#  **Improving domestic regulation and removing unnecessary obstacles to trade**

A strict regulation of the health sector is needed, e.g. to avoid malpractice, or encourage the choice of the most efficient providers. At the same time, most obstacles to trade in health services – and services at large – are found in domestic regulations (“behind the border” obstacles). A necessary step for countries aiming to enter and contest the world health services market is therefore to initiate a regulatory audit, which objective will be to ensure that the measures in place (1) contribute to achieving some legitimate policy objectives, and (2) are the least trade restrictive to efficiently achieve these objectives.

The World Bank, the OECD, and the Australian Productivity Commission, among others, have developed trade restrictiveness indexes that aim to identify common barriers to trade in services, including in the health sector. While not addressing the question of the adequateness of the domestic rules (and proportionality to the legitimate objective to be achieved), these help identify possible red flags for foreign investors and best practices. In the case of Tunisia (case-study n°8), for instance, all types of restrictions usually tested are present in the domestic regulatory framework: this would suggest that the government will need to re-assess all these rules in light of both its domestic public health and foreign trade objectives. These include rules pertaining to the form of establishment, foreign investment, nationality and residency requirements, movement of health personnel, etc.

|**Case-study n°8**<br>**Regulatory audit for health service**<br>|**s in Tunisia**<br>|
|---|---|
|**Type of restriction**|**Medical**|
|Form of establishment|Clinic,hospital,individualpractice|
|Foreignpartnership/association/joint venture|Authorized,restrictions apply|
|Investment and ownershipbyforeignprofessionals|Authorized,restrictions apply|
|Investment and ownershipbynon-professional investors|Authorized,restrictions apply|
|Nationality/citizenshiprequirements|Must be Tunisian|
|Residencyand localpresence|No|
|Quotas/economic needs tests on the number ofprofessionals and firms|Numerus clausus,e.g.pharmacy/ inhabitants|
|Licensingand accreditation of foreignprofessionals|Possible recognition of foreign diplomas|
|Licensing and accreditation of domestic professionals|Inscription on the Tableau de l’Ordre des<br>médecins|
|Movement of people|Usual<br>visa<br>conditions,<br>exceptional<br>authorizations topractice(e.g. training)|
|Activities reserved bylaw to theprofession|Yes, practice of medicine|
|Multidisciplinary practices|Authorized,restrictions apply|
|Advertising, marketing and solicitation|Prohibited for doctors, authorized for clinics<br>with restrictions|
|Fee setting|Yes,distinction betweenpublic andprivate|

**Note:** This list is by no means exhaustive: it gives an idea of potential regulatory obstacles to trade. It also does not address the question of the adequateness of the domestic regulations: some are fully justified to ensure the quality of the service, but some might be more restrictive than necessary to achieve this end. **Source:** World Bank staff compilation of laws and regulations, restriction index based on Nguyen-Hong (2000).

It appears often that facilitating trade is not about deregulating, but rather better regulating, and sometime even filling regulatory gaps. For example, the deontology in medical tourism is often a grey area with regard domestic regulations. It includes issues such as: the advertising of medical services, the role of tour operators and other intermediaries between the patient and the doctor which might affect the quality of the advice re- the decision to have surgery or the privacy of medical files, etc. Without creating unnecessary obstacles to trade, a deontology code or a set of rules might be necessary to prevent fraud and deceptive practices, not only for the sake of the

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