Trade in Services
WTO Article XXI: EC notification regarding proposed modifications to the services schedules of commitments of the EC-25, Bulgaria and Romania to reflect the expansion of the European Union
On 30 October 2007, the European Commission (EC) notified its intention to initiate a process under Article XXI (Modification of Schedules) of the General Agreement on Trade in Services (GATS) to modify some of its international trade obligations under the GATS to reflect the accession to the European Union of Bulgaria and Romania.
The EC is therefore seeking to transpose its own current services schedule of commitments to cover Bulgaria and Romania by seeking to apply its horizontal limitations on market access regarding public utilities, Mode 3 national treatment of branches, agencies and representative offices, Mode 3 and 4 national treatment regarding subsidies, and Mode 3 national treatment of subsidiaries to Bulgaria and Romania.
Under Article XXI of the GATS, the EC is entitled to modify its schedules of services commitments, subject to a requirement that it consults with other WTO Members that consider themselves to be affected by the modifications.
Members had until 15 December to notify the EC of their interest. Article XXI further obliges the EC to consult or negotiate with each Member that considers itself to be affected, with a view to reaching agreement in relation to necessary adjustments that the EC might make to its other WTO commitments by way of compensation for the modifications.
In order to decide whether Australia would be affected by the EC’s proposed modifications of its GATS commitments to accommodate the accession of Bulgaria and Romania, the Department of Foreign Affairs and Trade sought the views of Australian services providers and exporters regarding the possible impact of the modification on their commercial activities. Based on this advice, Australia notified and recently held its first round of consultations with the EC regarding the compensation package resulting from enlarged European Union (EU) membership to accommodate Bulgaria and Romania.