WORLD TRADE
ORGANIZATIONS/CSS/W/111
1 October 2001
(01-4723)
Council for Trade in Services
Special SessionOriginal:  English
COMMUNICATION FROM AUSTRALIA
Negotiating Proposal for Maritime Transport Services
The following communication has been received from the delegation of Australia with the
request that it be circulated to the Members of the Council for Trade in Services.
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I. IMPORTANCE OF TRADE LIBERALISATION IN THIS SECTOR
1. Maritime transport plays a vital role in the world economy:  an estimated 80 percent of world
trade goes by sea.  Australia believes that a safe, efficient and competitive maritime transport sectorwill benefit all WTO Members. As an important facilitator of world trade, the Maritime Transport
Services (MTS) subsector must be a priority in this round of services negotiations.
2. Access to a sufficient volume, quality and competitively-priced range of international
shipping services is vital for Australia, which is remote from most of its major trading partners and is
reliant upon foreign shipping for the vast majority of its trade (99 percent by weight).  Australia’s
policy objective is an internationally competitive maritime industry which observes international
standards of safety and environmental protection.
3. In this round of services negotiations, the MTS subsector has some start-up advantages in
comparison to other sectors.  Following the Urug uay Round, maritime services were the subject of
extensive negotiations within the Negotiating Group on Maritime Transport Services (NGMTS) under
the Council for Trade in Services.  Although the negotiations were not completed, they laid a solid
foundation for future work.  The achievements and experiences of the NGMTS should not be lost.
II. SCOPE AND MODALITIES OF THE NEGOTIATIONS
4. Australia supports the resumption of negotiations on Maritime Transport Services within the
current round of mandated services negotiations.  The negotiations should start with the re-opening of
the previous offers as provided in the Council for Trade in Services decision of 28 June 1996.  New
participants can enter the negotiations by submit ting their offers either at the opening of the
negotiations or at a later stage.S/CSS/W/111
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5. The negotiations should be resumed on the basis of the three-pillar model developed by the
NGMTS which included maritime transport services, maritime auxiliary services and port services.
Multimodal transport related to the maritime sector should be added to the negotiations as the fourth
pillar.  Multimodal transport in this context may be defined as:
“The carriage of goods by at least two different modes of transport, by the
multimodal transport operator on the basis of a single 'through' multimodal transport
contract, from a point of loading in one country to a point of delivery in another
country”.
6. Further examination of the scope of this pillar will be required in the course of the
negotiations.
7. Bearing in mind the difficulties encountered in the past with the three-pillar model, the model
could be supplemented by other appropriate nego tiating methodologies.  Options available could
include a cluster approach to the MTS subsector which would involve a group of the most
economically important services related to maritime transport.
III. ISSUES TO BE ADDRESSED DURING THE NEGOTIATIONS
8. Significant barriers to trade and investment in MTS still exist in many member economies.
Negotiations should, therefore, aim to achieve progressively higher levels of liberalisation in the MTSsubsector by eliminating market access barriers.
9. In the course of the negotiations, Australia w ould like to focus on the following major areas of
market access restrictions:
A. R
ESTRICTIONS ON COMMERCIAL PRESENCE
• Restrictions on entry of foreign capital
• Requirements for domestic equity participation
• Requirements for joint venture arrangements
• Other legislative and regulatory restrictions on foreign presence in the maritime
transport industry.
B. RESTRICTIONS ON ACCESS TO INTERNATIONAL MARITIME SERVICES
• Restrictions on allocation of cargo on particular routes to bilateral, plurilateral and
multilateral agreements (cargo sharing)
• Preferential treatment of shipping service providers from specific economies on the
basis of international agreements or for other reasons
• Restrictions on carrying government cargo to national flag vessels. (This does not
include defence and other national security-related cargoes.)
• Discriminatory taxation regimes and port dues for foreign companies and foreign flag
vessels.S/CSS/W/111
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IV. NON-TARIFF BARRIERS IN THE MARITIME TRANSPORT SECTOR
10. Burdensome non-tariff measures and anti-competitive business practices often serve as
barriers to free and efficient trade.  Such measures and practices can include, for example,
unreasonable environmental and safety standards, burdensome vessel and cargo examination
procedures, and lengthy and cumbersome port access and clearance procedures.
11. Removing trade-inhibiting effects of non-tariff measures and anti-competitive business
practices in MTS should be achieved without enda ngering legitimate safety, national security and
environmental requirements pertaining to the industry.
V. COMPETITION POLICY IN THE MARITIME TRANSPORT SECTOR
12. Lack of appropriate competition legislation or its enforcement by governments prevents
growth of efficiency and reduction of costs in the MTS subsector.  It is proposed that competition
policy issues be discussed during the next round of MTS negotiations. Understandings reached duringsuch discussions can be incorporated into a special annex to the agreement.
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