외교부

ANNEX 1B

GENERAL AGREEMENT ON TRADE IN SERVICES

PART I SCOPE AND DEFINITION

Article I Scope and Definition

PART II GENERAL OBLIGATIONS AND DISCIPLINES

Article II Most-Favoured-Nation Treatment

Article III Transparency

Article III bis Disclosure of Confidential Information

Article IV Increasing Participation of Developing Countries

Article V Economic Integration

Article V bis Labour Markets Integration Agreements

Article VI Domestic Regulation

Article VII Recognition

Article VIII Monopolies and Exclusive Service Suppliers

Article IX Business Practices

Article X Emergency Safeguard Measures

Article XI Payments and Transfers

Article XII Restrictions to Safeguard the Balance of Payments

Article XIII Government Procurement

Article XIV General Exceptions

Article XIV bis Security Exceptions

Article XV Subsidies

PART III SPECIFIC COMMITMENTS

Article XVI Market Access

Article XVII National Treatment

Article XVIII Additional Commitments

PART IV PROGRESSIVE LIBERALIZATION

Article XIX Negotiation of Specific Commitments

Article XX Schedules of Specific Commitments

Article XXI Modification of Schedules

PART V INSTITUTIONAL PROVISIONS

Article XXII Consultation

Article XXIII Dispute Settlement and Enforcement

Article XXIV Council for Trade in Services

Article XXV Technical Cooperation

Article XXVI Relationship with Other International Organizations

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PART VI FINAL PROVISIONS

Article XXVII Denial of Benefits

Article XXVIII Definitions

Article XXIX Annexes

Annex on Article II Exemptions

Annex on Movement of Natural Persons Supplying Services under the Agreement

Annex on Air Transport Services

Annex on Financial Services

Second Annex on Financial Services

Annex on Negotiations on Maritime Transport Services

Annex on Telecommunications

Annex on Negotiations on Basic Telecommunications

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GENERAL AGREEMENT ON TRADE IN SERVICES

Members,

Recognizing the growing importance of trade in services for the growth and development of

the world economy;

Wishing to establish a multilateral framework of principles and rules for trade in services with

a view to the expansion of such trade under conditions of transparency and progressive liberalization

and as a means of promoting the economic growth of all trading partners and the development of

developing countries;

Desiring the early achievement of progressively higher levels of liberalization of trade in services

through successive rounds of multilateral negotiations aimed at promoting the interests of all participants

on a mutually advantageous basis and at securing an overall balance of rights and obligations, while

giving due respect to national policy objectives;

Recognizing the right of Members to regulate, and to introduce new regulations, on the supply

of services within their territories in order to meet national policy objectives and, given asymmetries

existing with respect to the degree of development of services regulations in different countries, the

particular need of developing countries to exercise this right;

Desiring to facilitate the increasing participation of developing countries in trade in services

and the expansion of their service exports including, inter alia, through the strengthening of their domestic

services capacity and its efficiency and competitiveness;

Taking particular account of the serious difficulty of the least-developed countries in view of

their special economic situation and their development, trade and financial needs;

Hereby agree as follows:

PART I

SCOPE AND DEFINITION

Article I

Scope and Definition

1. This Agreement applies to measures by Members affecting trade in services.

2. For the purposes of this Agreement, trade in services is defined as the supply of a service:

(a) from the territory of one Member into the territory of any other Member;

(b) in the territory of one Member to the service consumer of any other Member;

(c) by a service supplier of one Member, through commercial presence in the territory of

any other Member;

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(d) by a service supplier of one Member, through presence of natural persons of a Member

in the territory of any other Member.

3. For the purposes of this Agreement:

(a) "measures by Members" means measures taken by:

(i) central, regional or local governments and authorities; and

(ii) non-governmental bodies in the exercise of powers delegated by central,

regional or local governments or authorities;

In fulfilling its obligations and commitments under the Agreement, each Member shall take

such reasonable measures as may be available to it to ensure their observance by regional and

local governments and authorities and non-governmental bodies within its territory;

(b) "services" includes any service in any sector except services supplied in the exercise

of governmental authority;

(c) "a service supplied in the exercise of governmental authority" means any service which

is supplied neither on a commercial basis, nor in competition with one or more service

suppliers.

PART II

GENERAL OBLIGATIONS AND DISCIPLINES

Article II

Most-Favoured-Nation Treatment

1. With respect to any measure covered by this Agreement, each Member shall accord immediately

and unconditionally to services and service suppliers of any other Member treatment no less favourable

than that it accords to like services and service suppliers of any other country.

2. A Member may maintain a measure inconsistent with paragraph 1 provided that such a measure

is listed in, and meets the conditions of, the Annex on Article II Exemptions.

3. The provisions of this Agreement shall not be so construed as to prevent any Member from

conferring or according advantages to adjacent countries in order to facilitate exchanges limited to

contiguous frontier zones of services that are both locally produced and consumed.

Article III

Transparency

1. Each Member shall publish promptly and, except in emergency situations, at the latest by the

time of their entry into force, all relevant measures of general application which pertain to or affect

the operation of this Agreement. International agreements pertaining to or affecting trade in services

to which a Member is a signatory shall also be published.

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2. Where publication as referred to in paragraph 1 is not practicable, such information shall be

made otherwise publicly available.

3. Each Member shall promptly and at least annually inform the Council for Trade in Services

of the introduction of any new, or any changes to existing, laws, regulations or administrative guidelines

which significantly affect trade in services covered by its specific commitments under this Agreement.

4. Each Member shall respond promptly to all requests by any other Member for specific information

on any of its measures of general application or international agreements within the meaning of

paragraph 1. Each Member shall also establish one or more enquiry points to provide specific information

to other Members, upon request, on all such matters as well as those subject to the notification

requirement in paragraph 3. Such enquiry points shall be established within two years from the date

of entry into force of the Agreement Establishing the WTO (referred to in this Agreement as the "WTO

Agreement"). Appropriate flexibility with respect to the time-limit within which such enquiry points

are to be established may be agreed upon for individual developing country Members. Enquiry points

need not be depositories of laws and regulations.

5. Any Member may notify to the Council for Trade in Services any measure, taken by any other

Member, which it considers affects the operation of this Agreement.

Article III bis

Disclosure of Confidential Information

Nothing in this Agreement shall require any Member to provide confidential information, the

disclosure of which would impede law enforcement, or otherwise be contrary to the public interest,

or which would prejudice legitimate commercial interests of particular enterprises, public or private.

Article IV

Increasing Participation of Developing Countries

1. The increasing participation of developing country Members in world trade shall be facilitated

through negotiated specific commitments, by different Members pursuant to Parts III and IV of this

Agreement, relating to:

(a) the strengthening of their domestic services capacity and its efficiency and

competitiveness, inter alia through access to technology on a commercial basis;

(b) the improvement of their access to distribution channels and information networks;

and

(c) the liberalization of market access in sectors and modes of supply of export interest

to them.

2. Developed country Members, and to the extent possible other Members, shall establish contact

points within two years from the date of entry into force of the WTO Agreement to facilitate the access

of developing country Members' service suppliers to information, related to their respective markets,

concerning:

(a) commercial and technical aspects of the supply of services;

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(b) registration, recognition and obtaining of professional qualifications; and

(c) the availability of services technology.

3. Special priority shall be given to the least-developed country Members in the implementation

of paragraphs 1 and 2. Particular account shall be taken of the serious difficulty of the least-developed

countries in accepting negotiated specific commitments in view of their special economic situation and

their development, trade and financial needs.

Article V

Economic Integration

1. This Agreement shall not prevent any of its Members from being a party to or entering into

an agreement liberalizing trade in services between or among the parties to such an agreement, provided

that such an agreement:

(a) has substantial sectoral coverage1, and

(b) provides for the absence or elimination of substantially all discrimination, in the sense

of Article XVII, between or among the parties, in the sectors covered under

subparagraph (a), through:

(i) elimination of existing discriminatory measures, and/or

(ii) prohibition of new or more discriminatory measures,

either at the entry into force of that agreement or on the basis of a reasonable time-frame,

except for measures permitted under Articles XI, XII, XIV and XIV bis.

2. In evaluating whether the conditions under paragraph 1(b) are met, consideration may be given

to the relationship of the agreement to a wider process of economic integration or trade liberalization

among the countries concerned.

3. (a) Where developing countries are parties to an agreement of the type referred to in

paragraph 1, flexibility shall be provided for regarding the conditions set out in paragraph 1, particularly

with reference to subparagraph (b) thereof, in accordance with the level of development of the countries

concerned, both overall and in individual sectors and subsectors.

(b) Notwithstanding paragraph 6, in the case of an agreement of the type referred to in

paragraph 1 involving only developing countries, more favourable treatment may be granted to juridical

persons owned or controlled by natural persons of the parties to such an agreement.

4. Any agreement referred to in paragraph 1 shall be designed to facilitate trade between the parties

to the agreement and shall not in respect of any Member outside the agreement raise the overall level

of barriers to trade in services within the respective sectors or subsectors compared to the level applicable

prior to such an agreement.

1This condition is understood in terms of number of sectors, volume of trade affected and modes of supply. In order to

meet this condition, agreements should not provide for the a priori exclusion of any mode of supply.

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5. If, in the conclusion, enlargement or any significant modification of any agreement under

paragraph 1, a Member intends to withdraw or modify a specific commitment inconsistently with the

terms and conditions set out in its Schedule, it shall provide at least 90 days advance notice of such

modification or withdrawal and the procedure set forth in paragraphs 2, 3 and 4 of Article XXI shall

apply.

6. A service supplier of any other Member that is a juridical person constituted under the laws

of a party to an agreement referred to in paragraph 1 shall be entitled to treatment granted under such

agreement, provided that it engages in substantive business operations in the territory of the parties

to such agreement.

7. (a) Members which are parties to any agreement referred to in paragraph 1 shall promptly

notify any such agreement and any enlargement or any significant modification of that agreement to

the Council for Trade in Services. They shall also make available to the Council such relevant information

as may be requested by it. The Council may establish a working party to examine such an agreement

or enlargement or modification of that agreement and to report to the Council on its consistency with

this Article.

(b) Members which are parties to any agreement referred to in paragraph 1 which is

implemented on the basis of a time-frame shall report periodically to the Council for Trade in Services

on its implementation. The Council may establish a working party to examine such reports if it deems

such a working party necessary.

(c) Based on the reports of the working parties referred to in subparagraphs (a) and (b),

the Council may make recommendations to the parties as it deems appropriate.

8. A Member which is a party to any agreement referred to in paragraph 1 may not seek

compensation for trade benefits that may accrue to any other Member from such agreement.

Article V bis

Labour Markets Integration Agreements

This Agreement shall not prevent any of its Members from being a party to an agreement

establishing full integration2 of the labour markets between or among the parties to such an agreement,

provided that such an agreement:

(a) exempts citizens of parties to the agreement from requirements concerning residency

and work permits;

(b) is notified to the Council for Trade in Services.

Article VI

Domestic Regulation

1. In sectors where specific commitments are undertaken, each Member shall ensure that all measures

of general application affecting trade in services are administered in a reasonable, objective and impartial

manner.

2Typically, such integration provides citizens of the parties concerned with a right of free entry to the employment markets

of the parties and includes measures concerning conditions of pay, other conditions of employment and social benefits.

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2. (a) Each Member shall maintain or institute as soon as practicable judicial, arbitral or

administrative tribunals or procedures which provide, at the request of an affected service supplier,

for the prompt review of, and where justified, appropriate remedies for, administrative decisions affecting

trade in services. Where such procedures are not independent of the agency entrusted with the

administrative decision concerned, the Member shall ensure that the procedures in fact provide for

an objective and impartial review.

(b) The provisions of subparagraph (a) shall not be construed to require a Member to institute

such tribunals or procedures where this would be inconsistent with its constitutional structure or the

nature of its legal system.

3. Where authorization is required for the supply of a service on which a specific commitment

has been made, the competent authorities of a Member shall, within a reasonable period of time after

the submission of an application considered complete under domestic laws and regulations, inform the

applicant of the decision concerning the application. At the request of the applicant, the competent

authorities of the Member shall provide, without undue delay, information concerning the status of

the application.

4. With a view to ensuring that measures relating to qualification requirements and procedures,

technical standards and licensing requirements do not constitute unnecessary barriers to trade in services,

the Council for Trade in Services shall, through appropriate bodies it may establish, develop any necessary

disciplines. Such disciplines shall aim to ensure that such requirements are, inter alia:

(a) based on objective and transparent criteria, such as competence and the ability to supply

the service;

(b) not more burdensome than necessary to ensure the quality of the service;

(c) in the case of licensing procedures, not in themselves a restriction on the supply of

the service.

5. (a) In sectors in which a Member has undertaken specific commitments, pending the entry

into force of disciplines developed in these sectors pursuant to paragraph 4, the Member shall not apply

licensing and qualification requirements and technical standards that nullify or impair such specific

commitments in a manner which:

(i) does not comply with the criteria outlined in subparagraphs 4(a), (b) or (c);

and

(ii) could not reasonably have been expected of that Member at the time the

specific commitments in those sectors were made.

(b) In determining whether a Member is in conformity with the obligation under

paragraph 5(a), account shall be taken of international standards of relevant international organizations3

applied by that Member.

6. In sectors where specific commitments regarding professional services are undertaken, each

Member shall provide for adequate procedures to verify the competence of professionals of any other

Member.

3The term "relevant international organizations" refers to international bodies whose membership is open to the relevant

bodies of at least all Members of the WTO.

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Article VII

Recognition

1. For the purposes of the fulfilment, in whole or in part, of its standards or criteria for the

authorization, licensing or certification of services suppliers, and subject to the requirements of

paragraph 3, a Member may recognize the education or experience obtained, requirements met, or licenses

or certifications granted in a particular country. Such recognition, which may be achieved through

harmonization or otherwise, may be based upon an agreement or arrangement with the country concerned

or may be accorded autonomously.

2. A Member that is a party to an agreement or arrangement of the type referred to in paragraph 1,

whether existing or future, shall afford adequate opportunity for other interested Members to negotiate

their accession to such an agreement or arrangement or to negotiate comparable ones with it. Where

a Member accords recognition autonomously, it shall afford adequate opportunity for any other Member

to demonstrate that education, experience, licenses, or certifications obtained or requirements met in

that other Member's territory should be recognized.

3. A Member shall not accord recognition in a manner which would constitute a means of

discrimination between countries in the application of its standards or criteria for the authorization,

licensing or certification of services suppliers, or a disguised restriction on trade in services.

4. Each Member shall:

(a) within 12 months from the date on which the WTO Agreement takes effect for it, inform

the Council for Trade in Services of its existing recognition measures and state whether

such measures are based on agreements or arrangements of the type referred to in

paragraph 1;

(b) promptly inform the Council for Trade in Services as far in advance as possible of the

opening of negotiations on an agreement or arrangement of the type referred to in

paragraph 1 in order to provide adequate opportunity to any other Member to indicate

their interest in participating in the negotiations before they enter a substantive phase;

(c) promptly inform the Council for Trade in Services when it adopts new recognition

measures or significantly modifies existing ones and state whether the measures are

based on an agreement or arrangement of the type referred to in paragraph 1.

5. Wherever appropriate, recognition should be based on multilaterally agreed criteria. In appropriate

cases, Members shall work in cooperation with relevant intergovernmental and non-governmental

organizations towards the establishment and adoption of common international standards and criteria

for recognition and common international standards for the practice of relevant services trades and

professions.

Article VIII

Monopolies and Exclusive Service Suppliers

1. Each Member shall ensure that any monopoly supplier of a service in its territory does not,

in the supply of the monopoly service in the relevant market, act in a manner inconsistent with that

Member's obligations under Article II and specific commitments.

2. Where a Member's monopoly supplier competes, either directly or through an affiliated company,

in the supply of a service outside the scope of its monopoly rights and which is subject to that Member's

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specific commitments, the Member shall ensure that such a supplier does not abuse its monopoly position

to act in its territory in a manner inconsistent with such commitments.

3. The Council for Trade in Services may, at the request of a Member which has a reason to believe

that a monopoly supplier of a service of any other Member is acting in a manner inconsistent with

paragraph 1 or 2, request the Member establishing, maintaining or authorizing such supplier to provide

specific information concerning the relevant operations.

4. If, after the date of entry into force of the WTO Agreement, a Member grants monopoly rights

regarding the supply of a service covered by its specific commitments, that Member shall notify the

Council for Trade in Services no later than three months before the intended implementation of the

grant of monopoly rights and the provisions of paragraphs 2, 3 and 4 of Article XXI shall apply.

5. The provisions of this Article shall also apply to cases of exclusive service suppliers, where

a Member, formally or in effect, (a) authorizes or establishes a small number of service suppliers and

(b) substantially prevents competition among those suppliers in its territory.

Article IX

Business Practices

1. Members recognize that certain business practices of service suppliers, other than those falling

under Article VIII, may restrain competition and thereby restrict trade in services.

2. Each Member shall, at the request of any other Member, enter into consultations with a view

to eliminating practices referred to in paragraph 1. The Member addressed shall accord full and

sympathetic consideration to such a request and shall cooperate through the supply of publicly available

non-confidential information of relevance to the matter in question. The Member addressed shall also

provide other information available to the requesting Member, subject to its domestic law and to the

conclusion of satisfactory agreement concerning the safeguarding of its confidentiality by the requesting

Member.

Article X

Emergency Safeguard Measures

1. There shall be multilateral negotiations on the question of emergency safeguard measures based

on the principle of non-discrimination. The results of such negotiations shall enter into effect on a

date not later than three years from the date of entry into force of the WTO Agreement.

2. In the period before the entry into effect of the results of the negotiations referred to in

paragraph 1, any Member may, notwithstanding the provisions of paragraph 1 of Article XXI, notify

the Council on Trade in Services of its intention to modify or withdraw a specific commitment after

a period of one year from the date on which the commitment enters into force; provided that the Member

shows cause to the Council that the modification or withdrawal cannot await the lapse of the three-year

period provided for in paragraph 1 of Article XXI.

3. The provisions of paragraph 2 shall cease to apply three years after the date of entry into force

of the WTO Agreement.

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Article XI

Payments and Transfers

1. Except under the circumstances envisaged in Article XII, a Member shall not apply restrictions

on international transfers and payments for current transactions relating to its specific commitments.

2. Nothing in this Agreement shall affect the rights and obligations of the members of the

International Monetary Fund under the Articles of Agreement of the Fund, including the use of exchange

actions which are in conformity with the Articles of Agreement, provided that a Member shall not impose

restrictions on any capital transactions inconsistently with its specific commitments regarding such

transactions, except under Article XII or at the request of the Fund.

Article XII

Restrictions to Safeguard the Balance of Payments

1. In the event of serious balance-of-payments and external financial difficulties or threat thereof,

a Member may adopt or maintain restrictions on trade in services on which it has undertaken specific

commitments, including on payments or transfers for transactions related to such commitments. It is

recognized that particular pressures on the balance of payments of a Member in the process of economic

development or economic transition may necessitate the use of restrictions to ensure, inter alia, the

maintenance of a level of financial reserves adequate for the implementation of its programme of

economic development or economic transition.

2. The restrictions referred to in paragraph 1:

(a) shall not discriminate among Members;

(b) shall be consistent with the Articles of Agreement of the International Monetary Fund;

(c) shall avoid unnecessary damage to the commercial, economic and financial interests

of any other Member;

(d) shall not exceed those necessary to deal with the circumstances described in paragraph 1;

(e) shall be temporary and be phased out progressively as the situation specified in paragraph

1 improves.

3. In determining the incidence of such restrictions, Members may give priority to the supply of

services which are more essential to their economic or development programmes. However, such

restrictions shall not be adopted or maintained for the purpose of protecting a particular service sector.

4. Any restrictions adopted or maintained under paragraph 1, or any changes therein, shall be

promptly notified to the General Council.

5. (a) Members applying the provisions of this Article shall consult promptly with the

Committee on Balance-of-Payments Restrictions on restrictions adopted under this Article.

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(b) The Ministerial Conference shall establish procedures4 for periodic consultations with

the objective of enabling such recommendations to be made to the Member concerned as it may deem

appropriate.

(c) Such consultations shall assess the balance-of-payment situation of the Member concerned

and the restrictions adopted or maintained under this Article, taking into account, inter alia, such factors

as:

(i) the nature and extent of the balance-of-payments and the external financial

difficulties;

(ii) the external economic and trading environment of the consulting Member;

(iii) alternative corrective measures which may be available.

(d) The consultations shall address the compliance of any restrictions with paragraph 2,

in particular the progressive phaseout of restrictions in accordance with paragraph 2(e).

(e) In such consultations, all findings of statistical and other facts presented by the

International Monetary Fund relating to foreign exchange, monetary reserves and balance of payments,

shall be accepted and conclusions shall be based on the assessment by the Fund of the balance-ofpayments

and the external financial situation of the consulting Member.

6. If a Member which is not a member of the International Monetary Fund wishes to apply the

provisions of this Article, the Ministerial Conference shall establish a review procedure and any other

procedures necessary.

Article XIII

Government Procurement

1. Articles II, XVI and XVII shall not apply to laws, regulations or requirements governing the

procurement by governmental agencies of services purchased for governmental purposes and not with

a view to commercial resale or with a view to use in the supply of services for commercial sale.

2. There shall be multilateral negotiations on government procurement in services under this

Agreement within two years from the date of entry into force of the WTO Agreement.

Article XIV

General Exceptions

Subject to the requirement that such measures are not applied in a manner which would constitute

a means of arbitrary or unjustifiable discrimination between countries where like conditions prevail,

or a disguised restriction on trade in services, nothing in this Agreement shall be construed to prevent

the adoption or enforcement by any Member of measures:

(a) necessary to protect public morals or to maintain public order;5

4It is understood that the procedures under paragraph 5 shall be the same as the GATT 1994 procedures.

5The public order exception may be invoked only where a genuine and sufficiently serious threat is posed to one of the

fundamental interests of society.

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(b) necessary to protect human, animal or plant life or health;

(c) necessary to secure compliance with laws or regulations which are not inconsistent

with the provisions of this Agreement including those relating to:

(i) the prevention of deceptive and fraudulent practices or to deal with the effects

of a default on services contracts;

(ii) the protection of the privacy of individuals in relation to the processing and

dissemination of personal data and the protection of confidentiality of

individual records and accounts;

(iii) safety;

(d) inconsistent with Article XVII, provided that the difference in treatment is aimed at

ensuring the equitable or effective6 imposition or collection of direct taxes in respect

of services or service suppliers of other Members;

(e) inconsistent with Article II, provided that the difference in treatment is the result of

an agreement on the avoidance of double taxation or provisions on the avoidance of

double taxation in any other international agreement or arrangement by which the

Member is bound.

Article XIV bis

Security Exceptions

1. Nothing in this Agreement shall be construed:

(a) to require any Member to furnish any information, the disclosure of which it considers

contrary to its essential security interests; or

6Measures that are aimed at ensuring the equitable or effective imposition or collection of direct taxes include measures

taken by a Member under its taxation system which:

(i) apply to non-resident service suppliers in recognition of the fact that the tax obligation of non-residents

is determined with respect to taxable items sourced or located in the Member's territory; or

(ii) apply to non-residents in order to ensure the imposition or collection of taxes in the Member's territory;

or

(iii) apply to non-residents or residents in order to prevent the avoidance or evasion of taxes, including

compliance measures; or

(iv) apply to consumers of services supplied in or from the territory of another Member in order to ensure

the imposition or collection of taxes on such consumers derived from sources in the Member's territory;

or

(v) distinguish service suppliers subject to tax on worldwide taxable items from other service suppliers, in

recognition of the difference in the nature of the tax base between them; or

(vi) determine, allocate or apportion income, profit, gain, loss, deduction or credit of resident persons or branches,

or between related persons or branches of the same person, in order to safeguard the Member's tax base.

Tax terms or concepts in paragraph (d) of Article XIV and in this footnote are determined according to tax definitions

and concepts, or equivalent or similar definitions and concepts, under the domestic law of the Member taking the measure.

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(b) to prevent any Member from taking any action which it considers necessary for the

protection of its essential security interests:

(i) relating to the supply of services as carried out directly or indirectly for the

purpose of provisioning a military establishment;

(ii) relating to fissionable and fusionable materials or the materials from which

they are derived;

(iii) taken in time of war or other emergency in international relations; or

(c) to prevent any Member from taking any action in pursuance of its obligations under

the United Nations Charter for the maintenance of international peace and security.

2. The Council for Trade in Services shall be informed to the fullest extent possible of measures

taken under paragraphs 1(b) and (c) and of their termination.

Article XV

Subsidies

1. Members recognize that, in certain circumstances, subsidies may have distortive effects on trade

in services. Members shall enter into negotiations with a view to developing the necessary multilateral

disciplines to avoid such trade-distortive effects.7 The negotiations shall also address the appropriateness

of countervailing procedures. Such negotiations shall recognize the role of subsidies in relation to the

development programmes of developing countries and take into account the needs of Members,

particularly developing country Members, for flexibility in this area. For the purpose of such negotiations,

Members shall exchange information concerning all subsidies related to trade in services that they provide

to their domestic service suppliers.

2. Any Member which considers that it is adversely affected by a subsidy of another Member

may request consultations with that Member on such matters. Such requests shall be accorded

sympathetic consideration.

7A future work programme shall determine how, and in what time-frame, negotiations on such multilateral disciplines

will be conducted.

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PART III

SPECIFIC COMMITMENTS

Article XVI

Market Access

1. With respect to market access through the modes of supply identified in Article I, each Member

shall accord services and service suppliers of any other Member treatment no less favourable than that

provided for under the terms, limitations and conditions agreed and specified in its Schedule.8

2. In sectors where market-access commitments are undertaken, the measures which a Member

shall not maintain or adopt either on the basis of a regional subdivision or on the basis of its entire

territory, unless otherwise specified in its Schedule, are defined as:

(a) limitations on the number of service suppliers whether in the form of numerical quotas,

monopolies, exclusive service suppliers or the requirements of an economic needs test;

(b) limitations on the total value of service transactions or assets in the form of numerical

quotas or the requirement of an economic needs test;

(c) limitations on the total number of service operations or on the total quantity of service

output expressed in terms of designated numerical units in the form of quotas or the

requirement of an economic needs test;9

(d) limitations on the total number of natural persons that may be employed in a particular

service sector or that a service supplier may employ and who are necessary for, and

directly related to, the supply of a specific service in the form of numerical quotas or

the requirement of an economic needs test;

(e) measures which restrict or require specific types of legal entity or joint venture through

which a service supplier may supply a service; and

(f) limitations on the participation of foreign capital in terms of maximum percentage limit

on foreign shareholding or the total value of individual or aggregate foreign investment.

8If a Member undertakes a market-access commitment in relation to the supply of a service through the mode of supply

referred to in subparagraph 2(a) of Article I and if the cross-border movement of capital is an essential part of the service

itself, that Member is thereby committed to allow such movement of capital. If a Member undertakes a market-access

commitment in relation to the supply of a service through the mode of supply referred to in subparagraph 2(c) of Article I,

it is thereby committed to allow related transfers of capital into its territory.

9Subparagraph 2(c) does not cover measures of a Member which limit inputs for the supply of services.

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Article XVII

National Treatment

1. In the sectors inscribed in its Schedule, and subject to any conditions and qualifications set

out therein, each Member shall accord to services and service suppliers of any other Member, in respect

of all measures affecting the supply of services, treatment no less favourable than that it accords to

its own like services and service suppliers.10

2. A Member may meet the requirement of paragraph 1 by according to services and service

suppliers of any other Member, either formally identical treatment or formally different treatment to

that it accords to its own like services and service suppliers.

3. Formally identical or formally different treatment shall be considered to be less favourable if

it modifies the conditions of competition in favour of services or service suppliers of the Member

compared to like services or service suppliers of any other Member.

Article XVIII

Additional Commitments

Members may negotiate commitments with respect to measures affecting trade in services not

subject to scheduling under Articles XVI or XVII, including those regarding qualifications, standards

or licensing matters. Such commitments shall be inscribed in a Member's Schedule.

PART IV

PROGRESSIVE LIBERALIZATION

Article XIX

Negotiation of Specific Commitments

1. In pursuance of the objectives of this Agreement, Members shall enter into successive rounds

of negotiations, beginning not later than five years from the date of entry into force of the WTO

Agreement and periodically thereafter, with a view to achieving a progressively higher level of

liberalization. Such negotiations shall be directed to the reduction or elimination of the adverse effects

on trade in services of measures as a means of providing effective market access. This process shall

take place with a view to promoting the interests of all participants on a mutually advantageous basis

and to securing an overall balance of rights and obligations.

2. The process of liberalization shall take place with due respect for national policy objectives

and the level of development of individual Members, both overall and in individual sectors. There

shall be appropriate flexibility for individual developing country Members for opening fewer sectors,

liberalizing fewer types of transactions, progressively extending market access in line with their

development situation and, when making access to their markets available to foreign service suppliers,

attaching to such access conditions aimed at achieving the objectives referred to in Article IV.

10Specific commitments assumed under this Article shall not be construed to require any Member to compensate for any

inherent competitive disadvantages which result from the foreign character of the relevant services or service suppliers.

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3. For each round, negotiating guidelines and procedures shall be established. For the purposes

of establishing such guidelines, 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. Negotiating guidelines shall establish modalities

for the treatment of liberalization undertaken autonomously by Members since previous negotiations,

as well as for the special treatment for least-developed country Members under the provisions of

paragraph 3 of Article IV.

4. The process of progressive liberalization shall be advanced in each such round through bilateral,

plurilateral or multilateral negotiations directed towards increasing the general level of specific

commitments undertaken by Members under this Agreement.

Article XX

Schedules of Specific Commitments

1. Each Member shall set out in a schedule the specific commitments it undertakes under Part III

of this Agreement. With respect to sectors where such commitments are undertaken, each Schedule

shall specify:

(a) terms, limitations and conditions on market access;

(b) conditions and qualifications on national treatment;

(c) undertakings relating to additional commitments;

(d) where appropriate the time-frame for implementation of such commitments; and

(e) the date of entry into force of such commitments.

2. Measures inconsistent with both Articles XVI and XVII shall be inscribed in the column relating

to Article XVI. In this case the inscription will be considered to provide a condition or qualification

to Article XVII as well.

3. Schedules of specific commitments shall be annexed to this Agreement and shall form an integral

part thereof.

Article XXI

Modification of Schedules

1. (a) A Member (referred to in this Article as the "modifying Member") may modify or

withdraw any commitment in its Schedule, at any time after three years have elapsed from the date

on which that commitment entered into force, in accordance with the provisions of this Article.

(b) A modifying Member shall notify its intent to modify or withdraw a commitment pursuant

to this Article to the Council for Trade in Services no later than three months before the intended date

of implementation of the modification or withdrawal.

2. (a) At the request of any Member the benefits of which under this Agreement may be affected

(referred to in this Article as an "affected Member") by a proposed modification or withdrawal notified

under subparagraph 1(b), the modifying Member shall enter into negotiations with a view to reaching

agreement on any necessary compensatory adjustment. In such negotiations and agreement, the Members

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concerned shall endeavour to maintain a general level of mutually advantageous commitments not less

favourable to trade than that provided for in Schedules of specific commitments prior to such negotiations.

(b) Compensatory adjustments shall be made on a most-favoured-nation basis.

3. (a) If agreement is not reached between the modifying Member and any affected Member

before the end of the period provided for negotiations, such affected Member may refer the matter to

arbitration. Any affected Member that wishes to enforce a right that it may have to compensation must

participate in the arbitration.

(b) If no affected Member has requested arbitration, the modifying Member shall be free

to implement the proposed modification or withdrawal.

4. (a) The modifying Member may not modify or withdraw its commitment until it has made

compensatory adjustments in conformity with the findings of the arbitration.

(b) If the modifying Member implements its proposed modification or withdrawal and does

not comply with the findings of the arbitration, any affected Member that participated in the arbitration

may modify or withdraw substantially equivalent benefits in conformity with those findings.

Notwithstanding Article II, such a modification or withdrawal may be implemented solely with respect

to the modifying Member.

5. The Council for Trade in Services shall establish procedures for rectification or modification

of Schedules. Any Member which has modified or withdrawn scheduled commitments under this Article

shall modify its Schedule according to such procedures.

PART V

INSTITUTIONAL PROVISIONS

Article XXII

Consultation

1. Each Member shall accord sympathetic consideration to, and shall afford adequate opportunity

for, consultation regarding such representations as may be made by any other Member with respect

to any matter affecting the operation of this Agreement. The Dispute Settlement Understanding (DSU)

shall apply to such consultations.

2. The Council for Trade in Services or the Dispute Settlement Body (DSB) may, at the request

of a Member, consult with any Member or Members in respect of any matter for which it has not been

possible to find a satisfactory solution through consultation under paragraph 1.

3. A Member may not invoke Article XVII, either under this Article or Article XXIII, with respect

to a measure of another Member that falls within the scope of an international agreement between them

relating to the avoidance of double taxation. In case of disagreement between Members as to whether

a measure falls within the scope of such an agreement between them, it shall be open to either Member

to bring this matter before the Council for Trade in Services.11 The Council shall refer the matter to

arbitration. The decision of the arbitrator shall be final and binding on the Members.

11With respect to agreements on the avoidance of double taxation which exist on the date of entry into force of the WTO

Agreement, such a matter may be brought before the Council for Trade in Services only with the consent of both parties to

such an agreement.

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Article XXIII

Dispute Settlement and Enforcement

1. If any Member should consider that any other Member fails to carry out its obligations or specific

commitments under this Agreement, it may with a view to reaching a mutually satisfactory resolution

of the matter have recourse to the DSU.

2. If the DSB considers that the circumstances are serious enough to justify such action, it may

authorize a Member or Members to suspend the application to any other Member or Members of

obligations and specific commitments in accordance with Article 22 of the DSU.

3. If any Member considers that any benefit it could reasonably have expected to accrue to it under

a specific commitment of another Member under Part III of this Agreement is being nullified or impaired

as a result of the application of any measure which does not conflict with the provisions of this

Agreement, it may have recourse to the DSU. If the measure is determined by the DSB to have nullified

or impaired such a benefit, the Member affected shall be entitled to a mutually satisfactory adjustment

on the basis of paragraph 2 of Article XXI, which may include the modification or withdrawal of the

measure. In the event an agreement cannot be reached between the Members concerned, Article 22

of the DSU shall apply.

Article XXIV

Council for Trade in Services

1. The Council for Trade in Services shall carry out such functions as may be assigned to it to

facilitate the operation of this Agreement and further its objectives. The Council may establish such

subsidiary bodies as it considers appropriate for the effective discharge of its functions.

2. The Council and, unless the Council decides otherwise, its subsidiary bodies shall be open to

participation by representatives of all Members.

3. The Chairman of the Council shall be elected by the Members.

Article XXV

Technical Cooperation

1. Service suppliers of Members which are in need of such assistance shall have access to the

services of contact points referred to in paragraph 2 of Article IV.

2. Technical assistance to developing countries shall be provided at the multilateral level by the

Secretariat and shall be decided upon by the Council for Trade in Services.

Article XXVI

Relationship with Other International Organizations

The General Council shall make appropriate arrangements for consultation and cooperation

with the United Nations and its specialized agencies as well as with other intergovernmental organizations

concerned with services.

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PART VI

FINAL PROVISIONS

Article XXVII

Denial of Benefits

A Member may deny the benefits of this Agreement:

(a) to the supply of a service, if it establishes that the service is supplied from or in the

territory of a non-Member or of a Member to which the denying Member does not

apply the WTO Agreement;

(b) in the case of the supply of a maritime transport service, if it establishes that the service

is supplied:

(i) by a vessel registered under the laws of a non-Member or of a Member to

which the denying Member does not apply the WTO Agreement, and

(ii) by a person which operates and/or uses the vessel in whole or in part but

which is of a non-Member or of a Member to which the denying Member

does not apply the WTO Agreement;

(c) to a service supplier that is a juridical person, if it establishes that it is not a service

supplier of another Member, or that it is a service supplier of a Member to which the

denying Member does not apply the WTO Agreement.

Article XXVIII

Definitions

For the purpose of this Agreement:

(a) "measure" means any measure by a Member, whether in the form of a law, regulation,

rule, procedure, decision, administrative action, or any other form;

(b) "supply of a service" includes the production, distribution, marketing, sale and delivery

of a service;

(c) "measures by Members affecting trade in services" include measures in respect of

(i) the purchase, payment or use of a service;

(ii) the access to and use of, in connection with the supply of a service, services

which are required by those Members to be offered to the public generally;

(iii) the presence, including commercial presence, of persons of a Member for

the supply of a service in the territory of another Member;

(d) "commercial presence" means any type of business or professional establishment,

including through

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(i) the constitution, acquisition or maintenance of a juridical person, or

(ii) the creation or maintenance of a branch or a representative office,

within the territory of a Member for the purpose of supplying a service;

(e) "sector" of a service means,

(i) with reference to a specific commitment, one or more, or all, subsectors of

that service, as specified in a Member's Schedule,

(ii) otherwise, the whole of that service sector, including all of its subsectors;

(f) "service of another Member" means a service which is supplied,

(i) from or in the territory of that other Member, or in the case of maritime

transport, by a vessel registered under the laws of that other Member, or by

a person of that other Member which supplies the service through the operation

of a vessel and/or its use in whole or in part; or

(ii) in the case of the supply of a service through commercial presence or through

the presence of natural persons, by a service supplier of that other Member;

(g) "service supplier" means any person that supplies a service;12

(h) "monopoly supplier of a service" means any person, public or private, which in the

relevant market of the territory of a Member is authorized or established formally or

in effect by that Member as the sole supplier of that service;

(i) "service consumer" means any person that receives or uses a service;

(j) "person" means either a natural person or a juridical person;

(k) "natural person of another Member" means a natural person who resides in the territory

of that other Member or any other Member, and who under the law of that other

Member:

(i) is a national of that other Member; or

(ii) has the right of permanent residence in that other Member, in the case of a

Member which:

1. does not have nationals; or

2. accords substantially the same treatment to its permanent residents

as it does to its nationals in respect of measures affecting trade in

services, as notified in its acceptance of or accession to the WTO

Agreement, provided that no Member is obligated to accord to such

permanent residents treatment more favourable than would be

12Where the service is not supplied directly by a juridical person but through other forms of commercial presence such

as a branch or a representative office, the service supplier (i.e. the juridical person) shall, nonetheless, through such presence

be accorded the treatment provided for service suppliers under the Agreement. Such treatment shall be extended to the presence

through which the service is supplied and need not be extended to any other parts of the supplier located outside the territory

where the service is supplied.

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accorded by that other Member to such permanent residents. Such

notification shall include the assurance to assume, with respect to

those permanent residents, in accordance with its laws and regulations,

the same responsibilities that other Member bears with respect to its

nationals;

(l) "juridical person" means any legal entity duly constituted or otherwise organized under

applicable law, whether for profit or otherwise, and whether privately-owned or

governmentally-owned, including any corporation, trust, partnership, joint venture, sole

proprietorship or association;

(m) "juridical person of another Member" means a juridical person which is either:

(i) constituted or otherwise organized under the law of that other Member, and

is engaged in substantive business operations in the territory of that Member

or any other Member; or

(ii) in the case of the supply of a service through commercial presence, owned

or controlled by:

1. natural persons of that Member; or

2. juridical persons of that other Member identified under

subparagraph (i);

(n) a juridical person is:

(i) "owned" by persons of a Member if more than 50 per cent of the equity

interest in it is beneficially owned by persons of that Member;

(ii) "controlled" by persons of a Member if such persons have the power to name

a majority of its directors or otherwise to legally direct its actions;

(iii) "affiliated" with another person when it controls, or is controlled by, that other

person; or when it and the other person are both controlled by the same

person;

(o) "direct taxes" comprise all taxes on total income, on total capital or on elements of

income or of capital, including taxes on gains from the alienation of property, taxes

on estates, inheritances and gifts, and taxes on the total amounts of wages or salaries

paid by enterprises, as well as taxes on capital appreciation.

Article XXIX

Annexes

The Annexes to this Agreement are an integral part of this Agreement.

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ANNEX ON ARTICLE II EXEMPTIONS

Scope

1. This Annex specifies the conditions under which a Member, at the entry into force of this

Agreement, is exempted from its obligations under paragraph 1 of Article II.

2. Any new exemptions applied for after the date of entry into force of the WTO Agreement shall

be dealt with under paragraph 3 of Article IX of that Agreement.

Review

3. The Council for Trade in Services shall review all exemptions granted for a period of more

than 5 years. The first such review shall take place no more than 5 years after the entry into force

of the WTO Agreement.

4. The Council for Trade in Services in a review shall:

(a) examine whether the conditions which created the need for the exemption still prevail;

and

(b) determine the date of any further review.

Termination

5. The exemption of a Member from its obligations under paragraph 1 of Article II of the Agreement

with respect to a particular measure terminates on the date provided for in the exemption.

6. In principle, such exemptions should not exceed a period of 10 years. In any event, they shall

be subject to negotiation in subsequent trade liberalizing rounds.

7. A Member shall notify the Council for Trade in Services at the termination of the exemption

period that the inconsistent measure has been brought into conformity with paragraph 1 of Article II

of the Agreement.

Lists of Article II Exemptions

[The agreed lists of exemptions under paragraph 2 of Article II will be annexed here in the treaty copy

of the WTO Agreement.]

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ANNEX ON MOVEMENT OF NATURAL PERSONS

SUPPLYING SERVICES UNDER THE AGREEMENT

1. This Annex applies to measures affecting natural persons who are service suppliers of a Member,

and natural persons of a Member who are employed by a service supplier of a Member, in respect of

the supply of a service.

2. The Agreement shall not apply to measures affecting natural persons seeking access to the

employment market of a Member, nor shall it apply to measures regarding citizenship, residence or

employment on a permanent basis.

3. In accordance with Parts III and IV of the Agreement, Members may negotiate specific

commitments applying to the movement of all categories of natural persons supplying services under

the Agreement. Natural persons covered by a specific commitment shall be allowed to supply the service

in accordance with the terms of that commitment.

4. The Agreement shall not prevent a Member from applying measures to regulate the entry of

natural persons into, or their temporary stay in, its territory, including those measures necessary to protect

the integrity of, and to ensure the orderly movement of natural persons across, its borders, provided

that such measures are not applied in such a manner as to nullify or impair the benefits accruing to

any Member under the terms of a specific commitment.1

1The sole fact of requiring a visa for natural persons of certain Members and not for those of others shall not be regarded

as nullifying or impairing benefits under a specific commitment.

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ANNEX ON AIR TRANSPORT SERVICES

1. This Annex applies to measures affecting trade in air transport services, whether scheduled

or non-scheduled, and ancillary services. It is confirmed that any specific commitment or obligation

assumed under this Agreement shall not reduce or affect a Member's obligations under bilateral or

multilateral agreements that are in effect on the date of entry into force of the WTO Agreement.

2. The Agreement, including its dispute settlement procedures, shall not apply to measures affecting:

(a) traffic rights, however granted; or

(b) services directly related to the exercise of traffic rights,

except as provided in paragraph 3 of this Annex.

3. The Agreement shall apply to measures affecting:

(a) aircraft repair and maintenance services;

(b) the selling and marketing of air transport services;

(c) computer reservation system (CRS) services.

4. The dispute settlement procedures of the Agreement may be invoked only where obligations

or specific commitments have been assumed by the concerned Members and where dispute settlement

procedures in bilateral and other multilateral agreements or arrangements have been exhausted.

5. The Council for Trade in Services shall review periodically, and at least every five years,

developments in the air transport sector and the operation of this Annex with a view to considering

the possible further application of the Agreement in this sector.

6. Definitions:

(a) "Aircraft repair and maintenance services" mean such activities when undertaken on

an aircraft or a part thereof while it is withdrawn from service and do not include so-called line

maintenance.

(b) "Selling and marketing of air transport services" mean opportunities for the air carrier

concerned to sell and market freely its air transport services including all aspects of marketing such

as market research, advertising and distribution. These activities do not include the pricing of air transport

services nor the applicable conditions.

(c) "Computer reservation system (CRS) services" mean services provided by computerised

systems that contain information about air carriers' schedules, availability, fares and fare rules, through

which reservations can be made or tickets may be issued.

(d) "Traffic rights" mean the right for scheduled and non-scheduled services to operate

and/or to carry passengers, cargo and mail for remuneration or hire from, to, within, or over the territory

of a Member, including points to be served, routes to be operated, types of traffic to be carried, capacity

to be provided, tariffs to be charged and their conditions, and criteria for designation of airlines, including

such criteria as number, ownership, and control.

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ANNEX ON FINANCIAL SERVICES

1. Scope and Definition

(a) This Annex applies to measures affecting the supply of financial services. Reference

to the supply of a financial service in this Annex shall mean the supply of a service as defined in

paragraph 2 of Article I of the Agreement.

(b) For the purposes of subparagraph 3(b) of Article I of the Agreement, "services supplied

in the exercise of governmental authority" means the following:

(i) activities conducted by a central bank or monetary authority or by any other

public entity in pursuit of monetary or exchange rate policies;

(ii) activities forming part of a statutory system of social security or public

retirement plans; and

(iii) other activities conducted by a public entity for the account or with the

guarantee or using the financial resources of the Government.

(c) For the purposes of subparagraph 3(b) of Article I of the Agreement, if a Member allows

any of the activities referred to in subparagraphs (b)(ii) or (b)(iii) of this paragraph to be conducted

by its financial service suppliers in competition with a public entity or a financial service supplier,

"services" shall include such activities.

(d) Subparagraph 3(c) of Article I of the Agreement shall not apply to services covered

by this Annex.

2. Domestic Regulation

(a) Notwithstanding any other provisions of the Agreement, a Member shall not be prevented

from taking measures for prudential reasons, including for the protection of investors, depositors, policy

holders or persons to whom a fiduciary duty is owed by a financial service supplier, or to ensure the

integrity and stability of the financial system. Where such measures do not conform with the provisions

of the Agreement, they shall not be used as a means of avoiding the Member's commitments or

obligations under the Agreement.

(b) Nothing in the Agreement shall be construed to require a Member to disclose information

relating to the affairs and accounts of individual customers or any confidential or proprietary information

in the possession of public entities.

3. Recognition

(a) A Member may recognize prudential measures of any other country in determining

how the Member's measures relating to financial services shall be applied. Such recognition, which

may be achieved through harmonization or otherwise, may be based upon an agreement or arrangement

with the country concerned or may be accorded autonomously.

(b) A Member that is a party to such an agreement or arrangement referred to in

subparagraph (a), whether future or existing, shall afford adequate opportunity for other interested

Members to negotiate their accession to such agreements or arrangements, or to negotiate comparable

ones with it, under circumstances in which there would be equivalent regulation, oversight, implementation

of such regulation, and, if appropriate, procedures concerning the sharing of information between the

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parties to the agreement or arrangement. Where a Member accords recognition autonomously, it shall

afford adequate opportunity for any other Member to demonstrate that such circumstances exist.

(c) Where a Member is contemplating according recognition to prudential measures of

any other country, paragraph 4(b) of Article VII shall not apply.

4. Dispute Settlement

Panels for disputes on prudential issues and other financial matters shall have the necessary

expertise relevant to the specific financial service under dispute.

5. Definitions

For the purposes of this Annex:

(a) A financial service is any service of a financial nature offered by a financial service

supplier of a Member. Financial services include all insurance and insurance-related services, and all

banking and other financial services (excluding insurance). Financial services include the following

activities:

Insurance and insurance-related services

(i) Direct insurance (including co-insurance):

(A) life

(B) non-life

(ii) Reinsurance and retrocession;

(iii) Insurance intermediation, such as brokerage and agency;

(iv) Services auxiliary to insurance, such as consultancy, actuarial, risk assessment

and claim settlement services.

Banking and other financial services (excluding insurance)

(v) Acceptance of deposits and other repayable funds from the public;

(vi) Lending of all types, including consumer credit, mortgage credit, factoring

and financing of commercial transaction;

(vii) Financial leasing;

(viii) All payment and money transmission services, including credit, charge and

debit cards, travellers cheques and bankers drafts;

(ix) Guarantees and commitments;

(x) Trading for own account or for account of customers, whether on an exchange,

in an over-the-counter market or otherwise, the following:

(A) money market instruments (including cheques, bills, certificates of

deposits);

(B) foreign exchange;

(C) derivative products including, but not limited to, futures and options;

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(D) exchange rate and interest rate instruments, including products such

as swaps, forward rate agreements;

(E) transferable securities;

(F) other negotiable instruments and financial assets, including bullion.

(xi) Participation in issues of all kinds of securities, including underwriting and

placement as agent (whether publicly or privately) and provision of services

related to such issues;

(xii) Money broking;

(xiii) Asset management, such as cash or portfolio management, all forms of

collective investment management, pension fund management, custodial,

depository and trust services;

(xiv) Settlement and clearing services for financial assets, including securities,

derivative products, and other negotiable instruments;

(xv) Provision and transfer of financial information, and financial data processing

and related software by suppliers of other financial services;

(xvi) Advisory, intermediation and other auxiliary financial services on all the

activities listed in subparagraphs (v) through (xv), including credit reference

and analysis, investment and portfolio research and advice, advice on

acquisitions and on corporate restructuring and strategy.

(b) A financial service supplier means any natural or juridical person of a Member wishing

to supply or supplying financial services but the term "financial service supplier" does not include a

public entity.

(c) "Public entity" means:

(i) a government, a central bank or a monetary authority, of a Member, or an

entity owned or controlled by a Member, that is principally engaged in carrying

out governmental functions or activities for governmental purposes, not

including an entity principally engaged in supplying financial services on

commercial terms; or

(ii) a private entity, performing functions normally performed by a central bank

or monetary authority, when exercising those functions.

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SECOND ANNEX ON FINANCIAL SERVICES

1. Notwithstanding Article II of the Agreement and paragraphs 1 and 2 of the Annex on Article II

Exemptions, a Member may, during a period of 60 days beginning four months after the date of entry

into force of the WTO Agreement, list in that Annex measures relating to financial services which are

inconsistent with paragraph 1 of Article II of the Agreement.

2. Notwithstanding Article XXI of the Agreement, a Member may, during a period of 60 days

beginning four months after the date of entry into force of the WTO Agreement, improve, modify or

withdraw all or part of the specific commitments on financial services inscribed in its Schedule.

3. The Council for Trade in Services shall establish any procedures necessary for the application

of paragraphs 1 and 2.

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ANNEX ON NEGOTIATIONS ON MARITIME TRANSPORT SERVICES

1. Article II and the Annex on Article II Exemptions, including the requirement to list in the Annex

any measure inconsistent with most-favoured-nation treatment that a Member will maintain, shall enter

into force for international shipping, auxiliary services and access to and use of port facilities only on:

(a) the implementation date to be determined under paragraph 4 of the Ministerial Decision

on Negotiations on Maritime Transport Services; or,

(b) should the negotiations not succeed, the date of the final report of the Negotiating Group

on Maritime Transport Services provided for in that Decision.

2. Paragraph 1 shall not apply to any specific commitment on maritime transport services which

is inscribed in a Member's Schedule.

3. From the conclusion of the negotiations referred to in paragraph 1, and before the implementation

date, a Member may improve, modify or withdraw all or part of its specific commitments in this sector

without offering compensation, notwithstanding the provisions of Article XXI.

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ANNEX ON TELECOMMUNICATIONS

1. Objectives

Recognizing the specificities of the telecommunications services sector and, in particular, its

dual role as a distinct sector of economic activity and as the underlying transport means for other

economic activities, the Members have agreed to the following Annex with the objective of elaborating

upon the provisions of the Agreement with respect to measures affecting access to and use of public

telecommunications transport networks and services. Accordingly, this Annex provides notes and

supplementary provisions to the Agreement.

2. Scope

(a) This Annex shall apply to all measures of a Member that affect access to and use of

public telecommunications transport networks and services.1

(b) This Annex shall not apply to measures affecting the cable or broadcast distribution

of radio or television programming.

(c) Nothing in this Annex shall be construed:

(i) to require a Member to authorize a service supplier of any other Member

to establish, construct, acquire, lease, operate, or supply telecommunications

transport networks or services, other than as provided for in its Schedule;

or

(ii) to require a Member (or to require a Member to oblige service suppliers under

its jurisdiction) to establish, construct, acquire, lease, operate or supply

telecommunications transport networks or services not offered to the public

generally.

3. Definitions

For the purposes of this Annex:

(a) "Telecommunications" means the transmission and reception of signals by any

electromagnetic means.

(b) "Public telecommunications transport service" means any telecommunications transport

service required, explicitly or in effect, by a Member to be offered to the public generally. Such services

may include, inter alia, telegraph, telephone, telex, and data transmission typically involving the real-time

transmission of customer-supplied information between two or more points without any end-to-end

change in the form or content of the customer's information.

(c) "Public telecommunications transport network" means the public telecommunications

infrastructure which permits telecommunications between and among defined network termination points.

(d) "Intra-corporate communications" means telecommunications through which a company

communicates within the company or with or among its subsidiaries, branches and, subject to a Member's

domestic laws and regulations, affiliates. For these purposes, "subsidiaries", "branches" and, where

1This paragraph is understood to mean that each Member shall ensure that the obligations of this Annex are applied with

respect to suppliers of public telecommunications transport networks and services by whatever measures are necessary.

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applicable, "affiliates" shall be as defined by each Member. "Intra-corporate communications" in this

Annex excludes commercial or non-commercial services that are supplied to companies that are not

related subsidiaries, branches or affiliates, or that are offered to customers or potential customers.

(e) Any reference to a paragraph or subparagraph of this Annex includes all subdivisions

thereof.

4. Transparency

In the application of Article III of the Agreement, each Member shall ensure that relevant

information on conditions affecting access to and use of public telecommunications transport networks

and services is publicly available, including: tariffs and other terms and conditions of service;

specifications of technical interfaces with such networks and services; information on bodies responsible

for the preparation and adoption of standards affecting such access and use; conditions applying to

attachment of terminal or other equipment; and notifications, registration or licensing requirements,

if any.

5. Access to and use of Public Telecommunications Transport Networks and Services

(a) Each Member shall ensure that any service supplier of any other Member is accorded

access to and use of public telecommunications transport networks and services on reasonable and nondiscriminatory

terms and conditions, for the supply of a service included in its Schedule. This obligation

shall be applied, inter alia, through paragraphs (b) through (f).2

(b) Each Member shall ensure that service suppliers of any other Member have access to

and use of any public telecommunications transport network or service offered within or across the

border of that Member, including private leased circuits, and to this end shall ensure, subject to

paragraphs (e) and (f), that such suppliers are permitted:

(i) to purchase or lease and attach terminal or other equipment which interfaces

with the network and which is necessary to supply a supplier's services;

(ii) to interconnect private leased or owned circuits with public telecommunications

transport networks and services or with circuits leased or owned by another

service supplier; and

(iii) to use operating protocols of the service supplier's choice in the supply of

any service, other than as necessary to ensure the availability of

telecommunications transport networks and services to the public generally.

(c) Each Member shall ensure that service suppliers of any other Member may use public

telecommunications transport networks and services for the movement of information within and across

borders, including for intra-corporate communications of such service suppliers, and for access to

information contained in data bases or otherwise stored in machine-readable form in the territory of

any Member. Any new or amended measures of a Member significantly affecting such use shall be

notified and shall be subject to consultation, in accordance with relevant provisions of the Agreement.

(d) Notwithstanding the preceding paragraph, a Member may take such measures as are

necessary to ensure the security and confidentiality of messages, subject to the requirement that such

measures are not applied in a manner which would constitute a means of arbitrary or unjustifiable

discrimination or a disguised restriction on trade in services.

2The term "non-discriminatory" is understood to refer to most-favoured-nation and national treatment as defined in the

Agreement, as well as to reflect sector-specific usage of the term to mean "terms and conditions no less favourable than those

accorded to any other user of like public telecommunications transport networks or services under like circumstances".

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(e) Each Member shall ensure that no condition is imposed on access to and use of public

telecommunications transport networks and services other than as necessary:

(i) to safeguard the public service responsibilities of suppliers of public

telecommunications transport networks and services, in particular their ability

to make their networks or services available to the public generally;

(ii) to protect the technical integrity of public telecommunications transport

networks or services; or

(iii) to ensure that service suppliers of any other Member do not supply services

unless permitted pursuant to commitments in the Member's Schedule.

(f) Provided that they satisfy the criteria set out in paragraph (e), conditions for access

to and use of public telecommunications transport networks and services may include:

(i) restrictions on resale or shared use of such services;

(ii) a requirement to use specified technical interfaces, including interface

protocols, for inter-connection with such networks and services;

(iii) requirements, where necessary, for the inter-operability of such services and

to encourage the achievement of the goals set out in paragraph 7(a);

(iv) type approval of terminal or other equipment which interfaces with the network

and technical requirements relating to the attachment of such equipment to

such networks;

(v) restrictions on inter-connection of private leased or owned circuits with such

networks or services or with circuits leased or owned by another service

supplier; or

(vi) notification, registration and licensing.

(g) Notwithstanding the preceding paragraphs of this section, a developing country Member

may, consistent with its level of development, place reasonable conditions on access to and use of public

telecommunications transport networks and services necessary to strengthen its domestic

telecommunications infrastructure and service capacity and to increase its participation in international

trade in telecommunications services. Such conditions shall be specified in the Member's Schedule.

6. Technical Cooperation

(a) Members recognize that an efficient, advanced telecommunications infrastructure in

countries, particularly developing countries, is essential to the expansion of their trade in services.

To this end, Members endorse and encourage the participation, to the fullest extent practicable, of

developed and developing countries and their suppliers of public telecommunications transport networks

and services and other entities in the development programmes of international and regional organizations,

including the International Telecommunication Union, the United Nations Development Programme,

and the International Bank for Reconstruction and Development.

(b) Members shall encourage and support telecommunications cooperation among developing

countries at the international, regional and sub-regional levels.

(c) In cooperation with relevant international organizations, Members shall make available,

where practicable, to developing countries information with respect to telecommunications services

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and developments in telecommunications and information technology to assist in strengthening their

domestic telecommunications services sector.

(d) Members shall give special consideration to opportunities for the least-developed countries

to encourage foreign suppliers of telecommunications services to assist in the transfer of technology,

training and other activities that support the development of their telecommunications infrastructure

and expansion of their telecommunications services trade.

7. Relation to International Organizations and Agreements

(a) Members recognize the importance of international standards for global compatibility

and inter-operability of telecommunication networks and services and undertake to promote such standards

through the work of relevant international bodies, including the International Telecommunication Union

and the International Organization for Standardization.

(b) Members recognize the role played by intergovernmental and non-governmental

organizations and agreements in ensuring the efficient operation of domestic and global

telecommunications services, in particular the International Telecommunication Union. Members shall

make appropriate arrangements, where relevant, for consultation with such organizations on matters

arising from the implementation of this Annex.

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ANNEX ON NEGOTIATIONS ON BASIC TELECOMMUNICATIONS

1. Article II and the Annex on Article II Exemptions, including the requirement to list in the Annex

any measure inconsistent with most-favoured-nation treatment that a Member will maintain, shall enter

into force for basic telecommunications only on:

(a) the implementation date to be determined under paragraph 5 of the Ministerial Decision

on Negotiations on Basic Telecommunications; or,

(b) should the negotiations not succeed, the date of the final report of the Negotiating Group

on Basic Telecommunications provided for in that Decision.

2. Paragraph 1 shall not apply to any specific commitment on basic telecommunications which

is inscribed in a Member's Schedule.