General Agreement on Trade in Services (GATS)

Market Access Phase of Negotiations

EU Enlargement Process

September 2006

Canada recently completed negotiations with the European Commission (EC) regarding the EC’s modification of its WTO services obligations resulting from the accession of thirteen new members to the European Union (EU).

The Uruguay Round of GATS negotiations were completed in 1995. Because Austria, Finland and Sweden acceded to the EU later that year, and Cyprus, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovak Republic and Slovenia acceded in 2004, each of these countries negotiated Uruguay Round GATS commitments individually, rather than collectively, as part of the EU. Following their accession to the EU, some of the commitments contained in the GATS schedules of these WTO members were not in accord with EU law. Accordingly, the EC initiated a modification of commitments to bring the commitments of countries that has acceded to the EU after the Uruguay Round, in line with the EU's Uruguay Round commitments. In some cases, this resulted in an increase in the level of liberalization for some of these countries, in other cases it resulted in a diminishment. As a result, the EC, along with 18 WTO members (who thought their trade interests may have been affected), entered into negotiations to ensure that the balance of service liberalization reflected in the EU's and its acceding members' Uruguay Round commitments was maintained.

Canada participated in the process to ensure that the interests of Canadian service providers active in the EU market were protected and that new commitments were provided where the modifications to the EU's GATS schedule resulted in a lower level of commitment for the newly acceded countries.

In determining our interests in this process, Canada undertook a series of consultations, including the 2004 Canada Gazette publication seeking feedback from Canadians, to assess the degree to which EC modifications could affect Canada’s market access interests in the sectors where modifications have been made.

The negotiations resulted in the EC offering new and improved commitments in its GATS schedule in sectors such as engineering and computer services. Canada is satisfied that such compensation rebalances the EU's GATS commitments.

Following a certification procedure at the WTO, a revised schedule of commitments will come into force for the EU.