Training Workshop on Trade in Services Negotiations for AU-CFTA Negotiators

The quality of a services agreement is determined by the disciplines associated with the scheduling technique, rather than the form or technique used for scheduling liberalization or market access commitments. Services agreements demonstrate a wide variety and diversity, with no two agreements being identical. The distinction between form and substance is crucial in understanding approaches to services agreements. Form refers to the technique used for scheduling liberalization or market access commitments, while substance refers to the disciplines associated with the scheduling technique. The quality of a services agreement depends on several factors, including coverage, transparency obligations, national treatment obligations, scheduling at the level of status quo, future liberalization commitments, breadth and depth of other included disciplines, rule of origin criteria, and denial of benefits. These factors are not directly related to the form or scheduling technique, which can be associated with weaker or stronger disciplines. The architecture or structure of a services agreement is another critical aspect that differs between RTAs. The structure refers to the way services are dealt with in various chapters of the RTA, the relationship between services and investment, and services and other areas. The structure can influence the quality of the agreement, as it can either facilitate or hinder the use of the RTA by service suppliers. There are three primary scheduling techniques used in services agreements: positive list, negative list, and hybrid approaches. The positive list approach is largely based on the World Trade Organization's (WTO) General Agreement on Trade in Services (GATS) and has been the traditional approach for most developing countries. This approach involves listing sectors by choice or in a positive way, with commitments not applying unless the sector and/or specific sub-sector is inscribed in the schedule. The negative list approach, on the other hand, is largely based on the North American Free Trade Agreement (NAFTA) and has become the standard practice for the majority of RTAs. This approach involves listing limitations to market access and national treatment, with all limitations to MA and NT must be listed unless a full commitment to maintain no restrictions or limitations is made. The hybrid approach is a variation of either the positive list or negative list approach and is being followed in the Trade in Services Agreement (TISA) negotiations. The positive list approach involves sector-specific commitments, including sector/sub-sector, modes of service supply, market access limitations, and national treatment limitations. The negative list approach, on the other hand, involves listing limitations to market access and national treatment, with all limitations to MA and NT must be listed unless a full commitment to maintain no restrictions or limitations is made.