WORLD TRADE WT/REG52/1
15January 1998
ORGANIZATION(98-0124)
Original: English Committee onRegional Trade Agreements
THE EUROPEAN COMMUNITIES-SLOVAK EUROPE AGREEMENT,
SERVICES
Joint Communication from theParties
Standard Format forInformation onEconomic Integration Agreements onServices
Inacommunication dated 23December 1997, theEuropean Communities, alsoonbehalf of
theSlovak Republic, hastransmitted thefollowing documentation establishing anassociation between
theEuropean Communities andtheirMember States andtheSlovak Republic.
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I. BACKGROUND INFORMATION ONTHE EUROPE AGREEMENT (AGREEMENT)
1. Membership: Slovak Republic, theEuropean Communities
andtheirMember States
Dateofsignature oftheEurope Agreement: 4October 1993
Entry intoforce oftheEurope Agreement: 1February 1995
2. General Description oftheStructure oftheEurope Agreement
The"Europe Agreement" between theSlovak Republic andtheEuropean Communities and
theirMember States isawide-ranging economic integration agreement thatestablishes anAssociation
between thetwoParties. Thestated aimsoftheAgreement arebothpolitical andeconomic, andinclude
thedevelopment ofclose political relations andtheexpansion oftrade between theParties. The
Agreement isdesigned asastepping-stone totheSlovak Republic ’smembership oftheCommunity,
andprovides aframework forthenecessary integration.
TheAgreement isbased upon clearundertakings onliberalisation oftrade andeconomic co-
operation. Inturn, these undertakings arereinforced bypolitical dialogue between thetwoParties at
alllevels, including ministerial andparliamentary dialogue. AnAssociation Council, meeting at
ministerial levelatleastonceayear, ischarged withoverseeing theimplementation oftheAgreement.
Below theleveloftheCouncil, anAssociation Committee anditssub-committees arecharged with
theresponsibility ofassisting theAssociation Council intheperformance ofitsduties. Thetechnical
aspects oftheimplementation oftheAgreement arediscussed atsectoral sub-committees. Theentire
process isreinforced byprovisions foreconomic co-operation onallmajor issues ofmutual interest.
TheEurope Agreement isapreferential agreement, structured around atenyeartransitional
period, divided, intotwostages offiveyears. Bytheendofthetenyearperiod, afree-trade area
forgoods together withaliberalised regime fortheestablishment ofcompanies andnationals between
thetwoParties willhave been established. Thesupply ofservices willhave been progressively
liberalised during thatperiodWT/REG52/1
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3. Planandschedule:
Article 1 Aims
TitleI Articles 2-5 Political Dialogue
TitleII Articles 6-7 General Principles
TitleIII Articles 8-37 FreeMovement ofGoods
TitleIV Articles 38-59 Movement ofWorkers, Establishment, Supply of
Services
TitleV Articles 60-71 Payments, Capital, Competition andOther Economic
Provisions, Approximation ofLaws
TitleVI Articles 72-96 Economic Co-operation
TitleVII Article 97 Cultural Co-operation
TitleVIII Articles 98-103 Financial Co-operation
TitleIX Articles 104-124 Institutional, General andFinal Provisions
4. Relationship oftheAgreement toawider process ofeconomic integration
TheSlovak Republic applied tojointheEuropean Union on27June1995. The Europe
Agreement provides aframework forthenecessary preparations formembership, including theremoval
oftradebarriers, theharmonisation oflegislation andliberalisation inthefieldofservices. Membership
oftheUnion implies fullparticipation intheEuropean Single Market.
5. Economic andTrade Data
Datatobesupplied.
II. PROVISIONS AFFECTING TRADE INSERVICES
1. Sectors orsub-sectors andmodes ofdelivery
TheAgreement provides fornational treatment intheareaofestablishment andtheliberalisation
oftrade inservices between theParties inallservices sectors except those services mentioned under
Article 52.Inprinciple, nosector isexcluded fromthescope oftheAgreement. Interms oftimetable,
forestablishment, most services aretobecovered bytheendofthefirststage, i.e.afterfiveyears
(Article 45).Having regard totheprovisions ofArticle 6establishing atenyeartransitional period,
theliberalisation ofthesupply ofservices willtakeplace progressively andtheAssociation Council
ischarged withtaking thenecessary measures.
Interms ofmode ofsupply, theliberalisation oftrade inservices doesnotexclude anyof
themodes ofsupply .Itshould benoted thattheAgreement distinguishes between themovement
ofworkers, establishment andthesupply ofservices inlinewiththeprinciples oftheEuropean Single
Market assetoutintheTreaty ofRome, rather thaninterms oftheclassification ofthemodes of
delivery asusedintheGATS. Articles 56,57and60provide forcross-border supply andconsumption
abroad, Articles 45,49provide forestablishment/commercial presence andArticles 38,42,43,53,
provide forthepresence ofnatural persons.
2. Elimination ofDiscriminatory Measures
TheaimoftheAgreement isliberalisation between theParties and,assuch, itprovides for
theabsenceoreliminationofsubstantiallyalldiscriminationthrougheliminationofexistingdiscriminatory
measures andprohibition ofnewormore discriminatory measures. While thetimetable establishedWT/REG52/1
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forthecomplete elimination ofexisting discriminatory measures isinlinewiththeoverall transitional
period onwhich theAgreement isbased -i.e.10years -many discriminatory measures areprohibited
fromthedateofentryintoforce. Theprinciple articles concerned withtheprohibition ofdiscrimination
areasfollows:
Article 38prohibits discrimination onthebasisofnationality against Slovak Republic workers
oncetheyareemployed ontheterritory ofanECMember StateandECworkers oncetheyareemployed
intheSlovak Republic withregard toworking conditions, remuneration orredundancy.
Article 45requires theSlovak Republic togrant national treatment fortheestablishment and
operation ofECcompanies andnationals (with some phasing ofsectors). Andrequires theECMember
States togrant national treatment fortheestablishment andoperation ofSlovak Republic companies
andnationals.
Article 56provides fortheliberalisation ofthesupply ofservices between theParties andthe
temporary movement ofservice suppliers.
Article 57dealswiththesupply oftransport services between theSlovak Republic andtheEC.
Formaritime transport, theParties undertake toapply theprinciple ofunrestricted access tothemarket
andtraffic. Forairandinland transport, thereisastandstill provision andacommitment bytheSlovak
Republic tobring itslegislation intolinewithCommunity legislation. Thisarticle alsocommits the
Association Council toexamining ways ofcreating thenecessary conditions fortheimprovement of
theprovision ofairandlandtransport services.
Article 113provides fornon-discriminatory access foranatural orlegalperson ofoneParty
tothejudicial system intheother Party inorder todefend theirindividual andproperty rights, including
intellectual, industrial andcommercial property.
Article 115isageneral non-discrimination clause covering thetreatment ofnationals and
companies from bothParties.
3. Restrictions Remaining inForce
Establishment andOperation
Asstated above, theAgreement provides fornational treatment fortheestablishment and
operationofcompaniesandnationalsofthePartiesinallservicessectors.Fromentryintoforce,national
treatment isgranted across allsectors bytheCommunity toSlovak Republic companies andnationals
forbothestablishment andoperation. National treatment isalsogranted foroperation fromentry into
forcebytheSlovak Republic toCommunity companies andnationals established intheSlovak Republic.
NationaltreatmentbytheSlovakrepublicfortheestablishmentofECcompaniesandnationals,isgranted
attheentry intoforce oftheAgreement forallsectors, except forfinancial services, agency activities
forrealestate andnatural resources. Those latter sectors aresubject tophase-in provisions thatare
specified inarticle 43andtherelated annexes, andtheywillallbeliberalised atthelatest bytheend
ofthetransitional period.
Attheendofthetransitional period, theonlyremaining restrictions ontheestablishment of
companies andnationals intheservices sector willbeonthetransport sector (airtransport, transport
byinland waterway andmaritime cabotage services) andonthesaleandpurchase ofnatural resources,
agricultural landandforests, andcultural andhistoric monuments andbuildings. TheAssociation
Council ischarged withmaking recommendations fortheimprovement ofestablishment andoperations
intheabove transport sectors.WT/REG52/1
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Supply ofServices between theCommunity andtheSlovak Republic
Forthesupply ofservices between theSlovak Republic andtheEC,allservices sectors are
tobeprogressively liberalised bytheendoftheten-year transitional period setoutinArticle 6ofthe
Agreement. Transport services aretreated differently fromother services sectors .Forinternational
maritime transport, bothParties arecommitted toapply theprinciple ofunrestricted access tothemarket
atentryintoforce, while forairandinland transport, theParties havecommitted themselves toconclude
separate agreements toco-ordinate development andprogressively liberalise thesectors. Inaddition,
forthese sectors, theParties undertake toobserve astandstill andtheSlovak Republic commits itself
toadapting itslegislation tothatoftheECinsofarasitserves liberalisation purposes.
4. Treatment ofServices andService Providers from Third Countries
There arenoprovisions which affect thetreatment ofservices andservice providers fromthird
countries andnomodifications totheschedules ofspecific commitments areproposed. Noprovisions
intheAgreement raisethelevelofrestrictions ontrade inservices foranyother WTO Member.
5. Rules ofOrigin forCommunity andSlovak Companies
Article 49oftheAgreement setsoutthedefinition of“Community company ”and“Slovak
Republic company ”.A“Community company ”anda“Slovak Republic company ”respectively shall
mean “acompany orafirmsetupinaccordance withthelawsofaMember State oroftheSlovak
Republic respectively andhaving itsregistered office, central administration, orprinciple place of
business intheterritory oftheCommunity ortheSlovak Republic respectively. However, should the
company orfirm, setupinaccordance withthelawsofaMember State ortheSlovak Republic
respectively, haveonlyitsregistered office intheterritory oftheCommunity ortheSlovak Republic
respectively, itsoperations must possess arealandcontinuous linkwiththeeconomy ofoneofthe
Member States ortheSlovak Republic respectively. ”Under Article 55,theprovisions oftheAgreement
onestablishment andservices arealsoextended tocompanies jointly owned bySlovak andCommunity
companies andnationals.
Article 49alsodefines whatismeant byCommunity andSlovak republic national -“anatural
person whoisanational ofoneoftheMember States oroftheSlovak Republic respectively ”.
Finally, withregard tointernational maritime transport, Article 49alsoextends coverage of
theestablishment andsupply ofservices chapters tonationals orshipping companies oftheParties
established outside theParties iftheirvessels areregistered intheMember States orinTheSlovak
Republic.
Nochanges havebeenintroduced tothecriteria fordetermining theorigin ofservice suppliers
asaresult oftheAgreement.
6. Standards/Recognition
Article47oftheAgreementcommitstheAssociationCounciltoexaminewhatstepsarenecessary
forthemutual recognition ofqualifications. Articles 69and70commit theSlovak Republic toensuring
thatitslegislation willbegradually made compatible withthatoftheCommunity.
7. Safeguard measures forservices
TheprovisionsintheAgreement(Article63)concerningtheapplicationofsafeguardmechanisms
donotprovide fortheexclusion ofoneorother Party fromsafeguard measures applied tothirdparties.WT/REG52/1
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Under specified andrestricted circumstances, theimplementation oftheprovisions onestablishment
incertain sectors maybedelayed asprovided forinArticle 50.Thissafeguard hasnoeffect onservice
suppliers from thirdcountries.
8. Subsidies andState-aid
Chapter IIofTitleVoftheAgreement setsoutrulesonsubsidies, stateaidandcompetition.
Parties maytakeappropriate measures ifaparticular practice isincompatible withthefunctioning of
theAgreement asdefined inArticle 64,ifthepractice causes serious prejudice totheinterest ofthe
other Party, oritsdomestic industry. AsbothParties areWTO Members, anymeasures taken must
becompatible withWTO rules; thisisstated intheAgreement.
9. Government Procurement
Under theterms ofArticle 68,from entry intoforce, Slovak companies aregranted access
tocontract award procedures intheCommunity pursuant toCommunity procurement rules under a
treatment nolessfavourable thanthataccorded toCommunity companies. Community companies
established intheSlovak Republic enjoy theequivalent right, while allCommunity companies will
begranted thatright, atthelatest bytheendofthetransitional period.
III. GENERAL PROVISIONS OFTHE AGREEMENT
1. Exceptions andreservations
Liberalisation ofestablishment andthesupply ofservices issubject tolimitations justified on
grounds ofpublic policy, public security orpublic health. Activities connected, evenoccasionally,
withtheexercise ofofficial authority arealsoexcluded.
2. Accession
TheAgreementwasconcludedspecificallybetweentheEuropeanCommunityandtheirMember
States andtheSlovak Republic. Similar agreements havebeenconcluded withnineother countries
inCentral andEastern Europe, allofwhich haveapplied tojointheEuropean Union.
3. Dispute settlement procedures
Following Article 107,theAssociation Council maysettle adispute relating totheapplication
ofinterpretation oftheAgreement bymeans ofadecision. Intheevent ofthisnotbeing possible,
arbitrators maybeappointed, onebyeachParty andonebytheAssociation Council. TheParties are
bound bydecisions taken either bytheAssociation Council orbythearbitrators. Thedispute settlement
procedures relate solely totheAgreement andhavenoimpact onother dispute settlement procedures
towhich theParties might besubject asaresult ofother international obligations.
4. Institutional framework
Asdescribed above, theAgreement isadministered through theAssociation Council, the
Association Committee anditssub-committees.
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