Specific Trade Services Liberalization Efforts
At the same time that that discussions over trade facilitation measures are taking place in the WTO there has been movements toward the liberalization of trade services markets. Since June 2002, countries participating in General Agreement on Trade in Services (GATS) negotiations have been exchanging bilateral requests in accordance with the DOHA Ministerial Conference in order to address liberalization in Maritime Transport Services, Air Transport Services, Land Transport Services and Services Auxiliary to all modes of transport. Specific efforts, or the lack thereof, in some of the topics noted in Chapter Two are discussed below.
Maritime Transport Services Maritime transport services were the subject of extensive negotiations following the Uruguay round under the Negotiating Group on Maritime Transport Services (NGMTS) under the Council for Trade in Services. The negotiations were not completed, but a foundation based on a three-pillar model of maritime transport services, maritime auxiliary services, and port services was developed. The inclusion of a fourth pillar – multimodal transport – has been recommended. It has been agreed that significant barriers to trade and investment in the provision of maritime transport services exist in many member countries and that progressive liberalization steps eliminating market access should be pursued. Four key sectors that have been highlighted for action include:
• Restrictions on commercial presence - Restrictions on establishing a commercial presence remain in many countries because of the horizontal commitments of countries in the GATS service schedules. Restrictions include entry of foreign capital, domestic equity participation obligations, joint venture arrangements and other legislative and regulatory restrictions on foreign presence. • Restrictions on access to international maritime services - Restrictions on cargo allocation for particular routes, in accordance with bilateral and multilateral agreements, remain a prohibitive barrier to access to maritime services. The preferential treatment of shipping services providers from specific economies on the basis of bilateral agreements or other reasons raises the overall cost of shipping services. Restrictions for carrying government cargo on national flag vessels, with the exception of defense and national security cargoes, also serve to limit overall access to the provision of services. Finally, discriminatory tax regimes and port fees for foreign companies and foreign flagged vessels are contrary to the GATS doctrine of non-discrimination. • Non-tariff barriers in the maritime transport sector - Anti-competitive business practices raise costs to free and efficient trade. For example, practices such as unreasonable environmental and safety regulations, unfair vessel and cargo examinations and cumbersome port procedures excessively discriminate against foreign transport suppliers. • Competition policy in maritime transport sector - Price fixing and capacity sharing agreements of conference carriers that receive anti-trust exemption serve to restrict growth of new transport providers and control cost reduction movements.