[Federal Register Volume 68, Number 161 (Wednesday, August 20, 2003)]
[Notices]
[Pages 50208-50209]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-21364]


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OFFICE OF THE UNITED STATES TRADE REPRESENTATIVE


Request for Public Comment on the Market Access Implications for 
U.S. Trade in Services of the Accession to the European Union of 
Austria, Finland and Sweden

AGENCY: Office of the United States Trade Representative.

ACTION: Request for comment.

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SUMMARY: The Trade Policy Staff Committee gives notice that the Office 
of the United States Trade Representative (USTR) requests written 
submissions from the public concerning the market access implications 
for U.S. trade in services of the 1995 enlargement of the European 
Union to include Austria, Finland and Sweden. On July 10, 2003, the 
European Communities and its Member States (collectively, the EC) 
transmitted a ``Notification Pursuant to Article V:5 of the GATS--
Accession of Austria, Finland and Sweden to the European Communities'' 
(S/C/N/231), notifying the WTO Council for Trade in Services of their 
intention to modify or withdraw Specific Commitments. It stated that 
previous GATS schedules of specific commitments and lists of MFN 
exemptions will be replaced by new commitments as from April 30, 2004. 
The existing schedules and lists are accessible through the WTO's 
Services Database Web site, http://tsdb.wto.org/wto/WTOHomepublic.htm. 
From that site, click on ``Pre-defined Reports'' and then ``All Sectors 
in Each Country.''
    On August 6, 2003, the United States indicated its claim of 
interest in the modification or withdrawal of specific commitments and 
requested negotiations with the EC pursuant to GATS Article XXI with a 
view to reaching an agreement on any necessary compensatory adjustment. 
The United States also requested that the EC clarify the legal and 
procedural basis for any modifications in the GATS Article II MFN 
exemptions of the EC or its Member States that may be included in the 
EC's consolidated list of GATS Article II MFN exemptions, reflecting 
changes in the EC's WTO obligations resulting from the 1995 
enlargement. USTR and other agencies are currently engaged in an 
assessment of the potential impact on U.S. services trade of the 1995 
enlargement of the EC and in particular of what compensation the EC may 
owe to the United States under WTO rules; comments from the public in 
response to this notice will be incorporated into that assessment.

DATE: Submissions must be received on or before noon, 30 days after 
publication.

ADDRESSES: Submissions by Electronic Mail: [email protected]. Submissions 
by facsimile: Gloria Blue, Executive Secretary, Trade Policy Staff 
Committee (TPSC), Office of the USTR, at (202)395-6143.

FOR FURTHER INFORMATION CONTACT: For procedural questions concerning 
public comments, contact Gloria Blue, Executive Secretary, TPSC, Office 
of the USTR, 1724 F Street, NW., Washington, DC 20508, telephone 
(202)395-3475. Substantive questions concerning this review should be 
addressed to Mark Mowrey, Deputy Assistant U.S. Trade Representative 
for Europe and the Mediterranean, telephone (202)395-3074.

SUPPLEMENTARY INFORMATION:

1. Background Information

A. The 1995 Enlargement

    On January 1, 1995, the EC grew from 12 to 15 Member States, with 
the accession to the Union of Austria, Finland and Sweden effective 
that date. With respect to WTO rules related to trade in goods, the 
United States entered into compensation negotiations with the EC under 
General Agreement on Tariffs and Trade (GATT) Articles XXIV and XXVIII. 
Those negotiations took place in 1994 and 1995, yielding a bilateral 
agreement on compensation which entered into force on July 22, 1996 
(effective from December 30, 1995).
    Despite repeated requests from the United States and other WTO 
members, the EC failed in the period subsequent to the 1995 enlargement 
to notify WTO Members of its proposed modification or withdrawal of 
commitments as the result of this enlargement as required under GATS 
Articles V:5 and XXI. However, on July 10, 2003 the EC provided its 
proposed consolidated GATS schedule for the EC 15 and formally notified 
its intent to modify or withdraw commitments as a result of its 
enlargement. Pursuant to GATS Article XXI, the EC is required to enter 
into negotiations with any WTO Members who believe they may be affected 
by the proposed modification or withdrawal of specific commitments with 
a view to reaching agreement on any necessary compensatory. On August 
6, 2003 the United States notified the EC that it did desire such 
negotiations.

B. The EC Notification of 2003

    On July 10, 2003, the EC transmitted a communication to the WTO 
Secretariat presenting its consolidated schedule for the EC 15 of 
specific commitments under the GATS, and its consolidated list for the 
EC 15 of GATS Article II MFN exemptions.
(1) Specific Commitments
    The EC's Communication stated that pursuant to Article V:5 of the 
GATS and in accordance with the terms of GATS Article XXI:1(b), the EC 
was notifying the WTO's Council for Trade in Services of its intention 
to modify or withdraw a number of specific GATS commitments. The EC 
presented a summary list of these modified commitments, which is 
paraphrased below:
    a. Horizontal Commitments
    [sbull] Market access entry: the EC limitation with respect to 
public utilities services being subject to public monopolies or to the 
granting of exclusive rights to private operators is extended to 
Austria, Finland and Sweden.
    [sbull] National treatment limitations on subsidies--mode 3: the 
limitations on subsidies on mode 3 inscribed in the EC's schedule now 
apply also to Austria, Finland and Sweden.
    b. Sectoral commitments
    [sbull] Rental/Leasing services without operators--relating to 
aircraft: the EC's limitations under mode 2 and mode 3 are extended to 
Austria.
    [sbull] Services incidental to manufacturing: the commitment 
included in the schedule of Austria is withdrawn.

[[Page 50209]]

    [sbull] Education services--limitation to ``only privately funded 
services'': the EC's limitation is now extended also to Austria.
    c. Space Transport
    [sbull] The commitment included in the schedule of Austria is 
withdrawn.
(2) MFN Exemptions
    In its communication of July 10, 2003 the EC also proposed a 
consolidated list of GATS Article II MFN exemptions for the EC 15 that 
in essence would extend the coverage of the EC's existing MFN 
exemptions to Austria, Sweden and Finland. According to the EC's 
notification, the only modifications or withdrawals of specific 
commitments are those listed in the Annex attached to the notification, 
which does not refer to the EC's MFN exemptions. The United States 
therefore believes that the EC's MFN exemptions are not within the 
scope of its GATS Article V notification and has requested that the EC 
provide clarification of the procedural and legal basis for any changes 
in its MFN exemption list.
(3) Applicable GATS Requirements
    Article V of the GATS provides that the GATS does not prevent a WTO 
Member from being a party to an economic integration agreement 
liberalizing trade in services provided that, inter alia, the agreement 
has substantial sectoral coverage and provides for the absence or 
elimination of substantially all discrimination between the parties in 
the sectors covered by such an agreement. Paragraph 5 of Article V 
provides that if such an agreement is later enlarged or significantly 
modified, and a WTO Member intends to modify or withdraw a specific 
GATS commitment as a result, it must provide 90 days advance notice of 
such modification and follow the applicable procedures set out in GATS 
Article XXI. Paragraph 2 of Article XXI provides that WTO Members who 
believe they may be affected by the proposed modification of 
commitments can request negotiations with the modifying Member with the 
purpose of reaching an agreement on compensation for the proposed 
modification.
    While Article XXI covers modification and withdrawal of specific 
GATS commitments, it does not address modifications to a WTO Member's 
MFN exemptions pursuant to GATS Article II. The GATS Annex on MFN 
exemptions provides that any modifications to a WTO Member's MFN 
exemptions, after entry into force of the Agreement Establishing the 
WTO (``WTO Agreement''), require a Member to seek a waiver pursuant to 
Article IX of the WTO Agreement. The EC's communication of July 10, 
2003 did not address the issue of whether it intends to seek a waiver 
for its proposed consolidated list of MFN exemptions.
(4) Accessing the Schedules of Specific Commitments and Lists of MFN 
Exemptions
    The EC's proposed consolidated schedule of specific commitments and 
consolidated list of MFN exemptions for the EC 15 are restricted WTO 
documents. The public therefore is advised to examine the existing GATS 
schedules of specific commitments and lists of MFN exemptions of the 
EC, Austria, Finland and Sweden to determine whether changes implied 
through consolidation of the schedules and lists would impact U.S. 
commercial interests. The existing schedules and lists are accessible 
through the WTO's Services Database Web site, http://tsdb.wto.org/wto/WTOHomepublic.htm. From that site, click on ``Pre-defined Reports'' and 
then ``All Sectors in Each Country.''

2. Requirements for Submissions

    To ensure prompt and full consideration of responses, USTR strongly 
recommends that interested persons submit comments by electronic mail 
to the following e-mail address: [email protected]. Persons making 
submissions by e-mail should use the following subject line: ``Services 
Accession Austria, Finland and Sweden.'' Documents should be submitted 
in WordPerfect, MSWord, or text (.TXT) files. Supporting documentation 
submitted as spreadsheets is acceptable in Quattro Pro or Excel format. 
For any document containing business confidential information submitted 
electronically, the file name of the business confidential version 
should begin with the characters ``BC-'', and the file name of the 
public version should begin with the character ``P-''. The ``P-'' or 
``BC-'' should be followed by the name of the submitted information. 
Persons who make submissions by e-mail should not provide separate 
cover letters; information that might appear in a cover letter should 
be included in the submission itself. To the extent possible, any 
attachments to the submission should be included in the same file as 
the submission itself, and not as separate files.
    Written submissions will be placed in a file open to public 
inspection pursuant to 15 CFR 2003.5, except confidential business 
information exempt from public inspection in accordance with 15 CFR 
2003.6 must be clearly marked ``Business Confidential'' at the top of 
each page, including any cover letter or cover page, and must be 
accompanied by a non-confidential summary of the confidential 
information. All public documents and non-confidential summaries will 
be available for public inspection in the USTR Reading Room in Room 3 
of the Annex of the Office of the USTR, 1724 F Street, NW., Washington, 
DC 20508. An appointment to review the file may be made by calling 
(202) 395-6186. The USTR Reading Room is generally open to the public 
from 10 a.m.-12 noon and 1-4 p.m., Monday through Friday. Appointments 
must be scheduled at least 48 hours in advance.

Carmen Suro-Bredie,
Chairperson, Trade Policy Staff Committee.
[FR Doc. 03-21364 Filed 8-19-03; 8:45 am]
BILLING CODE 3190-01-P