RESTRICTED  WORLD TRADE  
ORGANIZATION  S/C/W/275 
18 October 2006 
 (06-5028) 
Council for Trade in Services  Original:   English 
  
 
COMMUNICATION FROM THE SEPARATE CUSTOMS TERRITORY 
OF TAIWAN, PENGHU, KINMEN AND MATSU 
 
Transitional Review Mechanism Pursuant to Paragraph 18 of
 
the Protocol of Accession of the People's Republic of China ("China")  
 
  The following communication, dated 16 Octobe r 2006, from the delegation of the Separate 
Customs Territory of Taiwan, Penghu, Kinmen and Ma tsu is being circulated to the Members of the 
Council for Trade in Services.  
 
 
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I. TELECOMMUNICATIONS SERVICES 
1. In line with its WTO accession commitments, Ch ina has issued a draft Telecommunications 
Act, which is already on the 2006 legislative ag enda of the Standing Committee of the National 
People’s Congress.  
 Will China be providing the appropriate aut horities with a reasonable period for comments 
before enacting the Act?  In addition, it would be appreciated if China could provide us with 
a copy of the draft of the Act.  
 2. We note that China promised upon accession to the WTO to follow the WTO Reference 
Paper as far as basic and value-added telecommunications services sectors are concerned.   
 Could China please confirm whether or not its domestic regulations on value-added telecom 
services are in compliance with the obliga tions listed in the Reference Paper? 
 We would also appreciate knowing which of China’s government Acts and regulations would 
ensure consistency with the following points set forth in the Reference paper, and how such 
consistency would be achieved: 
(i) Article 1: Competitive safeguards; 
(ii) Article 2: Interconnection; 
(iii) Article 4: Public availability of licensing criteria; 
(iv) Article 5: Independent regulators. 
 
3. According to the provision on universal services in Article 3 of the WTO Basic 
Telecommunications Reference Paper,  any Member has the right to define the kind of universal 
service obligation it wishes to maintain. Such oblig ations will not be regarded as anti-competitive per 
se, provided that they are administered in a tran sparent, non-discriminatory and competitively neutral 
manner, and are not more burdensome than necessary for the kind of universal service defined by the Member.  S/C/W/275 
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  4. According to Article 44 of China’s Teleco mmunications Regulations, telecommunications 
operators shall fulfil the related telecommunicatio ns universal service obligation pursuant to the 
“related regulations of the State”. The Administrative Regulations on Telecommunications Universal 
Service Cost Compensation shall be  jointly enacted by the Ministry  of Information Industry and the 
Ministry of Finance under the State Council as well as the competent authority in charge of prices control, and then be forwarded to the State Council for approval before  its promulgation.  
Could China please explain and provide details of the contents of the “related regulations of 
the State”? Furthermore, have the Admini strative Regulations on Telecommunications 
Universal Service Cost Compensation been enac ted and promulgated? If yes, please provide 
the relevant document for our reference and, in  the absence of any relevant regulations, 
please advise what is the schedule for their legislation?  
 
5. In the Telecom Policy Review held in April 2006, we noted that MII was studying cost-
oriented inter-network rates a nd unbundling network elements.   
 Please indicate the schedule of relevant studi es and policy-making procedures. If a regulatory 
framework has been developed, please clarify wh ether fulfilment of the obligation to unbundle 
network elements is limited to dominant te lecommunications operators or whether all 
telecommunications operators shall fulfil the obligation to unbundle network elements? 
 
II. TOURISM AND TRAVEL-RELATED SERVICES 
6. According to Part 9.B of China’s Schedule of  Specific Commitments on Services, within six 
years after accession, there are to be no restri ctions on the establishment of branches by a joint-
venture travel agency/tour operator and the requirement on registered capital of foreign-invested 
travel agency/tour operators is to be the same as that of Chinese travel agency/tour operators.  
In view of the fact that it has been almost five years since China joined the WTO, could we 
please be advised of when the Regulations on Administration of Travel Agencies will be revised to contain the above commitments? 
 
 Could China please elaborate on the expected length of the trial period for the Provisional 
Regulations on the Establishment of Foreign- controlled and Wholly Foreign-owned Travel 
Agencies, and advise whether the relevant regulat ions will ultimately be included in the 
Regulations on Administration of Travel Agencies? 
 
7. Article 30 of China’s Administrative Regulations on Travel Agencies regulates the 
qualification requirements for forei gn tour operators. In addition to requirements consistent with its 
WTO commitments, there is a requirement that a fore ign tour operator be a member of the Chinese 
Tourism Services Association.  
Could China please explain why this  requirement is necessary, and provide 
details of qualifications and application procedures for becoming a member of this 
Association? An explanation of how this requi rement conforms to Article VI of the GATS 
would also be appreciated. 
 
8. China restricts joint ventures or wholly forei gn-owned travel agencies and tour operators from 
providing services for Chinese people travelling abroad.   S/C/W/275 
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  Could China please indicate why it has not lifted th is restriction, and when it plans to do so? 
 
III. MARITIME TRANSPORT SERVICES 
9. We recognize that, according to China’s WTO commitments, when a foreign company 
establishes a maritime transport company in Ch ina, foreign investment shall not exceed 49 ％ of the 
total registered capital of a joint venture, and that  the Chairman of the Board of Directors and the 
General Manager of the joint venture shall be Chinese appointees.  
Does China have any plans to remove these restrictions? 
 
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