News-CRUX-10     29th February 2024        

Context: Around 72 nations have agreed to take on additional obligations in services under the General Agreement on Goods in Services (GATS) to ease non-goods trade among themselves and extended the similar concessions to all other members of the World Trade Organisation (WTO).

General Agreement on Goods in Services (GATS)

  • About: The GATS is a treaty of the World Trade Organization (WTO) established to extend the multilateral trading system to the service sector.
  • Entered into force: January 1995 as a result of the Uruguay Round negotiations to provide for the extension of the multilateral trading system to services.
  • Creation and Implementation: It was created to expand the trading framework to services, similar to how GATT operates for merchandise trade, and it came into effect on January 1, 1995, concluding the Uruguay Round of Multilateral Trade Negotiations.
  • Background: The GATS was a significant outcome of the Uruguay Round of trade negotiations, spanning from 1986 to 1993.

oGATT Predecessor: Its inception occurred almost 50 years after the establishment of the General Agreement on Tariffs and Trade (GATT) in 1947, which focused on merchandise trade.

  • Membership: All WTO members, including India, are members of the GATS, which entails general obligations applying to all members and specific commitments outlined in individual schedules.
  • Scope and Exceptions: GATS applies broadly to all service sectors, with exceptions for services under governmental authority and an exemption for air transport services.
  • New Obligations and Disciplines: Recent obligations under GATS focus on mitigating trade-restrictive effects related to licensing, qualification requirements, and technical standards through disciplines named Services Domestic Regulation (DSR), which operate on a most-favored-nation principle benefiting all WTO members.

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