RESTRICTED
WORLD TRADE S/WPGR/M/8
13December 1996
ORGANIZATION(96-5320)
Working Party onGATS Rules
REPORT OFTHE MEETING OF8AND 14OCTOBER 1996
Note bytheSecretariat
1. Theeighth meeting oftheWorking Party onGATS Rules waschaired byMr.Stuart Carre
ofCanada. Theagenda consisted ofsixitems: negotiations onsafeguards under Article XoftheGATS;
negotiations onsubsidies under Article XVoftheGATS; negotiations ongovernment procurement
under Article XIIIoftheGATS; report ontheactivities oftheWorking Party totheCouncil forTrade
inServices; dateofthenextmeeting oftheWorking Party; andother business.
Negotiations onsafeguards under Article XofGATS
2. TheChairman noted thatsince thelastmeeting oftheWorking Party, some ofitsMembers
hadhelduseful informal discussions onthequestion ofemergency safeguards under GATS. The
representative ofSwitzerland formally introduced asubmission totheWorking Party (S/WPGR/W/14)
which hadpreviously beendiscussed inaninformal meeting. Heindicated thatthepaper sought to
cover issues thatwould havetobeaddressed indeciding upon thequestion ofemergency safeguards
under GATS. Theemphasis wasupon conceptual issues rather thanmatters ofform andpractical
modalities. Thepaper waspresented without prejudice tothebasic question astowhether emergency
safeguard measures were desirable under GATS.
3. TheChairmanstatedthatfollowinginformalconsultationsanddiscussionsintheWorkingParty,
ithadbeenagreed thataseries ofquestions presented bytheChairman onvarious aspects ofthe
safeguards issue, supplemented byanumber ofadditional questions proposed bydelegations, would
beissued asadocument oftheWorking Party (S/WPGR/W/15). Itwasfurther agreed thatMembers
oftheWorking Party would supply written answers tothese questions onavoluntary basis, andthat
those intending todosowould endeavour toprovide theanswers bythetimeofthenextformal meeting
oftheWorking Party.
Negotiations onsubsidies under Article XVofGATS
4. TheChairman recalled thattheWorking Party hadrequested theSecretariat todraftproposed
language foraquestionnaire thatwould serve asabasis fortheinformation exchange onsubsidies
relating totradeinservices which wascalled forinparagraph 1ofArticle XV.Therelevant document
wasnowbefore theWorking Party. TheChairman alsorecalled thattheWorking Party hadalready
agreed onanapproach todefining subsidies forthepurpose ofaninformation exchange. Thedefinition
ofsubsidies would bethatcontained inparagraph 1oftheAgreement onSubsidies andCountervailing
Measures, andMembers wereatliberty tovaryorsupplement thisdefinition iftheysodesired, provided
thatanymodifications were indicated atthetimeofsupplying information.
5. Several delegations expressed theviewthatthedefinition ofsubsidies inthesecretariat note
should betreated asindicative, andthatMembers would befreetointroduce theirownvariations as
theysawfit.Onerepresentative proposed thattheWorking Party should consider excluding broad-basedS/WPGR/M/8
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social subsidies affecting trade inservices from thepurview oftheinformation exchange. Other
delegations saidthattheypreferred toavoid anyapriori exclusion ofacategory ofsubsidy measures,
particularlyinlightofthescarcityofreadilyavailableinformationonthesubsidypoliciesofgovernments
inthefieldofservices. Another delegation emphasized theneedforclarity withrespect totheobjectives
andnature ofsubsidy measures, bearing inmind thatdueconsideration must begiven bothtothe
potential forsubsidies todistort tradeandthelegitimacy ofcertain social andeconomic aimsunderlying
somesubsidies.Arepresentativestatedthatherdelegationunderstoodtheinformation-gatheringexercise
toencompass bothfederal andsub-federal subsidy measures. Anideaproposed byonedelegation
wastotakeasastarting point thedefinitions anddisciplines oftheAgreement onSubsidies and
Countervailing Measures, andtoseehowfarthemandate oftheWorking Party could becarried on
thisbasis.
6. Anumber ofdelegations saidthatintheirview, replies totheproposed questionnaire should
besupplied onavoluntary basis. Oneofthese delegations added thatappropriate flexibility should
beshown towards developing countries inrelation totheresponses required, andthatanyinformation
provided should notbemisused inthecontext ofpossible future negotiations. Another delegation
challenged theviewthatresponses tothequestionnaire should beprovided onavoluntary basis, bearing
inmind thatallMembers were already committed toaninformation exchange under Article XV:1.
Onerepresentative saidthattheproposed questionnaire wastoodetailed andwould impose asubstantial
burden ondelegations. Hesuggested thatanalternative approach might betofocus onspecific sectors,
onthepremise thatsubsidies inthefieldofservices onlyaffected alimited number ofservice activities.
Other delegations wereoftheviewthatitwould beinadvisable totruncate thescope ofinformation-
gathering efforts attheoutset.
7. Some more specific proposals weremade inrelation tothedraftquestionnaire. Onedelegation
suggested thattheorder ofthefifth, sixth, seventh andeighth questions should bechanged, suchthat
questions seven andeight would come first, followed byquestion sixandquestion five. Itwasalso
suggested thatquestion 11should bedeleted, butthiswasopposed onthegrounds thatthequestion
wasalready formulated inamanner which recognized thattherelevant statistical information requested
maynotbeavailable. Another proposal wasforthelanguage ofquestion 8tobechanged soasto
askabout eligibility forsubsidies rather thanabout thesectors andentities thathaveactually benefitted
from subsidies. Finally, adelegation proposed theaddition oftwofurther questions, bothofwhich
focused oncontrasting approaches andpolicies relating tosubsidies intherespective fields ofgoods
andservices.
8. TheWorking Party agreed toholdinformal consultations onthismatter priortothenextmeeting
oftheWorking Party. Inthemeanwhile, theSecretariat would produce asecond draftofthesubsidies
questionnaire, taking account ofthedrafting suggestions thathadbeenmade.
Negotiations ongovernment procurement under Article XIIIofGATS
9. TheChairman noted thatninecountries --Norway, Switzerland, Brazil, NewZealand, Japan,
theUnited States, Canada, Colombia andHong Kong --hadsubmitted replies totheprocurement
questionnaire. Certain delegations saidthatitwasimportant thatmore Members submit replies to
thequestionnaire, asadditional information onnational procurement regimes would beuseful forthe
negotiations. TheChairman observed thatpressure ofwork hadmade itdifficult tomeetdeadlines
thathadbeenset,andurged those delegations intending todosotosubmit replies tothequestionnaire
attheir earliest convenience. Onedelegation wasoftheview thatwhile theexchange ofbasic
information wasuseful andimportant, thetimewasapproaching when theWorking Party would need
toengage innegotiations onsubstantive matters, suchastheapplication oftheprinciples ofmost-
favoured-nation andnational treatment, andtransparency, toprocurement inthesphere ofservices.S/WPGR/M/8
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10. Adelegation cautioned against theproliferation ofduplicative workongovernment procurement
intheWTO, bearing inmind proposals forfurther work inthisfieldcurrently under consideration
inthecontext ofpreparations fortheSingapore Ministerial Meeting. Thisdelegation wasoftheview
thatitwould bepossible toestablish adivision oflabour thatwould avoid suchduplication. TheGATS
exercise entailed substantive negotiations onsuchmatters asMFN andnational treatment. Other
delegations emphasized thatthere already existed anegotiating mandate under Article XIIIofGATS,
although thisdidnotpreclude consideration ofother proposals made elsewhere. Onerepresentative
saidthatwhile theGATS Article XIIImandate wasclear, theneedtoseekabalanced approach to
procurement should beborne inmind when considering therecent initiative putforward inthecontext
oftheSingapore Ministerial Meeting.
Report ontheactivities oftheWorking Party totheCouncil forTrade inServices
11. Following extensive formal andinformal discussions ontheWorking Party'sreport tothe
Council, theChairman indicated thathewould forward atexttotheCouncil, inlightoffurther informal
consultations.
Dateofthenextmeeting oftheWorking Party
12. TheChairman stated thatthedateofthenextmeeting oftheWorking Party would befixed
induecourse, probably forJanuary 1997.
Other business
13. Nomatters were raised under other business.