Tradeflow Study - UNDP Black Sea Trade and Investment Promotion ...

The commitments made by BSEC Member States who are members of the WTO provide an
important indication of the potential for cross border services trade between BSEC countries.
The countries which are members of the WTO have made commitments to liberalise their
services sector to cross border according to the mode of supply for delivering the service.
Thus members of the WTO are party to the General Agreement on Trade in Services which
applies to four modes of supply:
Mode 1: Cross border supply which does not require a physical movement from
supplier or consumer.
Mode 2: Movement of the consumer to the country of the supplier.
Mode 3: Services provided to the consumers of a foreign country through
commercial presence
Mode 4: Services provided through the temporary movement of natural persons.
Subscribing to the GATS principles, BSEC Member States must apply a non-discriminatory
trade policy in the area of services to other WTO members thereby providing an equal
treatment for all WTO members, undertaking to not discriminate between local and foreign
firms, promoting a stable trade environment which should increase cross-border trade in
services.
The GATS schedule of commitments provides for commitments to be made in Market Access,
National Treatment and any additional commitments. National Treatment (Art XVII GATS)
refers to the commitment to provide a treatment no less favourable than that accorded to
domestic service providers. Market Access refers to the conditions for accessing the market
and cover six principal types of market restrictions, namely (i) number of service suppliers
allowed; (ii) value of transactions or assets; (iii) total quantity of service output; (iv) number of
natural persons that may be employed; (v) the type of legal entity through which a service
supplier may supply a service.; and (vi) limitations on the level of foreign equity allowed by the
service provider. GATS Members are entitled to make limitations in these areas.
GATS provides some policy space for submitting a list of exemptions to non discrimination in
market access and National Treatment. The schedule is thus detailed within the areas of
Market Access, National Treatment, and other commitments, and each of these areas is
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