RESTRICTED
WORLD TRADE GATS/SC/6/Suppl.1/Rev.1
4October 1995
ORGANIZATION(95-2886)
Trade inServices
AUSTRALIA
Schedule ofSpecific Commitments
Supplement 1
Revision
(This isauthentic inEnglish only)
_______________
TheattachedtextsreplacetheHORIZONTALCOMMITMENTSsectionforMode(3)contained
inpages 1and2ofdocument GATS/SC/6, andtheFinancial Services section contained inpages 31
to38ofthesame document .AUSTRALIA -SCHEDULE OFSPECIFIC COMMITMENTS
Modes ofsupply: 1)Cross-border supply 2)Consumption abroad 3)Commercial presence 4)Presence ofnatural persons
Sector orsubsector Limitations onmarket access Limitations onnational treatment Additional
commitments
I. HORIZONTAL COMMITMENTS
ALL SECTORS INCLUDED
INTHIS SCHEDULE
3) Notification andexamination under
Australia 'sforeign investment policy
guidelines andtheForeign Acquisitions and
Takeovers Act1975. Inaddition tothe
specific foreign investment policy
requirement setoutinthose parts ofthis
Schedule concerning financial services and
international shipping, proposals for
foreign interests toinvest intheservices
identified intheSchedule areexamined
under theGovernment 'spolicy guidelines
without theneed todemonstrate economic
benefits ortoprovide forAustralian equity
participation andareapproved unless
judged contrary tothenational interest.
Theonus forestablishing thatproposals are
socontrary rests withtheAustralian
authorities. Investors canexpect that
approval willnotbewithheld from
proposals onnational interest grounds other
thaninunusual circumstances affecting
Australia 'svital interests anddevelopment.3) Australia 'sforeign investment policy
guidelines apply toforeign-owned or
controlled enterprises after establishment
inAustralia
Atleast twoofthedirectors ofapublic
company must beordinarily resident in
Australia
GATS/SC/6/Suppl.1/Rev.1
Page1AUSTRALIA (continued)GATS/SC/6/Suppl.1/Rev.1
Page2
Modes ofsupply: 1)Cross-border supply 2)Consumption abroad 3)Commercial presence 4)Presence ofnatural persons
Sector orsubsector Limitations onmarket access Limitations onnational treatment Additional
commitments
Unbound forcurrent andfuture measures
atthefederal, state orlocal government
levels according rights orpreferences to
anyindigenous person ororganisation
providing forthefavourable treatment of
anyindigenous person ororganisation in
relation toacquisition, establishment or
operation ofanycommercial orindustrial
undertaking intheservice sector. Forthe
purposes ofthisSchedule, anindigenous
person means aperson oftheAboriginal
raceofAustralia oradescendant ofan
indigenous inhabitant oftheTorres Strait
Islands.
Unbound forsubsidies forresearch and
developmentAUSTRALIA (continued)
Modes ofsupply: 1)Cross-border supply 2)Consumption abroad 3)Commercial presence 4)Presence ofnatural persons
Sector orsubsector Limitations onmarket access Limitations onnational treatment Additional
commitments
7.FINANCIAL SERVICES
Australia undertakes itsspecific commitments onfinancial services inaccordance withtheattached "Understanding onCommitments inFinancial Services"
(hereinafter referred toasthe"Understanding").
Theobligations under theUnderstanding areaddressed inthisSchedule additionally tothose covered bytheprovisions ofPartIIIoftheAgreement andthe
Annex onFinancial Services. Market access commitments withrespect to"cross-border supply" and"consumption abroad" arebound inthisSchedule tothe
extent oftheobligations inparagraphs 3and4oftheUnderstanding.
These specific commitments onfinancial services aresubject tothegeneral limitations contained inthe"Horizontal Commitments" section ofthisSchedule.
A.Insurance andinsurance-
related services
(8121, 8129**, 8140)
3)Approval ofnon-resident lifeinsurers is
restricted tosubsidiaries
3)Registered foreign lifeinsurance companies
arerequired tohave aprincipal officer
resident inAustralia
GATS/SC/6/Suppl.1/Rev.1
Page3AUSTRALIA (continued)GATS/SC/6/Suppl.1/Rev.1
Page4
Modes ofsupply: 1)Cross-border supply 2)Consumption abroad 3)Commercial presence 4)Presence ofnatural persons
Sector orsubsector Limitations onmarket access Limitations onnational treatment Additional
commitments
1),3)Anauthorised insurance company
operating inAustralia asanon-incorporated
entity must appoint anAustralian resident
asagent oftheinsurer
3)Most State andTerritory Governments
maintain restrictions, bywayofmonopolies
orlicensing provisions andassociated
controls onpremiums andother terms of
policies, inthefollowing areas of
insurance:3)Sub-national guarantees areprovided to
some State andTerritory Insurance Offices
Compulsory Third Party Motor
Vehicle Accident: VIC, WA, TAS,
NT,ACT (monopolies); NSW, QLD,
SA(licensing, premiums/policy terms)
Workers Compensation: VIC, QLD,
SA(monopolies); NSW, WA, TAS
(licensing, premiums/policy terms)
4)Thetemporary entry ofspecialists inthe
operation ofaninsurance service supplier
established inAustralia ispermitted subject
totheterms stipulated inthehorizontal
sectionAUSTRALIA (continued)
Modes ofsupply: 1)Cross-border supply 2)Consumption abroad 3)Commercial presence 4)Presence ofnatural persons
Sector orsubsector Limitations onmarket access Limitations onnational treatment Additional
commitments
B.Banking andother financial
services (excluding insurance)
(8112, 8113, 8119, 8131,
8132, 8133, 81115-81119,
81199, 81319, 81321, 81323,
81333, 81339)1)Theinvestment atinterest inAustralia of
official reserves byforeign central banks
andforeign government monetary
institutions isapproved bytheReserve
Bank provided thatitobtains assurance
from theinvesting authority thatitwillaim
tobeastable holder oftheAustralian
dollar andthatitwillconsult withtheBank
intheevent ofsignificant changes inits
Australian dollar portfolio. Monetary
institutions, responsible forbothreserve
assets andcommercial investments, are
permitted toinvest inAustralia uptoa
limit under thesame conditions.
1),3)Aforeign bank located overseas isable
tooffer itsservices toAustralian
enterprises, butitisnotallowed toraise
funds inAustralia orundertake business
within Australia unless itisanauthorised
bank (orestablishes amoney market
corporation, subsidiary etc.)
GATS/SC/6/Suppl.1/Rev.1
Page5AUSTRALIA (continued)GATS/SC/6/Suppl.1/Rev.1
Page6
Modes ofsupply: 1)Cross-border supply 2)Consumption abroad 3)Commercial presence 4)Presence ofnatural persons
Sector orsubsector Limitations onmarket access Limitations onnational treatment Additional
commitments
1),3)Dealings inforeign exchange in
Australia must becarried outthrough a
dealer authorised bytheReserve Bank.
Only banks, including branches ofoverseas
banks, andfinancial institutions
incorporated inAustralia withtherequired
minimum capital baseareeligible toseek
authorisation asaforeign exchange dealer.
Foreign banks satisfying prudential
requirements andcompetition policy
considerations mayconduct banking in
Australia. Foreign banks mayundertake
banking operations inAustralia through an
authorised branch, however, abranch may
notaccept "retail" deposits. Aforeign
bank wishing toaccept "retail" deposits
must seekauthorisation asalocally-
incorporated subsidiary forthatpurpose.
Foreign bank branches mayaccept deposits
(andother funds) inanyamount from
incorporated entities, non-residents and
their ownemployees. Deposits (andother
funds) mayonlybeaccepted from other
sources where theinitial deposit (orother
funds) isgreater than$250 000. Deposit-
taking outside ofthisisconsidered tobe
"retail" banking business.AUSTRALIA (continued)
Modes ofsupply: 1)Cross-border supply 2)Consumption abroad 3)Commercial presence 4)Presence ofnatural persons
Sector orsubsector Limitations onmarket access Limitations onnational treatment Additional
commitments
Acquisition, byforeign interests, ofcontrol
ofanyofAustralia 'sfourmain banks
(Commonwealth Bank ofAustralia,
National Australia Bank, Westpac Banking
Corporation andAustralia andNew
Zealand Banking Group) isnotpermitted.
State andTerritory governments reserve the
right toprohibit foreign control ofState-
owned orcontrolled banks. Banks
(resident andnon-resident) areprohibited
from holding shares intheCommonwealth
Bank ofAustralia andother entities may
notholdmore thanfivepercentofits
issued share capital.3)TheCommonwealth Bank ofAustralia, the
Australian Industry Development
Corporation, andother Commonwealth
owned entities which mayconduct financial
operations areguaranteed bythe
Commonwealth Government
Banks operating inAustralia, whether
domestically owned orforeign owned with
authorised branch status, maybepermitted,
incertain circumstances, toholdupto75
percentequity inAuthorised Money
Market Dealers (primary dealers). The
Reserve Bank imposes restrictions on
relationships anddealings between
authorised dealers andrelated banks, in
particular:
GATS/SC/6/Suppl.1/Rev.1
Page7AUSTRALIA (continued)GATS/SC/6/Suppl.1/Rev.1
Page8
Modes ofsupply: 1)Cross-border supply 2)Consumption abroad 3)Commercial presence 4)Presence ofnatural persons
Sector orsubsector Limitations onmarket access Limitations onnational treatment Additional
commitments
authorised dealers must be
independent legal entities andbe
separately capitalised;
authorised dealers 'transactions with
related entities (defined asparties
which own12.5 percentormore of
theauthorised dealer) must becarried
outatarm'slength andnotrepresent
adisproportionate source offunding
orturnover; and
authorised dealers must provide an
impartial service toallparticipants in
themoney market.
Anumber ofState andTerritory
Governments operate central financing
authorities through which theGovernment 's
wholly orpartly-owned statutory authorities
andbusiness enterprises areobliged to
borrow (andinsome cases invest) their
funds, orotherwise obtain certain financial
services:AUSTRALIA (continued)
Modes ofsupply: 1)Cross-border supply 2)Consumption abroad 3)Commercial presence 4)Presence ofnatural persons
Sector orsubsector Limitations onmarket access Limitations onnational treatment Additional
commitments
SA-South Australian Financing
Authority, SALocal Government
Financing Authority
TAS -Tascorp
NSW -Treasury Corporation
VIC-Treasury Corporation of
Victoria
3)TheAustralian Stock Exchange liquid
capital requirements formembers mayhave
theeffect offavouring membership ofthe
Exchange bysubsidiaries rather than
branches offoreign companies3)Amajority ofthedirectors ofamember
organisation oftheAustralian Stock
Exchange must beAustralian residents
Anapplicant must beabody corporate in
order toobtain approval toconduct astock
market orafutures market asastock
exchange orafutures exchange
4)Thetemporary entry ofspecialists inthe
operation ofafinancial service supplier
established inAustralia ispermitted subject
totheterms stipulated inthehorizontal
section
GATS/SC/6/Suppl.1/Rev.1
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