From The Economist:
2. Domestic Regulation
(a) Notwithstanding any other provisions of the Agreement, a Member shall not be prevented from taking measures for prudential reasons, including for the protection of investors, depositors, policy holders or persons to whom a fiduciary duty is owed by a financial service supplier, or to ensure the integrity and stability of the financial system. Where such measures do not conform with the provisions of the Agreement, they shall not be used as a means of avoiding the Member’s commitments or obligations under the Agreement.
Global Trade Watch puts its specific concern this way:
As the second sentence makes clear, prudential measures are only allowed under GATS rules if they don’t violate any of the GATS rules, which are very expansive.
I'm not sure that's quite right. Let me run through this provision briefly.
The first sentence suggests that Members can take measures for "prudential reasons," even if these measures would otherwise violate other GATS provisions. So, let's say you have a measure that violates GATS Article XVI (Market Access). If that measure is taken "for prudential reasons," including the ones listed, it is permitted despite the Article XVI violation. (Presumably there must be some objective determination as to whether the measure is actually "for prudential reasons," such as a means-ends test applied to the measure and the stated policy goal, rather than just accepting the Member's declaration of the purpose without further scrutiny.) This part looks like a pretty typical WTO "exception."
The second sentence narrows the scope of this "exception" to some extent. (In a sense, the debate here is over how much it has been narrowed). In this regard, the second sentence states that if the measures at issue do violate other GATS provisions, they are not completely off the hook when they are found to be "for prudential reasons" under the carve out, as there is a legal obligation that still applies: "[the measures] shall not be used as a means of avoiding the Member’s commitments or obligations under the Agreement." This language seems a bit like the GATT Article XX chapeau trying to root out "disguised restrictions." In particular, the requirement that such measures not be used as a "means of avoiding ... commitments or obligations" has a similar feel. "Avoiding" is not quite as strong as "disguised," but it's along the same lines. Basically, both the second sentence here and the Article XX chapeau indicate that the non-protectionist purposes offered to justify the measure must be authentic.
The problem is, the second sentence of the prudential carve out is worded a little more confusingly than the chapeau. The sentence starts with "[w]here such measures do not conform with the provisions of the Agreement." This language is somewhat duplicative of the "[n]otwithstanding any other provisions of the Agreement" language from the first sentence. Implicit in the "notwithstanding" language is that there was a violation of the other provisions. Restating this point in the second sentence as "[w]here such measures do not conform" makes it seem like this is an additional obligation not to violate the GATS which applies subsequent to the application of the first sentence. I think that's why Global Trade Watch takes such a broad view of the meaning of the second sentence: "prudential measures are only allowed under GATS rules if they don’t violate any of the GATS rules." I see how they get to that conclusion by focusing on the first clause of the second sentence, but I'm not sure that's right. Rather, as noted above, I think the better interpretation is that the second sentence corresponds to the chapeau, emphasizing that any measures taken for the stated policy reasons not be disguised trade restrictions (or here, measures taken to avoid commitments or obligations). The "[w]here such measures do not conform with the provisions of the Agreement" language just recalls the violation implicit in the "notwithstanding" language in the first sentence. To be more clear about it, the first part of the second sentence could have been written as "[w]here prudential measures that do not conform with other provisions of the Agreement have been used," or something along those lines. That's what the "such measures" refers to, in my view. It just doesn't do it very clearly.
Having offered that interpretation, I must admit that I do think the language is a bit vague and hard to pin down, and could be construed otherwise than I've suggested. It would be nice to have it stated more clearly. Along these lines, here's what Global Trade Watch suggests as a replacement provision:
2. Domestic Regulation
(a) Notwithstanding any other provisions of the Agreement, a Member shall not be prevented from adopting or maintaining measures relating to financial services it employs for prudential reasons, including for the protection of consumers, investors, depositors, policy holders, or persons to whom a fiduciary duty is owed by a financial services supplier, or to ensure the integrity and stability of the financial system. For greater certainty, if a Party invokes this provision in the context of consultations or an arbitral proceeding initiated under the Dispute Settlement Understanding, the exception shall apply unless the Party initiating a dispute can demonstrate that the measure is not intended to protect consumers, investors, depositors, policy holders, or persons to whom a fiduciary duty is owed by a financial services supplier, or is not intended to ensure the integrity and stability of the financial system.
As I see it, this is the same basic idea, just stated a little more clearly, and also the burden is placed on the complainant to demonstrate that the measure is not being used for the policy purposes the respondent says it is about.
I had seen brief references to a WTO complaint against China related to the credit card industry, but didn't know the details. Here's the argument, as set out by Eric Grover in the Washington Times:
Chinese banks have 1.88 billion debit cards and 190 million credit cards outstanding, on which cardholders made 19.7 billion purchases last year. But they can't buy domestic card payment network services from American Express, Discover, JCB, MasterCard or Visa. China UnionPay (CUP) enjoys a protected card-payment-network monopoly. And merchant processors such as First Data and Global Payments, which have joint ventures in China with British banks Standard Chartered and HSBC respectively, can't compete with CUP and Chinese banks providing domestic card acceptance to merchants.
By Dec. 11, 2006, China's entire domestic credit and debit card market should have been open to foreign payment networks and processors. But there has not yet been a single domestic MasterCard or Visa payment transaction in China, almost nine years after it joined the WTO and three years after it pledged to have completely opened its domestic retail cards market.
While Chinese banks co-brand payment cards with MasterCard and Visa, it's only for use overseas where CUP's acceptance network is weak. Similarly, foreign merchant processors only provide card acceptance for MasterCard and Visa payments by tourists and business travelers visiting China.
China's ban on American, European and Japanese firms from its domestic credit and debit card market violates the letter and spirit of its WTO commitments, harms Chinese consumers and merchants, and hurts businesses such as Amex, Discover, First Data, Global Payments, JCB, MasterCard and Visa. Dialogue with no credible possibility of punitive consequences won't change China's conduct. Successful WTO complaints have borne fruit in other sectors. The United States should bring a card-payments WTO action against China unilaterally, or, possibly, with Japan and the EU.
The Economist has a piece on competition in the market for building nuclear reactors, in which they discuss how state support for domestic competitors may be playing a role:
... the United Arab Emirates (UAE) completed a tender for four nuclear plants in December, Vietnam is planning a similar deal this year and many other countries, from Italy to Indonesia, are hoping to build new reactors soon.
Yet the $40 billion contract in the UAE, won by a consortium led by Korean Electric Power Corporation (KEPCO), South Korea’s largely state-owned electricity monopoly, has caused consternation among the six big firms that have dominated the industry for decades: GE and Westinghouse of America, Areva of France, and Toshiba, Hitachi and Mitsubishi Heavy Industries of Japan. Russian and Chinese firms hope to follow the Koreans’ lead. Suddenly the incumbents are confronted by emerging-market “national champions” with the full backing of their governments—an invaluable asset in a high-liability business like nuclear power.
“If you find out how they won, let me know,” quips Hirotada Nagashima, a senior executive in the nuclear division of Hitachi, whose joint venture with GE lost out to Kepco, as did a consortium of Areva and other French industrial behemoths, including Electricité de France (EDF), Total and GDF-Suez. But there is little mystery. The South Korean consortium, which includes the heavy-industry arms of Doosan, Hyundai and Samsung, three of the country’s biggest conglomerates, and uses some of Westinghouse’s technology, has worked together for decades, building and operating most of South Korea’s 20 reactors. It offered not just to build the plants, but also to run them and even to find the fuel they will need—at a fixed price, for the most part. “It was very easy to bring them together and offer the UAE a complete package,” says Mark Yoon of CLSA, a financial-research firm.
The South Korean government also played its part. The president, Lee Myung-bak, flew off to Abu Dhabi on the eve of the decision to gladhand the locals, promising to help the barren statelet recreate South Korea’s economic miracle. Hiroki Mitsumata, director of nuclear energy at Japan’s Ministry of Economy, Trade and Industry (METI), believes that support from the South Korean government may also have allowed Kepco to offer the lowest price, because the state can backstop cost overruns and accident liability.
The future looks just as competitive:
The next test of the nuclear vendors’ mettle will be the bidding this year to build four nuclear reactors in Vietnam. Mr Mitsumata of METI thinks the government-run Japan Bank for International Co-operation, an export-credit and project-finance provider, and state-backed trade insurance could be used to boost the Japanese entrants. There is talk of a joint bid with a big utility such as Tokyo Electric Power. The government “is trying to increase the level of industrial support for the Vietnam project and the utility companies have been talking more seriously about that,” he says. But Kepco has hinted that it, too, is eyeing Vietnam—as well as other middle-income countries such as Turkey, Jordan, Indonesia, Thailand and South Africa.
In addition to government support for specific foreign projects, government support for domestic projects is also important:
American and Japanese nuclear firms’ chances of maintaining an edge may depend on how far their governments are willing to push nuclear power at home. Mr Obama’s sudden enthusiasm has given the American firms hope. But the Department of Energy has yet to hand out any of the previous batch of loan guarantees approved in 2005. Regulators in Florida have squelched local utilities’ plans to build new reactors. Recriminations about rising costs have held up another project in Texas. It is a far cry from South Korea, where six reactors are under construction and another 14 are on the drawing board.
Presumably, governments are likely to go to domestic companies for domestic projects, which would give these companies additional profits and allow them to bid lower on foreign projects.
It's a little unclear what the government measures at issue are here, but it seems like WTO rules should have something to say. Or is this one of those "subsidies to services" issues, which we have talked about before (e.g., here), where there are no direct rules? Not no rules at all, of course, but nothing equivalent to the detailed rules of the SCM Agreement.
Then again, maybe this isn't just a service. Maybe there is a "good" in here somewhere as well (i.e., there are elements of both goods and services). When you pay someone to build you a nuclear plant, you end up with a big, physical structure. Isn't that a good? Or does the physical thing you end up with have to be resellable (at least to some limited extent)? One online dictionary defines "goods" as: "Items; chattels; things; any personal property." This seems pretty broad.
Perhaps the nuclear plant purchase is sort of like an American buying a car by having Toyota come to your house and assemble it in your driveway. If they did that, would you be buying a service (assembly of a car) or a car itself? But they don't do that, of course, so I'm not sure there is a parallel out there that provides much guidance.
Anyway, the point I was getting to was that if it is a good, then maybe we could apply the SCM Agreement to the issue, which would be much more helpful for thinking up WTO claims. And then, just briefly, if we do get to the SCM Agreement, if a company builds a nuclear reactor abroad, is it "exporting" a good? Does it depend on where the inputs come from, i.e., are they shipped in from another country?
With the passage of a health care bill this past week-end by the U.S. House of Representatives, I thought it was time for another post on trade in health services. This time I'll rely on an expert, Lior Herman of ECIPE. From the abstract of Assessing International Trade in Healthcare Services:
And from the conclusion:
On the basis of the availability of data this paper finds that a great deal of variation exists within different segments of international trade in healthcare services. For the most part, international trade is conducted through the movement of foreign health professionals between countries, as well as the presence of foreign healthcare firms in local markets. International trade through cross-border activity, whereby healthcare services are provided and consumed in different territories, remains very low. Trade based on the travel of healthcare consumers to foreign markets is also very low but is significantly higher than cross border trade.
Given the economic significance of the healthcare sector in overall economic activity, and in particular the high levels of both total and private expenditure on healthcare, it seems that there is scope and unexploited potential for greater international trade in healthcare services. Trade is growing in cross border trade, consumption abroad, commercial presence and movement of professionals. But the greatest potential lies in cross border provision and consumption abroad of services.
One interesting part of the recent China - Publications panel report was the discussion of technological change and the timing of GATS commitments. The specific interpretive question where this arose was the following: whether China's GATS commitment on "sound recording distribution services" in Sector 2.D, covering Audiovisual Services, "extends to the supply of such services through the delivery of content to the consumer 'electronically,' and not embedded in a physical medium such as a CD or DVD." The U.S. viewed the inscription "sound recording distribution services" in Sector 2.D. as a commitment on the distribution of recorded sound, "whether as a physical or non-physical product." By contrast, China contended that its commitment under "sound recording distribution services" "covers the distribution of sound recordings only as a physical product."
In the context of looking at "supplementary means of interpretation" pursuant to Vienna Convention Article 32 in relation to this issue, the Panel considered "the circumstances of the conclusion of China's Protocol of Accession annexing China's Schedule to the GATS, in particular evidence of the existence at that time of distribution of sound recordings in non-physical form." That is, it looked at whether sound recordings were being distributed in electronic form at the time China's WTO accession was concluded. The key aspects of its reasoning were as follows:
7.1235 China argues that the electronic distribution of sound recordings as an established business and the legal framework for such business emerged only after the negotiation of its GATS Schedule and its accession to the WTO. According to China, this was part of the circumstances of the conclusion of its GATS Schedule that have to be taken into account when interpreting its commitment on "sound recording distribution services".
7.1237 The Panel considers that, in seeking to confirm the "common intention of Members" with respect to a commitment in a GATS Schedule, evidence on the technical feasibility or commercial reality of a service at the time of the service commitment may constitute circumstances relevant to the interpretation of its scope under Article 32 of the Vienna Convention. This is particularly true where, like China's entry on "sound recording distribution services", the commitment is not explicitly linked to a well-defined system of services classification, such as the CPC. At the same time, the significance of any evidence of lack of technical feasibility or absence of commercial reality of the service at the time of the service commitment would need to be carefully evaluated. We consider therefore that any evidence that sound recordings delivered in non-physical form were not, unlike today, technically possible or commercially practiced at the time China's Schedule was negotiated might, in principle, be relevant as a supplementary means of interpretation with respect to the scope of that commitment.
7.1239 ... China's Accession Protocol, including its GATS commitments, contains the terms of accession agreed between China and the WTO, and reflects the common intention of China and the WTO. This common intention was formed when the final text of the Protocol was approved by the WTO on 10 November 2001 and was accepted by China on 11 November 2001.
7.1242 ... the evidence presented by the parties suggests that the electronic distribution of music had become a technical possibility and commercial reality, albeit limited, by 1998, and in any case before the entry into force of China's GATS Schedule following its accession to the WTO on 11 December 2001.
7.1246 In sum, the record indicates that the electronic distribution of sound recordings had become a commercial reality in many markets before China's accession to the WTO. China was aware of this fact. The domestic legal framework for the electronic distribution of sound recordings in China, to the extent that this is relevant for our interpretation, was under consideration in China from as far back as 1998, although put in place only in 2001. China had clearly taken note of, and was altering its domestic law to take into account the commercial reality of electronic distribution of sound recordings before its accession to the WTO in 2001.
7.1247 We find therefore that the electronic distribution of sound recordings was technically feasible and a commercial reality as early as 1998 and, in any case, before China's accession to the WTO in December 2001. We are therefore not persuaded that the meaning of the phrase "sound recording distribution services" cannot extend to the distribution of sound recordings in non-physical form, for the reason that negotiators of China's GATS Schedule and, more broadly, WTO Members, had at the time no conception of the technical or commercial viability of this form of distribution.
In essence, the Panel's finding was that electronic distribution was well-established at the time China made its commitments on "sound recording distribution services," and thus it is covered by those commitments.
One implication of the Panel's finding seems to be that as a result of changes in technology, different Members may have different GATS obligations, even where the terms of their commitments are identical, depending on the date on which the commitments were made. In particular, countries who negotiated their GATS commitments during the Uruguay Round (which most Members did) could have different obligations than China and other recently acceded Members with regard to certain kinds of services, despite having the same language in their commitments.
A federal appeals court has rekindled a challenge to a Wisconsin rule that allows graduates of the state's two law schools to become licensed attorneys without taking the state bar examination.
The U.S. Court of Appeals for the 7th Circuit on July 9 remanded a class action launched by two graduates of out-of-state law schools who allege that Wisconsin's "diploma privilege" rule is unconstitutional.
Wisconsin admits graduates from Marquette University and the University of Wisconsin Law School to practice without requiring them to take the Wisconsin bar exam. Only one other state, New Hampshire, admits graduates who haven't taken a bar exam — in that case, attorneys who have completed a special program at New Hampshire's only law school, Franklin Pierce Law Center.
Wisconsin requires graduates from outside the state to take the state bar exam in order to practice. It also permits bar admission without an exam for attorneys who have practiced for at least five years in another state.
The lawsuit alleges that the diploma-privilege rule unfairly restricts the mobility of out-of-state graduates in violation of the commerce clause in Article 1 of the U.S. Constitution.
Without addressing the merits of the arguments, the appeals panel held that the validity of the parties' arguments remained unclear because of the lower court's dismissal. Evidence was necessary to determine whether the diploma privilege creates an arbitrary distinction between in-state graduates and out-of-state graduates, it said. Such a determination, the court concluded, would help the courts weigh the burden on interstate commerce.
Judge Richard A. Posner wrote the opinion. Also on the panel were judges Kenneth F. Ripple and Diane P. Wood.
Here's an extract from the decision:
For suppose—a supposition not only consistent with but actually suggested by the scanty record that the plaintiffs were not allowed to amplify—that Wisconsin law is no greater part of the curriculum of the Marquette and Madison law schools than it is of the law schools of Harvard, Yale, Columbia, Virginia, the University of Texas, Notre Dame, the University of Chicago, the University of Oklahoma, and the University of Northern Illinois (which happens to be within a stone’s throw of Wisconsin, as are the three law schools in Minneapolis). That would suggest that the diploma privilege creates an arbitrary distinction between graduates of the two Wisconsin law schools and graduates of other accredited law schools. And it is
a distinction that burdens interstate commerce. Law school applicants who intend to practice law in Wisconsin have an incentive to attend one of the Wisconsin law schools even if, were it not for the diploma privilege, they would much prefer to attend law school in another state.
Todd Tucker has an interesting post over at Eyes on Trade, in which he makes the following points:
1. Certain trade experts have been saying that WTO rules do not apply to subsidies to the financial services industry (or, at least, do not provide much discipline). Thus, in their view, bailouts to this industry do not violate the rules.
2. These trade experts are wrong, as the GATS NT and MFN rules do, in fact, apply to subsidies on services.
At least, that's how I understand his argument -- Todd can correct me if I'm mis-stating it.
I'm not sure the disagreement here is as signifcant as it first appears. What I think the trade folks he quotes are saying is only that the services rules which relate to subsidies are fairly limited. Under these rules, if a domestic financial company or industry is about to go bankrupt, you can bail them out. At the same time, the trade experts would acknowledge that there are certain rules that apply to these bailouts, such as the NT and MFN requirements. So, for example, when bailing out a domestic company, you could not make the bailout money contingent on the use of domestic services of some kind (assuming the sector in question is covered).
Here's the tricky part, though, which Todd refers to in his post: "
Wisconsin’s diploma privilege for graduates of the law schools at Marquette University and the University of Wisconsin may be in danger, at least if the Seventh Circuit reviews the merits of the privilege.
Two of the judges at oral argument on Tuesday called the state’s justification for the privilege “fiction.”
Christopher L. Wiesmueller, a graduate of Oklahoma City University Law School, and an attorney with Kuchler & Cotton Law Offices in Waukesha, is challenging the privilege as a violation of the dormant commerce clause, by treating the in-state law schools and their graduates more favorably than those from out-of-state.
It pretty clearly has a discriminatory effect, and it seems that the judges were not impressed by Wisconsin's justification.
The UK gives up on a WTO subsidies complaint because there are no rules for subsidies to services:
"Last year the Government said that the UK via the European Union would take legal action against Canada if its support for its videogames industry violated WTO rules," said Richard Wilson, Tiga's CEO. "We now know that there are no legal grounds on which to lodge a complaint."
"We cannot stop our competitors from benefiting from tax breaks but there is a simple solution: copy them. The Government should announce in the Budget its intention to introduce a 20 per cent tax break for games production, similar to the EU approved French regime that applies to games that pass a cultural test," he added.
I can see why they gave up on the case, given GATS Article XV, which states:
1. Members recognize that, in certain circumstances, subsidies may have distortive effects on trade in services. Members shall enter into negotiations with a view to developing the necessary multilateral disciplines to avoid such trade-distortive effects.7 The negotiations shall also address the appropriateness of countervailing procedures. Such negotiations shall recognize the role of subsidies in relation to the development programmes of developing countries and take into account the needs of Members, particularly developing country Members, for flexibility in this area. For the purpose of such negotiations, Members shall exchange information concerning all subsidies related to trade in services that they provide to their domestic service suppliers.
2. Any Member which considers that it is adversely affected by a subsidy of another Member may request consultations with that Member on such matters. Such requests shall be accorded sympathetic consideration.
If the result of the absence of rules is a subsidy war, as the industry has now requested, perhaps this will motivate WTO Members to negotiate some rules in this area.
The Supreme Court said Monday it will rule on a case that could make it harder for U.S. companies to obtain protective tariffs on low-priced foreign goods.
The dispute centers on whether uranium that U.S. utilities send to France for enrichment and then import for use in nuclear power plants qualifies as a 'good' or 'service.'
In the case accepted by the court, a French uranium enrichment company, Eurodif SA, and a group of U.S. utilities argue that only the service of uranium enrichment is being imported, because the raw uranium was provided by the utilities. As a result, the enriched uranium shouldn't be subject to antidumping duties, they say.
The Commerce Department, however, decided in 2002 that enriching uranium is a 'manufacturing process' and not a service, and imposed a 20 percent antidumping duty on imports from Eurodif.
But the U.S. Court of Appeals for the Federal Circuit overruled Commerce in September 2007. That prompted the Bush administration and USEC Inc. (NYSE:USU) , a Bethesda, Md.-based company that is the sole U.S. uranium enricher, to appeal to the Supreme Court.
The Justice Department's Solicitor General, the administration's lawyer, said the appeals court's ruling 'has opened a potentially gaping loophole in the nation's trade laws' by encouraging U.S. importers and foreign companies 'to structure their transactions as contracts for 'services'' rather than for goods in order to avoid punitive duties.
Oral argument will be scheduled for the court's next term, which begins in October. The dispute consists of two cases, U.S. v. Eurodif, 07-1059, and USEC v. Eurodif and the Ad Hoc Utilities Group, 07-1078.
I heard about this case a number of years ago, but never really thought through the issues. My gut reaction is that WTO rules would permit anti-dumping duties to be imposed in this situation. While there is a service involved here, ultimately there is a good being imported, and thus anti-dumping duties are pemissible. However, I'm not sure what U.S. law says about it or what the Supreme Court will think of it. I'll try to follow the case as it develops next year.
ADDED: Here's the cert petition, with many related documents attached. I may have to re-think my views on how WTO rules would apply. I'm not sure I understand the facts completely at this point.
MORE: That was the government's cert petition linked to above. More documents are at the bottom of this page: http://www.scotusblog.com/wp/petitions-to-watch-conference-of-41808/
Here's my question: Was the uranium in question subject to normal tariff duties when it was entered into the United States after enrichment? I skimmed through some of the documents related to the case, but did not see the answer at first glance. (That's not to say it's not in there; there was a lot to read through, and I could have missed it).
AND YET MORE: Here's a summary of the appeal from Sidley Austin.
The United States maintains that China’s restrictions and requirements limit the ability of foreign suppliers of financial information services to conduct business in China and place them at a competitive disadvantage in the marketplace. The apparent conflict of interest of China’s regulatory authority compounds these issues. As such, China appears to be acting inconsistently with several WTO provisions, including Articles XVI and XVII of the General Agreement on Trade in Services as well as commitments made by China in its WTO accession agreement.
Here's a USTR fact sheet as well.
From EC DG Trade's background memo:
The relevant Chinese measure appears to breach China's GATS commitments on national treatment and market access, which require that foreign companies can operate in China and are not treated less favourably than local ones. It is also contrary to obligations not to cut back on existing rights for companies and to provide regulatory independence, which China committed to ensure at the time of its WTO Accession in 2001.
The official WTO consultations request documents should be available later this week.
Who are the companies that are the major players in the industry? AFP reports:
Financial information services, the subject of WTO trade complaints against China by the US and European Union, are dominated by US firm Bloomberg and Canadian-British Thomson-Reuters in the process of merging.
The two heavyweights, each with a third share of the global market, are trailed at a distance by three US companies and one Swiss firm, according to Inside Market Data, which reports on the global financial market data sector.
US-based Interactive Data, owned by British group Pearson, is the closest runner-up, with a five percent market share.
Dow Jones, bought last year by News Corporation, holds a three percent slice, as does US rival Factset. Switzerland-based Telekurs has a two percent share.
China expressed regret on Thursday at reports the U.S. Olympic team would bring its own meat for the Beijing Games over concerns of drugs tainted food, and said it could guarantee safe supplies.
The New York Times has reported that the U.S. Olympic Committee has arranged with sponsors to ship 25,000 pounds of lean protein to Beijing for the Games, in response to concerns about the potential impact of veterinary drugs and insecticides on athletes.
"I personally feel rather regretful," Kang Yi, head of the Catering Division at the Beijing Organising Committee for the Olympic Games, told a news conference.
I can't figure out where exactly this falls in the non-discrimination framework. Normally, non-discrimination occurs in relation to products imported into the market of the country doing the discriminating. But here, the discrimination is against foreign products when nationals of a country consume those products abroad. The whole thing has kind of a GATS feel to it. Perhaps that's it: It's discrimination against foreign catering services under the consumption abroad mode.
Over at the Conglomerate, Gordon Smith complains about all the junk mail he gets and says: "... I am willing to vote for the presidential candidate who proclaims, 'I look forward to nailing the going out of business sign on the front door of the United States Postal Service.'" Of course, there's not much chance of this actually happening. But putting reality aside for a moment, couldn't this be a great "win-win" for trade and the environment? Cutting out all that wasted paper from unwanted junk mail would save a lot of trees. And getting rid of a domestic monopoly would make foreign competitors very happy with their improved market access possibilities.
Over at Eyes on Trade, Todd Tucker says: "a move to universal health care could be challenged as a limitation on market access for health insurance companies." Upon reading this, my first thought was to look at the relevant part of the U.S. GATS Schedule to see what commitments had been made. However, when I did so my eyes immediately glazed over. There are lots of "nones" and "unbounds" and "horizontals." I assume I could figure it out if I really tried, but I couldn't get up the energy just now. But an interesting thought did occur to me: As long as private insurance companies are still involved, couldn't universal health care expand market access by increasing the number of insured people (that is, the number of customers)?
From the Korea Times:
Foreign envoys whose countries adopt English as an official language criticize what they call Korea's discriminative visa regulations against foreign English teachers. Korea allows English teaching or E-2 visas to only native-English speakers from the United States, Canada, United Kingdom, Australia, New Zealand, South Africa and Ireland.
The envoys said the "narrow-minded'' visa policy prevents Koreans from developing English proficiency in a more efficient and cheaper way. They also argue it is against international norm of equal treatment for all.
Last week, Pakistani Ambassador Murad Ali sent a letter to Justice Minister Chung Soung-jin, urging the Seoul government to allow qualified Pakistanis the English teaching visa.
Should English teachers have to be from designated English-speaking countries? Clearly, they have to speak English. But just as clearly, there are many people from countries other than those listed in the article who speak excellent English (some better than mine, no doubt). Is the distinction Korea makes a reasonable one? I haven't looked at Korea's GATS commitments to see what they say about this issue, but there were some allegations that the rules have been violated:
[Ambassador Ali] also said that the regulation violates the World Trade Organization (WTO) rules (Article II of GATS), which mandate most-favored-nation (MFN) treatment to all WTO members.