WORLD TRADE  
ORGANIZATION  WT/REG164/7 
28 September 2007 
 
 (07-4087) 
Committee on Regional Trade Agreements  
  
 
   
 
FACTUAL PRESENTATION 
 
Association Agreement between  
the European Communities and Chile 
(Services) 
 
Report by the Secretariat 
 
 
 
 
This report, prepared for the examination of the Association Agreement 
between the European Communities a nd Chile, has been drawn up by the 
WTO Secretariat on its own responsibilit y and in full consultation with the 
Parties.  The report has been made in  accordance to the ru les and procedures 
contained in the Decision for a Transp arency Mechanism for Regional Trade 
Agreements (WT/L/671).  
 
Any technical questions arising from this report may be 
addressed to Mr. Luis Verdeja (tel: +41 22 739 5244) or Mr. Markus Jelitto (tel: +41 22 739 5885). 
  
 
     
 
    WT/REG164/7 
Page iii 
 
  
TABLE OF CONTENTS 
Page 
 
I. TRADE ENVIRONMENT 1  
II. TREATY CHARACTER ISTIC ELEMENTS 6  
A. B ACKGROUND INFORMATION  6 
B. S COPE AND DEFINITIONS  8 
C. G ENERAL PROVISIONS ON TRADE IN SERVICES  9 
1.  Market access 9  
2. National Treatment and MFN 9  
3. Commercial presence and movement of natural persons 9  
D. L IBERALIZATION COMMITMENTS  10 
1. European Communities 10  
(a) General Overview 10 
(b) Horizontal Commitments 10 
(c) Sector–Specific Commitments 12 
2. Chile 17  
(a) Horizontal commitments 18 
(b) Sector-specific commitments 19 
E. P ROVISIONS SPECIFIC TO TRADE IN SERVICES  20 
1. Domestic regulation 20  
2. Recognition 20  
3. Transparency 20  
4. Exceptions 21  
F. P ROVISIONS COMMON TO OTHER AREAS OF THE AGREEMENT  21 
1. Government Procurement 21  
2. Current Payments and Capital Movements 22  
3. Intellectual Property Rights 22  
4. Competition 22  
5. Dispute Settlement 22  
6. Transparency 25  
7. Institutional Framework 25  
8. Exceptions 25  
9. Relationship with other agreements concluded by the Parties 25  
G. S ECTOR -SPECIFIC PROVISIONS  27 
1. Telecommunication services 27  
2. Financial services 27  
3. International Maritime Transport 28  
ANNEX  29 
 
 
  WT/REG164/7 
Page 1  
 
 
ASSOCIATION AGREEMENT BETWEEN THE EUROPEAN COMMUNITIES 
AND CHILE  (SERVICES) 
 
Factual Presentation by the Secretariat  
 
 
I. TRADE ENVIRONMENT 
1. In 2005 Chile ranked 46th and 47th in the world in terms of global imports and exports of 
commercial services, respectively.1  Chile's commercial services imports amounted to US$7.6 billion 
representing 0.32 per cent of world imports, while exports amounted to US$7.1 billion representing 
0.29 per cent of world exports.  Services exports represent 14.9 per cent of total exports and services 
imports for 18.9 per cent of total imports. 
2. Chart I.1 shows the evolution of Chilean co mmercial services exports and imports for the 
period 2000-05.2  Exports to the world increased 76 per cent in  this period, with growth in the last two 
years much faster than in 2000-03.  Total imports from the world followed a similar, but not identical 
pattern, increasing 62 per cent over the same period.  The increase was slight in the first two years, 
and accelerated in 2003-2005.  Chile has run a consta nt trade deficit in comme rcial services over this 
period.3 
0123456789
2000 2001 2002 2003 2004 20050123456789
2000 2001 2002 2003 2004 2005Chart I.1
Chile, total commercial services trade, 2000-2005
Exports Imports
Transportation services Insurance services Other business services
Travel services Financial services
Communication services Computer and information servicesPersonal, cultural and 
recreational services
Source: IMF, BOP CD-Rom.Construction services Royalties and license fees Government servicesUS$ millions
 
 
                                                      
1 WTO Trade Profiles. 
2 Data for this chart follows the BoP definition, and does not include information about all modes of 
supply as defined in GATS. 
3 Chilean Central Bank.  WT/REG164/7 
Page 2  
 
  3. The composition of exports has remained fairly st able over the last six years.  The three most 
important categories are transportation, travel a nd other business services, which, in 2005, accounted 
for over 90 per cent of total exports;  transportati on services represent by far the largest share, at 
58 per cent of total exports.  The same three ca tegories account for around 81 per cent of total 
imports.  Transportation and travel services accounted for a growing share of total imports in 
2004-2005, while communications services remained fairly constant over the period surveyed.   
4. Total FDI flows into and from Chile are depi cted in Chart I.2 which shows inward and 
outward FDI flows with the world for 2001-2005.  Total inflows fell below US$1 billion in 2003;  in 
2004 total inflows reached a maximum of US$4.9 billion.  Mining and quarrying is the sector that has attracted most inflows, representing 43.5 per cent of th e total for this period.  Other interesting sectors 
for investors in Chile are financial intermedia tion (11 per cent of all flows) and manufacturing 
(8.5 per cent).  Other developments include large investments in the utilities sector in 2004 and in 
transport, storage and communication in 2005 (US$2. 6 billion and US$1.6 billion, respectively).  The 
same sectors dominate the composition of Chilean FD I outflows, although in different proportions.  
Mining and quarrying represented 28.6 per cent of to tal flows over the period, although they were 
more volatile than for transport, storage and communication services, which accounted for 24.2 per 
cent of all outflows and in every year but 2002 accounted for more than 25 per cent of annual 
outflows.  Utilities, mirroring the developments in in flows, experienced a large increase in 2004, with 
outflows amounting to US$ 2.2 billion.    
0.00.51.01.52.02.53.03.54.04.55.05.5
2001 2002 2003 2004 20050.00.51.01.52.02.53.03.54.04.55.05.5
2001 2002 2003 2004 2005Chart I.2
Chile, total FDI flows 2001-2005
Inflows Outflows
Agriculture & Fishing
Electricity, gas & water supply  
Source: Chile Foreign Investment Committee.Mining & quarryingUS$ billion US$ billion
ManufacturingReal estate, renting and business 
activities
Other community, social and 
personal service activities
Other servicesConstruction 
Financial intermediationRepair, wholesale and retail trade 
Transport, storage and communication
 
 
  WT/REG164/7 
 Page 3 
 
 
  5. In 2005 the EC ranked first in the world in te rms of both global im ports and exports of 
commercial services.4  The EC's commercial services im ports amounted to €346.8 billion, 
representing 24.28 per cent of world imports, while exports were €404 billion, or 27.45 per cent of 
world exports.  Services exports represent 27 per cen t of total exports and services imports for 22.3 
per cent of total imports.5 
6. Chart I.3 shows the evolution of European commercial services exports and imports for the 
period 2003-2005.6  Exports to the world increased by 32 per cent in this period;  total imports from 
the world grew by a similar figure, increasing to 27.9 per cent.  There have not been significant 
changes in the composition of services exports  and imports.  Other business services and 
transportation services accounted for 50.8 per cent of to tal exports in 2003, increasing to 54.6 per cent 
in 2005.  Travel services accounted for 17.5 per cent of exports in 2005.  Financial services and 
royalties and licence fees are the other two categories that in 2005 represented over 5 per cent of exports (8.7 per cent and 5.8 per cent respectively).  Insurance services exports declined from 4.4 per 
cent of exports in 2003 to 1.6 per cent in 2005.  Se rvices imports tend to be more concentrated in a 
few sectors, and their composition has not changed significantly.  Transportation, travel and other 
business services have each accounted annually for close to 25 per cent of total imports;  royalties and 
licence fees represented close to nine per cent.  Th e EC maintained a services trade surplus over the 
entire period. 
050100150200250300350400450500
2003 2004 2005050100150200250300350400450500
2003 2004 2005Chart I.3
EC(25), total commercial services trade, 2003-05
Exports Imports
Transportation services Insurance services Other business services
Travel services Financial services
Communication services Computer and information servicesPersonal, cultural and 
recreational services
Source:  Eurostat statistical database.  Viewed at: http://epp.eurostat.ec.europa.eu .Construction services Royalties and licence fees Government services€ billion € billion
Note: "Services not allocated" are not included.
 
 
 
                                                      
4 WTO Trade Profiles. 
5 WTO Trade Profiles. 
6 Data for EC-25 was only available for the years 2003-2005.  Data for this chart follows the BoP 
definition, and does not include information about all modes of supply as defined in GATS. WT/REG164/7 
Page 4  
 
  7. Total FDI stocks into and from the EC in 2001- 04 are represented in Chart I.4.  Outward 
investment stocks remained higher than inward investment stocks for this period.  Inward FDI was 
mainly in financial intermediation, manufacturi ng and real estate, and business activities, which 
together accounted for over 93 per cent of total stocks in 2004, the largest being financial 
intermediation, which accounted for 49.7 per cent of tota l stocks in 2004.  The stock of investment in 
financial intermediation, real estate and business act ivities, and manufacturing, increased substantially 
over this period (85.9 per cent, 68.8 per cent and 52 per cent). Total outward investment increased by 40.1 per cent over this period, to a total of €1,886 billion.  44.3 per cent of total investment in this period was in financial intermediation, 23.8 per cen t in manufacturing and 14.8 per cent in real estate 
and business activities.  Of these sectors, the largest  increase was in financia l intermediation, with 
investment in 2004 80.2 per cent higher than in 2001.  FDI stocks in real estate and business activities 
increased by 18.6 per cent and fairly unchanged in manufacturing, with a 3.2 per cent increase.    
02004006008001,0001,2001,4001,6001,8002,000
2001 2002 2003 200402004006008001,0001,2001,4001,6001,8002,000
2001 2002 2003 2004Chart I.4
EC, total FDI stock, 2001-04
Inward Outward
Agriculture and fishing
Electricity, gas & waterConstruction
Sou rce :  Eurostat statistical database.  Viewed at: http://epp.eurostat.ec.europa.eu.Mining & quarrying€ billion
Hotels and restaurants€ billion
Manufacturing Transport, storage and 
communi cationFinancial intermediation
Real estate and business activities
Other services
 
 
8. Services trade between the Parties during 2003-05 is shown in Chart I.5.  Both Parties have 
been increasing their commercial se rvices exchanges in the last few years, although European exports 
to Chile increased by 100.1 per cent compared to the 46.9 per cent increase in Chilean exports to the 
EC, to a value of €1.64 billion and US$1.19 billion, respectively.  Consequently, the surplus in favour 
of the EC in 2003 has continued to increase up to 20 05.  In 2005, exports to , and imports from, Chile 
accounted for 0.41 per cent and 0.27 per cent of tota l European exports and imports, respectively.  
The sectoral analysis reveals that  the most traded sector is transportation services, which in 2005 
accounted, respectively, for 51.3 per cent and 52.5 per cent of EC exports to and imports from Chile.  
Other business services compose the second largest expor t to Chile, at 23.9 of total exports, followed 
by travel services, which represented 8.6 per cent in 2005.  For European imports from Chile the  WT/REG164/7 
 Page 5 
 
 
  relative shares of these two sectors are inversed.  Tr avel services accounted for 26.7 per cent and other 
business services for 10 per cent in 2005.    
0.000.250.500.751.001.251.501.752.00
2003 2004 20050.000.250.500.751.001.251.501.752.00
2003 2004 2005Chart I.5
EC(25)-Chile, bilateral trade in commercial services, 2003-05
Exports from EC(25) Imports by EC(25)
Transportation services Insurance services Other business services
Travel services Financial services
Communication services Computer and information servicesPersonal, cultural and 
recreational services
Source:  Eurostat statistical database.  Viewed at: http://epp.eurostat.ec.europa.eu. Construction services Royalties and licence fees Government services€ billion € billion
 
 
9. Investment flows are depicted in Chart I.6, which shows FDI flows between the Parties, by 
EC Member State of origin/destination.  A nnual inflows to Chile are higher throughout 2000-05 
except for the last year.  Spain and the United King dom together accounted for over three quarters of 
total flows from the EC in four out of the six years.  Spain alone was the source of 52.6 per cent of all the flows from the EC over the entire period.  Other significant investments came from the 
Netherlands in 2001 (54.4 per cent of total), Fi nland in 2002 (23.8 per cent) and Italy in 2005 
(54.7 per cent).  Outflows follow a similar pattern , with Spain and the United Kingdom attracting 77.4 
per cent of the total investment flows from Chile over 2000-05;  Spain alone attracted 52.1 per cent.  
Italy in 2002, the Netherlands in 2004 and Belgiu m in 2005 attracted 45.1 per cent, 18.9 per cent and 
26.3 per cent respectively of the annual flows to the EC from Chile.   WT/REG164/7 
Page 6  
 
  0.00.51.01.52.02.53.03.54.0
2000 2001 2002 2003 2004 20050.00.51.01.52.02.53.03.54.0
2000 2001 2002 2003 2004 2005Chart I.6
Chile-EC(25), FDI flows 2000-05
Inflows to Chile Outflows from Chile
Austria
Ireland 
Source: Chile Foreign Investment Committee. CyprusUS$ billion
Italy
Sweden US$ billion
FranceFinlandDenmarkBelgiumGermany
LuxembourgGreeceNetherlands
Spain
United KingdomPortugal
Negative flows are not included in the bars.  They correspond to the following import flows:  2000, 
Denmark, US$ -0.77 million;  2000, Finland, US$ -28 million;  2000, Luxembourg, US$ -1.66 million; 2002, 
Finland, US$ -406.7 million; 2002, Portugal, US$ -2.0 5 million; 2003, Austria, US$ -3.34 million and; 2005, 
Netherlands, US$ -21.08 million.Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovak Republic and Slovenia do not 
have any recorded FDI flows with Chile over the period of study.Note:
 
 
II. TREATY CHARACTERISTIC ELEMENTS 
A. BACKGROUND INFORMATION  
10. The Association Agreement between the European  Community and its Member States, of the 
one part, and the Republic of Chile, of the other part, was signed in Brussels on 18 November 2002.  
11. The Agreement entered into force on 1 Ma rch 2005, although some parts, namely the 
provisions on trade in goods, had been applie d on a provisional basis since 1 February 2003.7  The 
services aspects of the Agreement were notified u nder GATS Article V:7(a) on 28 October 2005 as an 
agreement providing for the liberalization of trade in services within the meaning of Article V of the 
GATS (S/C/N/360).8  The Council for Trade in Services refe rred the Agreement for examination in 
the CRTA on 9 February 2006 (S/C/M/81).9  
                                                      
7 At the time of entry into force, ten new countrie s had joined the Agreement, as new members of the 
European Communities.  These countries are: Cyprus, the Czech Re public, Estonia, Hungary , Latvia, Lithuania, 
Malta, Poland, the Slovak Republic an d Slovenia.  On 1 January 2007, Bu lgaria and Romania also acceded the 
Agreement as new members of the Euro pean Communities.  In light of th e accession of Bulgaria and Romania 
to the EU, an additional Protocol was signed on 24 July 2007 in Brussels. 
8 The text of the services aspects of the Agreem ent was circulated as doc ument WT/REG164/1/Add.1 
and it is also available at the Partie s' official websites (URL addresses: 
http://www.direcon.cl/frame/acuerdos_in ternacionales/f_bilaterales.htm and  WT/REG164/7 
 Page 7 
 
 
  12. The Agreement is composed of five parts, each of which is divided into titles, which are in 
turn divided into chapters and then sections; ther e are 17 annexes that are integral parts of the 
Agreement (Table 1).  The structure of the Agreement is as follows: 
Table 1 
Chile-European Community Association Agreement 
Index  
Preamble  
Part I: General and Institutional Provisions 
 Title  I Nature and Scope of the Agreement  
 Title  II Institutional Framework  
    
Part II: Political Dialogue 
    
Part III: Cooperation 
 Title  I Economic Cooperation 
 Title II  Science, technol ogy and Information Society  
 Title III Culture, Education and Audio-Visual 
 Title IV State Reform and Public Administration 
 Title V Social Cooperation 
 Title VI Other Cooperation Areas 
 Title VII General Provisions 
    
Part IV:  Trade and Trade-Related Matters  
 Title  I General Provisions 
 Title  II Free Movement of Goods 
 Chapter I  Elimination of Customs Duties 
 Chapter II Non Tariff Measures 
 Chapter III Exceptions 
 Title III Trade in Serv ices and Establishment 
 Chapter I Services 
  Section 1 General provisions 
  Section 2 International Maritime Transport 
  Section 3 Telecommunications Services 
 Chapter II Financial Services 
 Chapter III Establishment 
 Chapter IV Exceptions 
 Title IV Government Procurement 
 Title V Current Payments and Capital Movements 
 Title VI Intellectual Property Rights 
 Title VII Competition 
 Title VIII Dispute Settlement 
 Chapter I Objective and Scope 
 Chapter II Dispute Avoidance 
 Chapter III Dispute Settlement Procedure 
 Chapter IV General Provisions 
 Title IX Transparency 
 Title X Specific Tasks in Trade Matters of the Bodies Established under this Agreement 
 Title XI Exceptions in the Area of Trade 
  
Part V: Final Provisions 
    
Annex I Community's Tariff Elimination Schedule  
    
Annex II Chile's Tariff Elimination Schedule  
Annex  III Definition of the concept of originati ng products and methods of administrative 
cooperation 
Annex IV Agreement on Sanitary and Phytosanitary Measures Applicable to Trade in Animals and 
Animal Products, Plants, Plant Products and Other Goods and Animal Welfare 
Annex V  Agreement on Trade in Wines 
Annex VI  Agreement on Trade in Spirits Drinks and Aromatised Drinks 
Annex VII Schedule of Specific Commitments on Services 
Annex VIII Schedule of specific commitments on financial services 
Annex IX Authorities responsib le for financial services 
Table 1 (Cont'd) 
                                                                                                                                                                     
http://ec.europa.eu/trade/issues/bilateral/countries/chile/e uchlagr_en.htm).  The Parties had previously notified 
the entire text of the Agreement on 3 February 2004 (WT/REG164/1). 
9 The factual examination of th e goods part of the Agreement was conducted in the CRTA; it 
concluded on 13 October 2006, after three rounds of examination (WT/REG164/M/1-3). WT/REG164/7 
Page 8  
 
  Index  
Annex X Schedule of specific commitments on establishment 
Annex XI Community's covera ge on government procurement 
Annex XII Chile's coverage  on government procurement 
Annex XIII Implementation of certain provisions of Part IV, Title IV 
Annex XIV Regarding current pa yments and capital movement 
Annex XV Model rules of procedure fo r the conduct of arbitration panels 
Annex XVI  Code of conduct for members of arbitration panels 
Annex XVII Implementation of cer tain decisions of Part IV 
 
Source: EC-Chile Association Agreement 
 
13. The relevant aspects for the liberalization of trad e in services are contained in Part IV (Trade 
and Trade Related Matters), Title III (Trade in Serv ices and Establishment).  Annex VII lays down the 
Parties' specific commitments (except financia l services); Annex VIII, contains the specific 
commitments on financial services;  Annex IX, lists the authorities responsible for financial services; 
and Annex X details the specific commitments on establishment. 
14. No overall implementation period is explicitly  stipulated in the Agreement.  The 
commitments undertaken in the services area apply as from the entry into force of the Agreement.  
The Parties agreed to review the services chapte r three years after the entry into force of the 
Agreement (i.e. by 1 March 2008), with a view to further deepen the liberalization or eliminating 
remaining restrictions on a mutually advantageous basis and ensuring an overall balance of rights and 
obligations. Furthermore, within two years after the entry into force of the Agreement (i.e., by 
1 March 2007), the Parties agreed to start the revi ew of the rules and conditions applicable to the 
movement of natural persons (mode 4), with a view to achieve further liberalization.  
 B. S
COPE AND DEFINITIONS  
 15. Title III – Trade in Services and Establishment – is divided into three chapters.  Chapter I– 
Services – applies to all sectors, whether or not pr ovided in the exercise of governmental authority, 
with the exception of financial services, which are the subject of Chapter II,
10 audio-visual services, 
national maritime cabotage and air transport ser vices including domestic and international 
transportation services whether scheduled or non- scheduled, and services directly related to the 
exercise of traffic rights.11  International maritime transport and telecommunications services are 
subject to additional provisions in sections  2 and 3, respectively, of Chapter I.12 Chapter I applies to 
measures taken at central, regional or  local level and covers all four modes of supply, as defined in the 
GATS mutatis mutandis.   Hence, investment in services sectors is  dealt with in Chapter I (except for 
financial services), while Chapter III – Establishm ent – deals with establishment in non-services 
sectors.    
16. The definitions contained in Chapter I are modelled upon the GATS.  A service supplier is 
any natural or legal person that supplies or seeks to supply a service.
13  "Natural person" is defined in 
                                                      
10 The list of activities that comprise financial services in Article 117 mirrors that of the GATS Annex 
on Financial Services. 
11 The following air transport services are covered by  the Agreement: aircraft repair and maintenance 
services during which an aircraft is withdrawn from service, selling and marketing of transport services and 
computer reservation systems.  Note the clarifying distinction to paragraph 3 (a) of the GATS Annex on Air 
Transport Services regarding aircraft maintenance and repair services. 
12 Articles 107 and 109, respectively, provide the releva nt definitions for these sectors.  The provisions 
on international maritime transport apply to shipping companies established outside the Parties and controlled 
by their nationals, if their vessels are registered in accordance with their re spective legislation and carry the flag 
of one of the Parties. 
13 Note that the definition of service supplier explicitly includes also persons that seek to supply a 
service.  This notion is not contained in Article XXV III (g) of the GATS, but (for financial services) in  WT/REG164/7 
 Page 9 
 
 
  the Agreement as a national of a Party;14  "legal person of a Party" is defined as any legal entity 
constituted or organized under the la ws of one of the Parties, whether for profit or not and whether 
privately owned or not.  However, any legal pers on that only has its registered office or central 
administration in the territory of one of the Parti es, is not considered a legal person of the Parties 
unless it engages in substantial business ope rations in the territory of one of the Parties.  In contrast to 
GATS, this definition does not seek to determine the origin of a legal person through reference to the 
criteria of ownership or control.  
17. The provisions of Chapter I do not apply to government procurement, which is subject to the 
provisions of Part IV, Title IV, and to subsidies granted by the Parties.  
C. GENERAL PROVISIONS ON TRADE IN SERVICES  
18. The Agreement applies to all services sector s with the exceptions mentioned above.  
However, as detailed below, a number of provisions only apply to scheduled sectors, which are listed 
following GATS scheduling practices, i.e. a "positive list" approach.  The Agreement applies to all 
services areas (except the exceptions contained in Ar ticle 95.2) unless otherwise stated, in which case 
it only applies to listed sectors, (i.e. for the purposes of market access, national treatment and 
domestic regulation).     
1.  Market access 
19. Chapter I contains a market access provisi on (Article 97), which is modelled on 
GATS Article XVI, and which binds the Parties to grant each other treatment no less favourable than 
that provided for in the schedules of commitments.   
2. National Treatment and MFN 
20. For the purposes of Chapter I, Article 98 contai ns a similar obligation as GATS Article XVII, 
whereby the Parties commit themselves, for listed sectors, and subject to the conditions set out 
therein, to grant services and service suppliers of th e other Party treatment no less favourable than that 
granted to their own like services and service suppliers .  Treatment no less favourable is treatment that 
does not modify the conditions of competition between a Party's own services and service suppliers, 
and those of the other Party, and may be achieved by  granting either formally identical or formally 
different treatment.  The Parties also recognize that  they shall not be required to compensate for any 
inherent competitive disadvantage that can arise from the foreign character of the service.   
21. The Agreement does not contain an MFN provision  (i.e. an automatic extension of benefits 
accorded to third parties) except with respect to  commercial presence of international maritime 
service suppliers of the other Party.   
3. Commercial presence and movement of natural persons 
22. All the provisions contained in the Agreement ar e applicable to Modes 3 and 4.  There are no 
specific provisions for Mode 3 whereas reference to Mode 4 is limited to Article 101, which calls on 
the Parties to review the rules app licable to the movement of natural persons with a view to achieving 
further liberalization.  Article 135:3 allows the Parties to apply their own laws, regulations and 
requirements regarding entry and stay, work, labour  conditions and establishm ent of natural persons, 
                                                                                                                                                                     
paragraph 5 (b) of the Annex on Financial Services.  As in the GATS, the notion of financial service supplier 
does not include public entities.  
14 Article 101 states that in a review which is to ta ke place two years after the entry into force of the 
Agreement, the Parties may address a revision of the definition of natural person.   According to the Parties, no 
action has been taken with regard this Article. WT/REG164/7 
Page 10  
 
  in particular requiring the necessary qualifications in  the territory were the service is supplied, as long 
as these are not applied in a manner that impairs or nullifies the benefits of the Agreement.  
D. L
IBERALIZATION COMMITMENTS  
23. The schedules of commitments for both Parties are contained in Annex VII of the Agreement 
(except for financial services); they are modelled  on the GATS schedules with respect to the sectoral 
classification and the separation of sector specific a nd horizontal limitations, the latter applying to all 
sectors listed.  For each of the four modes of s upply, the schedules include limitations and conditions 
on market access and national treatment, undertakings  relating to additional commitments, and, where 
appropriate, time frames for im plementation of a commitment.  Where the Parties undertake 
commitments not subject to articles 97 and 98 (Market Access and National Treatment), such 
commitments are inscribed in the respective sch edule as additional commitments (Article 99). 
24. According to Article 100 the Parties undertake to  enter into negotiations in the three years 
following the entry into force of the Agreement with a view to pr ogress in the liberalization and 
elimination of restrictions.15    
1. European Communities 
(a) General Overview 
25. In structure and sectoral coverage, the EC sche dule of specific commitments in the EC Chile 
FTA ("FTA schedule") closely resembles the GATS EC-25 schedule ("GATS schedule").16  However, 
in a few sectors, a comprehensive reclassification has been applied in the FTA schedule.  For 
example, in postal and courier services, a detailed classification has been introduced delineating areas 
open to competition from reserved areas.  In e nvironmental services, the FTA schedule applies a 
reclassification which has, with some modifications, been used by the EC in the Doha negotiations.  
Unlike in the GATS schedule, the EC has added a commitment on "water for human use", which 
commits twelve of its Member States to market access and national treatment with regard to commercial presence, subject only to horizontal li mitations.  For telecommunications services, the 
consolidated GATS schedule applies, as a result of the compensatory adjustments granted by the EC 
in the consolidation negotiations (which were comp leted later than the 2004 adaptation of the FTA), a 
harmonized classification for all telecommunication services.   
26. Generally, the 10 new Member States that joined  the EU on 1 May 2004 ha ve made extensive  
liberalizing commitments.  In large part, they have  made full commitments in sectors that were not 
part of their previous GATS schedules.  A signifi cant number of improvements has occurred in Mode 
4, particularly for contractual service suppliers (C SS), i.e. natural persons employed by a company 
from outside the EC who enter the EC to carry out a service contract.   
(b) Horizontal Commitments 
27. The "public utilities carve-out
17" which in the GATS schedule applies to all Member States, 
does not extend to Austria, Sweden and Finland in the FTA schedule.   
                                                      
15 Measures regarding qualifications, standards, registration or licensing matters are examples of such 
measures. 
16 The GATS EC-25 schedule was certified on 18 December 2006 (S/L/286) and is contained in 
document S/C/W/273, and Add.1 and Suppl.1.  It will enter into force on a date to be specified by the European 
Communities and its Member States. 
17 Both the GATS and FTA schedule contain a ho rizontal limitation on commercial presence, 
stipulating that "services considered as public utilities at  a national or local level may be subject to public 
monopolies or to exclusive rights granted to private operators."     WT/REG164/7 
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  28. While Article 95:4 of the Agreement excludes fro m the application of the provisions of the 
services chapter "subsides granted by the Parties," the FTA schedule contains a horizontal limitation on national treatment on subsidies, largely mirrori ng limitations contained in the GATS schedule.  
The schedule specifies in addition that commitments do  not require offering of a subsidy to a service 
supplied from outside EC territory.   
29. A number of horizontal improvements con cerning conditions for commercial presence 
(Mode 3) by individual EC Member States are cont ained in the FTA schedule.  Hungary allows initial 
entry for branches, Poland permits limited partne rships as a legal form for establishment, and 
Slovenia's national treatment limitation on members of th e board of directors has been further relaxed.  
For Portugal, an authorization requirement for inv estment of more than 20 per cent or effective 
control is not contained in the FTA schedule.   In Malta, for the purpose of minimum capital 
requirements, treatment of companies with the partic ipation of non-resident legal or natural persons 
has been equated to the treatment of companies that are fully owned by residents.  Malta has also 
removed a requirement that non-residents establis hing a commercial presence must do so through 
registration of a local company, and with the prior authorization of the Central Bank.  With regard to 
restrictions on real estate, Germany and Finland ha ve removed certain authorization requirements.   
30. The FTA schedule contains a few limitations that do not appear in the GATS schedule.  For 
Lithuania, a "None" concerning limitations on re al estate purchases has been converted to an 
"unbound for the acquisition of land by juridical a nd natural persons" in the FTA.  For Malta, the FTA 
schedule maintains an "unbound for the acquisition of  real property", while the GATS schedule refers 
to the continuing application of the Maltese legi slation and its applica tion to mode 4.   
31. A few limitations that existed in the GATS schedules of the EC Member States were removed 
as compensation provided by the EC as a result of  the Article XXI negotiations relating to the 
consolidation of its schedule.  Consequently, in so me areas, as the result of the compensation granted 
by the EC, the GATS schedule provides for more fa vourable treatment than the FTA schedule. For 
example, in the consolidated schedule, for all Member States, telecommunications and computer and 
related services have been excluded from the sc ope of the public utility carve out.  Also for 
telecommunications services, Finland's national treatment  limitations on board Members and 
limitations that require foreigners to  obtain trade permits were abolished. 
32. With regard to Mode 4, the horizontal sections of both the GATS and the FTA schedules 
distinguish between commitments for Intra-Corporat e Transferees (ICT) and Business Visitors (BV) 
on the one hand, and Contractual Service Suppliers (CSS) on the other hand.  While the horizontal 
commitments for ICTs and BVs apply for all subse quently listed subsectors, those for CSS apply only 
to a select number of specified subsectors. 
33. The definition of ICTs in the FTA schedule is fo r one year of employment of the person in the 
foreign juridical person immediately prior to transfer, which in the GATS schedule is not a condition for the Czech Republic, Latvia, Hungary , the Slovak Republic, and Poland.  
34. Both schedules contain two sub-categories of  ICTs: the first concerning "persons who 
primarily direct the management under general s upervision from the board"; and secondly, "persons 
who possess uncommon knowledge essential for the estab lishment's service, research equipment, 
techniques, or management."  For both categori es, the FTA schedule has removed all Member State-
specific market access restrictions (such as economic  needs tests (ENTs) in Finland, Latvia, and 
Poland).   
35. The duration of stay for ICTs is determined  by national and Community regulations, but 
individual Member States have undertaken specific bi ndings.  Sweden has undertaken a binding for a 
minimum period of two years in the GATS schedule,  but not in the FTA schedule.  Lithuania has WT/REG164/7 
Page 12  
 
  clarified that that stay may be extended for two years, while the GATS schedule does not mention any 
specific period.   
36. With regard to Business Visitors, both sche dules contain commitments on "service sellers" 
and persons involved in the "establishment of co mmercial presence".  For both categories, the FTA 
schedule does not contain a one year prior employment requirement for Estonia and Sweden.  With 
regard to the latter category, FTA commitments also  encompass Finland, Hungary, and Poland, which 
did not commit to this category of persons in the GATS schedule.  For Latvia, Lithuania, and 
Slovenia, the GATS schedule does not require for th e latter category that the service provider has its 
principal place of business in a WTO Member other than the EU, and no other establishment within 
the EU.   
37. A number of EC Member States have improved their sector specific commitments with regard 
to ICTs and Business Visitors.  The main improv ements are the application of the horizontal 
commitments instead of an unbound, and the abolition of nationality requirements (which amount to a 
zero-quota for entry).   
38. For contractual service suppliers (CSS), i.e. juridical persons without a presence in the 
EU territory who send employees to carry out a services contract in the EU, the GATS and FTA 
schedules use identical definitions.  The FTA sche dule provides more access to Chile insofar as the 
number of subsectors in which CSS can supply services has been expanded by more than 
20 subsectors to include auditing services; medical, dental and midwifery services; veterinary services; services provided by nurses, physiotherapists and paramedical personnel; market research and opinion polling; advisory and consulting servi ces relating to agriculture, hunting and forestry; 
advisory and consulting services relating to fish ing; services relating to mining; maintenance and 
repair of equipment; photographic services; c onvention services; environmental services; adult 
education services; tourist guide services; and news agency services.
  
39. Application of CSS commitments to individua l subsectors (old and new) is, however, not 
uniform across Member States.  Typically, only a ha ndful of Members allow for entry of CSS.  In 
particular, Belgium, Germany, Denmark, and Spain allow such entry for the newly included 
subsectors, requiring a university degree, pr ofessional qualifications and 3 years professional 
experience for the natural person.  For a large nu mber of these subsectors, Belgium also imposes an 
economic needs test in cases in which the annual income  of the natural persons is below Euro 30,000.   
(c) Sector–Specific Commitments 
(i) Professional Services 
40. As in the GATS, the FTA schedule contains  commitments in all 11 subsectors of the 
professional services category18.  The sector scope of the commitments remains unchanged, except for 
legal services, where Hungary also includes public in ternational law in its FTA commitments.  Few 
changes have been made to limitations on cross-bor der supply and consumption abroad; the supply of 
some services (services provided by nurses, phys iotherapists and parame dical personnel) remains 
unbound in cross-border supply for up to 21 Member States with cross border supply being unbound, 
on average, for 11.5 Member States remaining unb ound for cross border supply (12.6 in the GATS 
schedule)19.  With regard to commercial presence, non-bindings decreased from 3.5 Members on 
average in the GATS schedule to 2.5 in the FTA schedule.  However, there are fewer improvements 
                                                      
18 The EC schedule contains 13 speci fic entries; architecture and en gineering services, as well as 
auditing and bookkeeping services have been split into separate categories; retail distribution of pharmaceutical 
goods by pharmacists is the only "other" professional service. 
19 This average also includes members who remain unbound for part of a scheduled service.  WT/REG164/7 
 Page 13 
 
 
  in the health-related services of this group of sectors,20 than the already more liberalized categories of 
legal, accounting and architecture etc.21  At a Member State level, Malta fully committed six new 
subsectors, followed by Poland with three, and Cy prus with two new full commitments.  Due to the 
compensatory adjustments negotiated in the EC- 25 consolidation, several other improvements, 
notably in engineering and urban planning services,  will be multilateralized once the EC-25 schedule 
enters into force. 
41. With regard to Mode 4, on average, 3.8 Me mber States have undertaken new commitments or 
improved existing ones for ICT and BV.  Commitments  on CSS have been made for the first time in 
four subsectors;  auditing services;  medical, dental and midwifery services; veterinary services; and services provided by nurses, physiotherapists and pa ramedical personnel.  Most of the improvements 
were made by Belgium, Denmark, Germany, and Spai n, which have made commitments as set out in 
paragraph 39 above.  
(ii) Computer and Related Services 
42. The FTA schedule provides for a uniform sector scope across all subsectors of CPC 84 for all 
25 Member States.  In particular, Cyprus, Malta , and Poland have liberalized CPC 845 and 849 for 
Modes 1-3, and Malta also for ICTs and BV for M ode 4.  Unlike in the GATS, CSS are permitted in 
nine Member States, subject to technical qualifica tions and experience requirements, or an economic 
needs test. 
(iii) Other Business Services
22 
43. The FTA schedule contains 35 other business servi ces subsectors.  Six additional subsectors 
inscribed in the GATS schedule are not mentione d in the FTA schedule, possibly because they 
contain commitments by only a few Members States.23  In the FTA schedule, the sector scope has 
been harmonized for five subsectors, while eight subsectors still contain variations in commitments 
among Member States.  
44. As in the case of professional services, the ten Member States that joined the EU in 2004 
account for the vast majority of new or improved co mmitments in Modes 1-3, and for ICTs and BV in 
Mode 4.  The CSS category has been extended to ma rket research and opinion polling;  advisory and 
consulting services relating to agriculture, hunting and forestry; advisory and consulting services 
relating to fishing; services relating to mining; maintenance and repair of equipment; photographic 
services; and convention services.   
45. The business services mentioned in this section cover a wide range of services, some of which 
are fully liberalized by all Member States, such  as management consulting services (CPC 865) or 
packaging services (CPC 876), while others remain unbound for most Member States, e.g. services 
incidental to manufacturing or energy distribution (CPC 884 and 887, respectively).  Significant liberalization, particularly with regard to comme rcial presence has been scheduled for research and 
development services in natural sciences; and interdisciplinary R&D, where 12 Member States undertook full commitments without having any prio r bindings, and interior design services, with 
                                                     
 
20 Subsectors h-j. 
21 Subsectors a-g. 
22 The discussion of other business services also incl udes research and development services, real estate 
services; rental/leasing services without operators. 
23 The subsectors concerned are : supply services of domestic help personnel, other commercial or 
industrial workers, nursing  and other personnel, (CPCs 87204, 87205, 87206, 87209), for which only Hungary 
has undertaken GATS commitments; investigation services  (CPC 87301), for which only Austria and Sweden 
have undertaken GATS commitments; collection agency  services (CPC 87902), with GATS commitments by 
Austria and Latvia; and credit reporting services (CPC 87901); duplicating services (CPC 87904); and other 
business services n.e.c. (CPC 87909)  with GATS commitments by Latvia. WT/REG164/7 
Page 14  
 
  10 changes from "unbound" to "none".  For Mode 3, the level of full or partial commitments rose on 
average from 16.1 to 19.4 Member States.  Most improvements in Modes 1- 3 were made by Malta 
and Cyprus (in 16 subsectors each), the Czech Re public (12), Slovenia (11), and Poland (10).   
46. In the seven subsectors that were opened to the CSS category, four Member States undertook 
commitments (Belgium, Denmark, Germany, and Spain).  For the other 21 Member States, the CSS 
category remains "unbound" for these sectors. 
(iv) Postal and Courier Services 
47. The sector classification of postal and courier services is substantially transformed from the 
GATS schedule, and is based on the classification proposed by the EC in the Doha negotiations.
24  
The sector description subdivides the sector into eight distinct services activities, rather than – as in 
the GATS schedule – distinguishing the services on the basis of whether they are supplied by private 
or public operators.  The EC has been using this  classification in its Doha services offers.   
48. While the new classification used in the FTA schedule does not lend itself to comparison with 
the GATS classification as regards the scope of commitments, the FTA schedule suggests certain 
improvements in terms of bindings in market access and national treatment.  For Modes 1-3, 
five Member States continue to have no commitme nts, while five others commit only to express 
delivery services for mail, parcels, and packages, and addressed press products.  The other 15 Member 
States maintain no limitations except for a licensi ng system in areas where a universal service 
obligation exists.  In contrast, under the GATS sch edule, 20 Members remained unbound for cross-
border supply, and 17 each for consumption abroad and commercial presence.  ICTs and BVs are 
permitted to the extent commitments under Modes 1-3 exist, i.e. fully for 15 members, and express 
delivery services only for five members.   Under the EC's GATS commitments, 17 Member States 
remained without commitments fo r these categories of natural pe rsons.  Finally, the FTA schedule 
contains additional commitments with  regard to an independent postal  regulator, which do not exist in 
the EC's GATS schedule. 
(v) Telecommunications Services 
49. The EC-25 GATS commitments were comprehensively redrafted as part of the compensatory 
adjustments granted by the EC in the Article XXI process.  The FTA commitments thus pre-date the 
GATS commitments.  While the GATS schedule mak es commitments on "all services consisting of 
the transmission and reception of signals by any electromagnetic means, excluding broadcasting", the 
FTA schedule separately identifies committed se rvices on the basis of the services sectoral 
classification list, W/120.  Both schedules have uniform commitments for basic and value-added 
services, with the exception that the FTA schedule contains a separate commitment on "mobile and 
personal communications services and systems."  While the GATS schedule incorporates the Reference Paper obligations for basic telecommunica tions services, similar provisions are contained 
in Articles 109-115 of the EC-Chile Agreement.  
50. For cross-border supply, Cyprus and Malta ma de commitments under the FTA, but these are 
unbound under the GATS schedule.  Poland specifies  in the FTA that it undertakes no commitments 
for telecommunications services using cable television and radio network services.  Such a specification is omitted from the consolidated GA TS schedule.  For commercial presence, three 
Member States provide liberalized treatment in the FTA:  Poland removed from the FTA schedule a 
limitation on the participation of foreign capital a nd voting rights for public cellular mobile telephone 
services and networks;  France dropped a 20 per cent lim itation on shareholding and voting rights for 
non-EC natural or juridical persons in companies th at establish and operate radio-based infrastructure 
for the provision of telecom services to the genera l public; and  Finland removed a requirement of 
                                                     
 
24 Document S/CSS/W/61, dated 23 March 2001.  WT/REG164/7 
 Page 15 
 
 
  permanent residence for half of the founders, half of the members of the board of directors, and the 
managing director.   
(vi) Construction and Related Engineering Services 
51. Under the FTA schedule, commitments on construction services are harmonized and 
encompass CPC 511-518 for all Member States,  except Hungary and Malta, where access has 
remained unbound for all modes of supply.  In contr ast, the GATS schedule shows variations in the 
sector scope for the Czech Republic, the Slovak Re public, and Sweden (which exclude CPC 515 and 
518 from their GATS commitments), Finland (which excludes CPC 511, 515, 517, and 518), Latvia (excludes 511), and Slovenia (excludes 518).
25 
52. In the FTA schedule, Cyprus has undertaken full commitments in Modes 1-3, while it has 
scheduled "unbound" under the GATS.  For Mode 1, 23 Member States have taken full commitments 
in CPC 5111 (site investigation work) and 5114 (earth moving and excavating work), which are the only services under this category whose cross-borde r supply is deemed feasible.  For commercial 
presence, the Czech and the Slovak Republics ha ve undertaken full commitments in the FTA 
schedule, while they have no GATS commitments.  Greece and Portugal removed market access 
limitations.  Belgium, Germany, Denmark, and Spain have also made commitments on contract 
service suppliers under Mode 4.  
(vii) Distribution Services 
53. The FTA schedule expands and, to some exte nt, harmonizes the coverage of the various 
subsectors.  CPC 6111, 6113, and 6121 are added to commission agents' services; CPC 61111, 6113, and 6121 to wholesale trade services; and CPC 613 for all Member States except Lithuania and 
Poland to retailing services.  In the area of co mmission agents' services, Cyprus, the Czech Republic, 
Hungary, Italy, Poland and the Slovak Republic have undertaken FTA commitments across all modes 
of supply (except for CSS), while they have no commitments under the GATS.  In wholesale trade 
services, Cyprus has undertaken full commitments acro ss all modes (except for CSS).  Spain, Italy, 
and Portugal have removed a limitation on a state monopoly in wholesale distribution of tobacco, and 
a residency requirement for ICTs and BVs.  In re tailing services, nine Member States improved their 
commitments in Mode 1, while few changes occurred in  the other modes of supply, other than the full 
commitments made by Cyprus. 
(viii) Education Services 
54. The sector heading of the FTA schedule refers to  "privately funded education services", while 
the GATS schedule refers to "educational services".  A sectoral definition by Estonia, limiting the 
scope of its commitments to "private education ser vices with the length of student participation not 
exceeding six months," does not appear in the FTA schedule.  In the four subsectors (primary, secondary, higher, and adult education services), fe w changes have been made.  For cross-border 
supply and with regard to ICTs and BVs, Italy re moved a limitation in primary, secondary, and higher 
education services in the form of a nationality requirement for service suppliers to be authorized to 
issue state recognized diplomas;  in primary and secondary education services, Greece removed a 
limitation on commercial presence requiring the major ity of board members to be Greek nationals, as 
well as a nationality requirement for teachers as IC T and BV; and in higher education services, the 
                                                     
 
25 Specifications of the services activities are:  CPC 511 - pre-erecti on work at construction sites; 
CPC 512 - construction work for buildings; CPC 513 - construction work for civil engineering; CPC 514 - assembly and erection of pre-fabricated constructions ; CPC 515 - special trade construction work; CPC 516 - 
installation work; CPC 517 – building completion and finishing work;  CPC 518 - renting services related to 
equipment for construction or demolition of buildings  or civil engineering works, with operator. WT/REG164/7 
Page 16  
 
  Czech Republic removed a similar limitation, requi ring Czech nationality.  In the same subsector, 
Denmark removed a nationality requiremen t for professors as ICTs or BVs. 
55. For contract service suppliers in higher and adult education services, Belgium, Germany, 
Denmark, and Spain made commitments on the tem porary entry of professors , provided they hold a 
university degree or equivalent  professional qualifications and have 3 years of professional 
experience.  Belgium also introduced an ENT, wher e the annual income of the natural person is below 
€30,000. 
56. A GATS commitment on other education services, applying to the Czech and 
Slovak Republic only, does not appear in the EC FTA schedule. 
(ix) Environmental Services 
57. Commitments in the FTA schedule are based on a classification proposal by the EC in the 
WTO, and include a new commitment on "water for human use" for 15 Members in Mode 1 and 12 in 
Mode 3.  Other services are renamed, but have rema ined substantially identical, and have the same 
CPC numbers as in the GATS.  Eight Member St ates have taken commitments in the FTA for 
consumption abroad, commercial presence, and presen ce of natural persons (o nly ICTs and BVs):   
Cyprus (CPC 9401-4, 9406, 9409); Finland (9401 and 9403); Malta (CPC 9401-6, 9409);  and Poland 
(CPC 9401-3, 9406); Czech Republic (CPC 9404,  9406, 9409), Hungary, (CPC 9404), the Slovak 
Republic (CPC 9404, 9406, 9409), and Slovenia (CPC 9404 and 9409).  Ten other Members have 
taken FTA commitments in CPC 9405 for consump tion abroad, commercial presence, and presence of 
natural persons (only ICTs and BVs).
26 
58. In all environmental services subsectors, Belgiu m, Denmark, Germany, and Spain have made 
FTA commitments for contractual service suppliers, s ubject to the limitations set out in paragraph 39  
above.  
(x) Financial Services 
59. Concerning the EC's commitments in fina ncial services following the GATS approach, 
18 Member States27 took commitments in accordance with th e provisions of the "Understanding on 
Commitments in Financial Services", whose relevant parts have also been attached to the EC's FTA 
schedule28; while the remaining Member States29 made commitments on the basis of the traditional 
approach foreseen in Chapter II.  The most important improvements to the EC's multilateral commitments include supply through commercial pre sence: Hungary eliminated its requirement that 
direct or indirect ownership or voting rights in a credit institution of a single shareholder must not exceed 15 per cent; in insurance, Malta eliminated its economic needs test, and Spain lifted its 
requirement for foreign insurers to have been author ized to operate in the sa me classes of insurance in 
their countries of origin for at least five years be fore establishing a branch or agency; and, in the case 
of banking and other financial services, Germany, Fr ance, and the UK eliminated their restrictions on 
the lead management of securities issues denominated in domestic currency.  These commitments may evolve in light of the mandate given to the Special Committee on Financial Services to consider, 
                                                     
 
26 The classification in the FTA schedule is : A.  Water or human use and wastewater management 
(CPC 9401 for wastewater services); B. Solid/hazardous waste management (CPC 9402, 9403); C. Protection of 
ambient air and climate (CPC 9404); D. Remediation and clean up of soil and waters (part of 94060); E. Noise 
and vibration abatement (CPC 9405); F. Protection of biodiversity and landscape nature and landscape protection services (CPC 9406); G. Other environm ental and ancillary servi ces (part of CPC 94090). 
27 Austria, Belgium, Czech Republic, Denmark, Finl and, France, Germany, Gr eece, Hungary, Ireland, 
Italy, Luxemburg, the Netherlands, Portugal, Slovak Republic, Spain, Sweden, and the UK.  
28 The Understanding's provisions on New Financial Services and Transfers of Information and 
Processing of Information have not been attached sinc e these matters are already d ealt with in chapter II.  
29 Cyprus, Estonia, Latvia, Lithuania, Malta, Poland and Slovenia.  WT/REG164/7 
 Page 17 
 
 
  three years after the entry into force of the Agreement, actions aimed at facilitating and expanding 
trade in financial services and further contributing to the objectives of the Agreement. 
(xi) Maritime and Air Transport Services 
60. For maritime transport services, a comparison of the FTA and GATS schedules is 
complicated because while the form er follows the maritime module schedule (MMS) classification, 
the GATS commitments are confined to the ten Memb er States admitted to the EC in 2004, all of 
which  followed the W/120-CPC classification.30   
61. With regard to maritime transportation of freight and passengers, GATS commitments have 
been made for Latvia only and Malta, whereas the EC  FTA contains full commitments for all Member 
States.  There are, however, two instances in which GATS commitmen ts are deeper than those under 
the FTA schedule.  First, cabotage is offered under the GATS for Latvia whereas it is excluded for all 
Member States under the FTA.  Second, Mode 4 co mmitments for Latvia and Malta under the GATS 
refer to the horizontal section and hence include ex ecutives, specialists and managers whereas the 
FTA schedule contains no commitments for ship crews.  
62. Maritime cargo handling services are part of maritime transport services in the FTA schedule, 
whereas they are part of "services auxiliary to all modes of transport" in the GATS schedule.  Under 
the FTA, full commitments are granted in Modes 2 and 3 by all Member States, except Malta, whereas full GATS commitments have been schedul ed only for Latvia, Estonia and Lithuania.  
Finally, whereas the EC has undertaken full GAT S commitments under Mode 1 for Latvia and 
Estonia, the FTA has an "unbound" for all Member States.  
63. The FTA schedule grants national treatment for access to use of ports, infrastructure and 
maritime auxiliary services, a provision that is not contained in the GATS commitments.  For storage 
and warehousing, the EC GATS commitments for Modes 2 and 3 cover only 19 Member States 
whereas the FTA schedule also covers Cyprus, Czech Republic, Poland, Sweden and the Slovak 
Republic.  The FTA commitments on container st ation and depot services (Modes 2 and 3 for all 
Member States except Malta) have no equivalent in the GATS schedule.   
64. As for customs clearance services; maritime  agency services;  and freight forwarding 
services, the FTA schedule has a wider territorial  coverage since only Malta remains "unbound" 
whereas six Member States are unbound for CPC 748 and seven for CPC 749 under the 
GATS schedule.    
65. In air transport services, for maintenance and repair of aircraft, there is a full commitment by 
the 25 Member States under Modes 2 (a significant mode for this service) and 3, whereas Malta and 
Cyprus do not have GATS commitments.   
66. For sales and marketing, the FTA schedule h as a full commitment under Modes 1-3, while 
Mode 1 is unbound for eight Member States, Mode  2 for six, and Mode 3 for eight under the GATS 
commitments.  
2. Chile 
67. Under the Agreement, Chile undertakes commitm ents in nine of the 12 services sectors 
identified in the Services Sectoral Classification Li st, leaving out educational and health related and 
                                                     
 
30 The EC-15 withdrew its offer at the end of the Negotiating Group on Maritime Transport Services 
negotiations in 1996. WT/REG164/7 
Page 18  
 
  social services, and other services not included elsewhere;
31  Chile did not undertake commitments for 
some professional services (e.g. medical and dental  services).  Additional horizontal limitations have 
been added (compared to the GATS), but the requi rement that 85 per cent of employers in small 
companies be Chileans has been liberalized sli ghtly.  Under the Agreement, Chile has made 
commitments which exceed those made in the GATS in :  legal services;  veterinary services;  services 
provided by medical support staff;  computer a nd related services;  research and development 
services;  real estate services;  other business services;  postal and courier services;  construction services and related engineered services;  distribution services;  environmental services;  recreational, cultural and sporting services;  and transport services.  
(a) Horizontal commitments 
68. Chile exempts from its specific commitments the application of its current and future special 
or voluntary investment regimes, in particular, D ecree Law 600, but not the investment flows entering 
through this regime.  Under this Decree, investor s enter into a legally binding contract with the 
Chilean state, which cannot be unilaterally modified.
  This Decree, also known as the Foreign 
Investment Statute, is a voluntary regime providi ng for non-discrimination, free repatriation of capital 
and profits, and a fi xed overall tax rate.32  In order to benefit from the special regime certain 
categories of investments require approval from th e Government's Foreign Investment Committee, 
and Chile reserves its right to reject applications under this regime.  These investments are those:  
a) with a total value over US$ investment 5 million;   b) relating to sectors or activities performed by 
the state or carried out by public utility companies;  c) in the mass media; and d) made by a foreign 
state or a foreign public entity.  Chile reserves its  right to restrict payments and transfers in 
accordance with the provisions of Annex XI of the Agreement (in particular by reserving the 
possibility of requiring tem porary reserves of up to 30 per cent of the value of the transfer).  
69. Chile reserves the right to adopt measures establis hing rights or preferences for original ethnic 
groups, and to grant subsidies in accordance w ith the subsidies disciplines of the GATS. 
70. Mode 3 commitments are restricted to cer tain forms of commercial presence: public 
corporations, private-limited companies and subsidia ries.  Real estate acquisitions and the other legal 
acts in border areas must comply with the provisions of  the relevant legislation.  As in the GATS, the 
entry of natural persons supplying services (Mode  4) is governed by the commitments in the 
horizontal section.  Mode 4 is basically unbound except for transfers of senior and specialized persons
33 within a foreign enterprise established in accordance with mode 3 commitments who are 
admitted temporarily for two years, extendable by two more years.34  Foreign personnel may not 
represent more than 15 per cent of the total sta ff employed for organizations with more than 
25 employees.35   
                                                      
31 Document MTN.GNS/W/120, 10 July 199 1, available on the WTO website at 
 www.wto.org/english/tratop_e/ serv_e/mtn_gns_w_120_e.doc  
32 The text of Decree Law 600 and of other special investment regimes are available on the website of 
the Chilean Foreign Investment Committee:  www.foreigninvestment.cl  
33 The schedule contains a detailed description of "senior and specialised personnel";  this category 
does not include members of the board of directors of a company established in Chile.  
34 Temporary entry is also granted to non-resident representatives of a service supplier seeking entry 
with the purpose of negotiating the sale of services, and to senior personnel responsible for setting up in Chile a 
commercial presence of a serv ice provider of an EC country, when these persons do not supply the service 
themselves and the service provider has its principal place of business in the territory of an EC country and has no other representative, office, br anch or subsidiary in Chile.  
35 In Chile's GATS Schedule, the 15 per cent ceiling applies to all services sectors (except professional 
services), whenever enterprises have more than 15 employees.    WT/REG164/7 
 Page 19 
 
 
  (b) Sector-specific commitments 
71. Although broader in coverage than the comm itments under the GATS, Chile's commitments 
in legal services under modes 1 and 3 are subject to  a nationality requirement ("the exercise of the 
profession of lawyers is reserved to Chilean nationa ls"), which applies primarily to legal services 
requiring pleading before a court of justice. In the case of other professional services, there are local 
incorporation requirements for accountants and auditors. Commitments on architectural and 
engineering services are similar to those schedul ed under the GATS (unbound for modes 1 and 2; and 
no limitations for mode 3); while the commitments on  veterinary and some auxiliary medical services 
(e.g. midwives and nurses) contain no limitations for modes 1 to 3.  All computer and related services 
have been bound with no limitations on modes 1, 2 and 3.  Research and development services are 
subject to limitations in mode 3, for instance certain activities must be authorized by the state, and the 
authorities may require that researchers from state-owne d institutions be part of the research activity.  
Real estate services, rental/leasing services without crew/operators and other business services are generally free of limitations for modes 1, 2 and 3 in the sub-sectors committed.   
72. As in its GATS schedule, Chile excludes b asic local telecommunications services from the 
coverage of its commitments in the Agreement;  only long distance national and international basic 
telecommunication services are covered.  Supply of  these services is subject to a concession, license 
or permit granted by the Under-Secretariat of Telecommunications.  Commitments in 
telecommunications however include one-way satellite transmissions of Direct-to-Home and Direct-Broadcast-Satellite television serv ices and digital audio services, and free reception broadcasting 
services.  They also provide for full coverage of value-added telecommunication services, subject to 
limitations described in the list. Other commitme nts include postal and courier services (including 
express delivery);  Chile has reserved the right to ex ercise a state monopoly for postal services items.   
73. In the case of construction services and related engineering services, Chile has reserved the 
right to impose market access limitations on modes 1 and 3, but on a national treatment basis. Distribution services, environmental services, tourism and travel-related services and recreational, 
cultural and sporting services are for the most part lib eralized with regard to modes 1, 2, and 3. 
Finally, maritime transport, inward-sailing trans portation, air transport services and road transport 
services are also liberalised.  Th e modalities of liberalization are, generally, no limitations for modes 
1 and 2, and detailed conditions for mode 3 concer ning technical requirements, registration of the 
means of transport, and movement and nationality of  staff.  In addition, there are no limitations on 
Mode 4 for cargo-handling services. 
74. Commitments in financial services are sche duled in Annex VIII.  Chile's horizontal 
commitments for financial services comprise the horizontal commitments of the general schedule 
(Annex VII) and its horizontal GATS commitments on fi nancial services.  In addition, Chile reserves 
the right to prescribe the form of commercial pr esence that entities must adopt in complementary 
banking systems, insurance and reinsurance services, security services and other financial services 
and excludes the social security system, although undertakes commitments in voluntary retirement 
pension plans.  
75. Chile does not request an economic needs test for Mode 3 in any sector (this request is 
established in GATS commitments).  In addition, it includes commitments (mostly under Mode 3) for 
the following subsectors:  operations with deriva tives authorized by the Central Bank; fiduciary 
operations; factoring;  claim settlement services;  a uxiliary insurance services;  operations in stock 
exchange derivatives authorized by the Superintendenc ia de Valores y Seguros;  trading in metals on 
the stock exchange;  custody undertaken by en tities for the deposit and custody of securities;  
management of funds of third parties performed by  mutual funds management  companies, investment WT/REG164/7 
Page 20  
 
  fund management and foreign capital invest ment funds management companies and;
36  service of 
clearing houses for derivatives.37  
76. Another change with respect to the GATS is the commitments undertaken under modes 1 and 
2 for the sale of insurance for international mariti me transport, international commercial aviation and 
goods in transit. 
E. PROVISIONS SPECIFIC TO TRADE IN SERVICES  
1. Domestic regulation 
77. Article 102 contains the provisions on domestic regul ation.  In contrast to Article VI:4 of the 
GATS which calls for the development of the necess ary disciplines on the basis of certain objectives, 
Article 102:1, contains a best endeavour clause.  The Parties are obliged to ensure that in sectors 
where specific commitments are undertaken, meas ures (a) are based on objective and transparent 
criteria, such as, inter alia , competence and the ability to supply the service; (b) are not more trade 
restrictive than necessary to ensu re the achievement of a legitimate policy objective, and (c) do not 
constitute disguised restrictions on the supply of a se rvice.   While the first element of the criteria 
closely resembles the one in GATS Article VI:4, th e second element allows the Parties to pursue any 
legitimate objective, while Article VI:4 refers only to the objective of ensuring the quality of the 
service.  This element seems to be inspired by paragraph 2 of the Disciplines on Domestic Regulation 
in the Accountancy Sector.38  Finally, the introduction of the notion of "disguised restrictions on the 
supply of a service" as the third basic criterion see ms to have been borrowed from the chapeau of 
GATS Article XIV on General Exceptions. 
78. The Parties will review the results of the negotiations on disciplines on qualifications, 
technical standards and licensing requirements undertaken by WTO Members under 
GATS Article VI:4, with a view to incorporating them in the Agreement.      
79. In case of a unilateral or reciprocal recogn ition of education, experience, licences or 
certifications obtained in a third party, Article 102: 3 requires the Parties to consider extending such 
MFN treatment to the other Party. 
2. Recognition 
80. Article 103 calls on the Parties to enc ourage their relevant bodies to provide 
recommendations on mutual recognition, so as to en able service suppliers of the other Party to 
provide services in their territories, with particul ar emphasis on professional services. According to 
the Parties there have thus far been no recommendati ons submitted to the Association Council.  If the 
Association Committee estimates that such recommenda tions are consistent with Chapter I, they are 
to be implemented through a mutual recognition ag reement, which must be in conformity with 
GATS Article VII. 
81. Under Article 103.1, the Parties ensure that servi ces suppliers of the other Party are informed 
about the completeness and result of their applications for licences or certification.  
3. Transparency 
82. Article 105 includes the requirement for the Parties to provide information, upon request by 
the other Party, on any measure or agreement that may affect Chapter 1.  
                                                      
36 Subject to the definitions of these companies provided in the general section for securities services.  
37 By corporations constituted in Chile only for that purpose.  
38 Document S/L/64, Adopted by the Council for Trade in Services on 14 December 1998.  WT/REG164/7 
 Page 21 
 
 
  4. Exceptions 
83. Exceptions related to the application of Title IV are contained in Article 135.  The Parties 
may apply the same type of measures as those cont ained in GATS Article XIV a) to c) plus those 
necessary to preserve exhaustible natural resources a nd to protect treasures of artistic, historic or 
archaeological value, as long as they do not cons titute a means of arbitrary or unjustifiable 
discrimination or a disguised restriction on trade in services.  
F. PROVISIONS COMMON TO OTHER AREAS OF THE AGREEMENT  
1. Government Procurement 
84. The provisions on government procurement are contained in Title IV of the Agreement 
(Articles 136-162) and Annexes XI-X III, and are based on the provisions of the WTO Agreement on 
Government Procurement (GPA).39  Subject to the conditions sp ecified in Annexes XI-XIII, the 
Agreement applies to all measures regarding procur ement by entities of the Parties, of services (and 
goods) including works, except to:  acquisition, deve lopment, (co)production material by broadcasters 
and contracts for broadcasting time;  arbitration and conciliation services;  employment contracts, research and development;
40  and financial services.41  Commitments are undertaken only in the 
sectors included under Annexes XI and XII for the EC a nd Chile, respectively;  for the EC coverage is 
based on a positive list approach, and it replicates the same sectors as in the GPA, while Chile has a 
negative list with no exceptions.42  Measures excepted from this Title are the same as those contained 
in Article XXIII:2 of the GPA (Article 161).  As c ontemplated in Article 162, the implementation of 
this Title is to be reviewed by the Association Committee every two years. 
85. The Parties adopt the principles of national tr eatment and non-discrimination, prohibition of 
offsets and national preferences and transparency in  the conduct of government procurement.  Public 
entities can award contracts by open, selective, or ot her procedures, as long as they are awarded in a 
non discriminatory manner (Articles 143-145).  The onl y conditions for participation in procurement 
that entities can impose are limited to the capability of the supplier to fulfill the requirements of the 
procurement (Article 146).  Article  147 lists a number of requirement s regarding the publication of 
notices that entities must fulfill for government procurement processes.43  
86. Other provisions (Articles 148-158) refer to: tende r documentation;  technical specifications;  
time-limits; permission for negotiations;  submissi on, receipt and opening of tenders;  awarding and 
related information on contracts;  bid challeng es;  information technology;  cooperation and 
assistance; and statistical reports.44  Article 159 opens the door for changes in coverage, subject to the 
conditions laid down therein.  In the case a Part y offers advantages to a third party beyond the 
coverage of the Agreement, the Parties must negotia te with a view to extend those advantages to each 
other on a reciprocal basis (Article 160).   
87. This Title applies only to entities listed in Annexes XI and XII for the EC and Chile, 
respectively, and over the threshold values specifi ed therein.  These values are the same as those 
committed by the EC under the GPA, as shown in Table 2. 
                                                      
39 The EC and their member States are signato ries of the GPA while Chile is not.    
40 Except R&D services that are wholly remunerated by the entity and it is the only beneficiary of those 
services  
41 Other exceptions are:  contract s awarded for: international agreements for the joint implementation 
of a project by the contracting parties, for international ag reements relating to the stationing of troops and for the 
particular procedures of an international organization;  and procurement made in the framework of government 
assistance or cooperation programmes.   
42 See Table A.1 in the Annex for EC's list of sectors. 
43 Annex XIII contains additional provisions on the means of publication. 
44 Annex XIII contains additional provisions on the time-limits and the statistical reports. WT/REG164/7 
Page 22  
 
  Table 2  
EC – Chile and EC's GPA threshold values fo r government procurement of goods and services45  
Threshold Value Classification Supplies Services Works 
Section 1 – Central 
Government Entities SDR 130,000 (US$ 195,543  
for 2006-07) SDR 130,000 (US$ 195,543  
for 2006-07) SDR 5,000,000 (US$7,520,901  
for 2006-07) 
Section 2 – Regional 
Government Entities SDR 200,000 (US$ 300,836  
for 2006-07) SDR 200,000 (US$ 300,836  
for 2006-07) SDR 5,000,000 (US$7,520,901  
for 2006-07) 
Section 3 – Government 
Enterprises SDR 400,000 (US$ 601,672  
for 2006-07) SDR 400,000 (US$ 601,672  
for 2006-07) SDR 5,000,000 (US$7,520,901  
for 2006-07) 
 
2. Current Payments and Capital Movements 
88. Articles 163-167 of the Agreement deal with cu rrent payments and capital movements.  Any 
current account payments and transfers between th e Parties as well as the free movement of capital 
relating inter alia to investments in service sectors made in accordance with the relevant provisions of 
the Agreement are permitted.  The free movement of  capital extends to the liquidation and repatriation 
of capitals and profits.  A list of reservations to th ese principles which may be applied only by Chile is 
contained in Annex XIV.  According to Article 166, the Parties may take safeguard measures with 
regard to capital movement when payments and ca pital movements between the Parties threaten to 
cause serious difficulties for the operation of monetary or exchange rate policy.   
3. Intellectual Property Rights 
89. Title VI contains the relevant provisions for intellectual property rights (IPRs).  The Parties 
undertake to grant and ensure adequate and ef fective protection of IPRs in accordance with 
international standards, as listed in Article 170, wh ich includes a series of conventions to which the 
Parties are already members and others to which the Parties will accede or ratify.  The scope of IPRs 
is defined in Article 169;  it includes: copyright and related rights, patents, industrial designs, 
geographical indications, trademarks, lay-out designs,  integrated circuits, as well as protection of 
undisclosed information and protection against unfair competition in accordance with the Paris 
Convention for the Protection of Industrial Property.  
4. Competition 
90. The Agreement, in Title VIII of Part IV, cont ains provisions on competition so as to prevent 
distortions which may affect trade in services (a nd goods).  To this end, Articles 173-178 contain a 
number of cooperation and coordina tion provisions with regards to notification, enforcement 
activities, consultations, exchange of information, and technical assistance on competition matters.  
91. Under Article 179:1, public or private monopo lies are allowed according to the Parties' 
respective laws.  The Associati on Committee ensures that with re gards to public enterprises and 
enterprises which have been granted exclusive rights,  there are no measures in place that distort trade 
in services between the Parties and that these enterp rises are subject to the rules of competition as 
long as they can comply with the particular tasks assigned to them (Article 179:2).  Dispute settlement 
provisions do not apply to any matter under Title VIII. 
5. Dispute Settlement 
92. The provisions related to dispute settlement are detailed in Part IV, Title VIII of the 
Agreement46 and in Annexes XV and XVI.47  Article 189 for disputes on the same matter arising both 
                                                      
45 Chile is not a signatory of the GPA so it has no commitments.  On 13 June 2007, 
1 SDR = US$ 1.5048   WT/REG164/7 
 Page 23 
 
 
  under the Agreement and the WTO Agreement, the complaining Party has discretion to choose the 
forum where the dispute is to be settled.  Howe ver, once dispute settlement procedures have been 
initiated under one forum, that foru m shall be used to the exclusion of the other.  The Parties are 
encouraged to arrive to a mutually satisfactory resolution through cooperati on and consultation; they 
may request so within the Association Committee, which is to endeavour to resolve the dispute 
specifying the implementing measures by the Pa rty concerned and the time-frame for doing so.48 
93. Where a Party considers that a measure is in  breach of the Agreement and has not been 
resolved at the Association Comm ittee within the specified deadlines,  it may request, in writing, the 
establishment of a panel (Article 184).  The appointment  of the arbitrators is described in Article 185;  
panels consist of three arbitrators, and they are appointed within three days of the request for the 
establishment of the panel.  The arbitrators can obt ain information and technical advice at the request 
of a Party or their own initiative (Article 186).  The panel's ruling is final, a nd it must be transmitted, 
as a rule, within three months from the date of est ablishment of the panel, and in no case later than 
five months (Article 187).49  The burden of proof falls on the complaining Party, which can withdraw 
the dispute at any moment.  
94. Compliance with the panel's ruling is binding (Ar ticle 188).  The Party complained against is 
to notify the other Party on the specific measures re quired to comply with the ruling;  if the Party 
complained against does not notify such measure s or the complaining Party does not find them 
acceptable, the latter is entitled to suspend benef its granted under this Part of the Agreement 
equivalent to the impairment caused by the measur e in place.  This suspension must be approved by 
the panel, upon request of the Party complained against, and can only be in place on a temporary 
basis.  
                                                                                                                                                                     
46 Title VIII applies to matters arising under Part  IV of the Agreement except on competition matters 
(Article 180).  There are additional pr ovisions that apply to disputes on financial services, as described below 
47 Annex XV (Model Rules of Procedure for the C onduct of Arbitration Panels) deals with the 
procedural questions relating the panel and the period before its establishment;  Annex XVI (Code of Conduct 
for Members of Arbitration Panels) lays down th e obligation for panelists and panel candidates. 
48 In the context of this Title, measure includes "practice".  
49 In case of urgent matters, these dates are redu ced to 75 days and four months respectively. WT/REG164/7 
Page 24  
 
   Consultations within the Association 
Council (Art. 183) 
Request for establishment of  
an Arbitration panel  ( Art 184:2)  
Composition and  
Procedures  
(Art 185) 15 days after 
consultations 
3 days for 
composition  
Arbitration panel examination and 
ruling 
(Art. 186-187)  Outside information and 
advice (Art. 186)  
Termination by 
complaining Party (Art. 
187:7)  As a rule, 3 months  
from Panel establishment (75 days if urgent). In no case later than five months (four 
months) from same 
date 
Award becomes public  
(Art. 187:1)  
Compliance (Art.188)
binding, by losing Party of 
proposed/adopted implementation 30 days from 
receipt of ruling  
Retaliation authorized 
(Art. 188:6) Arbitration panel ruling 
Binding (Art. 188:4 or 188:5)  45 days from request Disagreement on measures proposed 
or adopted No notice of 
implementation
No compliance
Notice of retaliation  
(Art. 188:8)  
60 days 
before retaliation Request for a ruling of the 
Arbitration panel  
(Art. 188:8 or 188:10)  
Arbitration panel ruling 
Binding (Art. 188:8 or 188:10)  In cases of disagreement on 
measures proposed or adoptedUpon 
notification  
Within 5 days from notice (proposed 
measures) or any time (measures adopted) 
45 days from request  Within 30 days  Synopsis of dispute settlement procedures 
Request for a ruling of the 
Arbitration panel  
(Art. 188:4 or 188:5)  Agreement 
between the 
Parties
Suspension (Art. 188:9) 
Temporary, until measures brought 
in compliance. Not before the 
panel's rulin gWT/REG164/7 
Page 25 
 
 
  6. Transparency 
95. The Parties will publish or make publicly ava ilable their laws, regulations, procedures and 
administrative rulings of general application as well  as international agreements that may affect the 
operation of the Agreements (Article 192).  Each Party will establish a contact point to facilitate 
exchange of information (Article 190).  The Agreement does not contain a requirement to formally 
notify the other Party of the introduction of new measures or changes to existing measures;  it relies on the provision of information upon request from the other Party
 
7. Institutional Framework 
96. The Agreement creates a series of bodies at various levels of government to deal with the 
different parts of the Agreement, as set out in Part I, Title II – Institutional Framework.  These 
include:  an Association Council, which is in charge  of the implementation of the Agreement and is to 
examine every major issue;  an Association Parliame ntary Council to act as forum for the exchange of 
views between the Parties' Parliaments;  a Joint Consultative Committee, whose function is to assist 
the Association Council in promoting dialogue and cooperation between the economic and social 
organisations of civil society in the Parties;  a nd an Association Committee which is responsible for 
the general implementation of the Agreement.   
97. The Association Committee is the relevant body fo r trade aspects of the Agreement.  Article 6 
specifies that the As sociation Council is to establish the rules of procedure of the Association 
Committee, which performs a number of functions  assigned to it in Article 193.  These include 
inter alia , to oversee further elaboration of the trade rela ted part of the Agreement or to resolve any 
disputes arising under the same part.  The Asso ciation Committee may also set up and supervise 
special committees to deal with specific matters.  As of entry into force of the Agreement, the only 
committee for trade in services is the Special Co mmittee on Financial Services, as established in 
Article 127.  
8. Exceptions 
98. Other than the services specifi c exceptions, referred to in section E.4, Articles 194 and 195 
include exceptions for national security and balanc e of payments difficulties, and taxation, which 
replicate Articles XIV bis and XII respectively.   
99. Article 196 allows the Parties to discriminate  between residents and non-residents in the 
application of their fiscal legislation and to take any measure to prevent tax evasion or avoidance.   
9. Relationship with other agreements concluded by the Parties 
100. Table 3 lists the regional trade agreements (R TAs), notified to the GATT/WTO and in force, 
to which Chile and the EC are parties to.   
 
  
 
   WT/REG164/7 
Page 26  
 
  Table 3 
Chile and the European Communities:  Partic ipation in RTAs (notified and in force) 
Partner/ 
Agreement GATT/WTO Notification 
 Date of 
entry  
into force Type of 
agreement 
Year WTO Provision 
CHILE 
Canada  05-07-97 Goods & services 1997 GATT Art. XXIV and GATS Art. V 
China 01-10-06 Goods 2007 GATT Art. XXIV 
Costa Rica 15-02-02 Goods & services 2002 GATT Art. XXIV & GATS Art. V 
EFTA 01-12-04 Goods & services 2004 GATT Art. XXIV and GATS Art. V 
El Salvador 01-06-02 Goods & services 2004 GATT Art. XXIV and GATS Art. V 
GSTP 19-04-89 Goods 1989 Enabling Clause 
LAIA 18-03-81 Goods 1982 Enabling Clause 
Mexico 01-08-99 Goods & services 2001 GATT Art. XXIV and GATS Art. V 
PTN 11-02-73 Goods 1982 Enabling Clause 
Republic of Korea 01-04-04 Goods & services 2004 GATT Art. XXIV and GATS Art. V 
US 01-01-04 Goods & services 2003 GATT Art. XXIV and GATS Art. V 
Trans-Pacific SEP 28-05-06 Goods & services 2007 GATT Art. XXIV and GATS Art. V 
EC 
EEA 01-01-94 Services 1996 GATT Art. V 
Albania 01-12-06 Goods 2007 GATT Art. XXIV 
Algeria 01-09-05 Goods 2006 GATT Art. XXIV 
Andorra 01-07-91 Goods 1998 GATT Art. XXIV 
Croatia 01-03-02 Goods 2002 GATT Art. XXIV 
Egypt 01-06-04 Goods 2004 GATT Art. XXIV 
Faroe Islands 01-01-97 Goods 1997 GATT Art. XXIV 
FYROM 01-06-01 Goods 2001 GATT Art. XXIV 
Iceland 01-01-97 Goods 1997 GATT Art. XXIV 
Israel 01-06-00 Goods 2000 GATT Art. XXIV 
Jordan 01-05-02 Goods 2002 GATT Art. XXIV 
Lebanon 01-03-03 Goods 2003 GATT Art. XXIV 
Mexico 01-07-00 Goods and Services 2000(G) & 
2002(S) GATT Art. XXIV & GATT Art. V 
Morocco 01-03-00 Goods 2000 GATT Art. XXIV 
Norway 1973 Goods 1973 GATT Art. XXIV 
OCTs 1971 Goods 1970 GATT Art. XXIV 
Palestinian Authority 01-07-97 Goods 1997 GATT Art. XXIV 
South Africa 01-01-00 Goods 2000 GATT Art. XXIV 
Switzerland and Liechtenstein 1973 Goods 1972 GATT Art. XXIV 
Syria 1977 Goods 1977 GATT Art. XXIV 
Tunisia 01-03-98 Goods 1999 GATT Art. XXIV 
Turkey 01-01-96 Goods 1995 GATT Art. XXIV 
Treaty of Rome 1958 Goods and Services 1957(G) 
&1995(S)GATT Art. XXIV & GATT Art. V  WT/REG164/7 
 Page 27 
 
 
  G. SECTOR -SPECIFIC PROVISIONS  
1. Telecommunication services 
101. Section 3 of Chapter I sets out additional pr ovisions for telecommunication services.  These 
are largely modelled upon the add itional commitments that both Parties have undertaken under the 
GATS. It commits the Parties to set up separate and independent regulatory authorities that use 
impartial decisions and procedures,  and to grant affected suppliers a right to appeal decisions 
(Article 110); to ensure the allocation and the use of scarce resources (Article 114);  to publish the 
terms and conditions for a licence when required (A rticle 111) and provide national treatment with 
respect to interconnection with a major supplier (Article 113). 
102. The Parties undertake to maintain appropriate measures to prevent suppliers from engaging in 
anti-competitive practices, as described in Article 112. 
2. Financial services 
103. Chapter II applies to measures taken at the central , regional or local level and covers all four 
modes of supply, as defined in the GATS mutatis mutandis.   Hence, investment in financial services is 
dealt with in Chapter II. 
104. The definitions in Chapter II mirror those contained in Chapter I mutatis mutandis .  Financial 
services are classified along the same  lines as in the GATS Annex on Financial Services.  Chapter II 
also does not apply to financial activities th at are excluded from the application of GATS.50   
105. The provisions on market access, national treatment, and schedules of specific commitments 
are similar to the ones contained in Chapter I. Hen ce, the scheduling approach is similar to the one 
adopted by the GATS, including the possibility of introducing additional commi tments on measures 
not subject to scheduling under market access and na tional treatment (Article 120:3).  There is no 
MFN provision other than with regards to recognition, as described below. 
106. Article 123 establishes the Parties' commitments  with regards to domestic regulation and 
transparency.  Article 123:4 requires the Parties to try and implement internationally agreed standards 
for regulation and supervision of financial service s and against money laundering.  With regards to 
transparency, the Parties must make available a ny measure that they inte nd to apply for public 
comment (Article 123:1-3).  The Parties are require d to provide the necessary information regarding 
the requirements, completeness and status of appli cations relating to the supply of financial services. 
107. The Chapter contains two specific exceptions for the protection of confidential information 
that might impede law enforcement, be contrary to the public interest, or would prejudice legitimate 
commercial interests of particular enterprises (Ar ticle 124); and for the adoption or maintenance of 
"reasonable measures for prudentia l reasons" (Article 125 "Pruden tial Carve-Out").  The latter 
exception is modelled on the carve-out contained in  paragraph 2(a) of th e GATS Annex on Financial 
Services.  It includes: (a) the protection of invest ors, depositors, financial market participants, policy 
holders, or persons to whom a fiduciary duty is  owed by a financial services supplier; (b) the 
maintenance of the safety, soundness, integrity or  financial responsibility of financial services 
suppliers; and (c) ensuring the integrity and stabilit y of the Party's financial system. Besides, the 
                                                      
50 Accordingly, excluded from coverage are: (i) activities conducted by a central bank or monetary 
authority or by any other public entity in pursuit of m onetary or exchange rate policies; (ii) activities forming 
part of a statutory system of social security or public  retirement plans;  and (iii) other activities conducted by a 
public entity for the account or with th e guarantee or using the financial reso urces of the Government.  If a Party 
allows any of the activities referred to in (ii) or (iii) to be conducted by  its financial service suppliers in 
competition with a public entity or a financial serv ice supplier, Chapter 2 applies to such activities. WT/REG164/7 
Page 28  
 
  recognition of prudential measures maintained by third parties is allowed, provided adequate 
opportunity is granted to the other Party to accede to  such agreements or to negotiate a comparable 
one (Article 126).  In case of unilateral or recipro cal recognition of education, experience, licences or 
certifications obtained in a third party, Article 126:2 requires the Parties to consider extending MFN 
treatment to the other Party. 
108. Dispute settlement on matters related to Chap ter 2 are dealt with by the provisions of 
Title VIII as described in section E.2.a).  However,  the Parties may request consultations with the 
other party regarding any matter arising under Chap ter II (Article 128). Such  consultations shall 
include officials of the financial authorities specified  in an Annex to the Agreement, and the results 
must be reported to a Special Committee on Financial Services, which is in charge of supervising the 
implementation of this chapter.
51 Disputes are to be settled in accordance with the provisions of Title 
VIII, although the chapter contains some specific provisions, making it clear inter alia  that the 
chairperson of the arbitration panel must be a fi nancial expert; mandating th e constitution of a roster 
of financial exports who are not nationals of any of the Parties; and clarifying some of the timeframes 
and procedures applicable to disput es on financial services-related matters.52 
3. International Maritime Transport 
109. Section 2 on International Maritime Transport complements the provisions of Chapter I with 
regards to this sector.  The Parties confirm the appli cation of the principle of unrestricted access to the 
international maritime market and traffic on a commercial and non-discriminatory basis (Article 
108.1(a));  in Article 108:1(b) the Parties restate their commitment to grant national treatment with respect to access to ports, infrastructure and maritime  auxiliary services to ships flying the flag or 
operated by service suppliers of the other Party  According to Article 108.2, the Parties cannot 
introduce any cargo-sharing clauses in future bilate ral agreements with third parties nor in any 
agreement concerning dry and bulk trade;  it also re quires the Parties to abolish all measures that may 
have a restrictive effect on the supply of interna tional maritime transport services.  With respect to 
commercial presence of international maritime servic e, the Agreement allows suppliers of the other 
Party to establish and operate under no less favourab le conditions than those accorded to their own 
service suppliers or those of any other country (Article 108:3). 
                                                     
 
51 Article 127 foresees the establishment of  a Special Committee on Financial Services. 
52 Article 129.  WT/REG164/7 
 Page 29 
 
 
  ANNEX 
  
Table A.1 
EC service sectors listed with respect to government procurement under the Association Agreement and the GPA 
Subject CPC Reference No. 
Maintenance and repair services  6112, 6122, 633, 886  
Land transport services, including armoured car se rvices, and courier services, except transport 
of mail 712 (except 71235), 7512, 87304 
Air transport services of passengers and fr eight, except transport of mail 73 (except 7321) 
Transport of mail by land, except rail, and by air 71235, 7321 
Telecommunications services 752* (except 7524, 7525, 7526) 
Financial services ex 81 
 (a) Insurance services 812, 814 
 (b) Banking and investments services**  
Computer and related services 84 
Accounting, auditing and bookkeeping services 862 
Market research and public opinion polling services 864 
Management consulting services and related services 865, 866** 
Architectural services; engineering services and integrated engineering services, urban 
planning and landscape architectural services; related scientific and technical consulting 
services; technical testing and analysis services 867 
Advertising services 871 
Building-cleaning services and property management services 874, 82201 - 82206 
Publishing and printing services on a fee or contract basis 88442 
Sewage and refuse disposal; sa nitation and similar services 94 
 
Source: Annex XI of the Agreement  
 
∗ Indicates that the service specified is a component of a more aggregated CPC item specified else where in this classification l ist. 
 
∗∗ Indicates that the service specified constitutes only a part of  the total range of activities c overed by the CPC concordance.  
 
 
 WT/REG164/7 
Page 30  
 
  Table A.2 
EC construction service sectors listed with respect to govern ment procurement  under the Association Agreement and the GPA 
Group Class Subclass Title Corresponding ISCI 
SECTION 5  CONSTRUCTION WORK AND CONSTRUCTIONS:  LAND  
DIVISION 51  CONSTRUCTION WORK  
511   Pre-erection work at construction sites  
 5111 51110 Site investigation work 4510 
 5112 51120 Demolition work 4510 
 5113 51130 Site formation and clearance work 4510 
 5114 51140 Excavating and earthmoving work 4510 
 5115 51150 Site preparation work for mining 4510 
 5116 51160 Scaffolding work 4520 
     
512   Construction work for buildings  
 5121 51210 For one- and two-dwelling buildings 4520 
 5122 51220 For multi-dwelling buildings 4520 
 5123 51230 For warehouses and industrial buildings 4520 
 5124 51240 For commercial buildings 4520 
 5125 51250 For public entertainment buildings 4520 
 5126 51260 For hotel, restaurant and similar buildings 4520 
 5127 51270 For educational buildings 4520 
 5128 51280 For health buildings 4520 
 5129 51290 For other buildings 4520 
     
513   Construction work for civil engineering  
 5131 51310 For highways (except elevated highways), street, roads, railways 
and airfield runways 4520 
 5132 51320 For bridges, elevated highways, tunnels and subways 4520 
 5133 51330 For waterways, harbours, dams and other water works 4520 
 5134 51340 For long distance pipelines, communication and power lines 
(cables) 4520 
 5135 51350 For local pipelines and cables;  ancillary works 4520 
 5136 51360 For constructions fo r mining and manufacturing 4520 
 5137  For constructions for sport and recreation  
  51371 For stadia and sports grounds 4520 
  51372 For other sport and recrea tion installations (e.g. swimming 
pools, tennis courts, golf courses) 4520 
 5139 51390 For engineering works n.e.c. 4520 
     
514 5140 51400 Assembly and erection of  prefabricated constructions 4520 
     
515   Special trade construction work  
 5151 51510 Foundation work, including pile driving 4520 
 5152 51520 Water well drilling 4520 
 5153 51530 Roofing and water proofing 4520 
 5154 51540 Concrete work 4520 
 5155 51550 Steel bending and erec tion (including welding) 4520 
Table A.2 (Cont'd)   WT/REG164/7 
 Page 31 
 
 
  Group Class Subclass Title Corresponding ISCI 
 5156 51560 Masonry work 4520 
 5159 51590 Other special trade construction work 4520 
     
516   Installation work  
 5161 51610 Heating, ventilation and air conditioning work 4530 
 5162 51620 Water plumbing and drain laying work 4530 
 5163 51630 Gas fitting construction work 4530 
 5164  Electrical work  
  51641 Electrical wiring and fitting work 4530 
  51642 Fire alarm construction work 4530 
  51643 Burglar alarm system construction work 4530 
  51644 Residential antenna construction work 4530 
  51649 Other electrical construction work 4530 
 5165 51650 Insulation work (electrical  wiring, water, heat, sound) 4530 
 5166 51660 Fencing and raili ng construction work 4530 
 5169  Other installation work  
  51691 Lift and escalator construction work 4530 
  51699 Other installation work n.e.c. 4530 
     
517   Building completion and finishing work  
 5171 51710 Glazing work and window  glass installation work 4540 
 5172 51720 Plastering work 4540 
 5173 51730 Painting work 4540 
 5174 51740 Floor and wall tiling work 4540 
 5175 51750 Other floor laying, wall covering and wall papering work 4540 
 5176 51760 Wood and metal joinery and carpentry work 4540 
 5177 51770 Interior fitting decoration work 4540 
 5178 51780 Ornamentation fitting work 4540 
 5179 51790 Other building comple tion and finishing work 4540 
     
518 5180 51800 Renting services related to equipment for construction or 
demolition of buildings or civ il engineering works, with 
operator 4550 
 
Source: Annex XI of the Agreement 
 
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