WORLD TRADE  
ORGANIZATION  S/WPGR/21 
14 April 2011 
 (11-1925) 
  
  
 
REPORT BY THE CHAIRPERSON OF THE WORKING PARTY  
ON GATS RULES  
 
 1. The Working Party has continued to engage in  focussed discussions on all three GATS Rules 
subjects:  emergency safeguard measures, subsidies,  and government procurement in services.  In line 
with Annex C of the 2005 Hong Kong Ministerial D eclaration, which states  that "Members must 
intensify their efforts to conclude the negotia tions on rule-making under GATS Articles X, XIII 
and XV in accordance with their respective mandates and timelines"
1, Members have constructively 
engaged and further explored the issues at stake.   Nevertheless, in each of the three areas, the 
respective proponents found it difficult to convince th e broader Membership of the need to develop 
disciplines beyond those currently existing under the GATS.   In all three areas, the problems, if any, 
that would need to be addressed by new disciplines, have not yet been sufficiently identified;  neither 
have the benefits that would accrue from new or add itional disciplines.  As a result, discussions in the 
Working Party on GATS Rules have remained non-te xt-based, and essentially conceptual in nature.  
2. This report describes the state of play of the Working Party's discussions and progress 
achieved under each of the three agenda items.  It al so outlines possible future work in fulfilment of 
the Working Party's mandate as set out in Annex C of the Hong Kong Ministerial Declaration.  
I. NEGOTIATIONS ON EMERGENCY SAFEGUARD MEASURES (ARTICLE X) 
3. On emergency safeguard measures (ESM), during the latter part of 2009, the Working Party 
conducted several rounds of technical discussions on the definition of "domestic industry".  The 
Chairperson circulated an informal Note su mmarizing past discussions on that definition 
(JOB(09)/95).  In this context, Members also ex amined the relevance to trade in services of the 
concept of "domestic industry" as treated under th e WTO Agreements on anti-dumping, subsidies and 
safeguards.  A related Secretariat Note was circ ulated in JOB(09)/146 and Corr.1.  Discussions 
amongst Members focused on how the criteria of territo ry, registration, and ownership and control, as 
contained in the draft Annex on Article X Em ergency Safeguard Measures proposed by the 
delegations of Brunei Darussalam, Cambodia, I ndonesia, Malaysia, Myanmar, the Philippines, 
Thailand and Viet Nam (Attachment A of JOB(07)/155),  could be used to define "domestic industry" 
in a services context.   
4. In 2010, the above proponents proposed conti nuing with technical work, and advocated a 
presentation on the availability and adequacy of services statistics with respect to emergency 
safeguards.  At its meeting of 24 March 2011, the Working Party for the first time delved into these 
questions, with two presentations by representatives of the WTO Secretariat:  one on the availability 
at the international level of disaggregated data  on services trade flows that could potentially be 
relevant in a safeguards' context;  the second one on the types of statistics used under the Safeguards 
Agreement in trade in goods.  Members in r esponding to these presentations recognized the 
importance of having timely and reliable services' statistics and quantitative indicators, ideally on a 
highly disaggregated, sector-specific basis .  Regarding future work, the ESM proponents hoped that 
                                                      
1 Annex C of the Hong Kong Ministerial Declaration, paragraph 4, letter (a) to (c). S/WPGR/21 
Page 2  
 
  these two presentations would provide a gateway for subseque nt ones by Members on their national 
experiences/best practices in the compilation and use of services statistics, and on how current 
statistical deficiencies could be overcome.  Mo re focused discussions on sector- and mode-specific 
data that could be used in a potential safeguard investigation were deemed potentially useful.   
II. NEGOTIATIONS ON GOVERNMENT PROCUREMENT (ARTICLE XIII) 
5. The Working Party discussed in greater detail the Annex on Government Procurement in 
Services proposed by the delegation of the European  Union (S/WPGR/W/54).  To facilitate Members' 
consideration of the proposal, the Chairperson circul ated an informal Note, which synthesised past 
exchanges and highlighted several issues for di scussion (JOB(09)/114).  The delegation of the 
European Union provided a presentation of the proce dural rules contained in its proposal, as well as 
its suggested format for scheduling government pr ocurement commitments.  Two rounds of informal 
discussions examined various aspects of the proposed  Annex, including its relationship with the WTO 
plurilateral Agreement on Govern ment Procurement (GPA).  
6. Since the latter part of 2010, the Working Part y has pursued a series of dedicated discussions 
on the broader economic and deve lopmental importance of governme nt procurement in services, 
based on another proposal by the European Union (RD/SERV/23).
2  To date, the Working Party has 
held two dedicated sessions: one on the economic im portance of government procurement in services;  
and one on services aspects of the GPA and the latter's impact on international procurement markets.  It was observed in the discussions that commit ments under the GATS were scheduled by modes of 
supply, whereas commitments under the GPA were not specific to individual modes of supply.  It was suggested that the WPGR further examine the po ssible synergies between the GATS and the GPA as 
part of its future work.   
7. In the coming months, the WPGR's focus would be on completing the series of dedicated 
discussions proposed in RD/SERV/23.  Members also seemed open to further presentations or discussions that could flow from these.  The Wo rking Party intends to invite capital-based GPA 
experts to a dedicated session to share national experiences of opening up domestic procurement 
systems and seeking access to foreign procurement mark ets.  This could be he ld during a forthcoming 
GPA negotiating week.    
III. NEGOTIATIONS ON SUBSIDIES (ARTICLE XV) 
8. In the area of subsidies, much time has been de voted to reviving the exchange of information 
mandated by Article XV of the GATS.  In this conn ection, the Chairperson circulated an informal 
Note recalling a previously proposed definition of subsidies for the purpose of the information 
exchange (JOB(09)/96).  At its meeting of 1 February 2010, the Working Party endorsed the Work 
Programme on Information Exchange on Subsidies as contained in JOB/SERV/1. 
9. Since the launch of the Work Programme, 18 submissions covering 44 WTO Members have 
been received to date.
3  While an encouraging start, there is general acknowledgement that there is a 
great variety in the level of detail provided in the submissions received, and that more Members 
should join in this mandated exchange of informatio n.  So far, the Working Party held one session of 
dedicated discussions on the information provided by Members, with the aim of identifying potential 
                                                      
2 The EU's proposal, dated 24 September 2010, proposed a range of topics on the economic importance 
of government-procurement transactions for discussion over several months.   
3 Submissions were received from th e delegations of Australia;  Brazil;  Canada;  China;  European 
Union;  Chile;  Colombia;  Hong Kong, China;  India;  Japan;  Korea;  Mexico;  New Zealand;  Norway;  Peru;  
Turkey;  Chinese Taipei;  and the United States.  Th ey were circulated in JOB/SERV/1/Add. 1 to 12.  S/WPGR/21 
 Page 3 
 
 
  systemic issues that could be relevant for the negotiations on necessary multilateral disciplines.4  That 
session brought some progress in Members' understandi ng on how subsidies are provided and on their 
potential trade effects.  Members, however, acknowledge d that more analysis needed to be done.   
10. During 2010, the Working Party also continued discussions with a view to developing the 
necessary multilateral disciplines to avoid distortiv e effects on trade in services, as mandated under 
Article XV.  Based on a proposal by the delegati on of Switzerland for disciplines on export subsidies 
(JOB/SERV/36), discussions were undertaken on the c oncept of export subsidies in services and the 
possible distortions created.  The delegation of th e United States submitted questions for Members to 
identify possible trade-distortive effects of subsidi es in services with a focus on practical commercial 
concerns (S/WPGR/W/59).   
11. Regarding the possible way forward, some Members favour entering into negotiations to 
develop necessary multilateral disciplines to avoi d trade-distortive effects of subsidies.  A 
communication from India, Chile and Mexico propo sed developing a roadmap for future discussions 
to fulfil the remaining part of the mandate of  Article XV (JOB/SERV/37).  According to its 
proponents, such a roadmap would necessarily be flexible, with no timelines attached.  Other 
Members argue that, in the absence of concrete evidence of such effects, Members should refrain 
from entering into negotiations to devise any disciplin es.  Others are of the view that there is still 
useful conceptual and technical work that can be done short of entering into negotiations on new 
disciplines.  Overall, there appears to be broad agreement on the desirability of obtaining more and 
better information on the potential or actual trade-di stortive effects of subsidies.  One unresolved 
question is whether any such identification of tr ade-distortive effects should be undertaken before 
Members embark upon further technical work or negotiations.  At the WPGR meeting of 
24 March 2011, it was suggested that Members and th e Chair will continue to consult informally on 
resolving this question and will report back in due course.    
 
 
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4 WPGR meeting of 24 November 2010, see S/WPGR/M/71.