RESTRICTED  WORLD TRADE  
ORGANIZATION  S/CSC/M/36 
14 April 2005 
 (05-1544) 
Committee on Specific Commitments  
  
 
REPORT OF THE MEETING HELD ON 11 FEBRUARY 2005 
 
Note by the Secretariat
1 
  
1. The Committee on Specific Commitments (CSC) held a meeting on 11 February 2005.  The 
agenda for the meeting is contained in WTO/AI R/2492.  As no points were raised under Other 
Business, the agenda was adopted
 as proposed in the airgram. 
A. E DITORIAL CONVENTIONS FOR THE SUBMISSION OF REVISED OFFERS  
2. The Chairman  recalled that editorial conventions for the submission of initial offers had been 
set out in JOB (02)/88.  The purpose of these conve ntions was to facilitate the comparability of initial 
offers with existing schedules.  As these conventi ons had been generally adhered to by Members, 
initial offers typically indicated new text in bold and deleted text in strikethro ugh;  technical changes 
that did not alter the scope or substance of an  existing commitment usually appeared in bold and 
italics.   
3. The question arose whether re vised offers should merely track changes from existing 
commitments, or also from initial offers.  The la tter would allow delegations to distinguish newly 
offered commitments and other improvements and changes from commitments offered in the initial 
offer.  It hence provided maxi mum transparency which the Chai rman hoped would facilitate the 
negotiating process.  He had presented a Chairman's Note on this subject, JOB (05)/6, in which he 
suggested a fairly straightforward method that a llowed for tracking of changes from both the existing 
commitments and the initial offers.  In essence, it was suggested that the comparison between initial 
and revised offers be facilitated by shading the b ackground of any changes made to the initial offer.  
In other words, shading applied wh erever new text was inserted in the revised offer; and where text 
was modified, or deleted from it.  The editorial conve ntions set out in JOB (02)/88 would continue to 
apply for changes to the original schedule, and would also apply to any changes to the initial offer, but 
in addition any of these changes would also be sh aded.  JOB (05)/6 contained further details and 
examples on the suggested use of shading.  Due to a document reproduction error, the distributed 
paper version of JOB (05)/6 did not contain shadi ng in the table on page 3.  The document would be 
circulated with shading shortly.2  In addition to shading, the Chairman's Note also suggested that 
Members indicate in the cover notes to their revise d offers in which subsectors they offered new 
commitments, and in which column(s) or other pa rts of their schedules (i.e. head- or footnotes, 
attachments) they had introduced changes to prev iously scheduled or offered commitments.  The 
latter indications would not require utmost precision, but should simply point the reader of a revised offer to the relevant sections of the document. 
                                                     
 
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. 
2 A paper version of the document was re-distributed as JOB (05)/6* on 11 March 2005.  The 
electronic version of JOB (05)/6 remains the correct version for reference. S/CSC/M/36 
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4. Given the technical nature, and to permit a mo re free-flowing exchange of views, it was 
agreed to discuss the proposal in informal mode.  The delegation of Switzerland nevertheless wished 
that its intervention be recorded in the report of the meeting.  
5. The representative of Switzerland
 thanked the Chair for the Note concerning the legally non-
binding proposals on the editorial conventions br ought forward under his own responsibility.  His 
delegation recognized possible advantages derived fr om the proposed shading.  Its main purpose was 
to permit distinction of newly offered commitments in the revised offer from commitments offered in 
the initial offer.  However, he raised concerns w ith regard to certain disadvantages of the proposed 
approach: transparency and readability might actua lly suffer where large parts of the offer were 
modified.  In view of future revisions, the delega tion of Switzerland proposed to limit the tracking of 
changes to not more than the original schedule and the last offer presented. 
6. In reply to questions by the United States , the Chairman  clarified that he was not seeking a 
formal decision by Members on the content of the No te; rather, Members were requested to agree to 
work on the basis of the proposal contained therein.   Revised offers would carry the same symbols as 
the initial offers, but be marked as Rev.1 documents.  The old offers remained in the document system 
and could be consulted throughout the negotiations.  He did not wish to prejudge what types of 
editorial conventions, if any, would be devised by Members beyond the revised offers.  Paragraph 9 of 
his Note left this aspect open.   
7. The Committee agreed  to proceed on the basis of th e proposed editorial conventions 
contained in JOB (05)/6. 
B. SCHEDULING ISSUES  
8. The Chairman  recalled that the Committee's work on Scheduling Issues had evolved around 
two different approaches: general scheduling quest ions and specific questions on initial offers by 
Members.  With regard to the latter, the repr esentatives of two delegations had indicated their 
preparedness, in principle, to reply to questions posed  with regard to their initial offers.  One of these 
delegations was ready to reply to some of the ques tions in informal mode, while the other delegation 
preferred to reply to the questions outside the Co mmittee.  He suggested that those delegations who 
wanted to provide answers only outside the Co mmittee organize their own meetings or briefing 
sessions to facilitate this process; it was his unders tanding that such meetings would be open to all 
participants in the negotiations.  As for those dele gations who were prepared to address some or all 
questions posed to them within the Committee, he s uggested that they indicat e whether they preferred 
to reply in formal or informal mode.  As necess ary, the Committee would then switch to informal 
mode, and the replies would not be recorded in the report of the meeting.  
9. The representative of the European Communities  stated that his de legation was had been 
providing answers to Members' spec ific questions in the bilateral ne gotiations.  He saw no problem in 
having a multilateral debate on his or any other de legation's offer.  His delegation had numerous 
questions on around twenty offers which it would circ ulate directly to the delegations concerned.  
Once the questions were on the table, all participants  in the negotiations could meet for a discussion.  
Contrary to his delegation's view expressed at the l ast meeting, the WTO Secretariat could be invited 
to facilitate such a meeting.  Questions of logis tics, such as the possibility of interpretation, would 
have to be resolved. 
10. The representative of Brazil  acknowledged that a flexible approach that allowed Members to 
reply in the format and mode that gave comfort to  them would be most fruitful.  For those Members 
who preferred to engage in a separate context outsid e the CSC, care should be taken that interpretation 
was possible in order to reach the largest number of delegations.  S/CSC/M/36 
 Page 3 
 
 
11. The representative of Hong Kong, China  indicated that his delegation was prepared to provide 
answers at the present meeting to questions it had recei ved by Brazil in the context of the formal CSC.  
The ultimate goal of the exchange was to have a di scussion and to achieve clarity with regard to the 
initial offers.  He agreed with the proposal by the Ch air.  As for meetings outside the CSC context, he 
concurred that interpretation w as important and that the Secretariat should be invited.   
12. The representative of Switzerland  stated that his delegation was already discussing questions 
on the initial offers bilaterally with Brazil.  The CSC could be used for technical questions which 
were not directed at specific Members.  
13. The representative of the United States  reiterated that her delegation remained ready to 
address in the CSC - in informal mode - questions whic h it considered to be of a technical nature.  It 
might be more efficient to use the CSC in informal  mode rather than convening separate meetings for 
a discussion.  Her delegation had no problem with th e Secretariat's presence during such discussions.  
The United States' delegation was continuing to e ngage in bilateral disc ussions on non-technical 
questions with any interested delegation.  In order to preserve the flexibility of the negotiating 
process, she considered it impractical to enga ge in a written question and answer exercise. 
14. The representative of Colombia  noted that her delegation, which to date had not asked 
specific questions, had benefited from the general debate on scheduling issues in the context of 
preparing its offer.  She welcomed the opportunity  to discuss Members' offers as suggested by the 
European Communities, and hoped that interpre tation could be provided for such meetings. 
15. The representative of South Africa  supported the statement by Colombia; while her 
delegation had not sent technical questi ons to any delegation, it shared the interest in these issues.  In 
her view, discussions on scheduling issues should be  open to all participants in the negotiations, 
regardless in which format such discussions took place. 
16. The Chairman  stated that his intention had merely been to clarify that delegations could 
engage in the discussion of any scheduling issue in wh atever format they saw fit.  If some delegations 
preferred to hold private meetings, they could announ ce this intention today, while others could reply 
either in informal or formal mode at each meeting of the Committee.  
17. The representative of th e European Communities  clarified that his delegation would circulate 
its questions on certain Members' o ffers to all participants.  As it was difficult to distinguish between 
negotiating and technical questions,  he preferred replying to specific questions in ad hoc meetings on 
the sidelines of the Committee.  All delegations who had received questions from the EC or wanted to 
pose questions to the EC were invited to attend.   
18. The representative of India  stated that the Committee should concentrate on work that would 
be carried out in formal or informal mode, and not discuss modalities for other events organized by 
delegations.  His delegation had genera l reservations with regard to the creation of parallel structures.    
19. The representative of Switzerland , in reply to South Africa, stated that the plurilateral 
exchange of views referred to in his earlier interv ention had related to Switzerland's additional request 
on Mode 4, and not to questions and answers concerning individual offers.  South Africa had been 
invited to that meeting.  His delegation was ag reeable to addressing technical, non-Member specific 
questions in informal mode in the CSC. 
20. Further to a request by the delegation of Brazil , the Chairman  undertook to hold consultations 
to explore whether some of Brazil's questions could be addressed at an informal meeting of the CSC 
prior to the May deadline for revised offers.  Having opened the floor for formal or informal replies or 
comments on any of the submissions containing Me mber-specific questions on initial offers, i.e. 
JOB (03)/189, JOB (04)/12, and JOB (04)/174 from Brazil, and JOB (04)/173 from Hong Kong, S/CSC/M/36 
Page 4  
 
China, he noted that at this meeting, contrary to earlier indications, no delegation was apparently 
ready to do so.  Turning to the more general questions on schedul ing, he recalled that discussions had 
been triggered by 10 sample questions presente d by the delegation of Hong Kong, China in 
JOB (04)/81, and later supplemented in JOB (0 4)/133.  The delegation of Chinese Taipei, in 
JOB (04)/82, and subsequently in JOB (04)/172 , had provided observations and analysis on these 
questions.  At the last meeting, several delega tions had observed that the Committee could perhaps 
focus on some of the questions and in this context,  questions 1, 2, and 5 had been suggested.  He 
emphasized that Members were free to engage in formal or in informal mode on any of these 
questions.   
21. The representative of Hong Kong, China
, commenting on replies pr ovided by Chinese Taipei, 
recalled that concerning question 1, Chinese Taipei had argued that a blank entry in the horizontal 
section should neither be understood as signifying "None " nor "Unbound".  However, if the entry was 
not taken to mean "None," how c ould one infer that there was no horizontal limitation?  The question 
arising from this was whether and how the c onventions for using "None" and "Unbound" should 
apply to the scheduling of horizontal limitations.  A related issue was how to understand existing 
schedules that contained either "None" or "Unbound" in the horizontal section.  Furthermore, what 
language was appropriate for schedu ling situations where a Member wanted to undertake a horizontal 
commitment (instead of a limitation) in respect of  certain measures, such as taxation.  Turning to 
question 2, the comments received suggested that the main difficulty was the potentially conflicting 
requirements, on the one hand, to read sectoral co mmitments in combination with the horizontal 
commitment, and on the other hand, that the horiz ontal commitment would prevail, unless otherwise 
specified.  There was scope for conflict in cases where either the horizontal or the specific 
commitment was phrased in positive language.  In JOB (04)/133, his delegation had illustrated this 
point with the example of a schedule containing a horizontal commitment not to apply ENTs, and a 
sectoral commitment reading "unbound, except as indicat ed in the horizontal section."  On question 5, 
he noted that the comments by other delegations suggested that the allocation criteria for licences 
depended on the entry in the national treatment column.  In cases where no national treatment 
commitment was undertaken, the Member could freel y allocate all licences to domestic suppliers.  He 
posed the question whether irrespective of the entry in the national treatment column, the entry in the 
market access column "X number of licences" coul d be interpreted to imply a positive obligation to 
distribute licences on a non-discriminatory basis.  In  that case, the entry under market access would 
qualify the "Unbound" entry under Article XVII.  He was not sure about the meaning and value of the 
market access entry if the "Unbound" under national treatment would allow discretion to allocate all 
licences to national suppliers. 
22. Turning to process, he looked forward to receiving input from other Members, be it in formal 
or informal mode.  To obtain practical value for the preparation of offers from the discussions, he 
suggested that the Chair consult on how to move ah ead with the discussions.  His delegation remained 
interested in a checklist, consisting of questions for Members to peruse in the preparation of their 
offers.  In parallel, he sought to foster a meeti ng of minds among interested delegations to clarify the 
application of the Scheduling Guidelines, and hoped that this could inspire future work of the 
Committee. 
23. The representative of Canada  supported the procedural elements proposed by Hong Kong, 
China, which could be pursued either among interest ed Members or within the CSC, in order to see 
whether there was room for common understanding on some of the difficult scheduling issues.  
24. The representative of Chinese Taipei  stated that her delegation's submissions on scheduling 
issues had been made with a view to enhancing tran sparency and clarity in the scheduling of specific 
commitments.  While she would revert to the add itional questions by Hong Kong, China at the next 
meeting, she reiterated the views expressed in JO B (04)133 with regard to Hong Kong, China's 
questions 1 and 5.   S/CSC/M/36 
 Page 5 
 
 
25. The representative of the Korea  commented on question 1 that entries in the horizontal 
section had the objective of avoiding repetition of id entical limitations throughout the sector-specific 
commitments.  It was hence unnecessary to inscribe "None" in the horizontal section, if there were a variety of different limitations in the sector-speci fic section.  If no entry existed in the horizontal 
section for a given mode of supply, this simply meant that the sectoral commitments applied.  An 
"Unbound" in the sector-specific commitments meant that entries in the horizontal section should not 
be taken into account.  Limitations in the horiz ontal section could only apply to sectors in which a 
commitment existed under a given mode.  Turning to question 5, she expressed doubts as to whether 
an "Unbound" in the national treatment column woul d permit discriminatory quota allocation in cases 
where the market access column opened a specific num ber of licenses without further specification to 
foreign and domestic suppliers.  The interpretation offered by some  delegations would conflict with 
the market access commitment.  Sh e suggested that further thought be given to this question. 
26. The Chairman
 stated that he would consult on the best  format to carry forward the work on 
scheduling issues.  
27. Commenting on Hong Kong, China's  submission on economic needs tests (JOB (04)/171), the 
representative of Thailand  stated that with regard to scheduling, the criteria of a test should be 
inscribed in the schedule if the test was criteria-based.  If the test was quota-based, the numerical 
restriction should be specified.  On the question of what an ENT actually was, and what measures 
might qualify as an ENT, she suggested that three cases of licensing requirements under Article VI:4 
put forward by Brazil in the Working Party on Do mestic Regulation (WPDR) in JOB (04)/169 might 
be considered examples of ENTs, even though they  did not fall under Article XVI, as they were not 
specific to activities or subsectors committed.  Rath er, these cases extended across several activities or 
subsectors.  The cases in question where (i) " license is conditional upon the observance of the 
prohibition for services suppliers in the whol esale sub sector to undertake retailing activities 
simultaneously;" (ii) "license is conditional upon the observance of the prohibition for services 
suppliers acting in the fixed telephony sub sector to undertake activities in the mobile telephony sub 
sector simultaneously;" and (iii) "regulations rela ting to zoning being determined according to the 
competition environment, the principle of the greatest  benefit of the user and the social and economic 
interests of the country." 
28. The representative of Canada  stated that her delegation was a strong supporter of further 
discussions on ENTs with the aim of improving thei r scheduling by Members.  While Article XVI:2 
and the Scheduling Guidelines provided clear guida nce on the proper scheduling of these tests, 
including on the need to specify requirements and criteria, Members had not consistently used and 
implemented the relevant provisions .  Canada looked forward to discussions on the key questions that 
had been raised by Hong Kong, China in this regard .  Increased clarity and specificity in scheduling of 
ENTs could improve transparency and predictab ility of the schedules and prevent arbitrary and 
discretionary application of the tests.  She w as, however, mindful of the fact that too much 
information might produce the undesirable and unint ended result of obscuri ng the specific criteria 
used by Members in the application of ENTs.  It was thus important to find a balance that provided 
for an adequate degree of specification and precision in the schedules without adding unnecessary information.  For instance, as far as labour market tests in Mode 4 were concerned, transparency and 
predictability could be advanced by providing mo re explicit information about: (i) criteria on which 
labour market tests were based and their operati on; (ii) the relationship between the Mode  4 
commitment and the general immigration laws, regu lations, and administrative procedures; and (iii) 
the requirements and procedures for obtaining work permits and visas for work. 
29. The representative of the United States
 stated that her delegation's silence during the present 
and the last agenda item should not be taken as assen t to interpretations offered by any delegation.  
Her delegation would, as necessary, address certain issues in informal mode S/CSC/M/36 
Page 6  
 
30. The representative of Chile
 hoped that delegations could develop a common understanding on 
the interpretation and implementation of the Sche duling Guidelines, and as necessary, identify the 
elements that should be specified in the inscripti on of ENTs.  She emphasized that ENTs were one 
form of implementing quantitative limitations, and requested information as to whether Members had 
published criteria or notified any changes to criteria to the Council for Trade in Services.  As for the 
definition of ENTs, she suggested a focused exchange  of views on the experiences of Members with 
ENTs. 
31. The representative of Korea  supported further discussions on issues such as the relationship 
between discriminatory ENTs inscribed in the market access column with commitments on national 
treatment.  Also, a better understanding was needed concerning the borderline between non-
discriminatory ENTs and domestic regulation.  The Scheduling Guid elines offered only one example 
of possible criteria for ENTs, namely population de nsity.  She wondered about the validity of other 
criteria, such as environment-related tests.  She r ecalled that some delegations held the view that 
zoning regulations were part of  domestic regulation, but ques tioned whether certain zoning 
regulations did not amount to quantitative restricti ons in the sense of Article XVI.  She requested 
clarification on paragraph 6 of Hong Kong, China's paper which declared that ENTs were not in 
themselves quantitative limitations, but constituted only a means of applying such limitations.  
Following the argument in paragraph 7, she wo ndered what degree of specificity was deemed 
sufficient in order to establish that an ENT w as indeed a quantitative limitation.  Finally, she 
commented on the view of some delegations that an ENT without any specification amounted to an "Unbound" entry.  As for such ENTs, she wondered whether a Panel might refer to the existing ENTs 
in national legislation at the time when the commi tment was made.  If that was the case, such ENTs 
would differ from a situation without commitment. 
32. The representative of Hong Kong, China
 stated that the ultimate objective of the paper was to 
initiate discussion on the extent to which ENTs s hould be specified in the schedules of commitments. 
The fact that a Member scheduled an ENT in a gi ven sector meant that a commitment existed in that 
sector, which differed from a situation where "Unbound " was inscribed.  The real question was to 
what extent insufficiently specified ENTs provided a legal guarantee of any level of market access.  Most delegations agreed that a minimum degree of sp ecificity was needed to reflect a firm intention 
of such a legal guarantee. 
33. Commenting on the intervention by Thailand, he stated that his delegation's paper addressed 
exclusively ENTs mentioned in Article XVI:2 (a)-(d ) of the GATS, and did not analyse measures that 
might be contained in domestic regimes but did not qualify as limitations un der Article XVI.  To 
clarify the last sentence of paragraph 6, he ob served that ENTs served the purpose of inscribing a 
quantitative limitation, as expressed in Article XVI:2 (a)-(d).  An ENT itself was only the form which 
a quantitative limitation took, but not the quantitative limitation itself.  It was incumbent on the Member to specify clearly how a given ENT opera ted in imposing a quantitative limitation.    
34. Turning to the examples of regulatory measures in Brazil's paper (JOB (04)/169) he observed 
that another delegation had suggested that it was permissible that entries under additional 
commitments related to issues outside the scope of the sector column.  If that was the case, one could consider that limitations that went beyond the sector al scope could also be inscribed in the market 
access or national treatment column.  The first two ex amples offered by Brazil related to activities that 
cut across individual services sectors.   As for th e example on zoning requirements, he noted that 
some Members had opined that these fell under domes tic regulation, but he questioned whether such 
requirements needed to be scheduled if they had th e effect of imposing quantitative limitations in the 
sense of Article XVI. 
35. For Hong Kong, China, specificity was a prio rity, since there were doubts as to whether 
unspecific ENTs identified a market access limitation at  all.  The discussion was highly relevant to the 
on-going negotiations, especially the request-offer process.   Members needed to be able to discern the  S/CSC/M/36 
 Page 7 
 
 
value of ENTs according to the degree of  specifi cation.  As touched upon in the Working Party on 
GATS Rules (WPGR), the question arose as to the e ffect of an unspecified ENT compared to an 
emergency safeguard.  The ultimate aim was to reach an understanding of minimum standards of 
specification for the purpose of inscribing market ac cess limitations under Article XVI and to enhance 
clarity, certainty and comparability.  He would revert  to the issues at the next meeting and was hoping 
for input from other delegations, particularly on the question of what would constitute sufficient 
specificity. 
36. The representative of Brazil  stated that his delegation had put forward the examples in 
JOB (04)/169 in the context of the WPDR in orde r to initiate a discussion on whether or not such 
measures needed to be scheduled. 
37. The representative of Djibouti  stated that difficulties existed with initial offers, and proposed 
that a regional seminar be organized in Djibouti in 2 005 or the following year with the participation of 
other organizations such as UNCTAD or the Worl d Customs Organization on trade facilitation.  He 
would prepare a note and hoped for a positive reply by the Secretariat. 
38. The Chairman  suggested that Members take note of the statements made and that the 
Committee revert to the issues at the next meeting. 
39. It was so agreed . 
C. CLASSIFICATION ISSUES  
40. The Chairman  recalled that at the last meeting, I ndonesia had presented a revised proposal on 
the classification of energy services (S/CSC/W/42/Rev. 1 and Rev.1/Corr.1).  As there had been some 
questions and comments on that proposal, he first inv ited Indonesia to revert to any of these points.   
41. The representative of Indonesia  noted that views on her delegation's proposed classification 
had differed among Members.  Some delegations  were supportive of the proposal, noting the 
advantages of a detailed classification for speci fic activities within a large sector.  Such a 
classification would enable Members to make commitments at the precise level desired.  Other delegations had expressed the view that the pr oposal contained too much detail and was too 
complicated.  She hoped that these differences of view would not prevent Members from engaging in 
the negotiations on the basis of commonalities. 
42. In response to a question by Japan, she stated  that CPC 1.1. and CPC Provisional had been 
used for the classification, as they were complementar y.  She noted an error in the last sentence of 
paragraph 22 of the report of the last meeting (S/CSC/M/35).  Instead of "liquefaction and 
classification of energy," reference should be made  to "liquefaction and gasification of energy." 
43. The representative of Canada
 stated that it might be confusing to use CPC Provisional and 
CPC 1.1 within same classification system.  Turning to specific comments, he referred to item 1A.2.1, 
on rig positioning and preparation.  Positioning of offshore rigs was found in CPC 7214, but the installation of mobile floating units and subm ersible units was found under CPC 885.  These units 
were described under CPC 4939.  As for item 3.1.2. a nd 3.2.2. (wholesale and retail sale of electricity 
and town gas), he noted that these services were not included in the provisional CPC and could not 
have been considered before 1995.  Members woul d have to find ways to deal with those new 
services. 
44. The representative of Japan
 recalled that his delegation had presented a set of questions, in 
JOB (04)/165.  Given the technical nature of th e questions, he would welcome written replies by 
Indonesia. S/CSC/M/36 
Page 8  
 
45. The representative of Singapore
 requested clarification on a number of questions.  He 
inquired to what type of services item "1A.4.9. Distribution services (separator, pipeline, storage)" referred;  secondly, other than operating the electri city network and gas pipeline, he wondered what 
"management" services were covered by item "2.3 Op eration and management of  energy networks";  
thirdly, he sought clarification as to whether services for transmitting electricity and transporting 
piped gas fell under item "2.7. Transportation of fuels and energy transmission and distribution 
services".  If that was the case, what was the diffe rence between items 2.3. and 2.7?  Fourthly, he 
queried what type of services were referred to under item "2.7.5. Services supported to the operation 
of energy distribution";  and finally, what ot her services related to retailing under item "3.2.2. 
Retailing services of electricity, town gas," besides selling electricity and town gas to consumers? 
46. The representative of Norway
 agreed with Indonesia's character ization of the strategic nature 
of the energy sector.  She concurred that the mu ltilateral framework should respect national policy 
objectives and Members' right to regulate the supply of energy services within their territories, and recognize the particular needs of developing countri es.  She endorsed the view in paragraph 7 of 
Indonesia's paper  that a detailed classification of the energy services sector offered a comprehensive 
and essential instrument for WTO Members to nego tiate specific commitments on energy services.  
With its proposal, Indonesia had provided a long-ne eded list identifying the commercially relevant 
services, and their location in the classification sy stem.  Indonesia had taken a comprehensive and 
transparent approach, which her delegation preferre d in comparison to shorter lists which primarily 
focused on the trade interests of a few Members.  Th e Indonesian proposal was neutral with respect to 
energy sources and with respect to where the act ivities took place.  This was a great advantage 
because an assessment of  the quality of Members’ commitments had to take account of the 
commercial realities in the respective Members' mark ets.  For instance, in Norway, upstream services 
related to oil and gas were supplied offshore; an  offer from Norway which excluded such offshore 
activities would thus not be commercially meaningful for its trading partners.  A neutral approach, as 
proposed by Indonesia, was thus called for. 
47. Classification issues were means of helping Members understand the subject matter of the 
negotiations, and the meaning of the commitments unde r discussion.  The core of negotiations related 
always to the quality of commitments.  Norway ha d presented a comprehensive initial offer on energy 
services with the firm conviction that broad commitme nts in this field could make valuable and cost 
effective contributions to its economy.  Its na tional experience with open competition was very 
positive.  Her delegation looked forward to other countries moving from discussions on classification 
to negotiations on real commitments.   
48. The representative of Indonesia
 stated that replies to the questions would be provided in 
writing, as well as during friends- or bilateral meetings. 
49. Turning to legal services, the Chairman  recalled that at the last meeting one delegation had 
wished to make further comments on the OECD presentation on legal services, given during the 
meeting on 28 September 2004. 
50. The representative of Canada  stated that his delegation strongly supported the OECD 
document.  Legal services were an important sector, in which many Canadian firms were active.  He 
particularly recommended that de legations approaching the request-offer process use the set of 
questions in Annex Table 1 of the OECD paper, on page 30. 
51. The representative of Singapore  considered that the OECD paper set out clearly the state of 
play in the legal services negotiations and the issu es to be taken into account by WTO Members in 
scheduling commitments.  Singapore supported the GA TS framework for liberalization of services in 
a progressive, orderly and transparent manner with Me mbers having full freedom to decide the terms 
of liberalization so as to address market fa ilures and secure non-economic and social policy 
objectives.  Singapore supported the Australian propo sal on classification of legal services into 12  S/CSC/M/36 
 Page 9 
 
 
new sub-categories based on the area of law and the t ype of service, with the main categories divided 
into host-, home-, and third country law, as well as  international law.  The proposal was consistent 
with the regulatory framework of most Members, a nd was the most flexible and user-friendly method 
of classification for the scheduling of co mmitments in the current negotiations. 
52. As the large international law firms originated  mostly from certain developed countries, any 
further liberalization of the legal services sector should not result in marginalizing the domestic legal 
services sector of other WTO Members, impeding its gr owth and that of the domestic economy.  Any 
liberalization had to take into account the legitimate role of governments to offset market failures and 
to achieve non-economic objectives.  In this contex t, he noted that a small domestic legal services 
market left little or no room for the practice of host country law by foreign law firms and foreign 
lawyers;  the need to attract and retain local legal talent so as to build up a strong local bar with sound 
knowledge of local culture, or customs and circ umstances for key government and judicial 
appointments; and the importance of giving domestic  law firms the opportunity to improve the quality 
of their services by collaborating with foreign firms subject to conditions such as transfer of legal 
skills and knowledge as well as training of domestic lawyers by the foreign firms involved.  Any 
further liberalization of the legal services sector sh ould thus not merely benefit certain international 
law firms but ensure that conditions and limitations  could be put in place to create a more level 
playing field for domestic law firms with the objective of achieving the quality required to be internationally competitive in the years ahead. 
53. Since 1981, Singapore had a liberal and largely unregulated regime for foreign lawyers to set 
up law practice to supply offshore legal services.  There were currently about 60 foreign law firms 
and 500 foreign lawyers in Singapore.  Singapore we lcomed foreign law firms to come to Singapore 
to practise home-country law, third-country law a nd international law.  The present conditions of 
entry were extremely liberal, except that foreign lawyers were not permitted to practise Singapore law 
in Singapore.  However, foreign lawyers working in  Joint Law Ventures (JLVs) with local firms, who 
were registered with the Attorney-General’s Cham bers to practise Singapore law in banking, finance 
and corporate work after passing a prescribed examin ation, were permitted to practise those areas of 
Singapore law. 
54. Foreign lawyers or foreign law firms should be permitted to either employ or form 
commercial association with Singapore lawyers in Singapore only to the extent provided under 
domestic laws which were necessary given the small domestic legal services market and which would at the same time fac ilitate the provision of legal services sought by clients covering multiple 
(domestic, foreign and international) jurisdictions .  Accordingly, Singapore reserved the right to 
decide at the appropriate time whether and to what extent it would remove the existing MFN 
exemptions, make any specific commitments on le gal services, or bind in the current round of 
negotiations the current regime governin g domestic and offshore legal services. 
55. The representative of Switzerland
 stated that the OECD paper showed the importance of 
liberalizing legal services and the catalyst function of these services for foreign investment.  
Commitments in the sector contributed to secu rity and predictability of the local business 
environment, and might promote transfer of knowledge  and skills.  He noted that the paper did not 
propose any new classification, but rather explored ways in which Members could work within the 
existing, flexible GATS framework.  He encouraged  Members to take commitments in this sector. 
56. The representative of the European Communities  stated that the OECD paper was neutral on 
classification, and merely took stock of the differe nces in approach.  His delegation concurred with 
many others that the CPC at four of five digit level was not a good classification for legal services, but 
believed that all legal services were covered at the th ree-digit level.  His delegation was working with 
interested delegations on ways to divide the three- digit level in more adequate sub-categories than 
those offered by the CPC.  In doing so, his delegation did not want to see the introduction of S/CSC/M/36 
Page 10  
 
regulatory conditions into the classification.  A cl assification should be neutral, and only serve to 
identify services activities. 
57. The representative of the United States
 stated that her delegation was working with the 
friends of legal services on classification and other issues.  In her view, the classification issue was not a question of sub-dividing the CPC, which her au thorities were not using, but of the structure of 
W/120.  Another issue that her delegation was pursu ing was the notion of arbitration services, which 
should not to be restricted to the legal services sphe re.  Arbitrators existed also outside the legal area 
and often were experts in specific technical subject areas.   
58. The Chairman
 drew the attention of Members to a recent communication from the European 
Communities on the classification of telecommunication services (S/CSC/W/44).  
59. The representative of th e European Communities  stated that the classification used today for 
telecommunication commitments was outdated, as it was based on business concepts and terminology 
that did not match the current reality of the tel ecom sector.  This created legal uncertainties on the 
scope of existing commitments and commitments cu rrently under negotiation.  Several services had 
emerged over the last decade that were not part of the W/120 classification, while other services 
included in W/120 were no longer used.  In addition, the W/120 classification was not technologically 
neutral.  Some categories had potential for overlap, and their alignment with the CPC, which in itself 
was not up to date, created confusion.  In particul ar, there was an overlap with computer and related 
services; for example, "online information and/or data processing" referred to CPC 843 which covered 
database processing.  The solution put forward in the EC paper was based on the definition of 
telecommunications in the GATS Annex on Telecommunications.  The suggested approach left 
enough flexibility for Members to accommodate particul ar situations.  He invited Members to study 
the proposal.  His delegation recognized that other solutions might exist, and was looking forward to 
engage actively on this matter. 
60. The representative of Switzerland  stated that his delegation had not had the time to study all 
details of the proposal, but was supportive of its principal ideas.  He emphasized that a new 
classification should be introduced on  the basis of broad agreement. 
61. The representative of Hong Kong, China  shared much of the problem analysis relating to the 
existing classification in the EC paper.  She echoe d the need for a technology- and content neutral 
classification that was forward looking.  A new classifi cation had to be neutral w ith regard to the level 
of commitments; Members must remain able to iden tify services on which they did not intend to take 
commitments.  She was mindful that the language of  the proposed classification had to be examined 
carefully to ensure that services, and in turn commitments, would not be unduly left out.  Her 
delegation had particular concerns  about the notion of "content".  She appreciated that commitments 
in telecommunication services should not cover se rvices which fell under other sectors and were 
merely provided through telecommunications.  It was necessary to maintain a clear delineation 
between the telecommunication sector and other sector s.  One particular question was whether the 
transmission of television and radio services (CPC 7524) would be covered under the proposed 
definition of telecommunications as transmission services. 
62. The representative of Chinese Taipei  shared the approach of th e European Communities, to 
classify telecommunication services as the "transmission and reception of signal by electromagnetic means".  The proposed classification avoided the le gal uncertainty of the existing classification and 
did not prejudge business models.   
63. The representative of Canada
 recognized the attractiveness of a streamlined classification 
based on a functional definition of telecommun ications, but was concerned about possible 
implications for the coverage of value-added telecommunication services.  S/CSC/M/36 
 Page 11 
 
 
64. The representative of Senegal  noted that Senegal had modi fied its communication system 
including the concept of the service, in the year 2000.  According to the new concept, television and 
radio broadcasting was not part of telecommunication services.   
65. The representative of Japan  stated that it was important to carefully consider the EC proposal 
from the viewpoint of legal certainty and progressive  liberalization, in order to assess whether it was 
more beneficial for all Members than the existing approach.  
66. The representative of the United States  voiced concerns in view of possible implications of 
the proposal for value-added services, which c ould arise from collapsing all services into a 
transmission or transport function.  Indeed, many telecommunication services were classified as value-added telecom services that involved a function beyond mere transmission of signals.  Her 
delegation would be concerned with schedules that  did not explicitly cover value-added telecom 
services or that rolled back existi ng commitments for these services.  
67. The representative of Korea
 concurred that the CPC was outdated, but shared the concerns of 
other interventions regard ing value-added services. 
68. The representative of the European Communities  stated that value-added services like voice 
mail, e-mail, or value-added facsimile services incl uding store and forward, store and retrieve, fell 
under the proposed definition of telecom services.   The fact that in these services messages were 
stored for retrieval by recipients did not alter the primary purpose of the service which was the 
transmission and reception of information.  Services 2 C h) – m) of the existing classification, which were often referred to as value-added services, were  covered by the proposed  definition.  Service 
2 C n) dealing with on-line information and/or da tabase processing (CPC 843) was not a transmission 
service but a processing service covered under computer and related services.  He agreed that certain 
providers of value-added services also provided content services.  These suppliers were often 
supplying a host of services, ranging from internet  access services (which were telecommunications 
services) to information services such as on news or sports (which were content services), and database services (which were computer services) by hosting data for information services.  The 
problems arising from these content services were not adequately covered by W/120 and the CPC.  In 
terms of its function, the closest category in th e existing classification was news agency services 
(CPC 962); however, the definition of that service came from a time when clients of information 
services were mainly media and other businesses, but  not individual customers.  Modern content 
services as those mentioned above did not exist at the time the W/120 classification had been devised and had never been covered by the existing classificat ion.  For these services, it was necessary to find 
a place in a revised classification system and to negotiate appropriate commitments.   
69. The representative of the United States
 stated that her delegation was not convinced, but took 
note that the EC intended to elabor ate further in the Special Session. 
70. The Chairman  suggested that delegations take note of the statements made that the Committee 
revert to the issues at the next meeting.   
71. It was so agreed . 
  S/CSC/M/36 
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D. O
THER BUSINESS  
72. The Chairman  suggested that, in accordance with the practice of grouping meetings of 
subsidiary bodies close to meetings of the Council,  the next formal meeting be held in conjunction 
with the next services cluster.   
73. It was so agreed . 
__________