WTO/GATS-Alien Framework Provisions in RTAs – A Closer Look

Abstract

AbstractThis article deals with a challenge in drafting regional trade agreements (RTAs) in services that has been widely ignored to date: the need to comply with, and ensure consistent use of, GATS-based framework provisions. This includes in particular the requirement for the RTA parties to eliminate substantially all discrimination between their services and service suppliers. Yet the criteria that are used in individual agreements to identify the benchmark services and service suppliers quite often depart from relevant GATS provisions (Article V on economic integration in combination with Article XVII on national treatment). These departures may not only affect the WTO/GATS-compatibility of the RTAs concerned, but contribute to further fragmenting international market conditions. This is particularly unfortunate at a time when regional agreements are the only realistic options to overcome the negotiating stalemate at multilateral level. Hence, given the stakes involved, there is an urgent need for participants to (re-)consider the framework provisions underpinning their RTAs.