RESTRICTED  WORLD TRADE  
ORGANIZATION  TN/S/W/52 
29 September 2005 
 
 (05-4309) 
Council for Trade in Services 
Special Session Original:   English 
 
 
 
COMMUNICATION FROM THE REPUBLIC OF KOREA 
 
A Proposal on the Complementary Negotiating Methods: "The Bi-dimensional Approach"   
 
 
 The following communication, dated 28 Septem ber 2005, from the delegation of the Republic 
of Korea, is being circulated to the Me mbers of the Council for Trade in Services. 
 
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I. INTRODUCTION  
1. Korea has prepared this paper in relation to paragraph 18 of the Report by the Chairman of 
the Special Session of the Council for Trade in Se rvices (TN/S/20), which was presented to the Trade 
Negotiations Committee on July 21, 2005. This pa per proposes an approach to the negotiating 
methods which could be used to complement the cu rrent bilateral request-off er process within the 
parameters of the GATS and the Negotiating Guidelin es. This paper is without prejudice to Korea's 
final position in the negotiations. 
II. BACKGROUND 
2. There is a growing degree of recognition among Members that the current bilateral request-
offer method alone is not producing satisfactory r esults. As of 20 September 2005, only 69 initial 
offers and 25 revised offers ha ve been submitted. Setting aside the LDCs, 24 developing Members 
have yet to submit their initial offers. Amongst the submitted offers, sectoral coverage is narrow and 
market access (MA) and national treatment (NT) restrictions still remain prevalent.     
3. Owing to its resource-intensive and time-consumi ng nature, the bilateral request-offer process 
has many weaknesses. Since it does not give a clear indication about the level of ambition expected 
on a multilateral basis, Members may not have a gauge as to how much they can come forward until they have received the offers of all the others. Th e current approach also l acks a mechanism in terms 
of providing political impetus to yield high qualit y offers. This necessitat es countless exchanges of 
offers to meet individual levels of ambition. Fu rthermore, the limited time available for bilateral 
meetings discourages Members to achieve overall ba lance in the negotiations across all of their 
trading partners and interested sectors/modes.  This is even more so for developing Members who are faced with resource constraints. 
4. It should be noted that Article XIX of the GATS and the Negotiating Guidelines stipulate that 
the process of progressive liberalization shall be adva nced in each round through bilateral, plurilateral, 
or multilateral negotiations. Hence, utilizing a comple mentary approach to the bilateral request-offer 
process is to execute the mandate of the current round of negotiations.  TN/S/W/52 
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III. A SHARED OBJECTIVE: WIDENING AND DEEPENING  
5. As stated in the preamble and Article XIX of the GATS, achieving a progressively higher 
level of liberalization is the central objective of th e negotiations on trade in services. Korea envisages 
that widening the scope and deepening the level of commitments undertaken by Members can help 
accomplish this central objective. Pursuing the reduc tion or elimination of trade barriers in both 
dimensions simultaneously serves to promote the inte rests of all participating countries in a mutually 
advantageous way that secures an overa ll balance of rights and obligations.  
6. Out of the 160-odd sub-sectors, the coverage in the offers is on average about 65 percent for 
developed members and 30 percent for developing members. This low level of sectoral coverage 
reflects that, in the last 10 years since its inception, the GATS has not provided sufficient 
predictability for trading conditions. Therefore, ta bling binding commitments in particular sub-sectors 
that have already been liberalized will be the firs t step in the market access negotiations on those sub-
sectors, while at the same time main taining the possibility of being re visited in the successive rounds 
of negotiations in order to achieve higher levels of commitment.  
7. Broadening the sectoral coverage alone does not guarantee new business opportunities. To 
create new opportunities for market entry, it is n ecessary that the level of commitments go beyond the 
status quo. In this respect, it should be emphasized  that liberalizing infrastructure services will be 
beneficial in promoting economic development and competitiveness of the economy, as highlighted 
by UNCTAD and the WTO Secretariat.
1 This is so because infrastructure services are used as inputs 
to other sectors of the economy, including manufacturing. Therefore, from the development perspective, it is essential to provide a more busin ess-friendly environment in infrastructure services 
through further liberalization.  
IV. PROPOSED ELEMENTS  
A. 
WIDENING – A MULTILATERAL BASIS 
8. To achieve the objective of 'widening', it is im portant that Members share the load of making 
new commitments, if not equally in strictly quantit ative terms. In this regard, Korea proposes that 
Members shall commit 'x' percent of their unco mmitted sub-sectors securing the existing level of 
market openness for each mode. Commitments o ffered should be commercially meaningful.  
9. The magnitude (quantitative target) of the 'x' will reflect the collective  level of ambition for 
the services negotiations. Contrary to some concerns expressed by a few Members, this will not impinge on the right of Members to specify the sectors/sub-sectors (i.e. a positive list approach), 
because Members will still possess the right to choo se from which uncommitted sub-sectors they will 
fulfill the x percent.  
10. Flexibilities shall be appropriately guaranteed fo r individual developing  country Members in 
line with their level of development, as provided fo r by Article XIX:2, and special priority shall be 
granted to least-developed country Members as stipulat ed in Article IV:3. Flexibility can be either in 
the form of a differential parameter of x compared w ith that of developed countries, or in the form of 
phased-out commitments with a longer implementati on period. Additional channel of flexibility could 
be considered for Members who have undertak en relatively higher levels of autonomous 
liberalization.  
11. To guarantee the commercial meaningfulness of th e commitments offered, they should reflect 
both the degree of market development of the Member  concerned and the commercial interests of its 
                                                     
 
1 "Trade in Services and Development Implica tions," Section II, UNCT AD, TD/B/COM.1/71, 20 
January 2005 and World Trade Report 2004 , Chapter 2.B, WTO Secretariat, 2004.  TN/S/W/52 
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trading partners. Accordingly, the specific sub-se ctors to be included in the x percent should be 
determined through the bilateral request-offer proc ess, where Members should be in line with the 
requests of other Members for commercially mean ingful commitments. In this respect, Members 
should give particular attention to paragraph 5 of the Negotiating Guidelines that there shall be no a 
priori exclusion of any service sector or mode of s upply, and special attention shall be given to 
sectors and modes of supply of export interest to developing countries. This is a way to ensure an 
overall balance of rights and obligations in the current round through the positive reciprocity  towards 
an expansionary equilibrium of the global trade in services, while departing from the negative 
reciprocity , where each member seeks to exclude all of their sensitive sectors reciprocally. 
B. DEEPENING – A PLURILATERAL BASIS 
12. In attaining 'deepening' liberalization in infrastructure services, Korea recognizes the 
constructive role of each informal group organizing voluntarily during the course of the negotiations. 
In order to enhance transparency, each inform al group is requested to report their activities 
to the Special Session regularly, and for the sake of inclusiveness, to endeavour to open participation 
to other interested Members. 
13. These informal groups are called upon to develop possible minimum target levels (qualitative 
benchmarks) for liberalization or model schedules for individual sectors or modes for commitments 
beyond the current level of liberalization and make them available to a wi der audience. A critical 
mass should be attained for their adoption. Approp riate flexibilities should be inherent in each model 
schedule and the specific degree of flexibilities fo r each Member should be agreed upon by their 
trading partners through the bilateral request-offer process. 
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