GATS-General Agreement on Trade in Services. History, Scops Modes of trade etc.

1. UNIVERSITY OF AGRICULTURAL SCIENCES,
DHARWAD
COLLEGE OF AGRICULTURE, BIJAPUR
GATS-General Agreement on Trade in Services
Agricultural Marketing, Trade & Prices(AEC-203)
Credit Hours:
Course Teacher: Dr.R.S.Poddar
Prepared by
5469-Chiranjeevi Kulkarni
5470-Daivata S More
5471-Deepak Kamatar
5472-Dhanya A J
5473-Dhoolappa R Tamadaddi
5474-Divyashree M S
1+1

2. Introduction
• GATS – General Agreement on Trade in
Services is a treaty of the World Trade
Organization that entered into force in 1995 as
a result of the Uruguay Round Negotiation.
• The treaty was created to extend the
multilateral trading system to service sector.
• All the members of WTO are signatories to the
GATS.
• The basic WTO principle of Most Favoured
Nation (MFN) applies to GATS as well.

3. History of GATS
• WTO is successor of GATT in 1949
• WTO is organization where members have
agreed to a set of agreements.
• GATS is one of the main WTO agreements
• 1947- GATS (General Agreement on Trade in
Services)
• 1995 – WTO (World Trade Organization)
• Trade in goods + agriculture + services +
intellectual property

4. Main principles and scope
• GATS follows many main principles of the
original GATT
• The aim is to ensure progressive market
liberalization and non-discrimination
between Members
• GATS cover almost all services, in total 155
services sectors
• Does not cover services supplied in the
exercise of government authority

5. Related sectors & sub sectors of GATS
 Business services
a)professional services
- Medical and Dental services
- Midwives, nurses, physiotherapists, paramedical
services
 Financial services
a)All insurances & insurance-related services
 Health related & social services
a)Hospital services
b)Other human health services

6. How Does GATS work?
• Successive rounds of negotiations “with a
view of achieving a progressively higher
level of liberalization” in their service
sector.
• WTO members make liberalization
requests/ offers of other member
countries in bilateral secret meetings in
Geneva.

7. Modes of Trade
♠ Cross-border supply.
♠ Consumption abroad
♠ Commercial Presence
♠ Movement of natural persons

8. MODE MEANING EXAMPLE
1)Cross-border
trade
Trade takes
place from the
territory of
country A into
that of B.
-Tele health
-passing of information by
means of fax or mail.

9. 2)Consumption
abroad
Services consumed
by nationals of
country A in
territory of country
B.
-Tourism
-Consumers who cross
borders to obtain medical
treatment.
MODE MEANING EXAMPLE

10. 3)Commercial
presence
A service supplier of
country A cross the
border to establish and
provide a service in
country B
-Establishment of a
private hospital by a
European company in
Ecuador.
MODE MEANING EXAMPLE

11. 4)Movement of
natural persons
Temporary
movement from
country A to B to
supply a service.
-Doctors moving to another
country to temporarily provide
their services.
MODE MEANING EXAMPLE

12. GATS & Public Services
 GATS does not apply to services
“supplied in the exercise of government
authority”
 A service is supplied in the exercise of
governmental authority “only when it is
supplied neither on commercial basis nor
in competition with one or more service
suppliers”

13. GATS & Domestic Regulation
• “ GATS does not remove a government’s
right to regulate services in its country”
• Government regulation of a service
should be “not more burdensome than
necessary to ensure to quality of service”
(possibility of necessity test)

14. GATS & Health Care Systems
MODES OF TRADE HEALTH SERVICES
1)Cross border supply • Telemedicine
2)Consumption abroad • Patients seeking health care
in foreign countries.
• Medical health educational
services provided to foreign
students.

15. GATS & Health Care Systems
MODES OF TRADE HEALTH SERVICES
3)Commercial Presence Foreign commercial presence:
• In the hospital.
operation/management sector
• In the health insurance
/education sector.
4)Presence of natural persons Temporary movement of
medical health professionals
to provide services abroad.

16. Future Negotiations
• To extend the number & extent of
commitments made.
• To remove existing limitations on
current commitments.
• To bind commitments so that they
cannot be reversed.

17. Conclusion
• GATS is “first & foremost, an instrument
for the benefit of business, & not only for
business in general, but for individual
service companies wishing to export
services or to invest & operate abroad”

18. Summary
History of GATS
 Main Principles & Scope
 Related Sectors & Sub-sectors
 Modes of trade
 GATS & Public Services
 GATS & Health Care System
 GATS Domestic Regulation
 Modes of Services
 Future Negotiations