# Classification of measures

Drawing from the World Bank's experience with its original Services Trade Restrictions Database (STRD) and developments since then, notably the OECD STRI, we developed a new classification of measures affecting trade in services. We organized measures into four main policy categories, namely a) conditions on market entry, b) conditions on operations, c) measures affecting competition, and d) regulatory environment and administrative procedures. Relevant policy measures that potentially affect trade but do not fit neatly into any of these four categories are included in a fifth category – miscellaneous measures (see Box 1).

<!-- Start of picture text --> Box 1: Structure of STPD classification of measures<br>A Conditions on market entry<br>A1 Legal forms of entry (including foreign equity limits)<br>A2 Quantitative measures (for firms and natural persons)<br>A3 Conditions on licensing/investment screening/qualifications relating to market entry<br>(firms /natural persons)<br>A4 Other conditions on market entry<br>B Conditions on operations<br>B1 Conditions on supply of services<br>B2 Conditions on service supplier<br>B3 Conditions on government procurement<br>B4 Other conditions on operations<br>C Measures affecting competition<br>C1 Conditions on conduct by firms<br>C2 Governmental rights/prerogatives (including public ownership)<br>C3 Other measures affecting competition<br>D Administrative procedures and regulatory transparency<br>D1 Administrative procedures<br>D2 Regulatory transparency (including licensing)<br>D3 Nature of regulatory authority (measures related to nature of regulator)<br>D4 International standards<br>D5 Other regulatory environment and administrative procedures<br>E Miscellaneous<br><!-- End of picture text --> All measures are classified according to the taxonomy above in binary form (yes or no), except for the few measures that require a quantitative reply (e.g. level of foreign equity allowed, number of days required to process a license application). The modal dimension was built into each of the policy categories. Thus, each policy category includes measures relevant for each mode of supply; for example, category A (conditions on market entry) includes the measures affecting entry through each of the modes of supply, i.e. cross-border, commercial presence and presence of natural persons.

The first category focuses on the measures affecting foreign service suppliers' ability to enter the host economy's market to supply services. Typical measures include quantitative limitations or economic/labor needs tests on the number of providers, Foreign Direct Investment (FDI) screening, foreign equity limitations, or requirements to adopt specific types of legal form. Category A also includes specific licensing and qualification requirements that are pre-requisites for entry, such as registration, the need to obtain a sectoral license, or specific education/training/experience requirements. While the distinction between entry and operational requirements is not straightforward, we may think of category A as encompassing those requirements that must be fulfilled by the supplier before it may actually start to operate in a foreign market.

Category B covers conditions on operations, focusing on two main aspects: 1) conditions on the supply of services – in other words, measures affecting 'how' the services must be supplied, i.e. types of services that may be supplied, through how many outlets, in which locations, at what prices, 5