commitments were made. In fact, the measurement of both trade in financial services and of the actual level of restrictiveness remains an important on-going challenge<sup>29</sup> .

A new round of services negotiations began in January 2000 alongside those on agriculture as mandated by the Uruguay Round’s built-in agenda. Both sets of negotiations were subsequently woven into the _Doha Development Agenda_ (DDA) launched in November 2001. Some of the financial services-related issues under discussion in the DDA include the clarification in the scope of the FSA’s prudential carve-out clause and of distinctions across modes relating to the electronic delivery of financial services, the expansion and strengthening of commitments on national treatment and market access across modes, as well as improved regulatory transparency and procedural fairness, particularly in matters of licensing<sup>30</sup> . Although the negotiations have been suspended, a collective request in financial services coordinated by Canada and cosponsored by several countries<sup>31</sup> was lodged in early 2006 and could become a focal point going forward, assuming that negotiations resume (see Box 1 for a summary).

Box 1: Collective Request in Financial Services

- <mark>Definitions: Use the agreed definitions in the GATS Annex on Financial Services for scheduling</mark>

- <mark>commitments. • Mode 1: undertake commitments for marine, aviation and transport insurance; reinsurance; insurance intermediation, insurance auxiliary services; financial advisory services and financial information and data processing services.</mark>

- <mark>Mode 2: undertake commitments for marine, aviation and transport insurance; reinsurance;</mark>

- <mark>insurance intermediation, insurance auxiliary services; and all non-insurance financial services (sub-sectors v-xvi). • Modes 1 and 2: there can be advantages of additional liberalization, especially where the consuming agent is sophisticated, for example, an institutional consumer of securities services. • Mode 3: for all financial services sectors, undertake commitments encompassing rights to establish new and acquire existing companies, in the form of wholly-owned subsidiaries, joint ventures and branches. • Modes 1, 2 and 3: remove discrimination between domestic and foreign suppliers regarding application of laws and regulations ("national treatment").</mark>

- <mark>Modes 1, 2 and 3: remove limitations such as monopolies, numerical quotas or economic needs</mark>

- <mark>tests and mandatory cessions.</mark>

- <mark>Transparency in development and application of laws and regulations, transparent and speedy</mark>

- <mark>licensing procedures, and other regulatory issues should be addressed in the negotiations.</mark>

_<mark>Source: Coalition of Service Industries (http://www.uscsi.org/publications/papers/collective/financial.pdf)</mark>_

> 29 Conventional trade statistics generally cover cross-border financial service transactions (mostly mode 1) but do not adequately capture commercial presence (mode 3). In addition, countries use different subsectoral classifications of financial services, such as the so-called W/120 classification based on the provisional UN Central Product Classification (CPC), the FSA classification, or a national classification – see World Trade Organization (December 1998) for a discussion.

> 30 See Sauvé P. and Steinfatt K. (2001), Dobson W. (August 2002), Key S. (2003) and Cornford A. (June 2004) for a discussion.

31 It bears noting that only one LCR country – Ecuador – ranks among demandeur countries, whereas three countries from the region – Argentina, Brazil and Costa Rica – are targeted by this request.

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