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166 QUANTIFICATION OF BENEFITS FROM ECONOMIC COOPERATION IN SOUTH ASIA the commitments, countries would therefore like to persevere with the existing classification of the GATS, even though it is recognised to be out of date. For example, in the Indo-Singapore CECA (signed on 29 June 2005 and came into force on 1 August 2005), telecommunication services are defined following a positive list approach, like in the GATS. 6 RELEVANT PROVISIONS OF GATS AND OTHER RULES AND DISCIPLINES FOR TELECOMMUNICATIONS The WTO rules and disciplines for telecom comprise the GATS, the Annex on Telecommunications (hereinafter the Annex) and the Schedules of commitments made under the GATS. In addition, the Reference Paper provides the basic thrust of major regulatory disciplines that are relevant to telecom services. The Annex recognises ‘the specificities of the telecommunications service sector and, in particular, its dual role as a distinct sector of economic activity and as the underlying transport means for other economic activities’, i.e. importance of telecommunications as an input for other sectors. The Annex comprises seven sections, with the core obligations contained in the section on access to and use of ‘public telecommunications transport network and services’ (or PTTNS). These require WTO members to ensure that access to and use of the PTTNS are allowed on reasonable and non-discriminatory terms for the supply of services included in its schedules. This would be true even when no basic telecom service commitments have been made by the government in its schedule, and whether or not such PTTNS is supplied by a monopoly or through competition. Inasmuch as a Commitment in a Member’s schedule on basic telecom services is for the supply of these services, access to and use of PTTNS on reasonable and nondiscriminatory terms is a mandatory requirement under the provisions of this Annex. In addition, there is recognition of the need for maintaining security and confidentiality of messages, safeguarding universal service and other public obligations, and protection of the technical integrity of the networks. Several governments felt that explicit regulatory principles should be drawn up for basic telecom services, particularly in order to guard against anticompetitive behaviour by incumbents. This was based on the view that the telecom sector normally has a dominant supplier who could alter the market situation to the disadvantage of a newcomer. Further, an Table 15.2 WTO Reference Paper: Definitions and Principles Definition/Principles Definitions Description The Reference Paper applies rules to ‘major suppliers’ of telecommunications services who have ‘control over essential facilities’ or uses its position to ‘materially affect the terms of participation’. Competitive Governments must take appropriate Safeguards measures to prevent suppliers of telecommunications services from using anti-competitive practices such as cross-subsidisation, apply information obtained from competitors in an uncompetitive manner, or denying competitors access to relevant technical information. Interconnection Governments must ensure that major suppliers provide interconnection of their networks to other service suppliers at ‘any technically feasible point in the network’. Major suppliers will offer interconnection that is non-discriminatory, timely, and at a rate and quality ‘no less favourable’ than that provided for its own subsidiaries or affiliates. Universal Service Governments may set universal service obligations, as long as they are administered in a transparent, non-discriminatory, competitively neutral manner and are not more burdensome as necessary in reaching their policy objectives. Transparency Under circumstances where licenses are required, the licensing criteria, timeframe, and terms and conditions are to be made publicly available. Upon the request of the applicant, the reasons for denial of a license will be made known. Independent The regulatory body must be separate Regulators and not accountable to any supplier of basic telecommunications services and that its procedures be impartial. Allocation and Use Government procedures for the allocaof Scare Resources tion and use of scare resources, such as frequencies and numbers, must be objective, timely, transparent and nondiscriminatory. Source: Compiled from www.wto.org 6 A positive list approach gives countries the flexibility to choose the sectors/sub-sectors and modes within those sectors/subsectors for making commitments.
P ROSPECTS FOR THE TELECOMMUNICATION SECTOR UNDER SAFTA 167 efficiently functioning telecom market requires appropriate linking up (‘interconnection’) of the established and new suppliers, while guarding against anticompetitive behaviour. A reference paper (RP) (see Appendix 15) was, therefore, prepared which laid down regulatory disciplines that were considered necessary for promoting competition in this sector. Adherence to these principles, however, is voluntary and subject to whether or not WTO Members inscribed them into their schedules as additional commitments. The reference paper has been described as the touchstone for telecommunications services negotiations (see Table 15.2). It elucidates principles necessary for facilitating and sustaining a competitive telecoms sector, thereby recognising the vital role a competitive telecom sector plays in its own development as well as in growth of other sectors that use telecom services as input in the production process. Liberal telecom regimes such as those in Western Europe and United States have fully subscribed to the principles enshrined in the RP. SAFTA country commitments to the RP, in particular, and under GATS in telecom in general have both been modest. This is surprising since the applicable regime in individual countries in SAFTA is far more liberal than the commitments made under GATS. The revised offers, where available also do not bridge this gap. The reasons are discussed later in this chapter. The Schedules of Commitment Article XX of the GATS provides that WTO members should inscribe their specific commitments in their Schedules. The Schedules of commitments specify both the telecommunication service sector (the sub-sector) in which commitments have been undertaken by a WTO member, and the nature of these commitments with respect to market access and national treatment. These commitments are made separately for each mode of service supply. In certain cases, members have undertaken additional commitments (on licensing and regulatory principles) in their schedule of commitments. While one schedule specifies the conditions and qualifications attached to market access and national treatment by members, another Schedule contains the MFN exemptions specified by countries. With respect to market access commitments inscribed in the schedule, certain types of limitations (separately for each mode of supply) may be maintained only if, and to the extent, it is specifically mentioned in the Schedule. The types of limitations that may be specified for market access are: • limitation on the number of suppliers • limitations on the total value of service transactions or assets • limitations on the total number of services operations or on the total quantity of service output • limitation on the total number of natural persons that may be employed • measures which restrict or require specific types of legal entity or joint venture limitations on the participation of foreign capital. With respect to national treatment for any specified service, members can specify conditions and qualifications so as not to give full national treatment. The exceptions to national treatment can take the form of different treatment with respect to tax measures, nationality or residency requirements, licensing standards, criteria relating to qualifications, and requirements for obtaining authorisation for providing the service. Based on an interpretative note issued by the Chairman of the negotiating group on basic telecom, an understanding was developed that unless specified, the scheduled commitments would cover all the relevant dimensions of basic telecom services in terms of: • local, long distance and international services • public and non-public services • supply on a facilities basis or through resale • technology-neutrality with respect to supply by cable, radio, satellites, stationary and nonstationary means. As is well known, negotiations are conducted on a request offer approach, ultimately culminating in commitments by individual countries. Based on information available currently, the following members have submitted 69 initial offers: Albania; Argentina; Australia; Bahrain; Barbados; Brazil; Brunei Darussalam; Bulgaria; Canada; Chile; the People’s Republic of China; Taipei,China; Colombia; Costa Rica; Croatia; Cuba; Dominica; Dominican Republic; El Salvador; Egypt; European Communities and its member states; Fiji; Former Yugoslav Republic of Macedonia (FYROM); Gabon; Grenada; Guatemala; Guyana; Honduras; Hong Kong, China; Iceland; India; Indonesia; Israel; Jamaica; Japan; Jordan; Kenya; Korea; Liechtenstein; Macao, China; Malaysia; Mauritius; Mexico; Morocco; New Zealand; Nicaragua; Norway; Oman; Pakistan; Panama; Paraguay; Peru; Philippines; Qatar; Saint Kitts and Nevis; Saint Lucia; Saint Vincent & the Grenadines;
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QUANTIFICATION OF BENEFITS FROM ECO
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QUANTIFICATION OF BENEFITS FROM ECO
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Preface Our consultations with seni
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viii CONTENTS 7. Revenue and Welfar
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Executive Summary OBJECTIVE This st
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EXECUTIVE SUMMARY xiii Table 1 EAMA
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EXECUTIVE SUMMARY xv India A full S
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EXECUTIVE SUMMARY xvii indicates th
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EXECUTIVE SUMMARY xix ments on basi
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Part I BENEFITS FROM TRADE, INVESTM
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4 QUANTIFICATION OF BENEFITS FROM E
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2 Literature Review and Rationale f
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4 Effective Additional Market Acces
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6 Impact of SAFTA on Member Countri
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7 Revenue and Welfare Implications
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8 Impact of SAFTA on Inward and Out
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Part II BENEFITS FROM DEEPENING INT
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11 Construction and Related Enginee
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Appendix 11 Table A11.1 On an Emplo
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Appendix 12 Original Commitments/In
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Appendix 14 Table A14.1 Telecommuni
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Appendix 15 REFERENCE PAPER Scope T
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Bibliography Abelson, P. (1996),
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BIBLIOGRAPHY 241 Cuba (2002), Negot
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BIBLIOGRAPHY 243 (2004), Impacts of
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BIBLIOGRAPHY 245 Silva, Patricia an
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BIBLIOGRAPHY 247 (1998), Tourism Se
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