
WTO/AIR/3112. 
2. The Chairperson
 indicated that he intended to make  a brief statement regarding the Air 
Transport Review. 
3. The agenda was adopted , as modified. 
I. NOTIFICATIONS PURSUANT TO ARTICLES III:3 AND V:7 OF THE GATS 
4. The Chairperson  drew attention to notifications made pursuant to GATS Article III:3 
(Transparency) and submitted by  The Separate Customs Territory of Taiwan, Penghu, Kinmen and 
Matsu (S/C/N/399 and S/C/N/400), Albania (S/C/N /401 to S/C/N/411 and S/C/N/413 to S/C/N/418), 
and Switzerland (S/C/N/412).   
5. The Council took note  of these notifications. 
6. The Chairperson  thanked those Members who had notif ied, and commended in particular 
Albania.  He reminded Members that, according to Article III:3 of the GATS, "each Member shall promptly and at least annually inform the Counc il for Trade in Services of the introduction of any 
new, or any changes to existing, law, regulati ons or administrative guidelines which significantly 
affect trade in services covered by its specific commitments" under the GATS.  He noted that the 
number of Members submitting notifications under GATS Article III:3 had been disappointingly low.  
Moreover, it had a tendency to diminish over the year s.  Since the entry into force of the GATS, in 
1995, 38 Members had submitted one or several notif ications, while only ten Members had done so 
over the last three years.  He encouraged Members to comply with their notification obligations as 
transparency was one of the pillars of the system .  Turning to the notifications made pursuant to 
GATS Article V:7 (Economic Integrat ion), he drew attention to comm unications from:   the European 
Communities and its Members States (S/C/N/397) ;  Chile and Japan (S/C/N/398);  Japan and 
Singapore (S/C/N/206/Add.1);  and Japan and Thailand (S/C/N/419).   
7. The representative of Japan
 said that the Agreement between Japan and the Republic of Chile 
for a Strategic Economic Partnership (Japan-Ch ile Economic Partnershi p Agreement (EPA)) had 
entered into force on 3 September 2007.  The EPA with Chile was the fourth such agreement for 
Japan following those with Singapore, Mexico and Malaysia.  The agreement covered a substantial 
range of trade in goods and services.  The latter wa s treated under the chapter on cross-border trade, 
                                                      
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/C/M/90 
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  while mode 3 was covered by the chapter on inv estments.  The provisions on national treatment, 
most-favoured-nation treatment and local presence c ontained in the chapter on cross-border trade 
should not apply to any existing non-conformi ng measure listed in the Annex containing the 
reservations for existing measures and to any measure that a Party adopted or maintained with respect 
to sectors, sub-sectors or activities listed in the Anne x containing reservations for future measures.  
Financial services were treated in a separate chapte r.  The agreement also included provisions on 
intellectual property, competition and improvement of business environment.  The negotiations on the 
EPA had been conducted with strong support from th e Japanese industrial sector that wished to see 
improvements in the business environment with Chile.   Japan believed that the implementation of the 
agreement would greatly contribute to enhancing ec onomic relations between the two countries.  The 
Protocol Amending the Agreement between Japan and the Republic  of Singapore for a New-Age 
Economic Partnership (Japan-Singapore Econo mic Partnership Agreement (EPA) Amending 
Protocol) had entered into force on 2 September 2007.   The EPA with Singapore was the first such 
agreement for Japan.  The negotiations on the prot ocol had been conducted with strong support from 
both parties' private sector that wished to see furt her improvements in their business environment.  
Japan believed that the implementation of the Pr otocol would further contribute to enhancing 
economic relations be tween the two countries.  The Agreemen t between the Government of Japan and 
the Government of Thailand for an Economic Pa rtnership (Japan-Thailand Economic Partnership 
Agreement (EPA)) had entered into force on 1 Nove mber 2007.  The EPA with Thailand was the fifth 
such agreement for Japan following those with Singapore, Mexico, Malaysia and Chile.  The 
agreement covered a substantial range  of trade in goods and services.  The latter was treated under the 
chapter on trade in services, including financial services, while mode 3 was also covered under the 
chapter on investments.  Specific commitments we re scheduled in a positive list annexed to the 
chapter on trade in services.  The agreement also  included provisions on intellectual property, 
competition and cooperation.  The negotiations on the agreement had been conducted with strong 
support from the Japanese industrial sector that wished to see improvements in the business 
environment of Thailand.  Japan believed that th e implementation of the agreement would greatly 
contribute to enhancing economic relations between the two countries.  The text of the three 
agreements and protocol and the re lated documents were available on the websites of the Ministry of 
Foreign Affairs of Japan.  Japan was ready to answ er any question concerning these instruments at the 
coming meeting of the Committee on Regional Trade Agreement.  
8. The representative of Chile
 thanked the delegation of Japan for presenting the agreement 
signed between their two countries.  The EPA was very important for Ch ile as it was a step forward in 
Chile's policy to deepen political and commercial lin ks with the Asia-Pacific region.  The EPA with 
Japan followed suit with other agreements signed with Korea, Singapore, New Zealand and, more 
recently, with China.  The EPA with Japan would co ntribute to transparent and predictable access to 
the respective markets of the two countries and would be of great value for the private sector. 
9. The representative of Singapore  said that the Protocol with Japan complemented the far-
reaching economic partnership agreement between th e two countries.  His delegation associated itself 
with the comments made by Japan.  The EPA and the protocol would further deepen bilateral 
economic relations and benefit bus iness and consumers at large. 
10. The representative of Thailand  associated his delegation with the statement made by Japan.  
Thailand was convinced that the Japan-Thailand  EPA would further broaden and deepen the 
longstanding close ties and cooperation between the two countries.  The EPA's coverage was 
comprehensive.  Major elements included elimin ation and reduction of ta riffs on industrial goods, 
agricultural, forestry and fishery products, trade facilitation through simplification and harmonization 
of customs procedures, a framework for liberali zation of trade in services, a framework for the 
liberalization of investments in non-service sectors,  as well as, investment protection, intellectual 
property, government procuremen t, competition, mutual recognition and movement of natural 
persons.  With regard to services, the agreement deepened market access in various sectors and sub- S/C/M/90 
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  sectors, such as wholesale trade and retailing services relating to the distribution and installation of 
products manufactured in Thailand or by its group companies in Thailand under the same brand, or 
automobiles manufactured in Japan by its group companies under the same brand;  logistics 
consulting services;  construction services;  spa services;  a range of professional and business services;  and health services.  The chapter on trad e in services included a general review clause for 
all service sectors, which should begin within five y ears after the entry into force of the agreement.  
Implementation of the agreement, including subseq uent rounds of negotiations, would be geared 
towards forging closer economic relations, enhanc ing the investment climate and creating greater 
business opportunities for the two countries with positive spill-over on global services markets in 
general.  The parties had notifie d the agreement to the Committee on Regional Trade Agreements on 
25 October this year, under both Articles XXIV:7 of GATT 1994 V:7(a) of GATS.  The agreement 
would be considered at the next appropriate CRTA meeting.  
11. The representative of th e European Communities
 said that the European Communities and its 
Members States had notified the accession of Bulg aria and Romania to the European Communities 
pursuant to GATS Article V:7.  The EC Treaty liberalised, inter alia , trade in services between the 
parties, as stipulated in GATS Article V:1.  Th is notification complemented that made under the 
GATT. 
12. The Council took note  of the notifications and the statements made, and referred  the 
agreements notified to the Committee on Regi onal Trade Agreements for examination. 
II. NOTIFICATION FORMAT FOR REGIONAL TRADE AGREEMENTS 
13. The Chairperson  recalled that, on 13 October 2006, the Committee on Regional Trade 
Agreements (CRTA) had agreed to recommend th e introduction of a common and simplified format 
for the notification of regional trade agreements  (RTAs), including those under Article V of the 
GATS (WT/REG/16).  In forwarding its recommendation, the CRTA had indicated that the proposed format would facilitate the task of the parties to comply with the requirement to notify an RTA while 
making available to other WTO Members the necessary basic elements in a systematic and coherent 
way.  Moreover, on 14 December 2006, the Genera l Council had adopted a Decision establishing, on 
a provisional basis, a Transparency Mechanism for RTAs (WT/L/671).  He understood that the 
proposed new format for RTA notifications was in  line with the overall approach to RTAs that 
Members had agreed to adopt in that Decision.  This notification format had already been adopted 
some months ago by both the Council for Tr ade in Goods and the Committee on Trade and 
Development.  He recalled that, upon request by some delegations at the March meeting, the 
Secretariat had prepared a draft decision for the purpose of adopting the proposed new format and 
formally modifying S/L/5 as far as notifications ma de pursuant to GATS Articl e V:7 were concerned.  
This draft decision had been circulated in docum ent S/C/W/282 and considered by the Council at its 
June meeting.  It had then decided to revert to this issue.   
14. The representative of the United States
 recalled that, at the last meeting of the CTS, her 
delegation had proposed a change in the last paragraph, third line, of the draft decision.  The proposal 
was that the word "will" should be changed to "may".   
15. The Chairperson  proposed that the draft decision on the notification format for regional trade 
agreements, as contained in document S/C/W/282, be adopted, with the amendment proposed by the 
United States. 
16. The Council so agreed . S/C/M/90 
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  III. ANNUAL REPORTS OF THE SUBSIDIARY  BODIES TO THE COUNCIL FOR 
TRADE IN SERVICES 
17. The Chairperson
 said that, in accordance with WTO reporting procedures, the Council for 
Trade in Services was to consider the annual reports of its subsidiary bodies. Accordingly, he drew 
attention to the following reports which had been adopted by the respective bodies:  (i) Annual Report 
of the Committee on Trade in Financial Services (S/F IN/18);  (ii) Annual Report of the Committee on 
Specific Commitments (S/CSC/13);  (iii) Annual Report of the Working Party on Domestic Regulation (S/WPDR/10);  and (iv) Annual Report of the Working Party on GATS Rules 
(S/WPGR/17).  These reports were factual and self-expl anatory.  He suggested that the Council take 
note of the four reports on the understanding that they  would be annexed to the annual report of this 
Council and form an integral part of it. 
18. The Council so agreed
. 
19. The representative of the Philippines  said his delegation, speaking on behalf of Brunei 
Darussalam, Cambodia, Indonesia, Malaysian, Myan mar, the Philippines, Thailand, and Viet Nam, 
wanted to make a couple of brief points for the reco rd.  He welcomed the report of the Working Party 
on GATS Rules to the Council for Trade in Services and wished to put on record his appreciation for 
the excellent leadership exercised  by the Chair of the Working Party over the last year.  He also 
wished to commend the work of her immediate pr edecessor who had chaired his last WPGR meeting 
on 19 April 2007.  Secondly, Philippines recognized  that the Chair of the Special Session was 
responsible for facilitating the process of negotia ting a so-called breakthrough text in services.  
However, as the Working Party was a subsidiary body  of this Council, Philippines wished to briefly 
record here its fundamental interest in the ESM negotiations and its basic position that GATS rules, 
together with domestic regulation, were vital co mponents of the services negotiations in addition to 
market access.  Philippines believed, therefore, th at the report adopted today and the minutes referred 
to in the footnotes provided a solid and factual background for engaging constructively and positively 
with other Members, in the appropriate negotiating fo rum, in order to craft a text on GATS rules that 
recognized the importance of the rules negotiatio ns, captured progress in the implementation of 
Ministerial instructions from Hong Kong, and woul d be the basis for Members' work forward. 
20. The Council took note  of this statement. 
IV. ANNUAL REPORT OF THE COUNCIL FOR TRADE IN SERVICES TO THE 
GENERAL COUNCIL 
21. The Chairperson  said that, in accordance with WTO reporting procedures, the Council for 
Trade in Services should report each year to the Ge neral Council on the activities in the Council, as 
well as in the subsidiary bodies.  The draft Annua l Report of the Council for Trade in Services on its 
activities in 2007 was contained in document S/C/W/288.  The Report was factual and self-explanatory.  As already indicated, the annual repor ts of the subsidiary b odies would be annexed to 
this Report for submission to the General Council. 
22. The Council adopted
 the 2007 Annual Report to the Ge neral Council, as contained in 
document S/C/W/288. 
V. TRANSITIONAL REVIEW UNDER SECTION 18 OF THE PROTOCOL OF 
ACCESSION OF THE PEOPLE'S REPUBLIC OF CHINA 
23. The Chairperson  recalled that, Section 18 of the Accession Protocol of the People's Republic 
of China provided for an annual review of the implementation by China of the WTO Agreement and 
of the related provisions of China's Accession Protocol .  As indicated in Section 18, the Committee on  S/C/M/90 
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  Trade in Financial Services (CTFS) and the Council for Trade in Services were two of the bodies in 
which this Review was to be conducted.  When it concluded its review, the CTFS was to submit a 
report to the Council, which would form part of  the Council's report to the General Council. The 
General Council would conduct its own review.  The Committee on Trade in Financial Services had 
conducted and concluded the trans itional review under Section 18 of China's Accession Protocol on 
Monday 12 November 2007.  A report had been  submitted by this Committee (S/FIN/19).  The 
Chairperson proposed that the Council take note of the report by the Committee on Trade in Financial Services on the understanding that it would form part of this Council's report to the General Council.   
24. The Council so agreed
. 
25. The Chairperson  said that the Council would conduct the sixth transitional review of China's 
specific commitments and drew Members' attenti on to the communication from China in document 
S/C/W/290 which provided information required by Annex 1A of China's Accession Protocol.  He 
proposed that the Council follow the same procedure as in previous reviews.  First, China would be 
invited to respond to the comments and questions which were contained in the communications from 
The Separate Customs Territory of Taiwan, Penghu,  Kinmen and Matsu (S/C/W/285), the European 
Communities (S/C/W/286), Japan (S/C/W/287) and the United States (S/C/W/289).  After China's 
statement, the floor would be open for delegations to make comments.   Then, China would be invited 
to respond. 
26. The representative of China  said that, before responding to questions, her delegation wanted 
to inform Members of the regulations that China ha d adopted since the last Review to implement its 
commitments in sectors other than financial services.   Her delegation would also give Members some 
concrete ideas of how open China's services market was with the implementation of its commitments.  
The Chinese government had adopted rules and re gulations covering sectors such as construction 
engineering, onshore oil exploration, and distribution.  They were the Provisions concerning Foreign-
invested Construction Engineering Enterprises, Detailed Rules for Implementing Provisions 
concerning Foreign-funded Construction Engin eering Design Enterprises, Amendment to the 
Regulations Governing Sino-foreign Cooperation in  Exploitation of Continental Petroleum 
Resources, Regulations governing Commercial Franc hises, Measures for Regulating the Processed 
Oil market, Measures for regula ting the crude oil Market, Supplemen tary Provisions II on Measures 
for regulating Foreign Investment in Commercial Fields .  The adoption of these rules and regulations 
further improved the regulatory framework under wh ich services suppliers operated in China.  As a 
result of China's efforts to fulfil its commitments, China's trading partners had witnessed the speedy 
increase of their services exports to China.  In  2006, the total value of China's services imports 
reached a record level of 100.33 billion USD.  C onsequently, China's services deficit had also reached 
a record high of 8.91 billion USD.  Foreign direct investment continued to increase fast in China's 
services sectors.  In the first nine months of 2007, a total of 11,627 new foreign-invested services 
projects had been approved, up by 5.48% compared with the same period of last year.  The actualized 
FDI stood at 19.94 billion USD respectively.  For example, in express services, foreign express 
companies were allowed to set up wholly foreign- owned enterprises in China.  Multinational firms, 
DHL, TNT, FedEx and UPS had taken a dominating shar e of 80% of the international segment of the 
market, which was the most profitable business in  express services.  In construction, design and 
engineering services, by the end of September 2007, investors from 30 countries and regions had set 
up 1,633 construction design and engineering joint ventures in China.  During the same period, 254 
representative offices of foreign law firms, 6, 200 Sino-foreign partnership accounting firms and 
66 Sino-foreign joint-ventures or contractual medica l facilities had been granted approval to operate 
in China.  Efforts made by China so far in implementing its commitments and expanding 
liberalization in these sectors had been already widely acknowledged and highly commended by a 
majority of foreign investors and WTO Members.  Foreign services suppliers were becoming more 
and more confident doing business in China.  Th ese impressive figures also demonstrated China's 
faithful implementation of its GATS commitments.  Her delegation hoped that the Members who S/C/M/90 
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  most benefited from China's market opening would fo llow suit in providing effective market access to 
Chinese services providers, by applying reasonable re gulatory requirements a nd streamlining approval 
procedures.  
27. The representative of China then turned to the question submitted prior to the meeting.  
Starting with legal services
 and the comment that China mainta ined certain measures incompatible 
with its GATS commitments, she noted that the tw o major domestic laws re gulating the foreign law 
firms and foreign lawyers in China, i.e. Regulations On Administration Of Foreign Law Firms’ 
Representative Offices In China  (hereinafter referred to as the Regulations ) and Implementation  Rules 
On Regulations On Administration Of Foreign Law Firms’ Representa tive Offices In China 
(hereinafter referred to as the Implementation Rules ) were both fully consistent with China’s GATS 
commitments.  With regard to an "actual need to  establish a representative o ffice in China to conduct 
legal service business", which was alleged to constitute a de facto economic needs test, China wished 
to clarify that, as a developing country, it was co nfronted with imbalances  in economic and legal 
services development within its territory.  Therefore,  in view of China’s immature evolution of legal 
services, the Chinese government needed  to maintain an "actual need" requirement, determined by the 
local economic and legal services leve l of development.  Besides, the regulatory authority intended to 
foster and keep a sound market order in legal services  by fulfilling their responsibility in this regard.  
As a matter of fact, none of the applications by foreign legal firms for establishing a representative 
office in China had been rejected  due to such a requirement since China’s accession to the WTO.  
Regarding the request to provide a positive lis t of activities which could be undertaken on the 
provision of information on the impact of the Chines e legal environment, she said that Article 15.5 of 
the Regulations  allowed the representative offices of fore ign law firms and their representatives to 
provide information on the impact of Chinese lega l environment. China's interpretation of this 
provision was that foreign representative offices c ould offer introductory services on China’s legal 
regime including its laws, regulations and rules. Besides, article 33 of the Implementation Rules  
provided that foreign representative offices should no t give specific opinions or make judgments on 
the application of Chinese laws, regulations and rul es when providing such legal information services.  
Article 32 of the Implementation Rules  defined specifically what "Chinese legal affairs" were.  All 
these stipulations were in compliance with Chin a’s commitments.  Foreign representative offices 
could engage in legal information services, with the exclusion of those defined as "Chinese legal 
affairs".  Concerning the three-year waiting period re quired before a foreign law firm could open each 
additional office in China, China's explanation was three-fold.  First, GATS specific commitments on 
the elimination of quantitative restrictions by no means deprived regulatory agencies of their right to 
regulate:  the three-year requirement was a regulat ory behaviour, and not a quantitative restriction.  
Second, representative offices were allowed to engage  in commercial operations in China.  Article 20 
of the Regulations  and Article 34 of the Implementation Rules  had granted these representative offices 
the right to charge and apply for tax invoices.  Th erefore, the legal status of these representative 
offices were not non-profit-making institutions th at only handled general liaison issues, and the 
Chinese authorities needed to set up criteria to evaluate the operationa l ability of a foreign law firm 
that intended to open several representative offices  in China.  Third, operational experiences of 
foreign representative offices in Chin a over the past decade showed that  it generally took an average 
of three years for a representative office from ge tting the license, then starting the operation until 
operating normally. Therefore, the three-year requirement was reasonable and necessary for 
protecting the legitimate interests of the public.  The time period of nine months for establishing a 
foreign legal representative office in China, was mean t to take into consideration all the procedures 
needed during the process of examination and approval, upon receiving the relevant application 
materials including, examining the completeness and authenticity of the materials, then confirming 
the qualification, or notifying the applicant of s upplementary materials and verifying the required 
notarization and certifications, etc.  In the practice of the past two years, relevant authorities in charge 
of the examination and approval had accelerated the process, which could be completed within nine 
months provided that the application materials su bmitted were in line with relevant regulations.  S/C/M/90 
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  28. With respect to postal and courier services , including express delivery services, the 
representative of China noted that several qu estions related to the amendment of the Postal Law .  
Since the law was still in the process of being drafted,  her delegation could not predict the final results 
and was unable to provide detailed information.  However, China would ensure that amendments 
would be made fully in line with China’s co mmitments  The Chinese authorities had solicited 
opinions from domestic and foreign enterprises on va rious occasions.  Regarding delivery of mails, 
China's commitments indicated that the courier ma rkets would be open, "except for those currently 
specifically reserved to Chinese postal authorities by law".  The existing Postal Law  stipulated that 
"Posting and delivery services of mail and other articles with characteristics of mail shall be exclusively operated by postal enterprises".  The 2007 postal industry standards for express services 
were China’s first non-mandatory standards for e xpress services and applied equally to both domestic 
and foreign enterprises.  In drafting these standa rds, the Chinese authorities had solicited opinions 
from different types of courier enterprises (includi ng foreign-invested enterprises), and consumers, 
and had publicized the whole draft on the we bsite. More than 600 organizations, including 
government authorities, courier enterprises, academ ic institutions, consumers’ associations had put 
forward many constructive suggesti ons and reasonable ones had been included into the draft.  The 
core of China’s postal system reform was to se parate operational and re gulatory functions.  As 
prescribed by the State Council, the new State Post Bureau would be responsible for the "supervision 
of the quality of postal services, implementation of  the market access system in postal services 
including courier services". Moreover, as a wholly  state-owned enterprise, the newly established 
China Post should conduct the operational function of the former State Post Bureau, undertake the 
universal service obligation, and operate in a market-oriented manner in a competitive business 
environment. 
29. Turning to telecommunication
 services, she said that, since the operation of basic 
telecommunications services was restricted by the scarcity of resources (frequency, number and right-
of-way), the number of licenses was limited. On frequency, the Chairman's Note on Market Access 
Limitations on Spectrum Availability (S/GBT/W/3) indicat ed that "[i]n light of the physical nature of 
the frequency and the constraints inherent in its use, … under the GATS each Member has the right to 
exercise spectrum/frequency management, which may affect the number of service suppliers".  There was a strong natural monopoly situation in fixed telecommunications, which relied on the scarce 
resources of number and right-of-way.  Market a ccess and competition were limited by the objective 
factors of technology and resources.  Minimum cap ital requirements applied equally to domestic and 
foreign telecommunications enterprises, and, thus, complied with the national treatment obligation.  
The telecommunications sector was capital-intensive and each WTO Member had its own minimum capital requirement in line with its actual situation. There was no unified requirement in this regard.  
Regarding the approval of foreign-invested teleco mmunications enterprises, China strictly followed 
its GATS commitments and its laws and regulations, such as the Regulation on the Administration of 
Foreign Invested Telecommunications Enterprises , the Regulations on Telecommunications , and the 
Administrative Rules on Telecommuni cations Service Operation Licenses , when examining and 
approving foreign telecommunications enterprises.   On national treatment for foreign services 
suppliers wishing to provide the same value- added services as domestic suppliers, she said that 
China’s schedule clearly indicated telecommunicati ons services for opening up.  As regards services 
not included in the schedule, fore ign investments and operations were currently not allowed.  China 
strictly respected the commitments undertaken upon  WTO accession and the relevant WTO rules in 
opening up its telecommunications market.  On the independence of the regulatory authority 
responsible for telecommunications, she recalled that  the Reference Paper prescribed the "independent 
regulators" as "the regulatory body [that] is sep arate from, and not accountable to, any supplier of 
basic telecommunications services. The decisions a nd the procedures adopted by regulators shall be 
impartial to all market participants". In 1998,  China had established the Ministry of Industry 
Information (MII), which separated the operationa l and the regulatory functions.  The MII had 
completely relinquished its operational function and transferred the regulatory function of personnel, 
finance and property to enterprises or relevant agen cies, so as to realize equitable, open and fair S/C/M/90 
Page 8  
 
  regulation of the telecommunications industry.  The MII completely complied with the requirement of 
an "independent regulator" in the Reference Paper.   For detailed informati on on the responsibilities of 
MII, Members could refer to the website of MII at www.mii.gov.cn
.  The agreement between China 
Telecom and China Netcom reflected voluntary beha viour between enterprises.  Bearing in mind the 
principle of maintaining the order of the teleco mmunications market and safeguarding the rights and 
interests of users, her authorities would continue to follow the progress of the agreement.  At the same 
time, MII required that telecommunications regulators at all levels should stre ngthen their supervision 
and instruction of competition, st ep up regulation of illegal competitive behaviour, such as dumping, 
operating beyond the business scope and damaging netw ork interconnection, and expose typical cases 
of infringement to consumer interests.  
30. With respect to construction, architectural and engineering services , she said that China had 
fully implemented its specific commitments with re gard to the four categories of projects open to 
foreign companies.  In order to ensure the fa irness of the qualification review, administrative 
authorities in charge of construction at various levels strictly abided by legal procedures and 
standards.  According to the Circular on the Issues of Qualification Administration of Foreign 
Construction Enterprises  issued by the Ministry of Construc tion, the Chinese authorities would give 
consideration to the performance in  construction projects of a foreign investor gained abroad when 
examining the qualifications of a foreign investor in its application for establishing new enterprises in 
China.  With regard to foreign contractors setting up joint-ventures with Chinese partners, the 
Construction Law  stipulated that enterprises engaging in constructing activities should meet registered 
capital and qualification requirements by the state.  Therefore, domestic or foreign enterprises had to 
comply with Chinese laws and engage in constr uction services within the permitted business scope 
after being approved and getting the qualification cer tification.  Concerning large-scale construction 
projects jointly contracted by more than two contracting entities, Article 27 of the  Construction Law  
stipulated that "in the case of a joint contract by mo re than two units with di fferent quality grades, the 
project shall be contracted in accordance with th e business scope granted to the entity with lower 
quality grade".  Therefore, enterprises taking the form of joint-venture should follow this provision in 
contracting projects.  The Circular of the Ministry of Construction on Distributing the Measures of 
the Ministry of Construction for the Implementation of the Relevant Qualification Administration 
Provided in the Provisions on the Administra tion of Foreign Funded Construction Enterprises 
stipulated that, in case a foreign enterprise pur chased a domestic enterprise, the newly formed 
enterprise should be regarded as a foreign-funded construction enterprise and its qualification should 
be reviewed and re-evaluated.  As already indi cated, since China had fully implemented its WTO 
commitments in the new system, it did not intend to amend or abolish these regulations.  Registered capital requirements were stipulated in the Construction Law  and applied to all construction 
enterprises established in China, both foreign and national, which was consistent with the national 
treatment principle.  The Chinese construction ma rket was still under development. China was now 
promoting the reform of enterprises and developi ng guarantee and insurance system fitting the 
development of the market.  Under the current situ ation, the registered capital was still an important 
guarantee for the risk of the projects.  Whether China would replace capital requirements with other 
financial tools, such as letters of credit, insurance bonds, bank guarantees, depended on China’s 
reform process of the financial system and the de velopment of the construction market.  Regarding 
the dredging sector, according to China's criterion fo r the categories of construction enterprises, an 
enterprise should first get relevant qualificati on in porting and sea-routing in order to conduct 
dredging business, and there was no special qualifi cation requirement. Enterprises conducting renting 
business of dredging vessels should comply with rele vant Chinese laws and regulations, and there was 
no market access restriction.  In order to acquire  the qualification concerning construction designing, 
an enterprise should employ a certain number of archit ects or engineers who needed to reside in China 
for a required period of time. If the foreign archit ects or engineers constituted a part of the required 
number of architects or engineers, the residency re quirements was also to be met.  This regulation 
aimed, inter alia , at reaching the standard of quality prescribed by relevant Chinese laws and 
regulations.  The residency requirements for foreign staff in foreign companies registered in China  S/C/M/90 
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  was based on the operative need of enterprises.  Unlike general operations , construction projects 
required project managers to be pr esent on the site to direct and guide the constructing process, so as 
to ensure the quality, security and technical requirements of the projects.  Therefore, if the project managers or professionals of an enterprise were fore igners, they had to stay in China for a certain 
period of time, so as to exercise the project management.  With regard to allowing foreign 
construction enterprises without local presence to  undertake construction projects, China had a 
mode 3 commitment on constructi on and related engineering services to permit the establishment of 
wholly foreign-invested enterprises;  yet, Ch ina had made no commitments on allowing foreign 
enterprises to conduct project contracting directly in  China.  With regard to the qualification for 
project management services, according to the Circular  no. 200 of the Ministry of Construction, an 
enterprise providing project management services shoul d have at least one of such qualifications as 
project reconnaissance, designing, constructing, supe rvision, cost consultation and bidding agent. 
31. Turning to tourism services
, she said that China had neve r taken "meeting the development 
plan of tourism" and "meeting the need of the ma rket" as necessary requirements for approving travel 
agencies.  Considering that some WTO Members ha d raised this question in previous TRMs, China 
would consider modifying the expressions in releva nt regulations to avoid misunderstanding.  China 
had modified its relevant regul ations to align them with its WTO commitments. China National 
Tourism Agency and Ministry of Commerce had promulgated Provisional Rules on the Establishment 
of Travel Agencies with Majority Foreign Equity and Solely Foreign Investment and Amendment to 
the Provisional Rules on the Establishment of Tr avel Agencies with Majority Foreign Equity and 
Solely Foreign Investment respectively in 2003 and 2005.  These regulations had addressed issues 
such as establishing solely foreign-owned travel agencies, eliminating geographical restrictions, 
lowering registered capital requirements, etc.  China's specific commitment s stipulated that the 
elimination of restrictions on the establishment of  branches by foreign travel agencies and the 
granting of national treatment in terms of registered capital should be eliminated within six years after 
accession, i.e. before 11 December 2007.  Current ly, China was working to modify and amend the 
Regulations on Administration of Travel Agencies and other relevant dom estic regulations in 
accordance with its commitments.  
32. With respect to distribution services , she said that, according to Measures for the 
Administration on Foreign Investment in Commercial Fields , there was a cap on the share of foreign 
investments in retail distribution services of several products for suppliers with more than 30 stores.  
This limitation was in line with China's specific commitments, and the situation had not changed.  
Regarding internet retailing, according to the de finition on distribution under Annex 2 of China’s 
Accession Protocol, retailing without fixed outlets was confined to the sales away of goods or 
commodities for individual or household consumption from an unfixed location.  This was different 
from the value-added telecommunication business, wh ich required an ICP license and did not affect 
China’s implementation of its commitments on the distribution sector.  Regarding the period of 
examination of the application for direct selling, according to the Regulations on Administration of 
Direct Selling , MOFCOM, State Administration for Industry and Commerce and Ministry of Public 
Security should hold substantial examinations of the applications, and the approval could be granted 
on the condition that all the requirements had been met. Speeding up the processing of applications 
for direct selling license depended on the capacity of th e relevant agencies.  Regarding restrictions on 
the geographic scope of licenses, applicants shoul d specify the exact location of the branches or 
networks situated in provinces, municipal cities or regions when applying for establishing direct 
selling enterprises.  With rega rd to the fact that the Regulations on Administration of Direct Selling 
required foreign investors to have more than three years experience in direct selling before applying 
for establishing direct selling enterprises, while dom estic enterprises did not need to meet similar 
requirements, she wished to clarify that:  (i) dom estic enterprises were prohibited from engaging in 
direct selling before promulgation of the Regulation , which meant that they had no operational 
experiences in this sector;  (ii) the requirement wh ich applied only to foreign investors was set up by 
taking into consideration the fact that foreign ente rprises had been engaged in this sector abroad for S/C/M/90 
Page 10  
 
  many years;  (iii) the Regulation  had adopted opinions and sugges tions from foreign enterprises 
before implementation.  Therefore, such a requireme nt was designed to create a level playing field for 
domestic and foreign enterprises to compete in Chin a’s direct selling market and did not constitute 
barriers for foreign investment.  By the end of 2006, China had appr oved 13 directing selling 
enterprises, among which ten were foreign enterprises.   Regarding limitations on the income received 
by direct sellers, she indicated that the payment to salespeople by domestic and foreign direct selling 
enterprises could only be calculated according to his or her direct sales revenue to consumers.  The 
overall payment, including commission, bonus, reward in various forms and ot her economic benefits 
should not exceed 30% of the sales revenue. This requirement had been designed after adopting the 
opinions of most foreign investors, and perfectly met the status quo.  On licensing foreign retail 
outlets, up to now, most municipal, provincial cities or cities in central government levels of China 
had made and published their urba n commercial network plans, whic h would apply to all kinds of 
investment entities regardless of whether it is dome stically- or foreign-owned.  Moreover, according 
to the Measures on Administration of Foreign-funded Commercial Sectors , there was no requirement 
on registered capital for newly established branches. Since the promulgation of the Measures , 
MOFCOM has transferred the power for approving foreign-investment in commercial sector to a 
lower level twice, and streamlined the administrativ e examination and approval procedures.  Article 
16 of the Implementing Measures on the Admi nistration of Automobile Brand Sale  stipulated that a 
foreign investor who conducted automobile brand sa le with more than 30 outlets could exceed the 
49% share cap after 11 December 2006.  On im plementation of China's specific commitments 
regarding wholesale and retail distribution of crude oil and processed oil, MOFCOM had promulgated 
Measures for Administration of the Market of Crude Oil  and Measures for Administration of the 
Market of Processed Oil .  China had fully honoured its relevant  commitments.  With regard to the 
progress made in commercial franchising administration, the State Council promulgated, on 6 February 2006, the Regulations on the Administration of Commercial Franchises , and, on 
30 April 2007, MOFCOM had promulgated the Measures for the Administration of Information 
Disclosure of Commercial Franchises  and Administrative Measures for Archival Filing of 
Commercial Franchise . 
33. Turning to air transport
 services and legislation concerning Computer Reservation Systems 
(CRS), she said that China General Administra tion of Civil Aviation had finished drafting the Interim 
Regulation on Approval and Administration of th e Direct Access and Usage of Foreign Computer 
(Passenger)  Reservation System by Sales Agents of Civil Air Transport Enterprises .  The Regulation  
had been submitted for approval, and the ti me for promulgation remained uncertain. 
34. To conclude, the representative of China indicated  that her delegation welcomed the questions 
on trade in services raised by some Members under the TRM. Her delegation wished to avail this 
opportunity to exchange views with, and clar ify misunderstanding of, Members on China’s 
implementation of its GATS specific commitments.  However, her delegation regretted that some 
communications had not reached her authorities timely,  leaving them very limited time to prepare the 
answers to questions that involved a wide range of sectors. Therefore, she asked for Members' 
understanding if the responses did not fully and adequate ly satisfy them.  She wished to reiterate, as 
she did in the Committee of Financial Services, th at, for the next TRM, Members should submit their 
written questions at least one month before the me eting.  Otherwise, China could not guarantee to 
address fully the late communications. 
35. The representative of the United States  said that the United States attached great importance 
to the TRM, which gave WTO Members an opport unity to assess the progress made by China in 
complying with its WTO obligations, in this case the GATS.  Her delegation thanked China for its 
lengthy and in some cases, detailed, presentation,  and wished to make some follow-up questions 
regarding certain areas that, in the view of the Un ited States, were not sufficiently addressed as part of 
China's presentation.  Regarding legal services , her delegation noted that China had provided an initial 
answer regarding foreign legal firms wishing to est ablish offices and had asserted that this related to  S/C/M/90 
 Page 11 
 
 
  China's right to regulate the sector.  As a follow- up question, the United States wondered what exact 
policy objective was China attempting to achieve a nd would any such requirements also apply to 
Chinese domestic law firms.  Regarding the sector of postal and courier services , including express 
delivery services, the United States appreciated the information that China had provided and noted that China had emphasized that foreign express de livery companies could hold 100% foreign equity 
and that foreign companies had established a presence  to service the international market.  However, 
foreign express delivery companies were also seeki ng rights to service China's domestic market and 
the United States was concerned that there might be certain elements of the ninth draft of the postal 
law which China mentioned that would effectively cu t out foreign companies from participating in the 
domestic express delivery market.  For example, the ninth draft might contain provisions that would 
reserve the delivery of all items weighing less th an 150 grams to China post and would not allow 
foreign companies to deliver to letters or docum ents weighing more than 150 grams.  So, when you 
put those two numbers together, that could effec tively keep foreign providers from supplying an 
integrated chain of services both related to inte rnational delivery and access to the Chinese domestic 
market.  If such elements did exist in the current draft, the United States would ask China to explain 
how they would be consistent with China's GATS co mmitments.  Also relating to the express delivery 
services sector, her delegation appreciated that Ch ina provided information regarding the express 
delivery standards that were issued in Septembe r 2007 and had taken note that China had confirmed 
that these standards were not mandatory.  However,  the United States had some concerns that, even 
though China now intended the standards not to be mandatory, they might in some ways have the 
effective mandatory regulations, given that Chin a might be considering delegating authority to 
regulate the sector to certain provincial level industry associations and they might look closely at 
these non-mandatory express delivery standards.  W ith that in mind, the United States emphasized 
that, in most markets around the world, express deliver y providers were not regulated directly or were 
regulated in a very light fashion.  Her delegation hoped that the issuance of the standards, even though 
not mandatory, would in no way be interpreted to impose undue burdens on the operations of express 
delivery providers.   
36. She noted that China had provided lengthy info rmation with regard to the telecommunications
 
sector, but the United States had some follow-up questions.  Regarding China's minimal capital 
requirement for foreign-investment telecommunication providers, the Chinese delegation had clarified that this requirement applied equally to domestic and foreign companies.  However, the point of 
concerns that had been expressed by foreign companies was that the level of these capital 
requirements were so high that they served eff ectively to keep foreign providers out of China's 
market.  In addition, the United States would empha size that provision of telecommunication services 
was not always capital-intensive, i.e. it did not al ways require setting aside high levels of capital.  
Many providers of telecom services could operate su ccessfully with very little capital outlay or rely 
on infrastructure located outside Ch ina.  With these factors in mind, the United States would urge 
China to continue review of these minimal capita l requirements with a view to making them less 
burdensome.  China had also provided some info rmation about the ability of providers of basic 
telecom services to be able to fr eely choose a joint-venture partner.  In China's Working Party Report, 
that right was very clearly provided – not just for telecom, but more generally.  In response to this issue, China had talked again this year about c oncerns about scarcity of resources.  However, many 
types of basic telecom services could be provided without competing for scarce resources.  Even in 
sub-sectors where scarce resources would be implic ated, the United States wondered why China felt 
that such resources might already be exhauste d since Chinese incumbents, that was domestic 
providers, continued to be granted licences and grew at  a rapid rate.  On a separate issue related to 
telecom, she noted that her delegation had not h eard an answer from Chin a about the US question 
about whether China was planning to  update its domestic definition of value-added services.  The 
United States would encourage the use of a broad defin ition in this regard.  She also noted that China 
had not addressed the US questions on satellite se rvices.  Specifically, how were preferences that 
China had granted – a Hong Kong based satellite service – consistent with China's GATS MFN 
obligation. S/C/M/90 
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  37. On construction
 services, the United States welcomed all the information that China had 
provided.  This was a sector with a number of diffe rent decrees, in implementing rules and regulations 
but it was a growing sector in China.  China was right  that there were a number of foreign companies 
in the Chinese market.  Her government welcomed th e fact that China had issued a draft Decree 114 
implementing regulations, but hoped that China w ould consider revising these implementing rules for 
Decree 114 to allow foreign companies to receive all classes of licences including high-grade licences 
without a trial period under a smaller scale licence.  Her delegation had also noted China's comment 
that it would be willing to consider the experience  of parent and affiliated companies of foreign 
enterprises when examining their qualifications to carry out certain grades of projects and welcomed 
that step.  On the provision of construction ser vices and minimum capital requirements, the United 
States appreciated China's comment that it w as actively considering a system under which 
performance bonds or other types of guarantees coul d be posted in lieu of existing minimum capital 
requirements.  As noted by China, such an i ssue was connected with developments under China's 
regime more generally, and the United States would thi nk that this related to China's financial services 
regime which also continued to strengthen.  On the issue of project management services, her 
delegation noted that China had said that foreign companies might provide project management 
services if they qualified for one of a list of va rious construction and design qualifications.  In the 
view of her delegation, this kind of regulati on remained unduly burdensome because in global 
markets, such project management services could be provided well and eff ectively without those 
providers being separately qualified unde r a construction or design regimes. 
38. On the issue of distribution  services, she noted that, with respect to direct selling, China had 
mentioned that its licensing process contained no r estrictions on the geographic scope of licences that 
companies could apply for.  Her delegation welc omed that information and would welcome full 
implementation of such a system.  China also men tioned that it had been speeding up the review of 
applications for direct selling licenses and, in th at regard, the United States understood China's own 
regulations in this area to require a decision within  90 days on applications.  Her delegation wished to 
express its continuing concern about China's impos ition only on foreign firms, but not on domestic 
firms, of a three year direct selling experience in ot her markets in order to be granted a direct selling 
licence.  Moving onto the sub-topic of retail servi ces, her delegation welcomed what it thought it had 
heard from China, in that the MOFCOM licensi ng process for a retailing services would not impose 
additional regulatory requirements on foreign versus domestic compan ies in the form of additional 
minimum capital to be satisfied for each branch ou tlet of such retail suppliers.  Regarding majority-
owned retailers of motor vehicles, she would appreci ate if China could repeat what particular pieces 
of legislation or regulations implemented China's WT O obligations in this area.  Regarding the areas 
of both wholesale and retail of processed and crude  oil and gasoline, the United States had understood 
that China's response this year had been that its  GATS commitments had been fully honoured.  Her 
delegation would appreciate more detailed informati on, i.e. could China simply explain the steps it 
had taken and the relevant legisla tion or regulations that pertained to fulfilling its GATS obligations 
regarding wholesale and retail distribution of crude and processed oil. 
39. The representative of Japan  thanked China for providing de tailed responses to questions 
raised by his delegation.  The TRM continued to be important for China and other WTO Members.  
Japan recognized the progress that had been made by China in implementing its WTO commitments 
and hoped to see China continue to carry out furt her liberalization in services and provide a greater 
degree of market access for foreign services providers.  His delegation had not heard responses from 
China on some questions and comments raised by hi s government.  In the field of postal and courier 
services , Japan understood that Article 8 of the Post al Law stipulated that Chinese postal services 
should monopolize services of delivering corresponden ce and other articles that had the nature of 
correspondence.  On the other hand, Ar ticle 8 also stipulated that the above provisions did not apply if 
the State Council decided otherwise.  Japan would lik e to know the details of such decisions, if any.  
Also China might clarify the reason why internatio nal express was subject to stricter conditions, and 
why and how personal letters  were distinguished from other letters in China.  In field of telecom   S/C/M/90 
 Page 13 
 
 
  services, China had explained, duri ng the 2006 TRM, that Chinese domestic rules and regulations on 
the interconnections between public telecommunicati on networks did include leased circuits Frame 
relays and IP-VPN,  although this was not clearly stipulated in the law.  Japan wished to seek 
confirmation that leased circuits, Frame relays and IP -VPN were included in "Other networks that the 
Ministry of Information Industry defines", as s tipulated under paragraph 8 of Article 2 of the 
Regulation on the Interconnections betw een Public Telecommunication Networks  (Decree 9 of the 
Ministry of Information Industry).  Moreover, it w ould be much appreciated if China provided the 
legal document on what "the Ministry of Informatio n Industry defines" under paragraph 8 of Article 2 
of this regulation.  Japan further enquired whethe r, under Chinese domestic law, foreign enterprises 
were able to undertake Internet data centre servi ces and Internet connection services, provided that 
foreign capital participation was less than 50%.  It would be appreciated if China could clarify 
whether or not Internet data centre services and In ternet connection services were included in the sub-
sectors which had already been comm itted to at the time of China' s accession to the WTO.  Finally, 
Japan wished to know whether the rules for interc onnection were disclosed to the public, consistent 
with the Reference Paper which China had committed  to.  If so, Japan would request information on 
where to obtain appropriate documents on these rules, as well as the name of the law and the article 
number that obliged operators to disclose them for interconnection. 
40. The representative of Canada  said that her delegation appreciated China's efforts at improving 
the transparency of its regulatory regi me and welcomed the publication of the 2006 China Trade in 
Services Report  and the continued update of  its Gazette via the MOFCOM website.  At the same time, 
her government had surveyed Canadian business es, which still expressed concerns regarding 
transparency.  During its 2006 transitional review , China had reported that the State Council had 
issued a circular requiring authorities and local governments to send copies of laws, regulations and 
other measures to MOFCOM for immediate publicati on in the Gazette.  Some Canadian companies, 
however, had cited difficulty in obtaining a complete set of the necessary procedures to establish 
commercial presence.  While there was official inform ation available at the state level, it was often 
supplemented with hard-to-find and locally specifi c rules and regulations.  There was also the 
challenge of inconsistent impl ementation and interpretation of regulations between government 
departments.  For service suppliers to compete effectiv ely in global markets, they required consistent, 
clear, up-to-date and easily accessible information.   Canada requested further updates from the 
Chinese delegation on this matter.  In respect of Annex IA, Section V, Policies Affecting Trade in 
Services, paragraph a , Canada remained unclear on the specific criteria applied by China in order to 
sign an Approved Destination Status Memorandum of Understanding  with a WTO Member.  Canada 
had made inquiries with the MOFCOM enquiry point, but had not yet received a response.  Her delegation would appreciate knowing where to find such information.  Finally, Canada wished to touch on the implications of the measures or  regulations that would evolve from the State Council's 
Opinions on Accelerating the Development of Service Industries .  In developing measures to promote 
the development of its service industry, Canada unders tood that China would give priority to specific 
production-based service industries and provide vari ous forms of support to these priority sectors.  
Canada was interested to know what this w ould mean for China's mode 3 national treatment 
commitments.  Would foreign-owned service suppliers  also benefit from any measures taken to give 
priority to a sector?  Would the grant of priority involve any new subsidies?  China had taken only an 
exception for subsidies in a few sectors (audio-visual, aviation, and medical services) and the 
exception did not cover new subsidies, only exis ting ones.  Canada looked forward to China's 
responses in this regard. 
41. The representative of the European Communities
 said that he intended to raise two issues on 
which his delegation requested further clar ification from China.  On legal services , he had noted 
China's explanations regarding the rationale behind the "actual need requirement" for a law firm to 
establish a representative office in Ch ina and for the three year waiting period that applied to the 
opening of new representative offices of foreign law fi rms in China.  His delegation had noted that, in 
China's view, these measures were derived from Chin a's right to regulate.  While the European S/C/M/90 
Page 14  
 
  Communities did not want to challenge the right  to regulate, it still wondered whether these 
restrictions were fully compatible with the commi tments that China had undertaken on legal services 
because none of them – the limitation on needs and th e three-year waiting period – were scheduled in 
China's commitments on legal services.  Hence, his delegation would welc ome more details on how 
these two limitations/elements were compatible w ith China's commitments on legal services under the 
GATS.  Concerning telecommunications
, he noted China's explanation that the signature of the 
agreement between China Netcom and China Tel ecom earlier this year amounted to "voluntary 
behaviour" between private partners and that th e independent regulator, in this case the MII was 
monitoring the market.  His delegation would welcom e more specific information as regards to the 
measures that the MII had taken in response to th is "so-called" voluntary behaviour between private 
partners because the European Communities unde rstood that these two companies had signed an 
agreement which amounted to a non-competition agre ement and would therefore be incompatible 
with the principles contained in the Reference Paper. 
42. The representative of Chinese Taipei  thanked China for the detailed answers provided and 
said that, in the view of his delegation, the TRM was useful. 
43. The representative of China  said that most of the follow-up questions had been addressed in 
her statement, but she was ready to repeat the rep lies.  Questions on satellite services were irrelevant 
as China did not have specific commitments in th is sector and the agreement with the Hong Kong 
based satellite services providers predated Chin a's accession to the WTO.   China had already 
responded to the questions on inte rconnection during the 2006 TRM and had decided not to repeat the 
answers so as to save time.  More over, these questions had come very late.  China did not respond to 
questions coming too late or concerning issues not included in its schedule of specific commitments.  
China had taken note of the questions posed by Ca nada on transparency, but noted that, in past 
Reviews, her delegation had not res ponded to questions posed at the meeting and, thus, believed that 
Canada did not expect an answer now.  She wished to note, nevertheless, that the Chinese government 
had made every effort to improve transparency in the country and also through the TRM.  In fact, 
China had done more in this respect than any othe r Member in the WTO and hoped that others would 
follow this example. 
44. The representative of the United States  said that, in her earlier presentation, her delegation 
had neglected to mention how important transparency was.  So, she wished to associate her delegation 
with the remarks made by Canada and other delega tions on that issue.  She took note that China 
believed it had made the most contribution on tran sparency.  While the United States believed that 
China had indeed taken several important steps on tr ansparency of regulation since its accession to the 
WTO, her government still had concerns that China' s system was not uniform.  It was very arbitrary 
and even when China was willing to consult with  interested persons, including from the business 
community, the process, except for certain limi ted sectors, was not clear and there was no 
understanding of how the process would be carried out.  So, while the United States welcomed the 
progress that China had made, it still believed hat th ere were areas where Ch ina might think further 
about how to guarantee a more transp arent trade regime.  On the issu e of process, she understood that, 
according to China, Members should submit the written questions at least one month in advance of the 
TRM session.  Her delegation understood that there was no such specific requirement for the TRM.  
Of course, her delegation would endeavour to alwa ys provide as much advanced notice to China as 
possible and provide the questions early before the TRM review.  But it did not have the same 
understanding as China regarding this one month in advance requirement. 
45. The representative of China  said that she had heard a lot abou t transparency for several years, 
but was still ready to continue the discussion with th e US delegate.  As far as process was concerned, 
China could follow the US advice in the next TRM.  S/C/M/90 
 Page 15 
 
 
  46. The representative of the United States  said she did not wish to change the rules regarding the 
submission of documents.  Members were supposed to  submit their documents ten days in advance of 
the meeting and extra time was a courtesy.  Members who had to do translations outside of the official languages of the WTO had to make the necessary adju stments.  A delegation should not be penalized 
for not respecting specific, independent rules.  Her delegation would be happy to work with 
delegations bilaterally if necessary, in order to  accommodate genuine concerns relating to their 
internal domestic process.  However, Members should not try to create new rules. 
47. The Chairperson
 thanked China for its responses and pr oposed that the Council take note of 
the statements made and consider Chin a’s Transitional Review concluded.   
48. The Council so decided . 
49. Regarding the report to the General Council, the Chairperson  suggested that the Secretariat 
prepare this report, in accordance with previous practice.  It would be a factual report, stating basically the following:  (i) at its meeting on 16  November 2007, the Council for Trade in Services 
conducted the Sixth Transitional Re view of the Implementation by China of its WTO Agreement and 
of the related provisions of the Protocol, pursuant to Section 18 of the Protocol of Accession of the 
People's Republic of China;  (ii) written communica tions were submitted before the meeting by the 
following Members: The Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu, the 
European Communities, Japan and the United States;  (iii) a detailed account of the discussion during 
the meeting can be found in the meeting report, contained in document S/C/M/90. 
50. The Council so decided
.  
VI. NOTIFICATION PURSUANT TO GATS ARTICLE XXI 
51. Statements made under this agenda item are c ontained in an informal  document and will be 
circulated as an addendum to this report after th e conclusion of the Article XXI negotiations and the 
certification of any changes to the relevant schedule of commitments. 
VII. OTHER BUSINESS 
52. The Chairperson recalled that, as indicated at the beginning of the meeting, he wished to 
make a brief statement regarding the Review of the Air Transport Annex.  As indicated at the last 
dedicated meeting, on 2 October, it was his intention to hold informal consultations in order to reach 
an agreement on how to proceed further with the second Review.  He proposed to hold these 
consultation on Tuesday 4 December, in the afternoon. 
53. The Council took note  of the statement. 
__________