./.WORLD TRADE
ORGANIZATIONWT/GC/W/189
2 June 1999
(99-2211)
General Council Original:  English
PREPARATIONS FOR THE 1999 MINISTERIAL CONFERENCE
EC Approach to Services
Communication from the European Communities
The following communication, dated 28 May 1999, has been received from the Permanent
Delegation of the European Commission.
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1. As a result of the Uruguay Round negotiations, WTO Members committed themselves under
Article XIX of the GATS to resume negotiations no later than five years from the date of entry into
force of this Agreement – the "GATS 2000" negotiations.  On this basis, all WTO Members arecommitted to further reducing obstacles to trade in services in line with the principle of progressive
liberalization.  The need to take into account the interests of all participants on a mutually
advantageous basis to secure an overall balance of rights and obligations is emphasised.  In particular,
this entails that the particular situation of developing Members should be given due consideration.
2. The run-up to GATS 2000 has now started with the completion of the information exchange
programme in the Council for Trade in Services followed by the assessment of trade in services
required by Article XIX:3 of GATS.  During th e exchange of information programme, extremely
useful contributions have been submitted by Members, and highly instructive background notes have
been produced by the Secretariat.  This information is particularly helpful for the Council for Trade in
Services to carry out the assessment of trade in services, of which it is an integral part.
Assessment of trade/negotiating guidelines3. In accordance with Article XIX:3 of GATS, "the Council for Trade in Services shall carry out
an assessment of trade in services in overall terms and on a sectoral basis with reference to the
objectives of this Agreement, including those set out in paragraph 1 of Article IV".  It is believed that,
on the basis of the contributions of Members to the information exchange programme and the
background notes from the Secretariat, includin g background note S/C/W/94 on recent developments
in services trade, the Council for Trade in Services  has now all the necessary elements to complete the
assessment of trade necessary to establish negotiating guidelines.
4. We conclude from these facts and from the views exchanged in the Council for Trade in
Services the following broad approach which could be reflected in the overall negotiating guidelines
in due course:
- In overall terms, there is a need to reduce the current imbalance in commitments across
countries, and service sectors.  Therefore, the forthcoming negotiations should be
comprehensive .WT/GC/W/189
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- Looking at individual sectors, the need for regulatory disciplines to underpin market
access and national treatment commitments appears increasingly important, and also
includes the question of pro-competitive principles.
- Finally, developing countries have emphasized their concern that the forthcoming
negotiations should take better into account their interests in line with the objectives set
by Article IV:1 of GATS.  In this context, the benefits that developing and developed
countries are gaining from the GATS have now been better analysed.  The GATS is
particularly relevant to development, as it provides a key opportunity for all countries to
attract stable long-term investment and to improve the related infrastructure (transport,
telecommunications, financial services), fostering their long-term growth and the
competitiveness of their economies as a whole.
5. Based on the above elements, the EC and their member States propose that the following
negotiating approach be considered, while noting that the negotiations should be open-ended, all
Members being free to submit for discussion any topics that they may want to be subject to
negotiation:
(a) The GATS 2000 negotiations should bring about a deeper and broader package of
improved commitments from all WTO Members to market access and national
treatment.
Closing the gap between many Members’ commitments and actual market practice
would appear a priority, and commitments to further liberalization should be secured.
Regarding service sectors, the negotiations will include inter alia  a resumption of the
maritime transport negotiations, and a re-assessment of the Annex on Air Transport
Services.  Additionally, MFN exemptions will have to be reviewed, as foreseen in the
Annex on Article II Exemptions.
Finally, for the efficiency of the negotiations and in order to maximize the results while
at the same time ensuring coherence of commitments by sectors and by mode of supply,
horizontal formulas, when appropriate, should be considered as a useful tool for the
negotiations.  This would apply across the board to sectors committed, except where
expressly indicated.
(b) GATS disciplines based on Article VI:4 of the GATS should be strengthened.
The aim is to ensure a transparent and predictable regulatory environment which can
provide legal certainty and confidence to service suppliers, investors, users and
consumers.  Pro-competitive principles may also be promoted, with a view to providinga basic international discipline to certain practices preventing or reducing market entry.
(c) Any unfinished business which may remain, and may include for instance safeguards,
subsidies, government procurement should be absorbed in the GATS 2000 negotiations.
Likewise, other aspects of the functioning of GATS, which have been subject toinconclusive discussions on interpretation or implementation, could be reviewed.
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