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Towards the African EPA Template Some Issues
for Consideration for Africa Investment
Services

• ECA African Workshop on EPAs Reaping the
  Benefits of the EPAs
• Addis Ababa, 8 October 2008
• Taisuke ITO
• DITC/UNCTAD

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Outline

• Objective - Draw lessons from CARIFORUM EPA
  keeping in mind GATS rules experience
• Liberalization scope, modalities commitments
• Regulatory provisions cooperation
• Conclusions some lessons

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CARIFORUM-EU EPA

• Investment, Trade in Services E-commerce
  (Title II)
• 7 chapters an annex (schedules)
• General provisions
• Commercial Presence (Investment)?
• Cross Border Supply (Modes 1 2)?
• Temporary Presence of Natural Persons for
  Business Purpose
• Regulatory Framework (computer, courier, telecom,
  financial, international maritime transport
  tourism services)?
• E-Commerce
• Cooperation

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Main Features (1) - Investment

• M3 commercial presence includes non-services
  sectors (Mode 3 plus)
• Agriculture
• Fishing
• Mining quarrying
• Manufacturing
• Production, transmission distribution of
  electricity, gas, steam, hot water
• By scheduling (negative list covering all sectors
  CARIFORUM?)

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Main Features (2) Services

• 3-pillar structure (M1M2 cross border
  supply)
• Positive listing within 3 pillars
• MA/NT inter-modal linkages
• MA commitments trigger NT commitments (M12, M3)
• M3 (M1M2) commitments trigger certain
  high-skill M4 commitments
• Built-in agenda for future negotiations in 5
  years
• M4 qualified as business purpose
• Like in goods, MFN clause

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GATS Schedule EC Health Sector
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GATS Schedule EC Health Sector
National treatment
National treatment
MA for key personnel etc
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EPA Schedule EC Health Sector
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EPA Schedule CARIFORUM Health Sector
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Liberalization Commitments

• EU over 90 of services sectors
• CARIFORUM 65-75 of sectors
• Dominican Republic 90
• Bahamas and Haiti (LDC) to make commitments in
  2008
• Asymmetrical liberalization, to what extent?

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WTO Compatibility Test
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GATS Art V Benchmarks Flexibility SDT

• Despite divergent views, arguably
• GATS V does NOT require RTAs to eliminate MA
  restrictions but only discriminatory measures
  (NT) in the sense of Article XVII (of GATS)
• GATS V allows for stand-still, rather than
  roll-back, PROVIDED absence or elimination is
  achieved
• In addition, SDT provision flexibilities shall
  be provided for DCs in meeting these conditions
  in accordance with the level of development
  further allow DCs lesser coverage extent of
  liberalization over longer time period
• So greater scope for flexibility but the Parties
  interpretation matters as in goods

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Temporary Presence of Natural Persons for
Business Purpose (M4)

• Key personnel (3 years)
• Business visitors for setting up CP
• Inter-corporate transferees (managers
  specialist)
• Graduate trainees (12 months)
• Business services sellers
• (90 days/12months)
• Contractual services suppliers (6/12 months)
• Independent professionals (6/12 months)
• Short term visitors for business purposes (NEW)
  (90 days/12 months)

CP required (MA where M3 committed)
MA where M12, M3 committed
No CP required (de-linked to M3)
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EC Mode 4 Commitments

• Market access in CSS IPS limited
• CSSs 29 sub-sectors, with 12 not in GATS offer
  (medical dental, veterinary, midwives, nurses,
  market research, maintenance repair, chef de
  cuisine, fashion model, site investigation,
  tourist guide services)
• chef de cuisine, fashion models entertainment
  services - waives requirements for university
  degrees professional qualifications
• IPs 11 sub-sectors (RD, market research,
  opinion polling, service re management
  consulting)

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MFN Clause

• Definition of major trading economy same as in
  goods
• DCs 1 of merchandise exports (2006) China,
  HK, KOR, Russia, Singapore, Mexico, Taiwan, Saudi
  Arabia, Malaysia, Brazil, Thailand, India,
  Indonesia, UAE DC groups 1.5 ASEAN, GCC,
  CIS, ECO, Mercosur, SAARC, Andean Community
• Use of services exports (2007) 1 limits the
  eligibility to India, China, Singapore, Korea
  Russia
• Not apply to
• Mode 4
• Agreements creating internal market or
  significantly approximate their legislation
  EEA, pre-EU accession
• Recognition of qualifications, license or
  prudential measures
• Taxation
• GATS MFN exemption measures (audio visual)
• Structurally asymmetric?
• EU offer to ACP the most generous given EC
  hierarchy of preferences
• Areas where there is scope for improvement
  excluded esp M4

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Regulatory Framework

• Horizontal Sector specific on computer,
  courier, telecom, financial, maritime transport
  tourism
• Applies only to sectors liberalized as per
  schedule
• Draw on GATS texts (Annex, FS Understanding,
  Telecom Ref Paper)
• Extension of non-multilateral or stronger
  obligations to EPAs (GATS-plus)
• Financial Services
• Prudential carve-out, New financial services,
  International standards
• Telecommunication Services
• Universal Service
• Competitive safeguards (RP) - as per Competition
  Chapter
• Anti-competitive cross-subsidization, use of
  information obtained from competitors, not making
  available to competitors technical info about
  essential facilitates on a timely basis

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Competition-Related Provisions

• Telecom competitive safeguards
• Courier services
• As per competition chapter, appropriate measures
  to prevent suppliers anti-competitive practices
  by the use of their position in the market
• Tourism services
• As per competition chapter, appropriate measures
  to prevent, in particular tourism distribution
  networks, to engage in anti-competitive practice,
  including abuse of dominant position through
  imposition of unfair prices, exclusivity clauses,
  refusal to deal, tied sales, quantity
  restrictions or vertical integration
• Competition (Chapter 1, Title IV)
• Agreement concerted practices between
  undertakings, abuse of market power. Some
  disciplines on State monopolies
• Best endeavour on enforcement cooperation
• Enact enforce competition law in 5 years.
  Review in 6 years

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Conclusions (1)

• Investment liberalization significant
• Services liberalization modalities a priori
  drive for M12 M3 liberalization ? GATS
  flexibility positive list approach
• M12 merger 3 pillars
• Presumption of non-discrimination (NT) where QR
  eliminated (MA)
• Modal linkage with movement of high-skill NP
• Built-in agenda for future negotiations
• WTO compatibility matters case for greater
  flexibility asymmetry AS PROVIDED in GATS V
  (NT, SDT)
• Weaker impetus for low skill labour (IP, CSS)
• Need for comprehensive M4 agenda?

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Conclusions (2)

• MFN clause Asymmetric in nature (M4)
• Regulatory frameworks WTO-plus in some respects
  (FS Understanding, Telecom Ref Paper)
• Anti-competitive provisions on courier, telecom
  tourism call for competition law as per
  competition chapter
• Various cooperation provisions lead back to
  development cooperation issue

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• Thank You
• Contacts
• Taisuke ITO
• E-mail taisuke.ito_at_unctad.org
• Tel [phone]
• Fax [phone]