RESTRICTED  WORLD TRADE  
ORGANIZATION  TN/S/M/39 
13 January 2011 
 (11-0223) 
Council for Trade in Services 
Special Session  
 
 
 
REPORT OF THE MEETING HELD ON 25 NOVEMBER 2010 
 
Note by the Secretariat1 
 
 
1. The Special Session of the Council for Trade in Services held a formal meeting on 
25 November 2010, chaired by Ambassador Ferna ndo de Mateo of Mexico.  The agenda for the 
meeting, contained in document WTO/AIR/3667, was adopted. 
A. IMPLEMENTATION OF  THE MODALITIES FOR THE SPECIAL TREATMENT FOR LEAST -
DEVELOPED COUNTRY MEMBERS IN THE TRADE IN SERVICES NEGOTIATIONS  
2. The Chairman  noted that the Special Session had recen tly met informally to discuss further 
the LDC waiver proposed by the LDC Group.  A us eful paragraph-by-paragraph examination of the 
text had been undertaken, covering issues such as the scope of eligible measures, notifications, effects 
on other developing countries, origin, duration, and scope of beneficiaries.  Ambassador Mwape of 
Zambia, on behalf of the LDC Group, had indicated  at the informal meeting that he would be 
consulting further on the LDC waiver text. 
3. Ambassador Mwape of Zambia , on behalf of the LDC Group , took the floor to brief Members 
on recent consultations by the Group.  Consultations  held on 12 November with several Members had 
covered issues arising from the Group's submission in document RD/SERV/18.  The LDC Group had also consulted with the European Union, b ased on its submission in document RD/SERV/24. 
4. On paragraph 1 of the draft waiver propo sal, questions had been raised concerning 
beneficiary countries and the scope of the preferen ces.  On beneficiaries, the issue was whether 
benefits should accrue to all 49 LDCs, or only th e 32 LDCs who were WTO Members.  The example 
of the goods waiver was cited as an instance wh ere preferences had been granted also to non-
Members of the WTO.  The LDC Group sensed an emerging consensus to extend the scope of the 
waiver to all least-developed countries.  In light of this, it would amend the text to reflect this. 
5. On the issue of the scope of preferences, positions were polarised between a wider scope 
(based on Article II of GATS) as proposed by the LDC Group, and a narrower scope (based on Article 
XVI) favoured by some other delegations.  Duri ng the discussions, some delegations favouring 
coverage based on Article XVI had indicated a willingness to be fl exible by considering an extension 
of coverage to Article XVII measur es as well.  However, this appro ach appeared to entail the listing 
of individual GATS provisions, together with exampl es of relevant measures to be covered.  This 
listing of GATS provisions was in itself problematic.  Other delegations had asked for illustrations of 
measures to be covered under Article II other than market access.  The LDC Group thought that an 
approach based on broader coverage was better, since it provided flexibility for individual Members 
granting preferences to choose the extent of  coverage according to their sensitivities.  
                                                     
 
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. TN/S/M/39 
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  6. In paragraph 2 of the waiver text, one delega tion had made a textual proposal in the second 
sentence to include the words 'modes of supply'.  Sinc e there appeared to be no objection by Members 
to this proposal, the LDC Group would proceed to am end the text accordingly.  Another issue raised 
under paragraph 2 related to the inclusion of CP C numbers in the text, and linking language to 
schedules of commitments.  As regards CPC number s, the initial waiver text of November 2009 had 
included such a reference, but this had been de leted from the June 2010 revision at the request of 
some delegations.  It was pointed out that including CPC codes would cause problems on how to reflect those services not having CPC codes.  At the informal meeting of the Special Session on 29 
October, a proposal had been made by a delegation to  include a reference to CPC numbers in the text.  
During the 12 November LDC consultations, this i ssue was discussed and co nsensus was reached to 
request the Secretariat to undertake work to assi st Members in understanding how CPC codes could 
be dealt with in terms of notification.  In light  of this, and if there was no objection among Members, 
it would be important for the Special Session to manda te the Secretariat to undertake work on issues 
raised regarding CPC codes, services without CPC codes, and link to schedules of commitments. 
7. In paragraph 3 of the waiver text, questions had been raised on the nature of the consultations 
envisaged, and the outcome of such consultations.  Other issues of clarification raised included the 
meaning of the term 'satisfactory adjustment', how the current text protected the rights of Members in relation to existing commitments, and clarifica tion of the language in order to facilitate 
implementation.  The LDC Group said that, as highlighted in previous discussions, the language used in the waiver text was not new, but derived fro m the goods waiver.  The LDC Group would not insist 
on the particular language in para graph 3, and would await suggesti ons from those who supported it.  
On the rights of Members with respect to existin g commitments, the LDC Group did not wish to take 
away rights of Members.  The waiver would not apply retrospectively.  
8. In paragraph 4, issues raised included the m eaning of 'undue difficulty', the changing or 
restructuring of paragraphs, the reason for the deletion of the last sentence on exemptions, the replacement of 'facilitate' with 'promote', the scope  of the phrase 'interest to LDCs', and the meaning 
of 'undue difficulty' for trade.  The LDC Group wish ed to stress that the language was not new, but 
derived from paragraphs 3(a) and (b) of the Enabling Clause.  On 'undue difficulty', this was an area 
where there was no jurisprudence, but there were some 'obiter' findings.  It was the hope of LDCs that 
this clarified concerns raised.  Otherwise, it w as a paragraph that LDCs did not insist on.  On 
paragraph sequencing, it had been proposed by some  delegations to move paragraph 4 to become 
paragraph 2, so that old paragraph 2 became new 3, and old paragraph 3 b ecame new paragraph 4.  
LDCs sensed no objection to this structural suggestion and took it that an amendment could 
accordingly be made to the draft text.  On the de letion of the last sentence, the LDC Group clarified 
that this was done to avoid repetition, since issues rai sed in the last sentence we re already reflected in 
the text.  Regarding the phrase 'interest to LDCs', the LDC Group said that this related to the next 
stage, when Members were engaged in market ac cess negotiations, and would at that point indicate 
the areas of preference. 
9. In paragraph 5, the LDC Group reported that th ere had been constructive engagement during 
the consultations held on 12 and 23 November.  Whil e there had been general support of the principle 
raised in the proposal tabled by the European Un ion in document RD/SERV/24, to ensure that LDCs 
were not used as mere 'mail boxes', the limitations imposed by the wording of the EU proposal were 
highlighted.  It was noted that the EU proposal  would limit intra LDC investment, due to the 
requirement of substantive business operations.  In or der to deal with this concern, proposals had been 
made to replace the words 'that' before 'least-devel oped country' in subparagraph (a) with the word 'a' 
in the first sentence, and 'any' in the second se ntence.  A concern was also raised about the 
construction of subparagraph (b), wh ich might be interpreted to exclude mode 3.  It was suggested 
that the EU consider splitting the reference to natural persons and juridical persons, as had been done 
in paragraph (m) of Article XXVIII of the GATS.  Another question raised was how the EU intended 
to incorporate its proposal into the text tabled by  the LDC Group.  The EU had considered the textual  TN/S/M/39 
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  proposals positively.  On the incorporation of the pro posed text into the waiver text, the EU indicated 
that, while it maintained an open mind, it would make  sense to insert their textual proposal close to 
the denial of benefit clause in paragraph 5.  On th e overall problem of rules of origin regarding trade 
in services, the LDC Group thought this was a complex systemic issue that could not be resolved in 
the context of the waiver discussions.   
10. In paragraph 6, questions of clarification had been raised on how the waiver would be 
extended, the clarity of the last part of the para graph, the scope of 'exceptional circumstances', why 
there was no mention of 'terms and conditions' as in  the goods waiver, and whether the intention was 
to introduce new criteria to conduct a waiver review  not appearing in the Marrakesh Agreement.  In 
response, the LDC Group indicated that there was no harm in including the words 'terms and 
conditions as reflected in Article 9 of the Marrake ch Agreement.  Regarding the extension of the 
waiver, the Group said that it referred to the extension of the termination date, and that the life of the 
waiver would remain consistent.  As regards the last sentence of paragraph 6, the Group said it was 
flexible, and would reflect on the language. 
11. In closing, the LDC Group wished to hear from other Members detailed views on the draft 
waiver text, building on the discussions held on 12 N ovember.  In the view of LDCs, the topic was 
'low hanging fruit' ripe for harvest, and Memb ers should attempt to finalize the matter. 
12. The delegation of Tanzania  said that the comments of the delegation of Zambia on behalf of 
the LDC Group had strengthened Members' understa nding on the status of the negotiations on the 
LDC waiver.  Tanzania stressed the importance of  the LDC waiver, which would not only promote 
increased trading opportunities for LDCs, but also  expand services trade and development within the 
trading system.  It therefore continued to call on the entire membership to re focus their attention on 
the LDC waiver, which had been on the table for a long time.  
13. The delegation of Hong Kong, China  said that LDC modalities were a key component of the 
Doha Round, and that the informal Special Session held on 29 October and the consultations held on 
12 November had helped to narrow down the differen ces.  More work was still needed to bridge the 
gaps on two major issues, namely the scope of th e draft waiver and the definition of the service 
supplier of LDCs for the purpose of preferen tial treatment.  These two issues corresponded to 
paragraphs 1 and 5 of the proposal from the LDC group.  The gaps were not unbridgeable, and Hong 
Kong, China called on Members to exercise diligence  as well as the necessary flexibility to intensify 
the negotiation.  This was an area in which Memb ers could make substantive progress if they had the 
will to do so.  Hong Kong, China continued to support work on this  front and to contribute to any 
further consultation meetings. 
14. Since the LDC Group had asked Members for their views on specific issues, Hong Kong, 
China was please to offer comments.  On paragra ph 1, Hong Kong, China believed that waivers in 
principle should be as narrow as possible.  However,  it was keeping an open mind with respect to the 
version proposed by the LDCs, which cast the scope wider than just including market access.  It was 
important to point out that it would be for the Me mbers affording the preferential treatment to LDCs 
to define the exact scope of such treatment.  The waiver itself was only the enabling instrument.  On 
para 5, Hong Kong, China noted with interest the proposal from the EU.  This had provided a good 
basis for work on further clarification of the defin ition of an LDC service supplier, in order to address 
the concern of some Members over the risk of circ umvention.  Hong Kong, China had raised at the 
consultation meetings the proposal to use the term  'any' in line 2 of subparagraph (a) of the EU 
proposal.  That change would encourage, or at l east not discourage, intra-LDC investments or LDC 
business operations.  Hong Kong, China would exam ine further the additional drafting proposal 
mentioned by the ambassador of Zambia.  Regardin g the other paragraphs, Hong Kong, China didn't 
have fundamental difficulties, and were pleased to  see that the LDC Group had incorporated earlier TN/S/M/39 
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  suggestions to improve the provision on notifi cation, making it clear that it be done on an ex-ante  
basis, and to clarify that the waiver is subject to annual review. 
15. The delegation of Turkey
 said that it attached great importance to the inclusion of LDCs in 
global trade, and endeavoured to support LDCs in their fight to alleviate poverty and achieve 
sustainable development.  The most important  tier of development was perhaps trade, and 
diversification of trade for LDCs – especially away from extractive industries.  Progress in the field of 
services could play a very important role in this re gard by attracting investme nt and by job creation. 
16. Turkey believed that the international community  should further contribute to the efforts of 
the LDCs with regard to sustainable developm ent.  Turkey's decision to host the UNLDC 4 
Conference, which took place every ten years, was a sign of its determination in this matter.  The Conference would take place in Istanbul in the spring of 2011. 
17. With this in mind, Turkey welcomed the draf t waiver decision presented by the LDC Group.  
With regard to its position on the provisions of the draft waiver decision, Turkey believed that 
paragraphs 1 and 5 were of significance.  Regardi ng paragraph 1, Turkey stressed that beneficiary 
countries should not be limited to WTO Member LD Cs.  Turkey supported preferential treatment to 
LDCs that went beyond market access.  Paragrap h 1 had been drafted as a non-binding clause.  
Members were free to define the scope of the treatment they wished to provide.  Concerning preferential treatment other than market access, perhaps additional illustrative examples other than 
lower application fees could help Member countri es better understand what LDCs were expecting 
from their trade partners.  
18. On paragraph 2, Turkey had no objection to redrafting to include modes of supply.  At the 
same time, it did not support the inclusion of CPC c odes in the text.  On paragraph 5, Turkey would 
have to evaluate the new proposal.  In any case, it beli eved that the direct beneficiaries of the decision 
should be LDCs, and not others.  An option might be to explain the purpose of the provision in the 
preamble, with a view to achieving mutually accepta ble language in paragraph 5.  Turkey welcomed 
and supported the efforts underway to find a solution,  and stood ready to make its contribution.   
19. The delegation of Switzerland
 said that the recent consultations had been very useful.  On the 
issue of scope of the waiver in paragraph 1, Switzerland's preference was a scope that was specific and clearly defined, and limited to Article XVI.  An open scope would be cause for concern since, 
given the diversity of the provisions contained in the GATS, a number of issues or legal questions 
could arise.  Looking at the issue of the men tion of CPC numbers, Switzerland believed that a good 
dose of pragmatism could result in a fl exible solution.  On paragraph 5, it was clear that further debate 
was necessary.  The Swiss delegation had made a proposal in this regard, to take away some 
redundant wording at the end of the paragraph.  No objections had been made, but a final decision had 
not yet been taken. 
20. The delegation of Mexico
 noted the progress made on this topic, but recognized that 
substantial work might be needed to reach a final outcome.  To reach this point, the negotiation would 
need to taken into consideration the interests of LDCs rather than safeguarding the well-established 
multilateral trading system.  The multilateral trading system would not collapse through the establishment of a waiver system, so Members need ed to be more flexible in devising a waiver 
approach. 
21. With respect to the scope of the preferences covered by the waiver, Mexico believed that 
Members should have the courage to go beyond Artic le XVI, since it was up to each granting Member 
to decide or not to grant the preference.  Although there might technically be a problem in applying 
Article XVII under the waiver, each Member could decide or not to do so.  This was already a kind of compromise.  With respect to the proposal on the ru les of origin, Mexico thought that the proposed  TN/S/M/39 
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  EU language might be too stringent and disc ourage LDC investment, as well as mode 3 export-
oriented LDC service suppliers who might not be able  to find a similar demand in their home market 
for the services provided.  For this reason, Mexico en couraged other Members to take a more flexible 
approach in devising an appropriate waiver for LDCs. 
22. The delegation of the United States  said it wanted a credible mechanism that would help 
LDCs in the services area.  Without repeating p ast worries on the scope of the waiver, the United 
States stated it was still concerned about creating an  instrument that would apply too broadly, and 
might result in unintended consequences.  The fact that it was up to the granting Member to determine 
what preferences it would provide did not alleviate those concerns.   
23. The United States remain committed to work ing through these issues with LDCs and other 
Members, but the matter was not yet ripe for conc lusion.  It supported the proposal from the LDC 
Group that the Secretariat look at the notifica tion issues related to CPC numbers, which would 
provide helpful guidance. 
24. The delegation of India  accorded a high priority to LDC waiver issue.  The informal meetings 
had been useful to push Members forward.  India ha d listened with interest to the views of Members 
concerning scope, coverage and benefits.  It requested Members to adopt a liberal approach, as a 
waiver that was too restrictive might be self-defeati ng.  For its part, India was willing to engage in 
consultative discussions in any fo rmat to speed up the process. 
25. The delegation of Japan  recognized that the LDC modalities were one of the important 
elements for the end game of the DDA negotiations.  It  wished to work energetically to make the LDC 
modalities an appropriate mechanism to contribute to the economic development of the LDCs.  
Considering that LDC modalities would be a part  of the package of the DDA as a whole, Japan 
welcomed the continuation of intensive discussions on the development of market access negotiations.   
26. Regarding the scope of the waiver, Japan said a common understanding was needed, since 
this element was a fundamental one with respect to LDC modalities.  Japan wished to address this 
issue in the light of examples of preferential treatme nt that could be related to national treatment or 
domestic regulation.  As with the question about wh ether preferential treatment will be given only to 
WTO Members or not, in principle Japan thought that, keeping in mind the purpose of Article IV:3 
and Article XIX:3 of the GATS which led to exam ination of the LDC modalities, this mechanism 
should be built in the framework of the WTO, so th at its disciplines should be applied only to WTO 
Members. 
27. The delegation of the European Union  saw the LDC waiver as a crucial part of the overall 
services package, and was gratified by the useful discussions held on 12 November.  The issues were 
not fully resolved yet, but it was hoped that Members could resolve them very quickly.  In particular, 
with respect to scope of the preference, the EU co ntinued to urge its LDC partners to present and 
explain the areas of preferences – examples where LDCs would seek preferences beyond classic 
market access.  This was still not as straightforwar d as it might seem.  The EU had some sympathy for 
the point of view expressed by the United States.  This being said, the EU thought that work was 
going quite well on the LDC waiver, and it hoped that work could be conclude d soon so that it could 
be contained in the overall services package to be concluded in 2011. 
28. The Chairman  agreed that the proposed LDC waiver was a topic where matters were moving 
well, and that Members would need to continue wo rking on it.  He proposed that over the next few 
weeks he would conduct further consu ltations in different configurati ons so that, as mentioned by the 
EU, an agreed text could be developed as soon as possible on this topic.  The Chairman asked delegations to reflect further on the issues that remained  to be resolved in the draft text.  As always, he 
and the Secretariat stood ready to assist in any way to advance this important topic.  TN/S/M/39 
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  29. The Council
 took note of the statements made, and agr eed to revert to this item at its next 
meeting . 
B. WORK OF SUBSIDIARY BODIES - REPORTS BY CHAIRPERSONS  
30. The Chairman  said that the four subsidiary bodies had met recently, and that any Chairperson 
who wished to report on recent progress in their discussions could do so. 
31. The Chair of the Committee on Specific Commitments  said that since her last report to the 
Special Session in September, the Committee had held  one formal meeting, on 16 November.  Under 
the agenda item classification issues, M. Andr eas Maurer, Chief of the WTO International Trade 
Statistical Section, had made a presentation on the ma in developments in the la test version (v. 2) of 
the CPC.  After the presentation, the Committee agreed to start informal discussions on classification 
issues at its next meeting, based on the Secretariat' s sectoral Background Notes.  Each meeting would 
discuss one service sector, and the first would be computer and related services. 
32. With respect to the agenda item the relati onship between old and new commitments, the 
discussion focused on procedural issues related to the verification exercise at the end of the Round.  A 
revision of the Secretariat's informal Note on the Roadmap for the Verification Exercise 
(JOB/SERV/21/Rev.1) was circulated  before the meeting.  Following the discussion at the previous 
meeting, the revision presented two scenarios of th e roadmap for Members' consideration: one was 
the exercise after the formal adoption of the negotia tion results; the other was the exercise before the 
formal adoption of the negotiation results.  The fi rst scenario followed the previous practice where the 
exercise was a consultative process aimed at verify ing the technical accuracy of schedules.  In the 
second scenario, the verification exercise was also e xpected to prevent possibl e rollbacks in schedules 
and therefore required a different design.  Again, th e Note stimulated active discussions.  Twenty-five 
delegations made comments and in particular sought clarifications on a number of issues, such as how 
to deal with disagreement in the process regardi ng entries in new schedules and how to coordinate 
with the negotiations in other areas.  Some delega tions reiterated their position that the verification 
exercise could not be a substitute for particular langua ge in the final protocol to prevent rollbacks.  It 
was agreed that the Committee should continue to  discuss the issues related to the verification 
exercise and that the Secretariat would present a se cond revision of the Note to facilitate a further 
exchange of views.  Due to lack of time, th e Committee decided to revert to the agenda item 
scheduling issues at its next meeting. 
33. The Chair of the Committee on Trade in Financial Services  said that the Committee had held 
a formal meeting on 16 November.  As agreed at  the previous meeting, the Committee held a second 
round of discussion on the Impact of Regulator y and Compliance Aspects of Banking and Other 
Financial Services under the GATS.  Some Member s reported on their national experiences, both in 
terms of the introduction of technological advances  in their financial systems, as well as relevant 
regulatory actions.  Although no clear guidance was provided on the way forward, there seemed to be 
some appetite to revisit the question of the dis tinction between modes 1 and 2 in the case of cross-
border electronic transactions.  It was agreed that an y follow up on this dedicated discussion, be it on 
classification issues or the distinction between mod es 1 and 2, would be tackled under the agenda item 
on Technical Issues.   
34. A second issue that had prompted quite a nu mber of interventions was China's revised 
proposal on trade in financial services and developm ent.  This revised proposal consisted of two 
elements: a review of the literature  on the role of trade in financia l services in economic growth and 
development, to be prepared by the Secretariat; and a dedicated discussion on the topic.  The latter 
would allow Members to share their experience rega rding the liberalization of trade in financial 
services, discussing inter alia its impact on econom ic growth and development, the relationship 
between opening-up and domestic liberalization of th e financial sector, and the role of regulation.   TN/S/M/39 
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  Most Members supported the new proposal.  It was agreed that the Secret ariat would prepare a 
Background Note on the first element of the Chinese proposal, and that the dedicated discussion would be held in the second cl uster of meetings in 2011.  
35. Under the agenda item on Recent Developments in Financial Services Trade, Barbados had 
presented an informal paper entitled "Unintended Consequences of Remedial Measure Taken to 
Correct the Global Financial Crisis: A Regulatory and Compliance Perspective".  Under the agenda 
item on Technical Issues, Members' attention was drawn to the importance of discussing classification issues arising in financial services, as was done with regard to other sectors.  It was, in the Chair's 
view, a good way of fully exploiting the potential for t echnical discussions in the Committee.  Finally, 
concerning the outstanding acceptance of the Fifth Protocol to the GATS by three Members – Brazil, 
Jamaica and the Philippines – there was no news to report.  The next meeting of the Committee would 
be held during the next services cluster, in February 2011. 
36. The Chair of the Working Party on Domestic Regulation
 said that since his last report in 
September the Working Party had held one formal  meeting, on 22 November.  At the meeting, 
delegations continued with their detailed excha nge on the various draft obligations on licensing and 
qualification requirements and procedures.  They al so discussed the "technical standards" chapter of 
the Chairman's draft disciplines. The discussion was focussed and the atmosphere was generally 
constructive.  Due to a lack of time, the Working Party agreed to take up the chapter on "definitions" 
at its next meeting in February 2011.    
37. On licensing and qualification requirements and procedures, Members had taken up the 
remaining themes of timeframe for the processing of applications; permission to supply; fees; 
verification and assessment of qualifications; identif ication of deficiencies of qualifications; and 
examinations.  As in the past, in discussing these th emes, delegations had also considered the proposal 
by a group of Members to streamline licensing and qua lification matters into two chapters.  Several 
delegations noted inherent diffe rences between licensing and qualif ication matters, and questioned 
whether all provisions under these themes lent themse lves to harmonization.  Others saw a possibility 
for having some provisions that would apply to bo th licensing and qualification procedures.  It 
seemed to the Chair that "streamlining" provisions in areas where the proposed standard of treatment 
was the same, was essentially a technical drafting ma tter, and its feasibility needed to be judged on 
those terms.    
38. A separate matter was the level of ambition that  was to be struck on the various provisions 
relating to licensing and qualification requirement s and procedures.  Here, it was well known that 
delegations had varying levels of ambition.  It was also well known that such differences could not be 
bridged by drafting or technical fixes alone.  Dive rgences in ambition were per se different from the 
question as to whether certain provisions of the draf t disciplines could be "streamlined" or not. This 
issue was very clearly highlighted in the di scussions that were held on 22 November.   
39. The exercise of reviewing the Annotated Text had not yet been completed, but the Chair 
thought that the process had been useful in helpin g delegations to gain a better understanding of the 
contours of the various positions and,  hopefully, helped to lay some foundations for bridging gaps.  At 
some point delegations would need to intensify their work on a textual basis. 
40. Trade negotiators faced many difficulties when they interacted with sector regulators.  The 
trade community would benefit from having a better appreciation of how regulations were actually 
formulated and implemented across various sectors and regions, just as regulators required a better 
understanding of how licensing, qualif ication and technical standards might affect trade in services.  
In this connection, the Chair was pleased to report th at at the formal meeting of the Working Party, all 
Members had supported the idea of organizing a Workshop on Regulatory Practices for the next meeting in February 2011.   The Working Party also  instructed the Secretariat to update its 2003 note TN/S/M/39 
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  on "Necessity Tests" (S/WPDR/W/27), and to include therein the topic of "disguised trade 
restrictions".  
41. The Chair of the Working Party on GATS Rules
 said that since her last report the Working 
Party had met in formal session on 24 November. On subsidies, she said that the Working Party had held its first dedicated discussion on the topic under  the Information Exchange exercise.  It had 
allowed Members to hold a first exchange of views on the information provided so far, and to begin 
identifying potential systemic issues, which could be relevant for the nego tiations mandated in GATS 
Article XV.   Eighteen submissions (counting the EU as one) had so far been received.  They had been 
circulated in documents JOB/SERV/Add.1 to 12.  Counting individual Member States of the EU, the 
information provided currently covered 44 WTO Member s.  The Chair understood that there were still 
be more submissions in the pipeline.  In addition,  at the meeting, several delegations had indicated 
that they envisaged supplementing their current s ubmission, e.g. by adding new sectors, once the 
necessary information became available.  While the entire membership was not yet covered, the 
information currently on the table already provided  a significantly greater coverage of Members as 
compared to the five submissions previously r eceived between 1997 and 2005.  Members felt that a 
reasonable body of information was before them, upon which the information exchange could draw.  
The Working Party would revert to the dedicated di scussion on subsidies at its next meeting.  In the 
meantime, the Chair would consult on possible analytical  work to be carried out by the Secretariat in 
relation to the submissions made.   
42. The Chair added that, as on previous occasions, th e Working Party also had on its agenda the 
proposal submitted by the delegation of Switzer land on export subsidy disciplines, and the 
communication from the United States entitled "GA TS Article XV: Questions for Members by the 
United States" (S/WPGR/W/59).  She proposed further consultations on these submissions, should Members so wish.  
43. On government procurement, the Working Party had held a first dedicated discussion on the 
economic importance of government procurement in services in developed and developing countries.  
The dedicated discussion was introduced with a pre sentation by Professor Simon J. Evenett, Professor 
of international trade and economic development at the University of St Gallen.  His presentation was 
followed by a lively debate.  Thereafter, the Working Party discussed the next steps of its work in this 
area and how to organise dedicated discussions on th e remaining topics outlined in the EU proposal, 
as contained in document RD/SERV/23.  The next steps would include a possible future presentation 
by a WTO Secretariat GPA expert as well as a joint session between services and GPA experts.  The 
Chair would further consult on these meetings in due course.   
44. On emergency safeguard measures,  the delegate of the Philippi nes had made a comprehensive 
statement to share observations about the main stag es of the ESM negotiations, and where they could 
possibly go.  Members reiterated their agreemen t to postpone the discussion on ESM-relevant data 
until after the Council discussion of an updated Secret ariat Note on international trade statistics in 
services.   
45. Overall, the Chair believed that there was new en ergy in the Working Party, and efforts were 
being made to meet the mandate of the Hong Kong Ministerial Declaration for the GATS Rules 
subjects.  She wished to thank delegations for thei r support, and looked forward to continuing on this 
positive track. 
46. The Council took note of the reports made. 
  TN/S/M/39 
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  C. REVIEW OF PROGRESS IN NEGOTIATIONS , INCLUDING PURSUANT TO PARAGRAPH 15 OF THE 
GUIDELINES FOR NEGOTIATIONS ; AND ORGANIZATION OF FUTURE WORK 
47. The Chairman  noted that it was the last cluster meeting of the year.  It was thus an especially 
appropriate time to assess past progress, and to begi n formulating 'new year's resolutions' on how the 
negotiations should proceed in the months ahead.   
48. From the Chair's perspective, the record for th e year had been mixed.  There had of course 
been the fundamental disappointment of not concl uding the Round during the past months.  However, 
there had also been positive elements, including suggested new approaches to the market access 
negotiations, and technical work on the rule-maki ng side.  As well, under the so-called 'cocktail 
approach' the work during the past few weeks of small groups of ambassadors including in services 
had been useful.  
49. At the political level, welcome signals had been received recently from Ministers 
participating in the G20 and APEC meetings.  They had recognized the 'window of opportunity' for a conclusion of the Round in 2011, committed to intens ify the negotiations, and agreed to seek domestic 
ratification once an outcome was reached. 
50. The Chair said that he wished to hear Members' views on where services negotiations stood 
and, on that basis, what 'new year's resolutions' Members should be consider ing in order to advance 
their work.  As a practical matter, Members had tenta tively agreed to hold the next cluster of meetings 
during the week of 14 February.  The Chair added th at, if requested by Members, he was ready to 
convene additional meetings in di fferent formats aimed at the successful conclusion of the services 
negotiations, bearing in mind that these were not conducted in a self-contained environment. 
51. The delegation of Australia
 said it had asked for the floor early  because it wanted to introduce 
formally its job document (JOB/SERV/33) on 'F ocusing Plurilateral Requ est/Offer Negotiations – 
Ideas on Clustering'.  The document was a direct re sponse to requests for more information on the 
idea of clustering plurilateral requests that Austra lia and some other delega tions had been examining 
during the year.  The document set out in simple terms what the concept was and what it was not. 
52. Clustering was not an unrealistic push for greater  ambition, nor was it an attempt to supplant 
the existing process.  It was instead a way of bette r organizing the market access discussions so that 
they could be advanced more efficiently and presente d more clearly for political decision.  Of course, 
if stronger commitments were to result from the ideas put forward, then for Australia that would be a 
good thing.  Clustering should not howe ver be seen through this prism alone. 
53. Australia's ideas on clustering arose from work  done in the lead-up to the December 2009 
Ministerial.  The work had since evolved, and Aust ralia's current trade minister had taken an active 
interest in this concept as a means to better orga nize the existing plurilateral process, and to build a 
stronger constituency for a successful Doha outcome.  It was no secret that Australia had for some 
time been concerned about the slow progress in th e services negotiations. Clustering was aimed at 
helping restore momentum to the market access negotia tions as part of the wider work that needed to 
take place in market access and in other areas of the services negotiations.  There was a need to see 
some prompt and genuine engagement on services ma rket access if Members intended to catch up in 
procedural terms to the progress made in other market  access areas of the Doha package.  Importantly, 
Australia also believed that clustering could be used to highlight and develop further developing 
countries' interest in the negotiations.  As a result,  Australia believed that clustering had the potential 
to help achieve a stronger overall outcome in th e level of commitments that Members might be 
prepared to take on, but in a way that could also be used creatively to take account of sensitivities in 
individual Member economies. TN/S/M/39 
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  54. Work undertaken on logistics and supply chain services was an example of this.  It was an 
area where Australia believed that  there were real synergies with developing countries, and indeed 
Australia's own interests in ensuring the effective de livery of export goods to their destination.  While 
linking the main elements of the maritime transport,  air transport, logistics, postal and courier, and 
distribution services plurilaterals, Australia was able to define a set of services that were critical for a 
smoothly functioning supply chain.  Australia also wa nted to be clear that plurilateral requests were 
and would remain the key element of the overall ma rket access picture.  Clustering was not designed 
to replace plurilaterals but to complement them by providing a high level overview of a series of 
related plurilateral requests.  While each of the 22  plurilateral requests represented important services 
sectors in their own right, and individual Members' interest in those sectors, clustering could help 
ensure that Members did not continue to view those 22 requests in isolation, but start to see and act on 
the linkages between the services contained in those requests. 
55. Clustering would help Members explain their achievements in the negotiations by allowing 
them to package in an intelligib le and business-friendly way the si gnificance of the commitments that 
were secured.  This would help Members to sell the services outcome to th eir constituencies, whether 
in developed or developing countries.  Australia w as encouraged by the interest in its clustering ideas 
expressed by a range of Members with whom it had b een meeting bilaterally.  It intended to continue 
to dialogue with other Members, but was also looking to further elaborate its ideas on logistics and distribution services in more detail to better explain what it had in mind. 
56. Australia welcomed the work that others ar e doing to develop thinking on these issues, 
particularly the United States in the ICT sector.  Wh ile work on the development of the clustering idea 
was ongoing, it was important to grasp that the concep t was not based on a one-size-fits-all model.  It 
could apply across all modes and sectors, and necess arily would not work in the same way in every 
instance.  Australia was examini ng seriously the best way to creat e the necessary flexibility that 
would allow Members with different levels of  economic development and potentially different 
sensitivities to be able to take part.  It would be necessary to find a way to accommodate flexibilities 
in the overall concept of a logistics supply chain.  It went without saying that there were other equally 
important areas of the negotiations on which Member s also needed to make progress.  Delegations 
had just that day discussed issues of great importance such as LDC modalities and domestic 
regulation.  The Chair's initiative in building on the positive discussion in small groups and the 
ambassadorial process on domestic regulation was particularly appreciated, as there were clear linkages between the work on domestic regulati on and meaningful market access outcomes. 
57. If the recent encouraging signals about the pros pects for the Doha negotiations were to be 
given an expression, Members would need to act quickly in services to catch up with progress made in other areas.  Delegations would need to see serious engagement on all areas of the services 
package, including on market a ccess, as the process intensified in 2011.  The Chairman had 
commented about plans for a meeting in February.  Au stralia's view was that this was part of a wider 
intensification of work.  However, it wanted to see those timeframes brought forward to earlier in the 
year, if at all possible, because there was much work  to be done in order to move forward in the 
negotiations. 
58. Australia looked forward to continuing the di scussion on clustering, and was happy to take 
into account any views that it might receive now or in the future.  
59. The European Union
 shared the Chairman's assessment of the negotiations, but wished to give 
a more political appreciation of where Members were  and where they needed to go.  The Chairman 
was right to say that the negotiations had had a mixed record in the past year, and to say that there was 
now a perceptible increase in tempo.  The Seoul a nd APEC summits had given a very strong direction 
to the Round, including in services.  Members n eeded now to implement and take forward the 
political instructions that many had received.  Delega tions needed to intensify the negotiations if they  TN/S/M/39 
 Page 11 
 
 
  were to bring the ship to port as part of the c onvoy of the Round.  The EU asked and encouraged the 
Chairman in the strongest possible terms to launch and manage an intensive negotiating process in all 
areas of services from January, combining the meeti ngs of the negotiating gr oup with ambassadorial 
and senior official discussions and negotiations.  Tho se modalities had proved useful in recent weeks.  
For the EU, all aspects of the negotiation were about  market access, whethe r one focused on the LDC 
waiver which was about preferences, or on dom estic regulation which was about the potential 
regulations to facilitate trade access, or on the mo re classic market access components of services.  It 
was all about market access, which meant that a ll of those areas of the services negotiations had to 
proceed in parallel as part of a broader market access package. 
60. In practice, there was a need to see texts or  some form of emerging consensus on the LDC 
waiver and on domestic regulation early in 2011.  Many had talked about March as being a focal point 
for that.  On the more classic market access part of  the negotiation, the EU expected to see in early 
2011 and through the next few months, a combination of the continuation of requests and offers, but 
also a strong injection of plurilateral and other discussions, for example on the cluster approach, 
guided by the Chairman.  That would help at the a ppropriate time for services in all its elements to be 
brought into a more horizontal negotiation enco mpassing agriculture, NAMA, rules and other key 
components of the Round important to many Members.   It would be essential that services constitute 
part of that horizontal process whenever it took place, so that the overall value of the emerging 
package of the Round – the size and the nature of th e deal in services – could be progressively defined 
and appreciated along with other areas of the Round, a nd a balance struck.  There was no time to lose.  
Time was of the essence, and Members looked to the Chairman to do all he could to ensure a very 
intense negotiating process starting as rapidly as possible. 
61. The delegation of Canada  said that at the September Special Session, it had joined other 
Members in underlining, once again, that service s was a key pillar of the Round.  Since then, 
ministers at APEC and the G-20 had provided a rene wed direction to conclude the Round, and there 
was a growing optimism in Geneva following the focused high-level discussions in the last few 
months.  Canada expected renewed pressure in the next few months to assess the potential outcome 
across the various areas of the Round and to move qu ickly – decisively and efficiently – to bring the 
negotiations to a close.  Delegations had already received this message received their ministers, but they would also receive it from their industries, and would need to act. 
62. Canada had been encouraged by some of the exchanges during the services meetings in the 
past two weeks.  The accountancy plurilateral in pa rticular had been well attended, and participants 
had spoken readily about flexibilities and offers, wh ich was a positive step.  Canada was disappointed, 
however, that some Members had chosen not to participate in the plurilateral session, with one 
specifically noting a decision at present not to engage on services market access.  Canada also 
regretted that there had been so little progress on ser vices market access since July 2008.  Substantive 
discussions had continued in other areas, such as  LDC modalities and domestic  regulation.  Canada 
welcomed those, but Members could not continue to negotiate selectively.  Market access needed to 
be back on the agenda. 
63. In other areas of the round, Members were now addressing key issues.  In services, many 
Members were opting to wait.  Market access in services was however as complex as in agriculture, 
and they would be just as time-consuming as in othe r areas of the round.  If services were left until the 
last minute, there would be a race against the clock.  Services would not be the casualty – the real 
casualties would be service suppliers and the lost  opportunities for trade in services and economic 
growth and development worldwide.  
64. Members therefore needed to start preparing now.  It was not about setting a date for offers.  
It was about ensuring a good result, meaning offers th at were ambitious.  Members needed to go back 
to requests, assess them against what was on the tabl e, re-engage in a meaningful give and take, and TN/S/M/39 
Page 12  
 
  work towards a services deal that would meet ever yone's expectations.  In short, Members needed a 
commitment to negotiate in good faith, w ith full participation by all Members. 
65. Canada wanted an ambitious, commercially m eaningful result, and would continue to 
advocate its specific interests:  financial services, mode 4, energy and environmental services, and 
mode 3, to name just a few.  But in asking, Canada realized it would also need to listen.  It would be 
asked to push the envelope and address other Member s' priorities and other broader interests.  In 
terms of the "how" – the modalities for the negotiatio ns – Canada expected Members to use whatever 
tools best fitted their needs: bilaterals of course, but also plurilateral requests, and new ideas such as 
clustering, which could be complementary in many ways.  Canada was open and flexible in this 
respect.  Its concern was with the result – and en suring that there was time to get there.   
66. Canada agreed that market access was not the on ly area where Members needed to focus, and 
likely step up the pace.  Canada believed in re -engagement on all fronts.  This included LDC 
modalities, domestic regulation and discussion on the n eed for further disciplines on rules.  Canada 
was heartened to see that quite a few other Members sh ared its views.  However, there was a need for 
commitment from all Members to give services – in a ll areas – the priority they deserved, and to start 
meaningful negotiations as early as possible in 2011. 
67. The delegation of Chinese Taipei
 said it could not emphasize enough that services was one of 
the three market access pillars of  the DDA negotiations and, because of the complex nature of 
services, make special efforts were  needed to ensure that progress in the services negotiations would 
not lag behind other negotiating areas.  Members needed  to be well prepared in advance so that when 
it was time, they were ready to cross the finishing line together.  This included not only market access 
issues but also domestic regulation, rules and the LDC waiver issues as well.  Members had to make 
sure that at the end of the day services was a v ital element of the whole Doha undertaking that 
benefited all Members, devel oping and developed alike. 
68. In this connection, Chinese Taipei was pleased to see Australia's clustering paper.  This 
proposal could help to maintain the momentum  of the services negotiations and secure greater 
Member engagement in the market access negotiations .  Chinese Taipei shared with others the view 
that clustering was complementary to plurilateral requ ests in a way that helped Members to make their 
commitments even more commercially meaningful.  As far as organization for the next cluster was 
concerned, Chinese Taipei preferred to avoid the lu nar New Year holiday, which fell in the first week 
of February.  It could therefore go along with the Chairman's proposal to hold the next cluster in the 
week of 14 February. 
69. The delegation of Chile  noted that the signals from the G20 and APEC meetings were 
important and were genera ting movement in Geneva.  It was hope d that this trend would materialize 
and enable Members to enter a full negotiating process in different configurati ons and levels so that 
they could move forward on market access as well as on disciplines in services – in particular, the LDC waiver, domestic regulation and an in-depth  discussion on rules in services.  These new winds 
blowing from the east had led to two very busy weeks.   Chile could see the positive effects of this in 
the added bilateral meetings that had taken pl ace, as well as in other types of meetings, group 
meetings from the proponents of different plurilate ral requests, and in a very positive meeting on 
accounting services.  This demonstrated that the plur ilateral configuration was one that was still alive 
and well an could bring much more to the negotia tions on market access.  Chile hoped that all this 
boded well for January.   
70. Australia's contribution on clustering added to  the positive signs.  It introduced a positive 
input with a focus that would enable Members to  give a new momentum to the negotiations, update 
negotiations reflecting trade realities, and simplify them in an important way.  Clustering was a 
valuable tool that should be app lied alongside all of the other tools, the bilateral process, and the  TN/S/M/39 
 Page 13 
 
 
  plurilateral process.  A holistic type of liberali zation of logistics was something that had great 
potential, specifically for countries like Chile where the development strategy was based on 
international trade.  Deep commitments in these sectors would facilitate exports and imports.  The 
numbers that were found in the document were eloquent.  Great gains could be made through 
liberalization of logistics for developing countries.  
71. On the next cluster of meetings, Chile belie ved they should match the intensity of the 
negotiations.  One week would be necessary for the clus ter.  Time would be needed for bilateral and 
plurilateral meetings, so it would be necessary to postpone the regular session of the Council and the 
standing subsidiary bodies to March.  The work shop on domestic regulation could also be pushed 
back to April.  The Special Session of the Coun cil should meet on Friday afternoon of the cluster 
week so that all of the meetings on market access can be made effective. 
72. The delegation of Japan  said that during the last few weeks Members had been enjoying a 
wave of fresh air that had not b een felt for a long time.  APEC l eaders and ministerial meetings in 
Yokohama had delivered a strong political message on the need to bring the Doha Development 
Agenda to a successful conclusion.  In the me etings, there was a common understanding that 2011 
would be a crucially important 'window of opportu nity,' and that every Member would go into each 
negotiation 'with a sense of urgency' in order to m ove the negotiations into 'the end game', and there 
also was a common will to direct and 'empower' their representatives to engage in substantial negotiations.  The APEC ministerial meeting had al so adopted a standalone 'Statement on Advancing 
WTO Doha Development Agenda Negotiations and R esisting Protectionism'.  These clear messages 
from the Yokohama APEC meetings and the Seoul G20 Summit meeting were firmly received in 
Geneva.  In the past few days, Members had been putting their heads together to make a concrete 
work plan towards the 'window of opportunity' in 2011.  During the present two-week services 
cluster, Japan observed more faces of capital-based o fficials than it did during the previous cluster.  
This was a sign of the commitment from each Memb er to accelerate the negotiations for the year 
ahead.  
73. With regard to market access, the clustering a pproach that Australia had just introduced had 
made a significant contribution.  Japan supported th is approach as a way to increase momentum for 
the entire market access negotiation.  At the meet ing of maritime transport services friends, which 
Japan has been coordinating, there had also been a fruitful discussi on on Australia's proposal.  Japan 
had also held a number of bilateral meetings, where each side had confirmed the other's positive 
engagement towards a future in tensification of negotiations.  
74. As for rule making, Members had held a mean ingful discussion on domestic regulation.  The 
workshop planned for the February cluster would al so be a beneficial endeavour for subsequent 
discussions.  In addition, Japan was grateful for th e useful input from experts, both in the Working 
Party of GATS Rules and the Committee on Specific Co mmitments.  Furthermore, as stated earlier, 
Japan was committed to making further contributions  to LDC modalities.  In addition, Japan had 
actively contributed to the MFN Exemption review, held  for the first time in five years.  Japan had 
been putting emphasis on this important cornerstone in WTO, and would contribute to the coming reviews.  Japan appreciated the Secretariat's pape rs on distribution and road transportation services, 
which it found comprehensive and useful. 
75. Political will had been clearly expressed in Yokohama and Seoul, producing the strongest 
political momentum since 2008.  Nevertheless, that  was not enough.  Delegations were the ones 
feeling a sense of urgency in the end game, and we re the ones empowered by their leaders to open the 
'window of opportunity'.  Delegations were gath ered in Geneva to achieve this goal.   
76. To achieve success, three key points had to be keep  in our mind.  Firstl y, delegations had to 
focus on the substance of the negotiations.  That is to say, they had to promptly resume negotiations TN/S/M/39 
Page 14  
 
  on market access, a topic neglected since the Minister ial meeting in July 2008.  Members had to use 
all the means a their disposal, including bilateral and plurilateral negotiations, as well as a clustering 
approach, while intensifying simultaneously the negotiations on domestic  regulations and LDC 
modalities.  Secondly, while focusing on the substa nce, Members had to create a general timeline for 
work.  It was important for all to bear in mind th e truth that the service negotiations required more 
time to reach a final conclusion.  Members had to make efforts to create a mutual understanding on 
the timeline that would enable them to conclude  the DDA by 2011, with a substantive outcome on 
services, while taking into account the progress in othe r areas of market access negotiations.  Thirdly, 
it was important that ambassadors and senior officials continuously engage  in this area.  In order to do 
this, delegations needed to draw a clear picture of the services negotiations by capturing the major 
issues from the current entangled situation. 
77. The delegation of Hong Kong, China
 viewed Australia's proposal on logistics and the supply 
chain services as an important contribution to the services negotiations.  Logistics services were of strategic importance for all economies, developed or developing alike, as they formed the platform for 
other service suppliers and those engaged in the production of goods to build up their competitive 
edge.  The business potential of logistic services was large and growing fast, in particular for 
developing Members.  Hong Kong, China was a keen demandeur in respect of logistics services, and 
coordinated a plurilateral request seeking improved  commitments in this important sector.  The 
proposal sought to build on the logistics and othe r plurilateral requests for a more comprehensive 
package of services pertinent to th e supply chain.  This clustering approach might provide a clearer 
shape to some of the services out comes that could be readily understood by stakeholders in the 
industries concerned.  Hong Kong, China was inter ested in working with the proponent as well as 
other Members to develop the idea further with a view to enlist as Members as possible, and to be 
engaged in the relevant bilate ral and plurilateral processes. 
78. More generally, Hong Kong, China was also pleased to note that the Australian proposal 
would re-energize the market access discussion in services.  Hong Kong, China would welcome a 
process being put in place in the Special Session that would afford many Members the opportunity of 
initiating market access proposals and engaging in substa ntive negotiation on these.  It was aware that 
there were also other clustering proposals being de veloped by Members.  This was positive, and might 
increase the level of activity in the market access nego tiations.  Members were encouraged to keep an 
open mind on these initiatives.  Needless to say, this  was to be viewed as building upon, and not 
replacing, the plurilateral requests that were alrea dy on the table.  There were many sectors in the 
plurilateral requests not captured by the clustering proposals, and they deser ved equal attention in 
order to drive towards a comprehensive and balanced market access outcome. 
79. On the November cluster, Hong Kong, China viewed it as important since it had been 
preceded by the strong political messages from the G20 and APEC summits.  The negotiators in 
Geneva had been called on to engage in across- the-board negotiations to bring the Round to a 
successful conclusion in an ambitious, comprehe nsive and balanced way.  Members had been 
instructed to build on the progress already achieved a nd to intensify their work.  They were expecting 
busier and hopefully more fruitful negotiations early in 2011.  It was time for Members to translate 
the political will into concrete results.  In this  light Hong Kong, China was pleased to see that 
Members had engaged constructively during the clus ter to press ahead with work on all fronts and it 
thanked the Chairs of the subsidiary bodies for th eir useful reports which had highlighted the most 
important elements. 
80. The Council for Trade in Services had conducted the first dedicated session on the MFN 
Review during the cluster.  As in the two previ ous reviews conducted since the establishment of the 
WTO, Hong Kong, China attached much importan ce to this subject.  There were continual and 
systemic concerns over the fact that many Memb ers still retained their MFN exemptions without a 
clear and definite plan to eliminate them, and that  almost all the exemptions  had already exceeded the  TN/S/M/39 
 Page 15 
 
 
  ten-year duration as set out in the Annex to the GA TS.  As far as the review was concerned Hong 
Kong, China thanked those Members who had taken it seriously and provided useful clarification of 
their justifications on usage of the exemptions .  Hong Kong, China looked forward to the next 
dedicated session of the review to be held during the February cluster next year, and the concrete 
undertakings of Members to remove the exemptions in the current Round of negotiations if not in the 
Review itself. 
81. There was a need to expedite the work of th e Council for Trade in Services regarding, in 
particular, the issue of the way to deal with the relationship between old and new commitments.  
There needed to be an effective mechanism, including an effective protocol as well as a verification 
process, to address the situations of Members rolli ng back their existing commitments.  On the rule 
making front the thematic discussion on the substantiv e chapters of the draft disciplines in the WPDR 
was useful.  However, Hong Kong, China was wary th at negotiations would become circular if there 
were no real breakthrough on the critical issues in  domestic regulation.  Hong Kong, China would 
look forward to forthcoming discussions in various formats on those critical issues, including first and 
foremost the necessity test.  Regarding GATS rul es, Hong Kong, China was pleased to have had the 
dedicated session on the information exchange exerci se on subsidies.  This exercise was itself a partial 
fulfilment of the mandate, and also provided a bette r basis for Members to further the discussion on 
other dimensions of the subsidies issue.  There n eeded to be see more tangible progress in the coming 
cluster, and Hong Kong, China would continue to  work with the other Members to this end. 
82. The delegation of Colombia  said that it had a great deal to gain from the services negotiations.  
Each Member could focus on its development polici es and build a services infrastructure that enabled 
local and foreign investment, and which assisted it us in the development of trade in goods.  
Investment and trade were indispen sable for the growth of the economy, employment, and to meet the 
needs of the population.  They were all basic goals that every government tried to pursue.  Services 
were already predominant in the economies of deve loping countries.  Many developing countries had 
designed policies, programmes and strategies that had enabled them to improve their competitiveness 
and that of their service suppliers, thereby increasi ng their participation in local and international 
markets.  What was needed was to  ensure that those interests were  included in the negotiations.  In 
this context, it was indispensable for Colombia that the services negotiations, specifically market 
access, arrive at a successful conclusion within the Round. 
83. Colombia also valued highl y the conclusion of the negotiations on domestic regulation 
disciplines.  Liberalization could be defeated by protectionist tendencies if there was no appropriate 
framework in that area.  Conclusion of these nego tiations had to be ambitious, comprehensive and 
balanced as had been stated in a broader cont ext by world leaders from countries making up the G20 
and APEC.  Although Colombia did not belong to those groups, it saw their communiqués as a positive and clear message to move as soon as possi ble to the conclusion of the negotiations.  
Colombia was confident that the ideas arisi ng from the discussions amongst ambassadors over the 
past few months help negotiations in the near future , but these words had to be turned into deeds.  The 
political momentum had to be used to conclude the negotiation using different methods, including 
greater participation by delegates in Geneva and sen ior officials.  On domestic regulation, Colombia 
was pleased that the Chairman had already decided on consultations to be held in the near future, in 
order to have more in-depth discussions begun in the small groups of ambassadors. 
84. The clustering proposal by Australia was also positive.  It did not conflict with the 
request/offer negotiating modalities established for the services negotiations.  The grouping of 
interests in different sectors would facilitate th e discussions and be more meaningful for service 
suppliers.  Colombia wanted high quality offers a nd hoped that their depth and scope would meet the 
interests of developing countries in a balanced nego tiating result.  On the LDC waiver, very useful 
consultations had recently been held.  Colombia be lieved that the consultative process would result in 
a prompt and successful conclusion.  On GATS rules, there was a need to be very specific about what TN/S/M/39 
Page 16  
 
  the issue was that Members were trying to resolve,  and on the feasibility of the solutions proposed.  
One idea was to draw up a work plan for those negotiations. 
85. It was important to intensify the negotiations.  Colombia appealed to other Members to take 
on this task with an open mind, and to undertake ge nuine negotiations that met the interest of all 
Members, and particularly developing countries.  As to the length of our next cluster, Colombia 
believed that a one-week cluster would be a good idea.   It was flexible as to how work could be 
organized in order to ensure a balanced discussion in all areas of the negotiations, combining different 
formats with the participation of ambassadors and senior officials. 
86. The delegation of the United States
 said that G20 and APEC leaders had given a renewed 
impetus to the Doha negotiations.  With this en ergy came a sense that 2011 presented a 'window of 
opportunity' for delegations in Geneva.  To make th is opportunity real, there was a need to intensify 
engagement by Members – engagement that needed to be translated soon into active and constructive 
negotiations.  During the past two-week cluster,  there had been some more positive signs of 
engagement, including the advancement of a ne w plurilateral on accountancy services led by 
Australia.  But there had to be recognition of the fact  that if certain Members tried to opt out or place 
preconditions on their engagement, the entire effort would be placed in jeopardy.  
87. All Members had to realize that a credible, ambitious outcome in services was necessary in 
order to achieve a balanced outcome for the R ound.  For the United States, there could not be 
necessary clarity on a possible modalities package wit hout clarity on services.  A successful services 
outcome was needed not just to satisfy various st akeholders, but also because services liberalization 
played a key role in supporting economic developm ent.  A 'Development Round' had to produce real 
results in the services area. 
88. As for the state of play, there was a need for honesty.  What was now on the table – through 
offers and signals – came nowhere close to an acceptable outcome.  A quick glance at the Hong Kong 
Declaration made this abundantly clear.  For exampl e, what could be said about how the negotiations 
had achieved objectives like the removal of forei gn equity limitations, or making commitments 'at 
existing levels of market access'?  Coul d Members point to any evidence of success? 
89. Other Members appeared to be similarly dissatisfied with the level of progress in areas of 
particular interest to them.  So it seemed that th e only way forward for services was to get back to 
work.  Some had suggested that in pursuing a better outcome the United States was raising the level of 
ambition for services at the eleventh hour.  But ho w could it be seen as raising the level of ambition 
when all that was being sought was the ability to  make a reasonable case that Members had fulfilled 
the objectives set by ministers five years previously?   
90. Getting back to work on services did not mean  simply setting a date for revised offers. 
Members needed to do more work beforehand so that  there was greater confidence in the content of 
those offers that would put Members on a traject ory for a successful outcome.  That meant Members 
should set out an intensive work program for the first half of 2011 that re-engaged capitals and 
relevant ministries. 
91. The United States supported proposals to organi ze meetings around ma jor issue areas or 
'clusters' of related sectors, as this could help bring relevant experts together and ensure that their time 
and resources were maximized.  Australia had recen tly advanced important elements related to 
logistics services, just as the United States had been  actively advancing issues related to information 
communications technologies (ICT) services.  Such ideas could help make a strong case for advancing 
the services negotiations.  When Members started to focus attention on these issue areas, they could 
see more clearly the potential development gains fro m services liberalization, as well as a more 
realistic vision of how services really operate in the business world.  Clustering was not however a  TN/S/M/39 
 Page 17 
 
 
  magic bullet.  It was not necessary to repackage ever y issue into a cluster, nor did the United States 
think that an issue of interest to Members should be left behind if it did not fit neatly into a cluster.  
92. On domestic regulations, as market access negotia tions became more active, the pace of work 
in domestic regulations needed to intensify as well.  But a text had to evolve from the substance, and 
not from some artificial call for what would be a document with two square brackets – one at the 
beginning and one at the end.  The United States will also continue to engage constructively in 
discussions on rules and LDC modalities, as Members worked toward an appropriate outcome in those areas. 
93. In conclusion, the United States was pleased to  see a renewed sense of momentum in the 
negotiations as a whole.  It looked forward to worki ng with all Members to inject new energy into the 
services negotiations, and hoped that by working togeth er it would be able to craft a package that 
would be acceptable to all.  
94. The delegation of Brazil
 said that during the past two week s it had participated constructively 
in the meetings of the Council for Trade in Services and its subsidiary bodies, as well as in bilateral 
meetings to discuss the overall process of the services negotiations.  The year 2011 represented a 
critical 'window of opportunity' to conclude the Doha Round, as highlighted at the recent Seoul 
meeting of the G20.  Concerning the role of the ser vices negotiations, it was important to bear in mind 
the significant contribution already made by develo ping countries, especially in the market access 
pillar.  In this connection, Brazil disagreed that  the intensification of the process should necessarily 
lead to additional contributions from these countries.  As regards Brazil, a higher level of ambition in 
market access for services would require a higher level of ambition in its own areas of interest. 
95. On the idea of clustering, Australia had usefully translated into more concrete terms what had 
been suggested as a possible way of approachin g the negotiations.  From the communication 
submitted by Australia and from the exchange of id eas with a considerable number of Members, it 
was clear that clustering aimed at a stronger outcome  in market access for se rvices, irrespective of 
commensurate movements in agriculture, for instan ce.  Even if the proposed approach had positive 
spillovers in the areas of industrial and agricultura l goods, it did not address or solve the problem of 
subsidies and market access barriers in agriculture.  
96. It was disappointing that clustering seemed to di vert the focus of the Round to market access 
for services.  The services sector did provide a signi ficant contribution to development.  However, 
there was no consensus that the liberalization of tr ade in services would generate more benefits to 
developing countries than to deve loped countries.  The GATS set out a process of liberalization that 
should be gradual, and take into consideration the special need of developing countries to complete 
their regulatory frameworks.  Therefore, calls fo r an over-ambitious outcome in this Round were 
illegitimate, especially if the main targets of demands were developing countries, like Brazil. 
97. Much work was still needed in the other pillars of the servic es negotiations, if Members were 
to conclude the Round in 2011.  Brazil remained fully  engaged in the process so that the multilaterally 
agreed mandates were fulfilled.  
98. The delegation of China  recalled the wisdom, strength and encouragement that forefathers 
had shown more than sixty years previously at the start of the multilateral trading system.  On the overall progress of the negotiations, China thought that the cluster this time was full and well 
organized.  China had held several bilateral meet ings during the previous two weeks to exchange 
views on the overall progress of the negotiations, a nd to address specific concerns of Members.  
Members had intensified their efforts to address th e remaining issues in the rules negotiations and 
LDC modalities, as well as prepared for more focu sed and substantial market access discussions.  
China hoped that this renewed energy in the negotiations would remain in the future.  TN/S/M/39 
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  99. Both at the G20 meeting and the APEC summit,  leaders had reaffirmed their commitment to 
conclude the Doha Round as soon as possible, an d indicated that 2011 was a vital 'window of 
opportunity' to bring the Round to a conclusion.  Th is clear and strong signal from the political level 
had injected the negotiation with renewed moment um.  After intense Geneva-based consultations 
amongst ambassadors, it seemed that Members now had a common goal to seek a deal by the middle 
of 2011, which meant that there were 6 or 7 months left to resolve the remaining issues and conclude 
the negotiation.  
100. China had always emphasized that services was an important pillar of the DDA, and it 
expected that the current round of services nego tiation could generate meaningful market access 
commitments for service suppliers in developing countries, particularly in mode 4 and sectors where 
the developing Members had export interests.  China had repeated many times that the current lack of 
progress was predominantly due to the fact that the developed Members were reluctant to meet the requests from the developing Members.  As the negotiations were moving towards the end game, 
China encouraged developed Members to give ser ious thought to the requests from the developing 
Members, and take substantive steps to move towa rds an ambitious and balanced outcome of services 
negotiations.  
101. China had always actively participated in the services negotiations.  De spite limited progress 
in the overall negotiation, China had responded to every request for bilateral negotiations, and had 
brought experts from Beijing to participate in th e negotiations.  China wished to reaffirm its 
commitment to the services negotiations, and hoped to  see that key Members would be engaged in the 
negotiations with a similar spirit so that best e fforts could be made to exploit the 'window of 
opportunity' and meet the requirements of leaders to conclude the round during 2011. 
102. The delegation of Korea
 said that all Members were aware that trade in services had become 
an important engine for global growth, and that fo r a satisfactory and balanced outcome of the DDA 
negotiations there needed to be substantial achieve ments in the services area.  As previous speakers 
had indicated, it was encouraging to note that l eaders at the G20 summit in Seoul and the APEC 
summit in Yokohama had sent a strong message for th e negotiators to engage in across-the-board 
negotiations to promptly bring the DDA to a su ccessful, ambitious, comprehensive and balanced 
conclusions.  With this important political messag e, the negotiations in services needed to proceed 
with more vigour in 2011.   
103. On the idea of clustering, Kor ea was confident that this new initiative would help make the 
negotiations more manageable, and create momentum th at was badly needed in this key pillar of the 
DDA negotiations.  Although there might be some concerns on clustering, these could be addressed 
through active engagement in discussions among Me mbers, who could propose additional clusters, 
sub-sectors and modes for the end game.  Korea fully shared the view that clustering should not be intended to replace the existing request/offer process, but rather be used as a complementary tool to 
advance the current negotiation process.  Korea would continue to contribute to the progress of the 
whole market access negotiations in services, as well as the constructive discussion on clustering 
initiatives.  On domestic regulation, there was a mandate to develop disciplines, and work on 
developing a text needed to intensify.  Korea sh ared the views of previous speakers that for an 
ambitious result in services negotiations, market acce ss negotiations needed to be intensified in 2011, 
beginning with meetings in February allocated  for market access negotiations, and for the WPDR. 
104. The delegation of India
 found the current cluster useful, particularly with respect to domestic 
regulation and GATS rules, where the approach by Me mbers had been constructive.  In the meeting of 
the WPDR, there had been a good discussion, and Indi a was pleased there was agreement to deepen 
the negotiations by holding informal meetings.  It was possible to achi eve greater convergence on 
many issues in domestic regulation given the right  level of engagement.  Disciplines on domestic  TN/S/M/39 
 Page 19 
 
 
  regulation were an important deliverable of the Round, as without it effective market access was not 
possible.  India was now keen to see a draft bracketed text from the Chair. 
105. On GATS rules, the Chair's program on inform ation exchange has been encouraging, judged 
by the sheer number of submissions recently received.  This was in part a reflection of greater recognition of the importance of the issue of subsid ies in trade in services.  However, substantive 
work still needed to be done.  In order to facilitate  discussions on a road map for further work on this 
topic, India and co-sponsors would introduce a paper at the next meeting.  
106. On clustering, India had carefully studied the paper by Australia and had discussed the matter 
bilaterally.  Although the spirit behind the proposal  – to speed up market access negotiations in 
services – was appreciated, India had some concerns.  Australia in its paper had referred to paragraph 
6 of the Chairman's Report to the TNC of March 2010,  in which he pointed to the gaps in the market 
access negotiations in services.  It was true that th ere had not been significant progress in the market 
access negotiations since July 2008.  However, the lack of progress in market access was not because 
of any problems with the modalities, or lack of focu s in the negotiations.  For India, the slow pace of 
the bilateral and plurilateral processes in services in the Doha Round was due to lack of political will, 
inadequate response from developed countries in sect ors and areas of export interest to developing 
countries, and slow movement in agriculture and NAMA.  The lack of momentum in the services 
negotiations was not caused by any fundamental problem with the bilateral and plurilateral 
request/offer approach.   
107. For India, the clustering approach was not in accordance with Annex C of the Hong Kong 
Ministerial Declaration, which mandates sector-s pecific or mode-specific requests only.  One 
fundamental issue was imbalance in the Round be tween the offers from developing and developed 
countries.  In spite of developing countries havi ng shown considerable movement in their revised 
offers compared to their Uruguay Round commitments, their main requests had not been addressed by key developed Members.  For example, India had already made a considerable improvement in its 
revised offer (from 37 subsectors in its Uruguay Rou nd commitments to 95 in its revised offer), and 
its interests needed to be addressed without any further concession from it.  Some of the major 
developed country Members had s hown little or no movement in thei r mode 4 offers, which was a 
major cause of concern.  
108. For those reasons, the argument in the Australian paper that focusing bila teral and plurilateral 
request through clustering would generate mome ntum was not convincing.  A mere change of 
approach would not create actual value.  The solu tion was not in improving the 'machinery' of WTO 
services negotiations, as referred to in paragraph 2 of Australia's paper, as there was nothing wrong 
with the modalities of the negotiations.  Value w ould be created for India only if there were 
substantial improvement in offers in areas of interest for it. 
109. India also had concerns from a developing count ry perspective.  The idea of clustering might 
not be a very workable in a developing country, due  to a variety of policy constraints, institutional 
deficiencies and stakeholder conflicts in various sect ors.  Some sectors had a faster-evolving and more 
liberal policy, as compared to other sectors that mi ght be lagging behind.  Regulatory maturity in 
different sectors might also be at different stages.   It was easier to address these issues and requests 
individually, rather than in a format in which they  are interlinked.  Thus, India had strong concerns 
that the clustering might actually delay the negotiation rather than speed it up. 
110. Additionally, India had not faced any problems in conveying the potential benefits of 
meaningful outcomes in services negotiations to its stakeholders and decision-makers.  India was not 
sure if creating clusters would clarify or furthe r confuse current understandings.  Clustering had the 
potential of making the negotiations complex and diffi cult to handle, diverting attention from the real TN/S/M/39 
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  issues.  India strongly believed that Members had to a void this distraction at such a late stage in the 
negotiations. 
111. The delegation of New Zealand
 fully supported Australia's clustering proposal.  Clustering 
was a mechanism that allowed Members to gain a 'b igger picture' view of negotiations.  New Zealand 
supported efforts for achieving an ambitious outcome  reflecting the real world circumstances under 
which services were traded. 
112. Several features of Australia's paper needed  highlighting.  Clustering responded to the 
assessment of the Chair at the March stocktake that gaps remained in services market access, and that 
further work was required to fill them.  Clus tering was an attempt to distil the issues under 
negotiation, and to present them in a more easily digestible form, and it focused attention on key 
outcomes.  For New Zealand, clustering was not an end in itself, but a means of organizing work and 
to providing ministers and the business sector w ith a clear, comprehensible and commercially-
meaningful assessment of progress across key sectors.  Clustering was a valuable additional tool for 
attempting to consolidate the various offers and signals.  It was complementary to bilateral and 
plurilateral requests, which remained valid and on th e table.  In New Zealand's view, clustering could 
greatly assist the existing bilateral and plurilatera l request-offer processes by setting out, in one place, 
a very clear expectation across a range of relate d services, and seeking more definitive commitments 
regarding the content of final offers.  Clustering was not a one-size-fits-all approach.  There would 
inevitably be existing requests, or elements of these re quests, that did not quite 'fit' within a cluster.  
This underscored the need to pursue parallel and ongoing bilateral and plurila teral engagement on 
particular areas/elements of interest.   
113. One important element of any clustering initiative would be how to accommodate Members' 
particular circumstances.  This had been an element of great interest in consultations held so far.  
There was a clear need to strike a balance between the individual interests of Members and the overall clustering objective of high-quality commitments across a range of related services.  Members were 
encouraged to engage pragmatically and flexib ly in those discussions, keeping in sight the 
fundamental goal of commercially meaningful commi tments across a range of related sectors and 
subsectors. 
114. As the Australian paper highlighted, the conti nuity across related sectors and subsectors was 
particularly critical in logistics and supply chain services.  Logistics was a 'logical' place to start, since it contributed to a bigger-picture outcome across goods and services.  It offered the potential for a 
'headline' deliverable, the benefits of which were readily understood by government decision makers, 
as well as goods and services providers.  A number of  Members were interested in further exploring 
the utility of a similar approach across different sectors and issue areas, and New Zealand looked 
forward to further engagement in those discussions. 
115. More generally, on the assessment of progress in the market access negotiations, New 
Zealand saw in the present cluster a respectable le vel of friends/bilateral activity.  As previously 
stated, clustering would give a useful focus and impe tus to this work.  New Zealand had participated 
in a discussion on the new accountancy plurilateral,  and was encouraged by delegations' willingness 
to engage constructively.  Further extensive discu ssions on domestic regulation had helped to further 
clarify differences on the text.  Like others, New Zealand emphasized the need for strong disciplines on domestic regulation to support market access commitments. 
116. As Members intensified their effo rts in the near future, New Z ealand wished to reiterate the 
importance of an ambitious outcome in services as pa rt of the overall outcome of the Doha Round.  It 
believed that Members' level of engagement in th e services negotiation had to keep pace with broader 
developments in the overall D oha Round negotiations over the comi ng months if Members were to 
make use of the 'window of opportunity' identified by  G20 and APEC leaders.  On the organization of  TN/S/M/39 
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  work for the February cluster, New Zealand agreed with others who suggested that a one-week period 
would be appropriate. 
117. The delegation of South Africa  said that Members had correctly concluded that, in light of the 
particular economic difficulties confronting LDCs, one of the available tools to integrate them into 
global services markets was an MFN waiver.  A centr al element of the waiver needed to be the 
provision of commercially meaningful market access for LDCs, including recognition of the 
regulatory barriers that LDCs might confront.  South Africa took note of the progress that had been made on the LDC waiver text, but remained acutely aware of the work that remained to be done.  
118. South Africa also took note of the progress that had been made in the subsidiary bodies.  In 
respect of the work of the Working Party on Dome stic Regulation, South A frica looked forward to the 
workshop that was scheduled for early 2011, and hoped that it would focus on the relevant issues, not 
least the regulatory barriers experienced by de veloping countries in accessing developed country 
markets, as the World Bank had indicated in its r ecent study.  Given the recent financial crisis, the 
work of the Committee on Trade in Financial Services had become even more relevant.  The fact that 
countries were still emerging from the crisis was eviden t in the current reverberations being felt across 
European markets.  For these re asons, the CTFS would be remiss in not responding to the trade 
related aspects of the financial crisis.  The obj ectives contained in the proposal co-sponsored with 
Argentina, Ecuador and India were  still relevant, and Members needed  to re-commit themselves to the 
work programme contained in it. 
119. South Africa was committed to a fair and balanced  outcome of the Round, one that reflected a 
strong development dimension.  Such an outcome ha d to be supported by Members' constituencies, 
not only in major developed countries but also in the poorest developing ones.  Therefore, in 
approaching any attempt to re-energise or resume market access negotiations, there needed to be two 
guiding factors.  First, recognition of the already significant contribution that developing countries had made in the services negotiations in the presen t Round.  Second, an honest assessment of the 
extent to which the major players had le d by example in terms of their offers. 
120. Services were not the key to unlock the Round.  The problem was not lack of progress in the 
services negotiations, but rather the fact that th e overall package on the table did not address the 
interests of developing countries.  While developing countries were expected to provide more market 
access in services and in NAMA, in agriculture they faced a significant lowering of ambition.  The net 
result was a political and economic imbalance that did not bolster confidence in a successful conclusion to the Round.  Progress on the modalities in agriculture and NAMA was the only viable 
route to the success of these negotiations.  As a Memb er of the G20, South Africa welcomed the very 
clear political signals that leaders gave and their in struction that the DDA be concluded in 2011.  In 
this regard, it looked forward to working with  all Members in pursuit of this outcome.  
121. On the organization of future work, South A frica observed that in recent weeks, there had 
been a re-energising of the work of all negotiati ng groups.  Many ambassadors had been involved in 
efforts to facilitate this process, and it seemed evid ent that it would gain greater traction in January.  
However, success hinged on the process being suppor ted by the entire membership, in a manner that 
was broad-based, inclusive and transparent.  South Africa stood ready to make its contribution to an 
end game in 2011. 
122. The delegation of Norway
 agreed with the Chairman's introduction and shared his political 
assessment.  On the services cluster generally, usef ul discussions had been held over the two-week 
period, both in the regular bodies and in friends' gro ups and bilateral meetings.  Norway wished to 
signal in particular the positive step forward regarding the work programme on the information 
exchange on services subsidies.  TN/S/M/39 
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  123. On the clustering proposal, Norway stated th at it welcomed all new initiatives and approaches 
aimed at simplifying and better organizing work, and which could contribute to a solid result for the 
negotiations and the Round as a whole.  It understood that this idea was being developed not only as a 
tool for Members' internal work and for the ne gotiations, but also as a simplified approach for 
external stakeholders.  As underlined in several other interventions, the approach was not meant to 
change Members' approaches to the services negotia tions.  The request/offer method stood firm and 
would not disappear with the clustering of elements  from bilateral and plurilateral requests.  As 
highlighted in Australia's paper, the idea of a logi stics and supply chain cluste r was subject to further 
discussions and development.  Questions regardin g Members' particular circumstances were an 
important part of these discussions.  Norway looke d forward to working with Australia and other 
Members on this proposal, contributing to its furthe r development and finding solutions for Members' 
particular circumstances.  This included of cour se the specific needs of developing countries.   
124. The delegation of Malaysia
 said that Australia's proposal on clustering was an interesting tool 
to reflect the current commercial interests of the business sector.  Malaysia took note that the concept 
of clustering was built on the existing plurilateral ne gotiations in which Members had engaged in the 
past.  Since the proposal was still being examined by officials in capital, Malaysia's views were 
preliminary and it reserved the right to provide further comments in the future. 
125. Malaysia shared the view that to attract fore ign direct investment in the manufacturing sector 
there needed to be a sound logistic and supply chain service system in place to allow efficient operation, and enable both services suppliers and manufacturers to optimise effective production and 
maximise exports of prod ucts overseas.  In this light, the proposal was timely as it magnified the 
benefits to the way business was conducted.  Malays ia noted that the proposal aimed at encouraging 
Members to liberalise the components of supply ch ain services, which encompassed a wide range of 
activities involving transportation, delivery, dist ribution and management and advisory services.  
126. Bearing in mind GATS Article XIX on progressive liberalisation, Malaysia wished to seek 
clarification from Australia on the extent of co mmitments expected from this proposal.  Were 
Members expected to undertake commitments in the entire range of activities proposed, or could some 
commitments be made progressively within the mean ing of Article XIX of the GATS?  It would be 
helpful if Australia explained how it would address some  of the concerns Malaysia had, in particular 
on the possibility of taking only some or no commitmen ts in the proposed activiti es the cluster.  What 
were the core determinants to en sure that clustering would achieve  a sound logistic and supply chain 
service system? 
127. As there were a number of ministries and agen cies involved in Malaysia over this wide range 
of activities, each with its own legislation and regul ations, there would need to be some regulatory 
coherence to achieve the objective of this clusteri ng.  In light of this, it would be useful if a 
'mock' clustering commitment could be drawn up, to help Members visualise how this 'cluster' 
commitment would look like and what it would entail. 
128. The delegation of Singapore
 said that Members were at an important crossroad, and the recent 
G20 and APEC meetings had been key in injecting impetus to the negotiations.  There was a strong 
call on Members to intensify an engagement across the board.  The present cluster was a step in the right direction towards intensification, with time set aside for bilateral and plurilateral meetings.  
Singapore welcomed the revival of the plurilateral pr ocess.  In respect of the one plurilateral meeting 
in which it had participated as a respondent, there had been a good discussion.  Singapore wanted to 
see this momentum accelerated and intensified, and eventually translat ed into high quality 
commitments in services schedules.   
129. The meetings during the week had been useful  in allowing Members to understand better the 
constraints on services, and Singapore agreed that mo re needed to be done to help find a balance  TN/S/M/39 
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  between what each Member desired a nd what was achievable.  In light of the 'window of opportunity' 
in 2011, the organization of the next cluster in Fe bruary would be particul arly important.  Singapore 
was eager to move to the final phase of the nego tiations, and would help de velop any momentum in 
this respect. 
130. With respect to clustering, Singapore suppor ted a good and meaningful outcome in the 
services negotiations.  It welcomed any initiative or creative proposal that could help progress the 
negotiations.  In this regard, th e clustering of requests across services sectors in a coherent manner 
was certainly useful.  Essentially, clustering was a tool for continued engagement on services market 
access.  It was a tool that should complement rather  than replace the existi ng work in bilateral and 
plurilateral requests.  While ideas such as these might  be worth exploring, the ultimate objective was 
to ensure Members arrived at schedules that contri buted to an outcome that was both ambitious and 
balanced. 
131. The delegation of Mexico  said that the Australia's clustering initiative was very interesting, 
and was complementary to the tools already used, su ch as bilateral and plurila teral consultations.  It 
was also very useful for presenting market access issu es to industry sectors.  However, the goal of the 
services negotiations was to ensure satisfactory conditi ons for the supply of services.  So all of the 
tools were useful if used correctly, but the usefulness of the tools could only be assessed based on the content that Members decided to put in their service s commitments.  This applied not only to market 
access, but also to satisfactory results in negotia tions such as domestic regulation and GATS rules, 
particularly in subsidies, and the discussion on LDC modalities.  
132. In 2011 there was a need to intensify efforts to move forward the process, including through 
bilateral and plurilateral negotia tions.  Clustering would allow for a better participation from 
Members.  During the week, there had been a very interesting and useful exchange on a plurilateral 
request/offer in accounting services.  
133. The delegation of Argentina
 said that, with respect to the clustering proposal, there was a 
need to improve the machinery set up for the se rvices negotiations in order to ensure that the 
development dimension was taken into account.  It  was not certain how this machinery would be 
established.  As Argentina understood it, commitmen ts in different areas and different modes would 
allow Members to realize this development dimensi on, and on this point Australia's views would be 
welcome.  Australia had stated that the proposal on clustering was complementary to the bilateral and 
the plurilateral processes, and these processes continued to be valid. 
134. In line with the consultations being carried out  with Members, it seemed that a new level of 
negotiations might complicate rather than facilitate  the negotiations.  Alongside India, Argentina 
recalled that paragraph 6 of Annex C of the Hong Ko ng Declaration provided that requests and offers 
were the main tools for the negotiations.  Paragra ph 7 established that requests or collective requests 
in any specific sector or modes of supply needed to  be specific.  A number of Members did not feel 
that the problem inherent in the negotiations lay with the machinery.  Rather, it was the lack of 
tangible results in areas of interest for developing countries in services, NAMA and specifically in 
agriculture, that had been the obstacle.  Recogni zing the imbalance between the requests and offers 
would be the first step forward in improving the machinery for the Doha Round. 
135. On the next cluster, Argentina said that it woul d be difficult for it and other countries in the 
southern hemisphere to attend form al meetings in January.  Accordingly it wished to maintain the 
dates in February as suggested.  Nevertheless, Ar gentina remained flexible with regard to any 
proposals that might be forthcoming from Member s.  A weeklong cluster would be appropriate. 
136. The delegation of Barbados, on behalf of SVE  delegations, said it was aware of the efforts 
and initiatives to reinvigorate the services negotiatio ns.  While cognisant of the creative exchanges TN/S/M/39 
Page 24  
 
  that informal and smaller groups might facilitate, it welcomed the return to the multilateral approach 
so that the transparency of the negotiations could be maintained.  However, Members needed to find a 
way to maintain the energy observed over the preceding weeks. 
137. Within the context of the 'window of opportunity' for concluding the Round in 2011, the SVE 
delegations considered that such movement must be (1) commensurate with that taking place in other 
market access areas in the Round, (2) in line with  the modalities directed by Ministers in Hong Kong 
and (3) consistent with the progress achieved to da te in the services negotiations.  Most importantly 
however it was the political will of Members that w as required to concretely advance the negotiations. 
138. The SVE delegations understood the proposal of Australia on clustering as a means to 
generate momentum in the negotiations and make th em more manageable.  The approach was seen by 
the proponents as being complementary to the existin g bilateral and plurilateral requests process.  The 
SVE delegations were interested in hearing of the types of flexibilities developing countries could 
expect to derive from this appro ach.  Within this development Round,  the core interests of the SVEs 
remained the liberalisation of mark et access in sectors and modes of supply of interest to them, and to 
undertaking commitments in accordance with GATS sp ecified flexibilities and development needs.  
139. On other aspects of the negotiation, the SVE delegations noted the progress made in the 
ongoing technical discussions on the LDC Modalities, which should be continued.  On the rule-
making negotiations, and particularly in the WP DR, SVE delegations noted the progress made, and 
agreed that these negotiations required further work.  There needed to be continuing sensitivity as to 
the impact of proposed regulations on developi ng countries.  As always, the SVEs remained 
committed to playing their part in pursuing a successful outcome to the services negotiations. 
140. The delegation of Barbados
 added, on its own behalf, that in the context of a clustering 
proposal it would be useful to look at internationall y used classification system s in services.  It was 
recognized that services constituted a huge sector, and it could be useful to divide it into subsectors in 
order to fully appreciate the performance and impact of each subsector.  It might well be that after examining such classifications, Members did not fi nd any that suited their purposes, but it was worth 
examination in order to enhance global coherence.  However, were a decision taken on clustering, 
global classification systems, though useful, might be less of a priority. 
141.  Many small developing countries were una ble to compete in the area of goods, and 
concentrated instead on services, where the level of  skills became important, tending to remove the 
emphasis on financial resources.  For this reas on, services were very important for developing 
countries and in particular for sm all developing countries.  In de veloping guidelines in the area of 
services, Barbados urged the WTO to be open to gr anting flexibilities for small economies in services, 
as it had done in the area of goods. 
142.  It was important that Members responded to the direction given by the G20 leaders in Seoul.  
This was a challenge for WTO negotiations in general,  and in the area of services in particular.  It 
required that Members accelerate the process and adopt  a focused approach, so as to energize work in 
the sector, while taking care not to develop regulati ons which hampered small developing economies. 
143. In order to reach their goals, Members needed to  set timelines in every area in services, and to 
adhere to them.  Most importantly, it was critic al that Members actively commit to be open to 
compromises where these were indicated.  Barb ados undertook to support efforts toward a 
comprehensive, balanced and timely outcome wh ich fulfilled the Round's development focus.  
144. The delegation of Switzerland
 underscored the importance of the mandate Members had 
undertaken in the Doha and Hong Kong Declarations.  Members needed to continue to commit to the 
intensification of the negotiations in order to fulfil that mandate.  For that reason, it was important to  TN/S/M/39 
 Page 25 
 
 
  accelerate work at ambassadorial and senior official level.  Switzerland was very pleased to 
participate in the small groups, which for the moment  were an appropriate instrument.  Issues on the 
agenda dealt with domestic regulation, including th e necessity test.  Switzerland would continue to 
contribute to the discussion on the necessity test, in the wake of this renewed momentum.  Rules were 
also a very important area.  
145. Switzerland was in favour of the initiatives that ha d been taken thus far with regard to the 
aggregated or 'cluster' approach.  It was a co mplementary approach, and Switzerland supported the 
proposals that had been made with regard to ICT and logistics.  As to the quality of offers, many were 
below the current de facto access in markets.  In this  respect, an important point had been made by the 
United States concerning the goal of aligning offers with reality.  
146. As to the previous two weeks Switzerland, as a demandeur in accounting services, was very 
pleased with the discussion that took place on this sector.  Switzerland also followed with much interest the discussion on the MFN Review.  It wish ed to reiterate its appeal to those countries 
involved in the MFN Review to explain the reasons justifying the discrimination.  In the Committee 
on Specific Commitments, Switzerland had been able to discuss two important points:  the 
relationship between the old and new commitments,  and the process of verification.  The Swiss 
position took the view that there was a need to find solid solutions for both these topics.  Switzerland 
was fully committed to the work on domestic regula tion, and cooperated closely with a group of 
countries that had put forward a constructive proposal in  this area.  As to GATS rules, the element of 
most interest to Switzerland was renewed activity in  information exchange.  It would be important 
that Members maintain the energy to continue discussions on this topic as mandated under Article 
XV.  In concluding, Switzerland welcomed the st atements made by the G20 and APEC leaders. 
147. The delegation of Pakistan
 welcomed the positive signs coming from G20 and APEC 
meetings.  Although all Members could see the wi ndow of opportunity, they could not open their 
doors and hearts.  Pakistan attached high importan ce to an ambitious outcome in services, and assured 
other Members of their fullest participation in this regard.  Pakistan also put high priority on a positive 
and early outcome on LDC modalities,  and supported the intensification of work in the area of 
services, including market access.  In this rega rd, Pakistan welcomed the proposal submitted by 
Australia for a logistics cluster.  While not necessar ily subscribing to each and every element of the 
paper, it believed this  could help Members in the work  of the services negotiations.   
148. The delegation of Egypt  referred to the very strong and cl ear signals emanating from Kigali, 
where trade ministers from the African continent had met at the beginning of the month.  The 
messages from this trade ministerial were clear fo r Egypt, as well as for all African negotiators in 
Geneva.  Ministers had produced a very clear decl aration that mapped out the way to conclude the 
DDA, including the market access components. 
149. In this regard, the signals that emerged from Se oul were encouraging.  However, it was also a 
call to major trading partners, par ticularly developed countries, to show the required leadership to 
move the negotiations forward on the basis of the agr eed mandates.  Egypt cautioned, in the context of 
reinvigorating the negotiations, agains t any attempts to reinterpret or  change the existing mandates or 
deviate from agreed principles in the negotiations.  
150. Egypt was also concerned about any form of selec tive re-sequencing of issues.  It remained 
determined to collaborate and in tensify its coordination and enga gement incrementally, and on the 
basis of a bottom up approach, in all areas of the services negotiations.  Substance needed to lead the 
process if revised texts were to be pro duced during the first quarter of 2011.  
151. On the rule-making negotiations, Egypt belie ved that the discussions in the WPDR on 
licensing and qualification requirements and procedures,  and technical standards, had been fruitful.  TN/S/M/39 
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  However, there was a need for further work in these  areas in order to reach a consensus. Egypt also 
welcomed the WPDR proposed agenda concerning th e Regulatory Practices workshop that would be 
organized in February, as it was a good opportunity for Members to share their experience on the regulation of services. 
152. On the issue of subsidies, the discussions on in formation submitted by Members was useful in 
clarifying the types of programs and the criteria used  to grant subsidies.  These discussions might help 
in reaching a specific definition for subsidies in ser vices, and thus help in determining their trade-
distortion effect.  Concerning Egypt's status in this process, it was still in the phase of gathering 
information about subsidies programs granted in service sectors. 
153. Over the preceding weeks, Egypt had had th e opportunity to conduct fruitful bilateral 
consultations with some of its major trading part ners, in which views were exchanged on technical 
issues and ways to push negotiations forward.  In addition, Egypt had particip ated in the plurilateral 
meeting on accounting services, in which it discussed technical issues related to accounting services 
sector.   
154. Regarding ideas on clustering, Egypt recognized some virtue in the proposal.  However, many 
of the elements of the proposals remained uncl ear, namely on scope, overlap with the other 22 
plurilateral requests, the positioning of these propo sals in the overall market access negotiations, and 
how to place them in a horizontal context.  It w as also unclear whether the clustering approach fell 
within the boundaries of Annex C of Hong Kong declaration. 
155. In concluding, Egypt said it looked forward to achieving more progressive outcomes on the 
services negotiations, especially in the area of rule-making. 
156. The delegation of Turkey
 said that, in principle, it was not against Australia's proposal.  
However, it believed that it might be burdensome, especially for developing countries.  As already 
stated, many doubted that the clustering approach would fill in the gaps in services market access 
negotiations, and contribute to increasing the moment um of the Doha Round.  Trying to achieve 
consensus on the sectors and subsectors to be cluste red, and the links to be  established between them, 
would require tremendous effort.  Nevertheless, if  the clustering approach was preferred by the 
membership, in spite of the obvious difficulties, Tu rkey wished to see mode 4 included in all of the 
clusters, as it was relevant to them all. 
157. Second, with regard to the roadmap for a verification exercise, Turkey had taken note of the 
general direction of the discussion.  Clearly, c ontinued dialogue on this topic was necessary. If 
scenario B was preferred by the membership, then Members would need to ensure that it did not 
become an endless exercise. 
158. Third, Turkey had had very fruitful discussi ons in the Regular Session of the Council 
regarding road freight transportation services and dist ribution services.  It repeated its thanks for the 
Secretariat's very informative and comprehensive background papers.  At this point, Turkey wished 
simply to reiterate its interest in mutual liberalisa tion of road freight transport services, as the Turkish 
economy had been seriously affected by restri ctions implemented by some WTO Members.  
159. Fourth, on domestic regulation, the friends' proposal was concise and clear, and avoided 
repetition.  However, additional language referring to requireme nts compatible with GATS Rules 
does did not serve the purpose of streamlining.  
160. Finally, Turkey wished to make a point on the ongoing informal consultations.  For the sake 
of maintaining transparency and incl usiveness, it wished to encourage a ll Chairs to consider this issue  TN/S/M/39 
 Page 27 
 
 
  both with regard to number of dele gations being consulted and with re gard to balance.  Turkey would 
continue to support informal meetings, as long as they were open to other interested Members.  
161. The Chairman  said that the preceding discussion had demonstrated a new spirit in the 
negotiating process.  In the light of the recent ministerial and leader statements, delegations were now moving toward the end game of the negotiations, which would require both give and take.  The 
Chairman said he would continue to carry out consul tations on all levels and in all formats on the four 
subjects in which movement was needed:  LDC modalities, domestic regulation, GATS rules and 
market access.  With respect to the next cluster, th ere appeared to be a consensus that during the week 
of 14 February there would be meetings of the Special Session, the WPGR, and the WPDR, with the 
balance of that week devoted to bilaterals and pl urilaterals.  The other subsidiary bodies would meet 
in March at a time to be indicated later.  
162. It was so agreed
.  The Council  took note of the statements made , and decide to revert to this 
item at the next meeting. 
D. OTHER BUSINESS  
163. Since there was no other business, the Chairman  adjourned the meeting. 
 
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