WORLD TRADE  
ORGANIZATION  WT/REG164/M/4 
9 January 2008 
 
 (08-0093) 
Committee on Regional Trade Agreements 
Forty-eighth Session  
 
 
 
CONSIDERATION OF THE ASSOCIATION AGREEMENT BETWEEN THE EUROPEAN 
COMMUNITIES AND CHILE, SERVICES  
 
Note on the Meeting of 29 November 2007  
 
Chairman:  Mr.  J.  Metcalfe (United Kingdom) 
 
 
1. The meeting was convened in document WTO/ AIR/3097 and Revision 1 dated 18 October 
2007 and 15 November 2007, respectively. 
2. Under Agenda Item B.II of its 48th Session, the Committee on Regional Trade Agreements 
(CRTA or the Committee) took up consideration of the Association Agreement between the European 
Communities and Chile, services.   
3. The Chairman  noted that the Association Agreement ha d been notified by the Parties to the 
WTO on 28 October 2005 under GATS Article V:7(a) as an Agreement providing for the 
liberalization of trade in services within  the meaning of Article V of the GATS 
(document S/C/N/309).  It had entered into force on 1 March 2 005.  The text of the Agreement, 
document WT/REG164/1/Add.1, had been circulated to Members as an addendum to the text of the 
Goods Agreement, document WT/REG164/1. Both were  available, together with Annexes, on the 
Parties' official websites.  The goods aspects of the Agreement had been pr eviously examined during 
the Committee's 40th, 43rd and 44th Sessions. 
4. The Factual Presentation on the services aspects of the Agreement (document WT/REG164/7 
dated 28 September 2007) had been prepared by th e Secretariat on its own responsibility in full 
consultation with the Parties, in accordance with paragraph 7(b) of the Transparency Mechanism for 
Regional Trade Agreements (document WT/L/671).  In addition, written questions and replies on the 
Agreement had been recently distributed in document WT/REG164/8 date d 24 November 2007.  
Questions from Canada, which had been received after the deadline, had been distributed in document 
WT/REG164/9 dated 27 November 2007.  He underst ood that the Parties intended to provide oral 
answers in the meeting to these questions and would submit written answers to the Secretariat so that 
the questions and replies document could be reissued.   
5. He proposed to organize the consideration of the Agreement by asking first the Parties and 
then other Members to give any general comments.  The Committee would then turn to the specifics 
of the Agreement using the Factual Presentation, document WT/REG164/7, to guide the debate.  He 
proposed to go through the Factual Presentation by section and then through the questions and replies 
document. 
6. The representative of Chile  speaking on behalf of both Parti es recalled that both Chile and the 
EC were committed to a rules-based multilateral tr ading system under the WTO, and reaffirmed their 
support for strengthened WTO rules, disciplines and mechanisms on RTAs, to enhance their WT/REG164/M/4 
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  transparency and compliance with WTO rules. Th ey welcomed the adoption of the Transparency 
Mechanism.  The Agreement had been signed on 18  November 2002.  Although it had entered into 
force on 1 March 2005, some parts, such as the pr ovisions on trade in goods, had been applied on a 
provisional basis since 1 February 2003.  The Parti es were convinced that the Agreement fully met the 
WTO requirements, particularly those under Article V of the GATS.  The Agreement had substantial 
sectoral coverage and provided for the elimination of substantially all discrimination.  Article 55(c) of 
the Agreement had also foreseen that one of the objectives of the Agreement was “the reciprocal 
liberalisation of trade in services, in conformity with Article V of the General Agreement on Trade in 
Services ("the GATS")." 
7. In terms of structure, Trade in Services and Esta blishment were dealt with in Part IV ("Trade 
and Trade-related Matters"), under T itle III.  The title was further sep arated into Chapters, dealing 
with services in general, financial services, est ablishment and exceptions. The general chapter was 
further divided into three sections on general provisions, international maritime transport and 
telecommunications services. The Parties' respec tive schedules of specific commitments on trade in 
services (including financial services) and on establishment were contained in Annexes.  
8. In general terms, the Agreement was based on the structure of the GATS and the specific 
commitments listed in GATS-type positive lists for the four modes of supply.  Annex VII listed the 
parties' services commitments and Annex VIII the par ties' specific commitments on financial services.  
The Agreement relied on - with some modifications - the scope, definitions and principal disciplines 
of the GATS, although establishment in the non-servi ces sectors was not covered under the GATS.  
There was also no a priori  exclusion of sectors from the scope of the Agreement.   
9. The Agreement was dynamic and a review of th e services chapter by the Parties was foreseen 
three years after its entry into force, with a view  to further deepening liberalization and reducing or 
eliminating the remaining restrictions on a mutu ally advantageous basis and ensuring an overall 
balance of rights and obligations.  Additionally, the Parties had stated that two years after the entry 
into force of the Agreement they would review the rules and conditions applicab le to the movement of 
natural persons (mode 4), with a view  to achieving further liberalization. 
10. The Chairman
 opened the floor for comments on broad sections of the factual presentation. 
11. On Section II.B the representative of Canada  asked whether the parties could respond to his 
delegation's questions relati ng to paragraphs 15 and 16. 
12. The representative of the EC , responding to the first question, said that at the time of 
negotiating the Agreement, the option of not ha ving a separate Chapter on Investment had been 
retained.  On the second question he said that th e temporary movement of natural persons who 
supplied services as employees of juridical persons as independent professionals was only a services 
issue.  Temporary movement of key personnel was both a services and an establishment in non-services issue and was addressed accordingly in bot h chapters.  At the time of negotiating the 
Agreement the Parties had chosen to treat the issues separately in each chapter.  Finally, the definition 
of a juridical person of a Party was based on Article  48 of the EC Treaty and was similar to that in 
GATS Article 28(m)(i).  According to the respectiv e legal orders, a juridi cal person constituted under 
the laws of the EC Member States or of Chile and having a continuous and effective link with the 
economy of the EC or Chile respectively, was an EC or a Chile juridical person even if it was owned 
or controlled by a natural or juridical person of the other party. 
13. On Section II.C, the representative of Canada
 asked for an answer to question 4.  WT/REG164/M/4 
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  14. The representative of Chile  stated that given that the Par ties already provided MFN treatment 
to each other under the GATS and the level of liberal ization provided throughout the FTA, the parties 
had opted not to include other MFN provisions. 
15. On Section II.E the representative of Canada  asked about GATS minus provisions and their 
rationale in the Agreement. 
16. The representative of the EC  said that GATS Article V required substantial sectoral coverage 
and the absence of substantially all discrimination.  The few limitations that had not appeared in the 
EC's GATS commitments had been included because of  the large number of commitments covered by 
the two countries which went beyond their GATS commitments.  In the areas covered by the GATS commitments those horizontal limitations were not applied. 
17. On the questions and replies document,  the representative of the United States
 asked if it was 
correct to say that the Agreement excluded all a udio visual services from GATS disciplines including 
specifically non-discrimination.  On telecommuni cations services, economic activity consisting of 
"content provision" had been excluded from commi tments under the Agreement.  She was concerned 
about the possible exclusion as a result, of non-telecommunications activities such as e-banking, and 
other sectors that could have such a content component. 
18. The representative of Chile  replied that the only exclusion was from the Chapter on Trade in 
Services and Establishment but not from the Agreement. 
19. The representative of the EC  said that at the time of negotia ting the Agreement the Parties had 
agreed that the inclusion of the definition of econom ic activity would not pose a particular concern to 
them and had considered that in terms of adequa te legal certainty, the definition as used in the 
Agreement would be sufficient. 
20. The representative of the United States  asked if the only exclusion for disciplines on 
audio-visual services was in establishment and that  non-discrimination obligations were not excluded 
from the agreement. 
21. The representative of the EC  clarified that the exclusion related to the entire Chapter III but 
audio visual services were found in broader terms in the Agreement. 
22. The Chairman  noted that the consideration of the ser vices aspects of the EC-Chile Agreement 
had allowed Members to clarify a number of questions and concluded oral discussion of the RTA in accordance with paragraph 11 of the Transparency Mechanism.  He invited any delegations wishing 
to ask follow up questions to forward them in writi ng to the Secretariat by 7 December while Parties 
were asked to submit replies in writing by no  later than 21 December.  In accordance with 
paragraph 13 of the Transparency Mechanism,  all written submissions as well as minutes of the 
meeting would be circulated promptly in all WT O official languages and be made available on the 
WTO website.   
23. The Committee took note
 of the comments made. 
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