Open
Regionalism and Deeper Integration: The Implementation of ASEAN Investment
Area (AIA) and ASEAN Free Trade Area (AFTA)
Dr.
Lawan Thanadsillapakul
Part
21
However,
GATS Art. VII calls upon Members, wherever appropriate, to base recognition
of qualifications on multilaterally agreed criteria. It also calls upon
Members to work in co-operation with relevant international intergovernmental
and non-governmental organisations towards the establishment and adoption
of common international standards and criteria for recognition. Nevertheless,
the WTO itself does not play any role in the formation of standards or
development of criteria for recognition. In fact, the development of self-regulation
and prudential measures, such as in financial and banking service, also
indicates the trend towards interaction between national and international
regulatory networks propelled by professionals in each fields of services
(Picciotto, 1996: 89-123; Picciotto, 1998: 731-768).
The
WTO encourages Members to develop multilateral disciplines relating to
market access in order to put immediately into effect paragraph 4 of Art.
VI of the GATS on domestic regulation which provided that:
"With
a view to ensuring that measures relating to qualification requirements
and procedures, technical standards and licensing requirements do not
constitute unnecessary barriers to trade in services, the Council for
Trade in Services shall, through appropriate bodies it may establish,
develop any necessary disciplines. Such disciplines shall aim to ensure
that such requirements are, inter alia:
(a) |
based on objective
and transparent criteria, such as competence and the ability to
supply the services; |
(b) |
not more burdensome
than necessary to ensure the quality of the service; |
(c) |
in the case
of licensing procedures, not in themselves a restriction on the
supply of the services". |
These powers could be used by the GATS Council to ensure that MRAs contribute
to the development of internationally agreed standards. This could also
occur if some ASEAN members also conclude MRAs with non-members so that
MRAs so concluded would be complementary and interactive between ASEAN
and international MR.
What ASEAN countries should consider is to strengthen their national substantive
standards and procedural requirements to adequately assure the quality
of services and of service providers, but bear in mind the need to apply
such requirements transparently and avoid unnecessary burden on ASEAN
service providers. An ASEAN Council for Trade in Services should be established
to facilitate the co-ordination of ASEAN countries in negotiating MRA
and help promote the development of agreed ASEAN standards and requirements
where there are no such common international standards.
Co-operation
in Service Trade among ASEAN Countries
The liberalisation of service trade under AFAS also goes beyond the GATS
in that it encompasses co-operation in service trade among ASEAN countries(133) . The four areas of co-operation, provided in Art. II (2) are:
1. |
establishing
or improving infrastructural facilities; |
2. |
joint production,
marketing and purchasing arrangements; |
3. |
research and
development; and |
4. |
exchange of
information. |
This
co-operation aims to promote the harmonisation of legal and economic policy
as well as the enhancement of transparency of internal regulation of service
provision among ASEAN countries in order to improve their efficiency and
competitiveness, diversity of production capacity and supply and distribution
of services suppliers within and outside ASEAN.
In
particular, the crucial obligation under AFAS is the commitment of ASEAN
countries to the principles of stand still and roll back that guarantee
the progressive liberalisation intra-ASEAN. The 1998 ASEAN Summit decided
to extend service sector coverage to all sectors and all modes of supply
in principle, so that the implementation of this decision along with the
stand still and roll back principles would reinforce extensive liberalisation
in service trade intra-ASEAN.
The liberalisation of service trade under AFAS has reinforced the attractiveness
of the ASEAN region in service sectors, as it results in an enlarged ASEAN
market for such services. In particular, ASEAN's openness to welcome outsiders
into the region through their establishment in ASEAN countries enables
non-ASEAN firms to gain advantages both from the privileges offered under
AFAS and from economies of scale generated by intra-ASEAN integration.
The liberalised ASEAN market might further induce inflow of investment
associated with service trade in the region.
In
addition, AFAS(134) provides
that it shall neither affect existing agreements nor constrain the right
of members to enter into agreements not contrary to the Framework Agreement.
This apparently tautologous provision seems to aim at preserving the benefits
to ASEAN or non-ASEAN countries of bilateral agreements extending special
liberalisation privileges. Such benefits, which would normally be required
to be extended to other states under the MFN clause, may be preserved
if notified under the GATS Art. II MFN exemption lists. However, it should
be noted that these are in principle subject to review and roll-back.
An example is the bilateral agreement between Thailand and the USA(135) , which allows the US maritime transport of cargoes the rights to carry
all products. This privilege does not extend to all other WTO members.
The
1998 Heads of ASEAN Summit Meeting also agreed to initiate a new round
of negotiations beginning in 1999 and ending in 2001, to expand AFAS beyond
the seven priority sectors, identified at the fifth ASEAN Summit, to cover
all services sectors and all modes of supply(136) . This clearly shows the commitments made among ASEAN member countries
to liberalise trade in services beyond their commitments under the GATS,
under which they have made more reservations than they did under GATS-Plus.
However, the liberal interpretation of the "ASEAN services provider"
provision encompassing eligible non-member service providers who meet
the criteria or requirements for being regarded as an ASEAN service provider
to be able to enjoy preferences under AFAS, facilitates and complements
the generalised liberalisation of services into ASEAN from third countries.
Part
22
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(133)
AFAS Art. I (a) to enhance cooperation in services amongst ASEAN States
in order to improve the efficiency and competitiveness, diversify production
capacity and supply and distribution of services of their service suppliers
within and outside ASEAN.
(134)
Art. IX of the Framework Agreement on Services.
(135)
Treaty of Amity and Economic Relations.
(136)
Statement on Bold Measures paragraph 10. |