WORLD TRADE  
ORGANIZATION  RESTRICTED 
S/CSC/M/59 
11 July 2011 
 (11-3417) 
Committee on Specific Commitments   
  
 
REPORT OF THE MEETING HELD ON 23 JUNE 2011 
 
Note by the Secretariat
1 
 
 
1. The Committee on Specific Commitments (CSC) he ld a meeting on 23 June 2011, chaired by 
Mr. Robert Prochazka from Austria.  The Chairman said that under Other Business,  he would make 
an announcement concerning  a presentation to be give n by the International Trade Statistics Section 
of the WTO Secretariat at the Committee's next mee ting.  The agenda for the meeting, contained in 
WTO/AIR/3771, was adopted as modified.  
A. C LASSIFICATION ISSUES  
2. The Chairman recalled that the Committee ha d held informal discussions on telecom 
classifications based on the Secretariat's informal No te (JOB/SERV/73) at its last meeting.   The 
summary (JOB/SERV/75) showed that the discussion ha d been substantive and stimulating.  After the 
meeting, upon request, the Secretariat had re-c irculated the classification proposals submitted, 
respectively, by the European Union and the Un ited States in 2005.  Given the importance of the 
telecom sector and the complexity of the issues i nvolved, as requested by delegations, the Committee 
had agreed to continue the discussion at this meeti ng.  He invited delegations to further consider 
issues such as the application of the Chairman's Note in the scheduling of telecom commitments, as 
well as the distinction between value-added tel ecommunications and computer and related services 
(CRS) and between telecommunication transmission and audiovisual services.  He also encouraged 
delegations to raise any additional questions and points. 
3. The discussion was in informal mode.  The Chai rman then recalled that for the review of 
classification issues in each sector, the Committe e had agreed on a follow-up small-group process 
after the informal discussion.  He invited interested  delegations to approach him after the meeting.  
4. The Committee then considered classification issu es relevant to audiovisual services.  To 
facilitate and stimulate the discussion, the Secretaria t had prepared an informal Note (JOB/SERV/76).  
The Chairman invited the Secr etariat to introduce the Note. 
5. According to the representative of Secretariat,  the informal Note drew upon some of the 
issues raised in the sectoral background Notes on th at sector as well as earlier discussions within the 
CSC.  After an introductory section, the Note suggested a number of questions to stimulate 
discussions.  They were organized in three sections:  services relating to motion pictures, to television 
and radio, and to sound recording.  Since the a udiovisual sector had been heavily influenced by 
technological advances, in particular after the public ation of CPC Provisional, a few questions related 
to the gap between the current classification (in the W/120 and corresponding categories of the CPC 
Provisional) and prevailing market realities.  The No te also included some questions referring to the 
recent CPC Version 2, which presented a more detailed classification on services relating to the 
                                                      
1 This document has been prepared under the Secret ariat's own responsibility and without prejudice to 
the positions of Members and to their rights and obligations under the WTO. S/CSC/M/59 
Page 2  
 
  audiovisual industry.  Members needed to reflect on what classification would provide for the greatest 
clarity and coherence, and better capture the way the industry worked today. 
6. The Chairman opened the floor for informal discussions. 
7. The Committee switched back to formal mode  after the discussion.  Considering that 
delegations might need more time for reflecti on and consultation with capitals, the Chairman 
suggested that the Committee continue to discuss audi ovisual services at its next meeting.  After that, 
he might hold small-group consultations . 
8. The Chairman recalled that the Committee ha d held informal discussions on classification 
issues in computer and related services (CRS) in the past two meetings.  The summary of the 
discussion was contained in documents JOB/SERV/44 and JOB/SERV/44/Add.1.  This sector was kept on the agenda as some delegations had indicated that they might make comments at this meeting.  
The discussion was in informal mode.  
9. Regarding the sector to be examined next, the Chairman recalled that during the consultations 
undertaken by his predecessor, a proposal with br oad support was to examine classification issues 
relevant to environmental services.  If there was no objection to this proposal, he would ask the 
Secretariat to prepare an informal Note to assist  the discussion.  Finally, he suggested that the 
Committee take note of the statements made and re vert to this agenda item at the next meeting . 
10. It was so agreed. 
B. SCHEDULING ISSUES  
11. The Chairman recalled that it had been suggested  at the last meeting that the Committee take 
up again its examination of scheduling issues related to economic needs tests (ENTs).  The Secretariat 
had prepared a Note ten years ago (S/CSS/W/118, dated 30 November 2001) analysing ENTs in the 
legal framework of the GATS and providing an overvi ew of ENTs inscribed in Members' schedules.   
An update (S/CSS/W/118/Add.1) on this Note ha d been issued in 2010, which examined the 
schedules of those Members that had acceded to the WTO after 30 November 2001.  The Committee 
had held informal discussions on ENTs in 2004 and 2005, based on submissions from a number of 
delegations.  Given the amount of work done in the p ast, delegations needed to consider how best to 
approach the issue of ENTs so as to add value to  past discussions and avoid unnecessary repetition.  
12. The major problem with respect to ENTs was th at most relevant entries in schedules provided 
no or minimal indications of the objective and criteria applied.  These entries were not only 
inconsistent with the Scheduling Guidelines, but th e resulting lack of transparency also undermined 
the predictability of commitments.  Therefore it was important to consider how ENTs could be 
specified in accordance w ith the Scheduling Guidelines.  Reca lling a previous suggestion that the 
Committee examine ENTs on a sectoral or modal basi s, the Chairman invited delegations to think 
whether this approach was desirable or workable.  For example, given that a significant number of 
ENTs were scheduled under mode 4, in particular in the horizontal section, he asked whether 
delegations wished to consider the following questions:  (i) what kind of measures might qualify as an ENT for mode 4;  (ii) which elements would c onstitute the criteria for assessing "economic needs" 
under this mode;  and (iii) how rele vant measures should be scheduled in  a manner consistent with the 
Scheduling Guidelines. 
13. The representative of India stated that the issue of ENTs was particularly important for 
mode 4 where a large number of ENTs were scheduled.  Mode 4 commitments were already very 
restrictive. Vague and undefined ENTs significa ntly undermined the limited value of these 
commitments by reducing their predictability and cer tainty.  In this respect, it was impossible to  S/CSC/M/59 
 Page 3 
 
 
  legally challenge their operation.  There was also  a lack of transparency and objectivity.  The 
plurilateral request on mode 4 stressed the need to  remove or substantially reduce ENTs, and to 
provide details relating to their application, such as:  (1) the service sectors and occupations to which 
the ENT were to be applied;  (2) the definition, cr iteria and conditions to be used;  and (3) the duration 
of application.  His delegation was deeply con cerned about a large number of ENTs scheduled under 
mode 4 in a manner inconsistent with the Schedulin g Guidelines.  He thus supported the Chairman's 
suggestion that the Committee examine ENTs on a moda l basis, starting with mode 4.  His delegation 
would come back to this issue with more comprehensive comments at the next meeting. 
14. The representative of Canada supported the s uggestion to discuss ENTs in the Committee and 
responded to the questions put forward in the A nnotated Agenda.  Concerning the measures that 
might qualify as an ENT for mode 4, several studies had drawn attention to labour market tests.  
These might include restrictions on the entry of fo reign workers based on their impact on the host 
economy or its labour market, for example, the availa bility of similar workers in the host country or 
the competitive relationship between foreign and domestic workers.  The criteria for assessing 
"economic needs" under mode 4 could include:  the effects that foreign workers could have on the 
domestic economy (e.g. whether entry would create ot her job opportunities);  the domestic supply of 
similar workers (e.g. whether foreign workers would be meeting a labour shortage);  requirements for 
advertising or seeking recruitment of  domestic candidates prior to offe ring the job to foreigners;  or a 
test whether foreign recruitment would adversely affect an ongoing labour dispute.  Regarding the 
third question of how relevant measures should be  scheduled in a manner consistent with the 
Scheduling Guidelines, she noted that Article XVI:2  and the Guidelines provided that ENTs should be 
scheduled properly, including specifi c descriptions of the relevant criteria.  However, the rules were 
not consistently implemented.  In the area of mode 4, for example, transparency and predictability of 
labour market tests in commitments could be enha nced by inscribing more specifically:  (a) the 
underlying criteria of operation;  (b) the relationship between mode 4 commitments and relevant laws, 
regulations and administrative procedures;  and (c ) requirements and procedures for work permits or 
visas for work.  In addition to improving transparen cy and predictability this might also prevent 
arbitrary and discretionary application of ENTs.  Ho wever, her delegation was also mindful of the fact 
that too much information could also obscure the sp ecific criteria used by Members in the application 
of ENTs.  Thus, the goal should be to strike a bala nce and provide an adequa te degree of specification 
and precision without adding unnecessary information.   
15. The representatives of Argentina, Turkey and China supported the idea of holding discussions 
on ENTs, in particular under mode 4, and were willing to contribute. 
16. The representative of Chinese Taipei noted that  ENTs represented one form of quantitative 
limitations on market access.  The major problem with  respect to ENTs was that most relevant entries 
in schedules provided no or minimal indications of th e objective and criteria applied in the test.  These 
entries were not only inconsistent with the Scheduling Guidelines, but the resulting lack of 
transparency also undermined the predictability of  commitments.  His delegation was interested in 
further discussions in this regard, possibly star ting with ENTs under mode 4.  After that, the 
Committee might also examine ENTs under mode 3.  
17. The Chairman suggested that th e Committee take note of comments made and revert to this 
item at its next meeting. 
18. It was so agreed. 
C. RELATIONSHIP BETWEEN OLD AND NEW COMMITMENTS  
19. There was no intervention under this item.  Th e Chairman suggested that the Committee 
revert to it at a following meeting.  S/CSC/M/59 
Page 4  
 
  20. It was so agreed. 
D. OTHER BUSINESS  
21. The Chairman recalled that at the Committee's fo rmal meeting of last November, Mr. Andreas 
Maurer, chief of the WTO International Trade St atistics Section, had made a presentation on 
developments in CPC Version 2.  After that pr esentation, it had been agreed that the Committee 
would be informed on a regular basis of chang es and developments in classifications and the 
statistical system.  The new Manual on Statistics of International Trade in Services 2010 had recently 
been published on the United Nations Statistical Di vision's website, and was currently being prepared 
for release as a paper publication.  The Manual had been drafted by the inter-agency Task Force on 
Statistics of International Trade in Services.  In  particular, it presented the revised Extended Balance 
of Payments Services classification (EBOPS 2010, product classification) and the ISIC Categories for 
Foreign Affiliates Trade in services (ICFA Rev.1, activity classification).  These two classifications 
served statistical purposes for the collection, compilati on and publication of data on trade in services.  
The recent work of the Task Force had concen trated on establishing the correspondence tables 
between EBOPS 2010 and ICFA Rev.1, EBOPS 2010 and CPC Version 2, and EBOPS and W/120.  
In this context, the Statistics Section of the WTO Secretariat would present to the Committee the 
recent classification work and the main features w ith respect to correspondence tables, and how these 
could be used for analysing trade in services data.    
 
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