Mode 4 under the DDA negotiations

Hamid Mamdouh

Director, Trade in Services Division, WTO

September 2007

DDA negotiations - Mode 4

• 8 specific proposals– Developing economies- India, Colombia, Kenya– Developed economies - EC, US, Japan, Canada– 15 Developing economies as co-sponsors

• Other sector-specific proposals relate to mode 4, e.g., professional services

• 1 collective proposal reviewing progress in mode 4 negotiations

Current negotiations Mode 4 barriers identified

• Structure and coverage of existing commitments

• Economic Needs Tests (ENTs)

• Definitional problems

• Administrative practices: no access to information and lack of transparency

• Lack of recognition of qualifications

Some of the solutions proposed...

• More and better commitments more categories, improved definitions, finer classification, “sector-specific” commitments

• Removal of barriersmultilateral criteria for ENTs - more specific, transparent and non-discriminatory

• Greater transparency and predictability

• GATS visa

Mode 4 - Offers so far…• Over 30 of around 70 offers propose

some improvement to horizontal commitments (half developed, half developing countries)

• Of the eight ESCWA WTO Members, six have submitted initial offers (i.e. Bahrain, Egypt, Jordan, Oman, Qatar and UEA) and two (i.e. Bahrain and Egypt) also revised offers

Improvements in offersunder mode 4

• New categories, broader coverage• Expanded list of sectors to which the

commitments apply• Extended periods of stay; possibility of renewal • Clarification of the application/reduction of the

scope of ENTs• Reduction of discriminatory measures• Some improvements in transparency

Mode 4 improvements in offersby ESCWA WTO Members

Categories Number of undertakings

ENTs/Quotas

Usual duration of stay

Business visitors

7 (4) - 90 days

ICT andM, E, S

8 (7) 2 ENTs5 quotas

2-4 years

CSS 2 (1) 2 ENT 1 year

IP 1 (-) 1 ENT 90 days – 1 year

Other 1 (-) - 90 days

Numbers in parenthesis reflect the situation with respect to commitments

ICT = Intra-Corporate Transferees; E,M,S = Executives, Managers, Specialists; CSS = Contractual Services Suppliers; IP = Independent Professionals

Overall state of play in the DDA negotiations

• Number and quality of offers has thus far been unsatisfactory, including on Mode 4

• Hong Kong Ministerial (December 2005) provided timelines and more guidance

Hong Kong Ministerial Declaration – Mode 4

Members to be guided, to the maximum extent possible, by the following mode 4 objectives:

• New or improved commitments on:– Contractual Services Suppliers (CSS), Independent

Professionals (IP) and others de-linked from commercial presence

– ICT, Business Visitors

• to reflect inter alia– removal or substantial reduction of ENTs

– indication of duration of stay and renewal

Plurilateral Requests - Mode 4

Hong Kong Declaration set end February 2006 for the submission of plurilateral requests:

Request on mode 4• From 15 developing to 9 developed countries• Seeks commitments on CSS and IP • Commitments are sought in a number of

sectors, falling under business, construction, environmental, tourism and recreational services

• Asks for the removal/clarification of Economic Needs TestsLeast-developed countries have also submitted a mode 4 request, with a largely similar focus

Timelines

• Hong Kong services timelines for 2006:– Plurilateral requests – end of February– (2nd round of revised offers – end July)– (Final draft schedules – end October)

• BUT ... negotiations suspended in July 06

• “Soft resumption” in November 2006

• Formal resumption in February 2007

Plurilateral mode 4 process

• Two meetings to discuss the plurilateral request were held in 2006, prior to the suspension of the negotiations

• Since the resumption, one more plurilateral meeting was held in April 2007 and a further one is scheduled for the latter part of September

THANK YOU