WORLD TRADE  
ORGANIZATION  TN/S/22 
13 October 2005 
 (05-4689) 
Council for Trade in Services 
Special Session  
 
 
SPECIAL SESSION OF THE COUNCIL FOR TRADE IN SERVICES 
 
Report by the Chairman to th e Trade Negotiations Committee  
  
The Council for Trade in Services in Special Session met on 26, 29 and 30 September 2005. 
1. Subsequent to a communication from the Chair of the General Council contained in 
WT/GC/96, the Special Session of the Council for Trad e in Services confirmed, on 30 September, the 
appointment of H.E. Fernando de Ma teo of Mexico as its new Chairman. 
2. As my successor was confirmed in his functions at the close of the last day of the meeting, 
this report is made solely u nder my own responsibility.   
 
I. REVIEW OF PROGRESS 
3. Members of the Council are aware of their coll ective responsibility to produce a draft services 
text for the Hong Kong Ministerial Conference within  the next few weeks that will provide guidance 
for the concluding months of the negotiations.  
4. The services negotiations need at present to be tter specify the objectives which will translate 
the repeatedly expressed desire of Members to attain a high level of ambition.  From my point of 
view, it is imperative to produce clear and sp ecific objectives for services at Hong Kong.   
5. The lack of offers, I believe, results from this sense of a lack of direction.  Since the last 
formal meeting, only one new initial offer and four new revised offers have been tabled.  The total 
number of initial offers submitted is 69 (representi ng 93 Members); including LDCs, 54 initial offers 
remain outstanding.  I recall that we are now 2 ½ years beyond the date by which submission of initial 
offers was to take place, and only 15 months away from the anticipated end of negotiations.  The total 
of revised offers submitted is 28 (representing 52 Me mbers); 63 revised offers are outstanding if we 
set aside LDCs.   
6. I feel compelled to reiterate that the services negotiations are qualitatively different from the 
other two pillars of the DDA's market access ne gotiations.  The request-offer process involves a 
myriad of time- and resource-consuming bilateral meetings.  Proposed GATS commitments in offers 
require that governments consult with a complex we b of consumer, industry, regulatory and ministry 
representatives.  Moreover, because the process is reiter ative, there will be no time to spare in 2006 in 
arriving at final offers that fulfil a collective objective.   
7. In addition to delegations' views on progress in general, a number of communications were 
the subject of discussion.  A formal communication from 11 Members on the importance of mode 3 
commitments was presented.
1  A number of the non-papers on the intensification of the request-offer 
                                                 
1 TN/S/W/53. TN/S/22 
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 process and complementary approaches discussed in in formal meetings were re-introduced for the 
Council's consideration.2  In this regard, Members echoed their comments made at informal meetings 
(see bullet 1 of  paragraph 11).  All Members agre e that any complementary approach will remain 
within the negotiating structure set out in the GA TS and the Negotiating Guidelines (S/L/93).  They 
reaffirmed that the main method of negotiation is the request-offer approach. 
8. A number of Members reiterated the flexibilit y accorded to developing country Members in 
undertaking commitments.  A number of other Memb ers stressed the fact that GATS Article XIX 
places this flexibility within the context of achieving a progressively higher level of liberalization.  In 
this way, the GATS provided a framework throu gh which Members could liberalize their services 
trade.  The special situation of LDCs in the negotiatio n was recognised by all Members.             
9. My report in TN/S/20 included an Annex that sought to provide a first outline of Members' 
specific expectations for the round; the barriers face d by their services suppliers; and their individual 
assessments of the offers on the table.  Although pr eliminary, this outline pr ovided information that 
could be useful in producing a profile of a packag e of results for services with regard to sectors and 
modes of supply.   I had announced that a series of open-ended informal meetin gs in October could be 
dedicated to the further identification of objectiv es, including through the refinement of the inputs 
delegations provided for the Annex.   
10. With regard to the subsidiary bodies, including rules, the Chair of the Working Party on 
Domestic Regulation (WPDR) reported that Memb ers had worked in both informal and formal 
meetings with a view to advancing work for H ong Kong.  The Chair of the Working Party on GATS 
Rules (WPGR) reported on discussions on emergency safeguard measures, subsidies and government 
procurement.  With respect to safeguards, the Chai r highlighted that various delegations had showed 
openness to consider alternative ideas or approaches and noted the importance of engagement from all 
sides.  Delegations also pursued their discussions on s ubsidies, in particular re garding ways to achieve 
progress on the information exchange, and government  procurement.  The Working Party asked the 
Chair to undertake consultations on the way forw ard.  The Chair of the Committee on Specific 
Commitments (CSC) reported on possible work in in formal and formal meetings that would aim to 
improve the clarity, certainty, comparability and cohere nce of schedules that would enter into force at 
the end of the round. The Chair remarked that in general the offers did not improve the clarity of 
existing commitments.     
11. Members no doubt recall that in my last report,  TN/S/20, as requested by Members I outlined 
a schedule of work for this autumn that sought to  address the situation in the services negotiations.  
I can report that I have engaged in the followi ng intensive consultations since the summer break: 
• Three open-ended informal meetings have been held at which Members discussed extensively 
ways to intensify the request-offer process and complementary approaches to the negotiations 
within the parameters of the GATS and Nego tiating Guidelines.  Specifically, seven non-
paper proposals on these topics were explored th rough extensive questions which sought to 
clarify the proposals.  On the various proposal s themselves there were divergent views.  
However, all delegations indicated their willi ngness to continue discussing ways to strengthen 
the negotiating process. 
• One open-ended informal meeting was held on the Implementation of the LDC Modalities.  
Since the last formal meeting, the LDCs have put forth two notes on this topic that outline a 
number of proposals.  Members have welcomed  the LDC Group's participation and further 
                                                 
2 TN/S/W/52, Job(05)/215, Job(05)/217 and Job(05)/218.  TN/S/22 
 Page 3 
  
 consultations will be necessary in order to clarify positions and see where the common 
ground might lie on these proposals. 
• One open-ended informal meeting was he ld on the Proposals on GATS-related S&D  
Treatment Provisions.  The African Group info rmed the Council that text-based discussions 
were underway in small groups and that they would respond to the Chairman's invitation to 
use his good offices at the appropriate juncture. 
II. OTHER ITEMS 
12. Under Assessment of Trade in Services , a presentation was made by the International 
Organisation for Migration the World Bank and the WTO on the report of a jointly organised experts 
meeting entitled "Managing the Moveme nt of People:  What can be learned for mode 4 of the 
GATS?" that took place on 4-5 November 2004.  Th is was the second such experts meeting that 
brought together trade negotiators and migration o fficials with a view to strengthening the dialogue 
between the two.  While the point was made th at movement of natural persons under the GATS 
represents a very small sub-set of overall migration, some Members noted that some of issues being 
discussed in the context of migration overall might inform the Council's work on mode 4.   
Substantive discussion was also held on the basis of an extensive presentation by Rwanda on its 
experience with trade in services since the Uruguay Round.  This presentation outlined the role of 
services in the Rwandan economy, its relatively m odest export capacity, as well as some of the 
challenges faced in creati ng the necessary institutional  and regulatory framework. 
13. Three proposals were substantively discussed  under the agenda item Negotiating Proposals .  
A proposal from Switzerland outlined that delega tion's method of assessing the quality of offers 
numerically.3  A number of Members expressed interest in learning more about this method, which 
seeks to help improve transparency and compar ability in assessing the qua lity of offers.  The 
delegation of Switzerland said that it was seeki ng a method through which the quality of mode 4 
commitments could be quantified.  A number of Members expressed interest in a proposal from 
Pakistan on Mode 4 issues related to non-trade con cerns, return and temporariness of suppliers under 
this mode.4  A third proposal from Chile, Hong Kong Chin a, India and Mexico on cross-border supply 
(CBS) enumerates a number of issues related to CBS which the proponents felt could be used to 
pursued in dedicated and focused discussion.5  It was requested that the Chairman conduct 
consultations in this regard. 
14. On the Implementation of LDC Modalities , there was substantive discussion on the basis of a 
room document from the LDC Group and a communica tion from the European Communities.  In its 
room document, the LDC Group submits three propo sals to further the implementation of the LDC 
Modalities.  Discussion on these proposals I presume will be pursued in consultations bearing in mind the Council's work prior to the Hong Kong Ministerial Conference.  The communication from the European Communities contains responses to ques tions posed by the LDC Group in a July 2005 
informal proposal, which also pertains to the implementation of the Modalities.
6  A number of 
delegations seized the opportunity of this discussion to  report that they have provided answers to the 
LDC Group's questions bilaterally.     
 
                                                 
3 TN/S/W/51. 
4 Job(05)/211. 
5 Job(05)/214. 
6 TN/S/W/54 and Job(05)/114 respectively. TN/S/22 
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 15. On Proposals for S&D Treatment Provisions , Rwanda, on behalf of the African Group, 
reported to the Council on text-based consultations.  Given the short time prior to Hong Kong, the 
Group suggested that work in the coming weeks focu s on one of the proposals, and that examination 
of the others continue in the new year.   
III. FUTURE WORK 
16. Members are aware that they must keep their eye on the ball, namely, a good draft services 
text for Hong Kong.  This will be the key to a satisfactory result in the services negotiations.   
17.  In terms of process, the Special Session is requi red, pursuant to the July Package, to provide 
a full report to the TNC with possible recommendations for the purpose of the Sixth Ministerial 
Conference.7    
18. Finally, it was agreed that the Chairman woul d produce a list of possible elements for the 
draft services text of the Ministerial Declaration, based on indications from delegations at and outside 
of the meeting.  The suggestions at the meeting re lated to a wide range of the Council's work as well 
as to the rules negotiations.  I leav e future work on these elements in  the hands of my very capable 
successor.   
19. The next formal meeting of the Special Se ssion is to take place on 31 October and 
3 November 2005.  
 
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7 Please see paragraph (g) of Annex C of the General Council Decision contained in document 
WT/L/579.