1. Trade in Services Negotiations: Scheduling techniques
Achim Seiler, Trade Consultant and Capacity Building Specialist, Kathmandu
EU-Project: Trade and Private Sector Development (TPSD)
TPSD is implemented by
in cooperation with
and

2. Types of Scheduling Approaches
Positive List: Largely based on WTO GATS, has been the traditional approach for most (but not all) RTAs between developing countries
Negative List: Largely based on NAFTA; increasingly adopted since 2000 and becoming standard practice for the majority of RTAs
Hybrid Approach: Variations on either approach; being followed in the TISA negotiations
Source: Stephenson

3. Types of Scheduling Approaches (II)
Positive List: GATS approach (Bottom up)
Sectors are listed by choice. Commitments do not apply unless the sector and/or specific subsector is inscribed in the schedule
The way the commitment is expressed in both, the MA and NT columns is generally negative: setting out the limitation that is inconsistent with the agreement
All limitations to MA and NT must be listed unless
- full commitment to maintain no restrictions (“NONE”)
- no commitment at all (“UNBOUND”)
Source: Stephenson

4. Types of Scheduling Approaches (III)
Negative List Approach (Top Down)
Presumption: everything liberalized unless otherwise specified. However…
Annexes of non-conforming measures provide flexibility to the comprehensive coverage assumed
- Annex 1: stand-still schedule. Existing measures included at the level of regulatory application; commitment to make the sector no more restrictive in the future
- Annex 2: Measures (sectors) permanently excluded from the agreement; government retains full regulatory freedom
Source: Stephenson

5. Types of Scheduling Approaches (IV)
Hybrid Approach
Combination of key features of positive and negative list approaches,
e.g. positive list of sectors plus scheduling the regulatory status quo (Philippines-Japan)
positive listing for cross-border trade (mode 1) and negative listing for commercial presence (mode 3) (Korea-US)
Negative listing for banking services and positive listing for insurance services
Positive list for Market Access, negative list for National Treatment (TISA)

6. Types of Scheduling Approaches (V)
Positive List
Negative List
Hybrid Approach
Market Access
Voluntary sectoral coverage
Comprehensive sectoral coverage
Binding restriction/limitation at level of choice
No restrictions maintained unless indicated as non-confoming measures;
Binding of restricions at level of applied laws
Binding at level of applied laws for limitations in schedules for the sectors included
Source: Stephenson

7. Types of Scheduling Approaches (VI)
Positive List
Negative List
Hybrid Approach
National Treatment
Voluntary sectoral coverage
Binding restriction/limitation at level of choice
Non-discriminatory treatment obligation unless otherwise specified in exceptions (bound at applied level)
Mandatory inclusion of all service sectors within national treatment obligation;
Limitations to national treatment taken out and bound at applied level
Source: Stephenson

8. Positive List Approach (I)
Listed
Listed
Not listed
Not listed
Not listed
Sectors are listed by choice. Commitments do not apply unless the sector and/or specific sub-sector is inscribed in the schedule

9. Positive List Approach (II)
Listed
Listed
Not listed
Not listed
Not listed
Inscribed commitments (red line) can deviate from the status quo/ the applied regulatory regime (black line), thus leading to a binding overhang

10. Positive List Approach (III)
MA and NT limitations
MA and NT limitations
Not listed
Not listed
Not listed
Inscribed commitments can come with formal MA and NT limitations, i.e. limitations which are in principle inconsistent with the agreement

11. Positive List Approach (IV)
MFN exeptions
MFN exeptions
Not listed
Not listed
Not listed
A country must provide a complete and precise listing of its MFN exeptions, incl. the underlying rationale

12. Negative List Approach (I)
Everything liberalized (covered) unless otherwise specified and listed in the annexes

13. Negative List Approach (II)
Annex 1: Stand-still schedule

14. Negative List Approach (III)
Annex 2: Measures (sectors) permanently excluded from the agreement

15. Negative List Approach (IV)
Annex 1: Stand-still schedule
Existing measures included at the level of regulatory application; commitment to make the sector no more restrictive in the future
Annex 2: Measures (sectors) permanently excluded from the agreement
Government retains full regulatory freedom, e.g. regarding sensitive sectors and/or measures emanating in the future

16. Hybrid Approaches (I) Listed Listed Not listed Not listed Not listed
Inscribed commitments (red line) do not deviate from the status quo (liberalisation as is), may promote greater liberalization

17. Hybrid Approaches (II)
positive listing for cross-border trade (mode 1) and negative listing for commercial presence (mode 3)

18. Hybrid Approaches (III)
Negative listing for banking services and positive listing for insurance services

19. Hybrid Approaches (IV)
Positive list for Market Access, negative list for National Treatment

20. Structure of a Comprehensive FTA (Goods and Services, Services are Spread Throughout the FTA)
General Definitions
Trade in Goods (Tariff Schedules)
Special Agriculture Measures
Rules of Origin
Customs
SPS
TBT
Bilateral Safeguards
Government Procurement
Investment

21. Structure of a Comprehensive FTA (Goods and Services, Services are Spread Throughout the FTA) (II)
Cross-Border Trade in Services (with Annexes for Existing and Future Measures)
Temporary Entry of Business Persons
Electronic Commerce
Competition Policy
Transparency
Administration of the Agreement
Dispute Settlement
Exceptions
Final Provisions

22. Structure of a typical “negative list” type of FTA for treatment of services
Chapter on Cross-Border Services (Modes 1&2)
Chapter on Investment (applying to Goods and Services, Mode 3)
Chapter on Temporary Entry of Business Persons (Mode 4)
Chapter on Financial Services (Disciplines applying only to this sector)
Chapter on Telecommunications (disciplines applying only to this sector)
List of non-conforming Measures in Annexes
Source: Stephenson

23. Different Approaches Can Lead to Similar Commitments
„...the challenge in reaching meaningful results (in services trade negotiations) lies in mobilizing the political resolve needed and articulating it properly in guidelines and modalities. What ultimately matters is not governments´preference for a particular architectural approach, but their strength of purpose.“
(Adlung/Mamdouh, WTO)

24. Literature
Adlung/Mamdouh, 2013: How to Design Trade Agreements in Services: Top Down or Bottom Up? (downloadable from the net).
Sauvé, Lacey, 2013: Services Liberalization; a Handbook on Negotiating Preferential Trade Agreements (downloadable from the net
Schott, Lee, Muir, 2012: Prospects for Services Trade Negotiations (downloadable from the net)
Stephenson, 2015: Overview of Various Approaches to Services Liberalization (downloadable from the net)
World Bank, 2009: Negotiating Trade in Services (downloadable from the net)