Documents considered by the Committee on 16 September 2015 - European Scrutiny Contents


9 WTO waiver on services for least developed countries

Committee's assessment Legally important
Committee's decisionCleared from scrutiny; further information requested
Document detailsProposal for a Council Decision establishing the position to be taken within the Council for Trade in Services of the World Trade Organization on the acceptance of preferences notified by WTO Members as regards services and service suppliers of Least-Developed Country other than those described in Article XVI of the GATS
Legal base Articles 91, 100 and 207(4) TFEU, in conjunction with Article 218(9); consensus
DepartmentBusiness, Innovation and Skills
Document Numbers(37014), 11206/15, COM(15) 356

Summary and Committee's conclusions

9.1 In 2011, the World Trade Organisation (WTO) agreed the so-called The 'LDC Services Waiver', which allows members to waive the usual non-discrimination rules by treating the exports of services from the Least Developed Countries (LDCs) in a preferential manner compared with exports of services by other WTO members. However, there has been a delay in putting this agreement into effect, and some WTO members will now be offering preference to LDCs in areas such as national treatment of businesses. As a result, there will be a proposal at the WTO to extend the scope of the Waiver, and this draft Council Decision would enable the EU to agree to this.

9.2 As this document deals with a relatively straightforward extension of the waiver on services granted by the WTO for the least developed countries, it appears to be relatively straightforward in policy terms.

9.3 We commend the Minister for Trade and Investment (Lord Maude) and his officials for their vigilance in seeking to guard against competence creep in the shared competence field of transport. We note that the Decision may be adopted at the end of September or early October when the House is in recess. Whilst we welcome the Minister's approach of arguing that a second, formal Member State vote will be required on this mixed agreement, we would also urge him to seek to ensure that the mixed nature of the agreement and the extent to which the EU is exercising competence is clear on the face of the EU text.

9.4 We now clear this document, but request that the Minister inform us as to the outcome of the Council meeting in terms of voting procedure and any favourable amendment to the text as we have suggested.

Full details of the document: Proposal for a Council Decision establishing the position to be taken within the Council for Trade in Services of the World Trade Organization on the acceptance of preferences notified by WTO Members as regards services and service suppliers of Least-Developed Country other than those described in Article XVI of the GATS: (37014), 11206/15, COM(15) 356.

Background

9.5 In 2011, the World Trade Organisation (WTO) agreed the so-called The 'LDC Services Waiver', which allows members to waive the usual non-discrimination rules by treating the exports of services from the Least Developed Countries (LDCs) in a preferential manner compared with exports of services by other WTO members.

The current document

9.6 Because there has been a lack of progress in realising the preferences, WTO Ministers agreed in December 2013 to 'operationalise' the Waiver by setting in place a process for WTO members to make their offers. However, although the original Waiver only stipulated that the WTO members could notify preferential market access, some will now be offering preference to LDCs in areas such as national treatment of businesses, and there will therefore be a proposal at the WTO to extend the scope of the Waiver. This draft Council Decision would enable the EU to agree to this.

The Government's view

9.7 In his Explanatory Memorandum of 7 August 2015, the Minister says the Government is minded to agree with this Decision, as it will not bind the UK to any actions over and above what has been agreed on the Waiver, but it will increase the scope of the Waiver and therefore the benefits available to the LDCs. However, he notes that the Commission has proposed that the Decision should be based on Articles 91, 100 and 207(4), in conjunction with Article 218(9) of the Treaty on the Functioning of the European Union, and that Articles 91 and 100 relate to transport, which is generally considered to be a shared competence.  He says that, in the UK's view, where transport articles are cited in a proposal, this would ordinarily imply a mixed agreement, and that it will argue that the proposed Decision covers areas of Member State competence and, if appropriate, will argue for second decisions of the representatives of the Member States meeting in the Council.

Previous Committee Reports

None.


 
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