RESTRICTED  WORLD TRADE  
ORGANIZATION  S/WPDR/M/35 
14 August 2006 
 (06-3896) 
Working Party on Domestic Regulation  
  
 
REPORT OF THE MEETING HELD ON 19 AND 20 JUNE 2006 
 
Note by the Secretariat
1 
  
1. The Working Party on Domestic Regulation (WPD R) held its thirty-fifth meeting on 19 and 
20 June 2006.  The meeting was chaired by Mr. Pete r Govindasamy of Singapore.  The agenda for the 
meeting was contained in Airgra m WTO/AIR/2840, dated 9 June 2006. 
2. No points were raised under Other Business. 
B. REPORT FROM THE CHAIRPERSON ON INFORMAL MEETINGS 
3. The Chairman recalled that since its last formal meeting on 27 March 2006, the Working 
Party had held two informal meeting on 2 May 2006  and on 1 and 2 June 2006.  At those meetings 
Members had held informal discussions on several new and revised proposals made by Members on the development of regulatory disciplines under GATS Article VI:4.
2  As in past occasions he 
circulated summaries of these informal discussions, which were contained in documents JOB(06)/157 
of 29 May 2006 and JOB(06)/226 of 12 July 2006. 
C. DEVELOPMENT OF REGULATORY DISCIPLINES UNDER GATS ARTICLE VI:4 Proposals by Members on Regulatory Disciplines under GATS Article VI:4
 
4. Members addressed in informal mode a new proposal by Australia; Chile; Colombia; Hong 
Kong, China; Korea; New Zealand and the Separa te Customs Territories of Taiwan, Penghu, Kinmen 
and Matsu, entitled "Article VI:4 Disciplines – Pr oposal for Draft Text", which was contained in 
document JOB(06)/193 of 19 June 2006.  Members al so held a round of thematic discussions in 
informal mode on the elements contained in all their proposals on the development of regulatory disciplines under Article VI:4 of the GATS.  As on previous occasions, the Chairman would circulate 
a summary of these discussions, which is containe d in document JOB(06)/235, dated 14 August 2006. 
                                                     
 
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 Proposal by Brazil and the Philippines, contained in document JOB(06)/133 of 2 May 2006;  Revised 
proposal by Antigua and Barbuda, Barbados, Cuba, Dominica, Dominican Republic, El Salvador, Fiji, Grenada, Guatemala, Honduras, Jamaica, Mauritius, Mongolia, Nicara gua, Paraguay,  St. Kitts and Nevis, St. Vincent and 
the Grenadines and Trinidad and Toba go on "Trade-Related Concerns of Small, Vulnerable Economies in the 
Working Party on Domestic Regulation", contained in document JOB(06)/66/Rev.1 of 2 May 2006;  Proposal by the ACP Group on "Pro-Development Principles for GATS Article VI:4 Negotiations", contained in 
document JOB(06)/136 of 2 May 2006;  Proposal by the African Group on Domestic Regulation, contained in a 
room document of 2 May 2006;  Proposal by China and Pakistan on "Proposed Disciplines on Domestic Regulation under Article VI:4 of the GATS", contained in document JOB(06)/158 of 29 May 2006;  Proposal by 
Chile, India, Mexico, Pakistan, Peru and Thailand on Proposed Disciplines on "Qualification Requirements and 
Procedures", contained in document JOB(06)/160 of 30 May 2006. S/WPDR/M/35 
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  Organizational issues
 
5. The Chairman  pointed out that Members had had sever al rounds of substantive discussions on 
all proposals by Members, including revised and legal text proposals.  He recalled that several delegations had suggested that at this stage it would be helpful if the Chairman prepared a first draft 
consolidated text of the Article VI:4 disciplines.  He noted that, as it had been discussed in previous 
occasions, such text would be comprehensive of al l text proposals made and views expressed in the 
WPDR by Members and would not in any way prejudice the outcome of the negotiations.  He suggested that if delegations had no objections he would prepare such a text in time for the next 
informal meeting of the Working Party. 
6. The representative of Australia 
welcomed the proposal that the Chairman be given a mandate 
to develop a comprehensive text of the disciplines on  domestic regulation.  He pointed out that this 
text would be an important aid to domestic consultati ons, but that to be so it needed to be more than a 
mere compilation of all proposed language on the ta ble.  He said that his delegation trusted that, 
where there was an emerging "landing zone", the Chairman would use his judgment to capture it.  
While he acknowledged that there were a number of areas where it might have been more difficult to 
identify a landing zone, he encouraged the Chairm an to minimize the range of options he would 
present in these more contentious areas, so as to assist Members in their domestic consultations. 
7. He recalled that at this meeting his delegati on had co-sponsored a comprehensive text which 
set out their perspective on where the balance betw een the needs of services exporters and the needs 
of regulators lied.  Further, his delegation wanted to  set out some clear parameters within which they 
believed the Chairman's mandate lied.  First and fo remost, he recalled that the Working Party had not 
been given a mandate by Ministers, through the Hong  Kong Ministerial Declaration or previously, to 
depart from the objectives in Article VI:4 of the GATS.   In their view that meant that the disciplines 
must ensure that measures in this area “did not  constitute unnecessary barriers to trade” and should 
aim to ensure that measures were: (i) based on obj ective and transparent crite ria, such as competence 
(he highlighted the reference to ‘competence’); (ii)  not more burdensome than necessary to ensure the 
quality of the services (broadened to encompass other national policy objectives); and (iii) with regard 
to procedures (broadened here to cover both licen sing and qualification procedures), not in themselves 
a restriction on the supply of the service. 
8. He said that from their point of view any disciplines that did not deliver on this level of 
ambition would be of no value to the promotion of  services trade and the integration of all possible 
service providers into the global trading environment and should not, therefore, be inserted into the 
GATS.  He stressed that to add value, any discip lines must establish standards and tests against which 
the actions of regulators could be contested wher e another Member felt that the actions of the 
regulator were not based on objective and transpar ent criteria, were more burdensome than necessary 
and were, with respect to procedures associated with  licensing regimes, in themselves a restriction on 
the supply of the services. 
9. He said that his delegation had tried to provide  language which was as specific as possible to 
address this issues and added that they were ready to consider other forms of language which might 
set out clear and objective standards against which th e actions of regulators could be tested.  He noted 
that the key struggle Members faced was to achieve this, while fully respecting the right to regulate 
and, importantly, avoiding any express or de facto attempt to prescribe regulatory approaches.  He suggested that a common ground on which Members c ould develop disciplines might have been the 
exclusion of the most egregious of regulatory approaches, i.e., a commitment that regulators should 
not act with a view to ( i.e., with the intent of) creating barriers to  trade which did not directly respond 
to legitimate policy objectives.  S/WPDR/M/35 
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  10. Turning to some specific areas, on objectives, he said that his delegation believed that the 
right to regulate and the objectives of Article VI:4 represented an important balance, and that in any 
text the Chairman would prepare they should receive  equivalent treatment.  On scope, they believed 
there was some level of consensus on the coverage of the disciplines, including a level of consensus 
on the interaction between these disciplines and visa syst ems.  He suggested that the Chairman try to 
find the most appropriate language to reflect this.  On transparency, he noted that there seemed to be 
some emerging consensus, except for the issue of  prior comment.  He said that his delegation 
supported a provision which provided that, wh ere Members sought to comment on proposed 
regulations, no received comment shoul d be precluded from consideration, i.e., any party interested 
enough to follow the evolution of regulation and provide comment should have that comment taken 
into consideration.  He said, however, that any requirement for a written response to such 
submissions, even on a best endeavours basi s, would be a step too far for them. 
11. On qualification requirements, he made two point s.  First, he pointed to the importance of 
mandating due process for assessing foreign applicants .  In this respect, he noted that it was 
unacceptably restrictive for a regulator to refuse an application simply because the applicant held a 
foreign qualification, without providing an avenue either to assess the foreign qualification itself or 
for the applicant to prove his/her competence (exa minations, prior work experience, membership of 
professional associations etc).  Secondly, he said that while the ultimate responsibility for showing 
that an applicant satisfied qualification requireme nts rested with the individual applicant, his 
delegation believed there was a role for regulators in  identifying to the app licant the deficiencies in 
their application and, on a best endeavours basi s, advising on how those deficiencies could be 
overcome.  On licensing procedures, his delegati on believed that where a licensing application was 
rejected, the competent authorities should inform the a pplicant of the ‘reasons for rejection’ – at  least 
‘on request’ – unless there were legitimate public  policy grounds for not providing reasons. 
12. On development considerations, he said that his delegation believed that there was inbuilt 
S&D treatment in this negotiation, as the discip lines would only apply to sectors, sub-sectors and 
modes of supply in which commitments had been made .  They also believed that it was crucial to the 
integration into the global trading marketplace that all Members would be subject to these disciplines.  
He said that his delegation could agree to the phasi ng-in of commitments and had also proposed that 
the compliance of LDCs with the disciplines should not  be subject to dispute settlement for a defined, 
but extendable, period of time.  He added, howev er, that they could not accept any disciplines that 
could place a future panel in the position of having to  assess the level of development of a particular 
Member as part of assessing their compliance wi th the disciplines.  He emphasised that any 
consideration of level of developm ent should be on the part of the membership in determining when 
compliance was required and when dispute settlement might be appropriate, but should not factor into 
a panel’s consideration.  Once an international lega l obligation had been undertaken and subjected to 
dispute settlement, the only issue for consider ation by a panel should be compliance. 
13. Delegations supported the suggestion that the Chai rman be given a mandate to prepare a first 
consolidated text of the disciplines.  Delegations ag reed that at this stage the draft should constitute a 
working tool and should not prejudice the outcome of  the negotiations.  They pointed out, however, 
that it should not be a mere compilation of propo sals and positions expressed by delegations, but that 
it should reflect the progress made thus far in the negotiations. 
D. DATE OF NEXT MEETING 
14. Regarding the date of the next  formal meeting, the Chairman  suggested that the Working 
Party hold this meeting on the first Monday of the next cluster of services meetings, tentatively 
scheduled for Monday 2 October 2006.  He said this  date would be confirme d in due course.  He 
added that informal meetings to advance work pur suant to Article VI:4 of the GATS would continue S/WPDR/M/35 
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  to be convened on a needs basis.  The next inform al meeting of the Working Party was convened for 
13 July 2006. 
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