RESTRICTEDWORLD TRADE
ORGANIZATIONS/WPDR/M/1
14 June 1999
(99-2392)
Working Party on Domestic Regulation
REPORT ON THE MEETIN G HELD ON 17 MAY 1999
Note by the Secretariat
1. The Working Party on Domestic Regulation held its first meeting on 17 May 1999, under the
chairmanship of Paul Robertson of Canada following the transfer from Michael Stone of Hong Kong,
China.  The agenda for the meeting was contained in airgram WTO/AIR/1085.  The major item on theagenda, in addition to the selection of the Chairperson and approving the participation of Observers,
was the discussion of future work.
(a) Appointment of Chairperson
2. The meeting was opened by Michael Stone of Hong Kong, China, who had served as
Chairperson of the Working Party on Professional Services (WPPS).  Mr. Stone noted that the
Council for Trade in Services had previously agreed that Paul Robertson of Canada would be the next
Chairperson of the WPPS.  Since the Working Party on Domestic Regulation effectively replaced the
WPPS, he proposed that Mr. Robertson be appointed as the first Chairperson of the new Working
Party on Domestic Regulation.  The proposal was accepted by all Members.
(b) Participation of Observers
3. The Chairperson stated that Observer status had been granted in the Working Party on
Professional Services to the UN, UNCTAD, IMF, World Bank, OECD and ACP.  He suggested that
the Working Party on Domestic Regulation grant Observer status to these same organizations.  The
suggestion was accepted.
4. For the record, the Chairperson stated that meetings of the Working Party on Domestic
Regulation were open to Members of the WTO, other governments with Observer status, and the UN,
UNCTAD, IMF, World Bank, OECD and ACP.
(c) Discussion of Future Work
5. The discussion of future work was initiated by the Chairperson, on the basis of the Secretariat
paper S/C/W/96 and an informal Chairperson's Note (Job No. 2800).  The discussion was held in
informal mode, and included initial comments on the four concepts discussed in the Secretariat paper,
i.e. necessity, transparency, equivalence and inte rnational standards, regarding the development of
horizontally applicable disciplines on domestic regulation.
6. In general, the main comments by delegations were that work should focus on the
development of horizontally applicable disciplines for all services sectors, and that attention should
first be given to the concepts of necessity and transparency.  Most Members felt that the accountancy
disciplines developed by the Working Party on Professional Services could serve as a good starting-point;  some felt a wider perspective would be useful.  There was some divergence of views as to
whether the disciplines should be applicable only in sectors where Members have made specific
commitments, or whether they should be applicable unconditionally to all sectors;  most delegations,
however, agreed that a decision on this point was not urgently required.S/WPDR/M/1
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Necessity
7. Many delegations stated that the necessity test was a crucial issue and, together with
transparency, should be the major priority for initial discussions by the Working Party.  It wasimportant to provide clarity to the requirements of "least trade restrictive" and "not more burdensome
than necessary".  The Secretariat paper S/C/W/96 and the informal Chairperson's Note were felt to be
useful starting points for the discussions.
Transparency
8. Transparency issues were of great interest to Members.  Several delegations suggested that
the requirements of GATS Article III and Article VI were not in conflict.  Other delegations said the
relationship between these two Articles needed to be further discussed.  A number of delegations said
they were not convinced by the view expressed in para. 31 of the Secretariat paper S/C/W/96 that
some of the transparency measures from the accountancy disciplines may not be applicable
horizontally.
Equivalency
9. On equivalency, some delegations stated this concept is less likely to be applicable
horizontally.  One delegation stated that equivalency primarily concerned GATS Article VII.  Anumber of Members observed that additional information was required in respect to both equivalency
and international standards.
International Standards
10. The issues of voluntary versus mandatory standards, and of technical versus performance
standards, were raised by delegations as areas for further discussion.  One delegation enquired
whether information concerning performance standards, and the recognized standards-setting bodies
at the sectoral level, was available from the ISO.
(d) Dates of Next Meeting
11. The Chairperson stated that an informal meeting would be held in June, before the next
formal meeting in July (dates to be determined).
(e) Other Business
12. The delegate of Hong Kong, China, not wishing to lose the momentum gained from the
WPPS negotiations, introduced an informal paper on further horizontal work in professional services
(Job No. 2784).  The paper recommends that Members circulate the accountancy disciplines created
by the WPPS to their respective domestic professional organizations, seeking comments on the
horizontal applicability across other professional services.  The delegate noted that some Members
were already consulting informally with their domestic professional services organizations, and thatthis work would be an adjunct to the general work of the Working Party on Article VI:4.  The paper
suggested a common format for contacting domestic organizations.  In respect to international
professional services organizations, the Secretariat could contact an agreed list of such organizations
on the behalf of Members.
13. The delegations of Switzerland, Japan, Australia, Canada, the European Communities, the
United States, Guatemala, and Norway expressed generally favorable initial reactions to the Hong
Kong, China proposal.  Canada and the United States  stated their concerns that direct consultations
with international professional organizations might cause misunderstandings over their participationS/WPDR/M/1
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in the development of future regulatory disciplines.  They also enquired as to which professions
would be consulted, the timing of consultation and the role of the Secretariat in respect to the
information collected.  The delegate of the European Communities stated she was somewhat less
concerned about the possibility of referring to international bodies, as there would be a balance ofinterests.  The delegate said the consultations should include all professions.
14. The delegation of Hong Kong, China commented that it would seem logical to consult with
all the professions listed in the Services Sectoral Cl assification List (W/120).  Input from international
organizations would be important.  Members could decide which domestic organizations to contact,
and would be responsible for collecting information and comments.
15. The Chairperson said that initial reactions by Members on the Hong Kong, China informal
paper had been generally positive.  Several issues had been raised which required further discussion,
including the professions concerned, compilation of information and how international organizations
would be approached.  The next informal meeting w ould continue discussion of the four concepts of
necessity, transparency, equivalence and international standards, as well as comments on the Hong
Kong, China informal paper.
16. The Chairperson concluded by stating that dele gations wishing to obtain documents of the
Working Party more rapidly could provide their e-mail address to the Secretariat, which could also
compile a listing of Member e-mail addresses.
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