Open
Regionalism and Deeper Integration: The Implementation of ASEAN Investment
Area (AIA) and ASEAN Free Trade Area (AFTA)
Dr.
Lawan Thanadsillapakul
Part
20
Art.
V encourages ASEAN countries to enter into agreements or arrangements
to recognise education or experiences obtained, requirements met, or licenses
or certifications granted in another ASEAN country, the country of residence
of the service providers. Thus the conditions made by all ASEAN countries
regarding qualifications or requirements of service providers would be
mutually recognised for their qualifications, provided that such qualifications
meet the requirements of the receiving country (substantive standard).
Mutual recognition among ASEAN countries may be accorded autonomously
or based upon an agreement or arrangement with the member countries concerned.
However, this provision is not mandatory as Art. V stated that:
"Nothing
in paragraph 1 shall be so construed as to require any Member State
to accept or to enter into such mutual recognition agreement or arrangement".
From a legal point of view, this is a weak point of the AFAS, as mutual
recognition is not made a mandatory requirement. Nevertheless, ASEAN countries
tend to concertedly adopt the principle of mutual recognition and some
ASEAN countries such as Singapore, Brunei and Malaysia have already extensively
recognised each other's national qualifications. This is probably because
of their proximity in culture, education, legal systems, religion and
general social standards. These developments were validated under Art.
VII GATS.
A key issue of mutual recognition in service provision is whether to recognise
that the "standard" or "qualifications" of service
providers and services provided complies with the substantive standards
and the procedural requirements of each individual country which has adopted
the principle of mutual recognition. The host or importing country may
wish to retain its own substantive standard, but maybe willing to accept
certification by the exporting country that an item/service provider complies
with that standard. Alternatively, countries may be willing to agree a
common standard, e.g. for a professional qualification, but may wish to
retain certification in their own hands so that they can assure that the
certification granted really reaches their standard requirements compliance,
or the agreed common standard. For instance, according to Thai regulations,
a medical doctor can carry out surgery only if he/she has passed certain
procedural requirements tests and may be granted a certificate for surgery
even though he/she may hold a medical degree from somewhere else. Also,
a lawyer can practice in court and provide legal services only if he/she
reaches a substantive standard. This has a series of requirements: having
a law degree, passing a bar exam, being in legal practice for two years
and being granted a certificate from the Thai Lawyers Society, be aged
above 25 years, being of sound background, prudence and of good behaviour
(these qualifications will be scrutinised by the Committee), not being
physically handicapped, and having Thai nationality. Those not able to
comply with all these requirements may apply for a license from the Thai
Lawyers Society as international lawyers who can provide legal services
in business but cannot practice in court. Therefore, if Thailand adopted
and was bound by a MRA, medical doctors or lawyers who hold their degree
from their home country may be accepted by Thailand, but they may nevertheless
need to satisfy procedural requirements such as passing a test to obtain
a surgery certificate or passing a bar exam to obtain the certificate
for practising in court.
Another key issue is whether MR is subject to MFN treatment or not. For
example, if Thailand entered into a MRA with Singapore, the question is
whether the commitment under such agreement will extend to other ASEAN
countries automatically on a MFN basis, or even might extend to other
WTO Members. On this issue, Art. V AFAS has narrowed down the applicability
of such agreements so that they bind only ASEAN Members. Art. V reads:
"These
agreements or arrangements are concluded for Member State only. In the
event a Member State wishes to join such agreements or arrangements,
it should be given equal opportunity to do at any time".
Therefore, MRAs concluded between ASEAN countries will not automatically
be extended to other WTO Members, or to other ASEAN countries that did
not enter into such MRA. Art. V AFAS, like Art. VII GATS, allows Members
to treat service providers of other Members differently depending on the
type of qualifications granted in their country of origin. However, it
does not allow Members to discriminate in the application of their substantive
standards or criteria for authorisation, licensing or certification of
service suppliers. In other words, there is a distinction between allowing
services suppliers of certain Members to have access to the market through
a fast track on the basis of a recognition arrangements on the one hand,
and applying different substantive requirements to service suppliers on
the other hand: an individual who can meet the substantive standards should
be allowed to qualify whatever his country of origin(131) . Since MR is either unilateral (autonomous) or based on country-by-country
agreements, a MRA will not automatically extend to all WTO or ASEAN Members
on a MFN basis. However, members who are parties to recognition agreements
are required under Art. VII GATS to afford adequate opportunity for other
interested Members to negotiate their accession to such agreements or
to negotiate comparable ones with them. If recognition is granted on an
autonomous basis, the Member concerned must give adequate opportunity
for any other Member to demonstrate that qualifications acquired in its
territory should be recognised(132) .
The
further issue to be considered is whether the ASEAN limitation restricting
parties to the MRA is valid since, Art. VII GATS bound WTO Members to
grant adequate opportunity to negotiate MRA on similar terms. Also, Member
States need to notify the Council for Trade in Services of their existing
recognition measures and to state whether such measures are based on agreements
or granted autonomously. However, Art. IV of GATS allows WTO Members to
implement regional integration and grant preferences among the member
countries of such agreements, and may be considered to apply also to MRAs
that give preferential recognition to member countries of the regional
agreement. As mentioned above, GATS allows states to treat services providers
of other Members differently depending on the level of qualifications
granted in their country of origin. Therefore, states are likely to prefer
to negotiate MRAs with countries that may already have levels of qualification
equivalent to their own qualification. It should be noted that GATS is
based on a bottom-up or positive list approach that, in principle, allows
a certain level of discretion for the recipient country to commit itself
in market access. Since Art. V permits WTO Members to enter into regional
agreements for preferential treatment among some other Members for trade
in services, thus to implement such regional integration, preferences
such as MR limited to member countries of the regional agreement should
be accepted as valid.
Part
21
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(131)
See GATS: Recognition, WTO web site: http://www.wto.org/eol/e/wto06/wto6_19.htm.
(132)
See GATS: Recognition, WTO web site: http://www.wto.org/eol/e/wto06/wto6_19.htm. |