Information AboutGats |
| CATEGORIES ABOUT GENERAL AGREEMENT ON TRADE IN SERVICES | |
| treaties | |
| world trade organization | |
| international trade | |
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All members of the WTO are signatories to the GATS. The basic WTO principle of Most Favoured Nation (MFN) applies to GATS as well. RATIONALE For a long time, no need was seen for a trade agreement in services since large segments of the services economy have traditionally been considered as domestic activities that are difficult to trade over borders, e.g. haircuts or seeing a doctor. Furthermore, sectors from rail transport to Telecommunications have been viewed as classical domains of government ownership and control, given their infrastructural importance and the perceived existence, in some cases, of natural monopoly situations. A third important group of sectors, including health, education and basic insurance services, are considered in many countries as governmental responsibilities, given their importance for social integration and regional cohesion, which should be tightly regulated and not be left to the rough and tumble of markets. Nevertheless, some services sectors, in particular international finance and maritime transport, have been largely open for centuries--as the natural complements to merchandise trade. Other large sectors have undergone fundamental technical and regulatory changes in recent decades, opening them to private commercial participation and reducing existing barriers to entry. The emergence of the Internet has helped to create a range of internationally tradeable product variants--from e-banking to tele-health and distance learning. A growing number of governments have gradually exposed previous monopoly domains to competition; telecommunication is a case in point. FOUR MODES OF SUPPLY The GATS agreement covers "]]
A "Natural Person" is a human being, as distinct from legal persons such as companies or organisations. Countries can freely decide where to liberalize on a sector-by-sector basis, including which specific mode of supply they want to cover for a given sector. SECTORS ADDRESSED Services Sector Classifications addressed in the GATS are defined in the so-called " W/120 list", which provides a list of all sectors which can be negotiated under the GATS. The title " W/120 " refers to the name of the official WTO document, MTN.GNS/W/120 . CRITICISM The GATS document has been criticized for allegedly replacing the authority of national Legislature , with the authority of the GATS Disputes Panel. Such allegations argue that GATS intends to override all "burdensome rules". The WTO and member governments disagree with such allegations. GATS hearings are closed and held in secret. Sherry M. Stephenson has argued that GATS failed to deliver its service agreement key objectives, namely stability, transparency and liberalisation. The integrative approach of NAFTA-inspired Regional Trade Agreements (RTA) has proven more effective for multilateral services liberalisation. One of the most obvious defects of GATS remains its 'positive list' approach whereby countries 'schedule' voluntary commitments on specific services sectors. In other words -and by definition- GATS does not cover the entire universe of services activities. NAFTA-like RTAs, on the other hand, have adopted a 'negative list' approach whereby all sectors are taken to be free from restrictions unless listed in annexes of reservations. SEE ALSO EXTERNAL LINKS
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