TY - JOUR
AU - Delimatsis,, Panagiotis
AB - Abstract The conclusion of the Transatlantic Trade and Investment Partnership (TTIP) constitutes a priority and key component of the external trade policy of the European Union (EU). It is also an immediate follow-up to several years of regulatory cooperation between the two global trade powers. In an era of megaregionals, services is the only area where significant negotiating traction exists at the bilateral and multilateral level. However, recent events such as the imminent Brexit and the withdrawal of the USA from the Transpacific Partnership (TPP) cast doubt on the future of trade deals. Even so, services remain a key sector of export interest for the EU and thus completing agreements such as the TTIP or the Trade in Services Agreement (TiSA) is of crucial importance, allowing the EU to create new opportunities for service suppliers but also to reshape the regulatory philosophy governing the future regulation of global trade in services. With respect to TTIP, the EU Commission, backed by the EU executive, has advanced an ambitious agenda and submitted a conditional offer to the US, hoping for further liberalization on the two sides of the Atlantic. Against this backdrop, this article offers a critical account of the EU external trade policy, focusing on the EU’s recent external action with respect to services liberalization. The article advances three theses: first, that such ambitious agreements mark a new era of offensive services strategy which, however, is contained by internal conflicts and disagreements regarding certain still sensitive silos such as audiovisual or public services and Brexit shall exacerbate such internal conflicts in the medium run; second, that megaregionals can be used to accelerate domestic regulatory reform and openness in the service sector; and third, that TiSA will constitute a litmus test for the EU’s commitment to the World Trade Organization (WTO) cause. When appropriate, the article draws parallels with existing EU legislation and case law; other EU Free Trade Agreements such as the recently concluded Comprehensive Economic and Trade Agreement (CETA) with Canada; the General Agreement on Trade in Services (GATS); and TiSA. I. INTRODUCTORY REMARKS The European Union’s (EU) common commercial policy (CCP) of late reveals a considerate turn in external trade policy to focus on the conclusion of trade agreements that can have a significant economic impact on EU trade. The Comprehensive Economic and Trade Agreement (CETA) with Canada and the Transatlantic Trade and Investment Partnership (TTIP) form integral part of this turn and a renewed engagement with its most important transatlantic partners. How these agreements fare in the global arena will be viewed as a bellwether for the future focus of CCP. Under the instructions of the European Council,1 the European Commission’s interest shifted towards the launch of negotiations with its strategic partners, which are at the same time important trade partners globally. Within this framework, concluding comprehensive and balanced trade agreements with the USA and Canada, but also China, Russia, Japan, India, and Brazil became a top priority for the EU trade policy.2 There has been a varying degree of progress in these negotiations. For instance, negotiations with India have witnessed sluggish progress and no real prospect for the conclusion of a trade and investment agreement any time soon. The imminent Brexit made such prospect even slimmer. A deal with MERCOSUR should not come in the short run, as the EU and MERCOSUR exchanged market offers last year for the first time in over 10 years. On the other side, Japan appears to be eager to conclude a trade deal with the EU this year. Under the new Juncker administration, concluding bilateral agreements with the most important economies in North America and Asia has clearly taken centre stage. In this respect, the EU opts for immediately prioritizing three agreements, along with the conclusion of the CETA with Canada: TTIP; the agreement with Japan and the investment agreement with China.3 TTIP is the most ambitious and strategic among them.4 Just in terms of sheer trade size, TTIP is at the epicentre of public debate regarding trade and regulatory matters in both sides of the Atlantic. The USA is EU’s most important trading partner, representing over 15 percent of extra-EU trade flows. For the USA, the EU, taken together, is the second most important trading partner, after Canada and the most important investor in the US territory. Thus, as expected, upgrading the cooperation with the USA in all fronts, which has evolved around the work of the Transatlantic Economic Council (TEC) on regulatory matters, is the unequivocal message sent by the European leaders.5 Against this background, this article aims at offering a critical account of the direction that the EU external action in services will take in a mega-regional era. The article advances three theses: first, that such ambitious agreements mark a new era of offensive services strategy which, however, is contained by internal conflicts and disagreements regarding the adequate level of openness in certain still sensitive silos such as audiovisual or public services; and Brexit shall exacerbate such internal conflicts in the medium run. Second, that mega-regionals with a regulatory component are an interesting phenomenon for quasi-federal countries such as the EU, as they can accelerate domestic regulatory reform and openness in the service sector allowing to deal with thorny internal regulatory issues through external action; and third, that Trade in Services Agreement (TiSA) will constitute a litmus test for the EU’s commitment to multilateralism. Section II gives a glimpse of the EU constitutional processes regarding trade negotiations with a particular focus on TTIP negotiations and the CETA. Section III discusses the chapter on services, investment and e-commerce proposed by the EU, focusing on its innovative features ranging from the taxonomy of services supply to new due process provisions on domestic regulation introduced and juxtaposing the approach taken by the EU to the existing disciplines under the General Agreement on Trade in Services (GATS) and EU free movement law. At this juncture, the article discusses the potential for regulatory cooperation and harmonization in certain services sectors such as professional services and the intricacies of the most recent conditional offer by the EU on services liberalization and the EU’s liberalizing approach. Section IV concludes with some thoughts on the future of the EU services trade policy, the prospects for regulatory cooperation and convergence, and certain ideas for future research. II. The EU External Relations Law and the Mechanics of EU Trade Negotiations According to the European Commission, the revitalized EU trade policy should predicate on three pillars: effectiveness, transparency, and export of EU values to the rest of the world.6 Effectiveness means that the EU trade policy will become more results-oriented, focusing on the facilitation of value chains, the inclusion of digital trade in prospective negotiations, and the easing of rules governing movement of high-skilled professionals. The second pillar of the new EU trade policy focuses on the importance of transparency as an important component of an effort to increase the legitimacy of and confidence to the EU in dealing with important national interests of the EU Member States.7 The third pillar of the EU new approach in trade matters resides on the idea that EU values could be ‘exported’ through trade negotiations. Some would argue that the promotion of its values and ideals is the distinctive feature of the EU external action.8 Others argued that the distinctive feature of the EU external action is its governance mode that opts for the creation of stable and institutionalized relationships with other states and entities; promotes collective action; and uses regulatory frameworks that entail common articulated goals.9 In the EU foreign policy, such activity has previously included the exportation of concepts relating to public services (so-called ‘services of general interest’) to the EU’s partners in Eastern Europe but also concepts relating to competition law or standard setting. In its new trade-related strategy, the EU aspires to enrich this agenda with new concepts such as enhanced corporate social responsibility to ensure a high level of protection for European consumers; increased legitimacy for investment arbitration systems that the EU uses in its international agreements with an expressed preference in establishing a multilateral investment court; or a more targeted system of unilateral preferences given to developing and least developed countries via the Generalized System of Preferences. A. A new paradigm for the conclusion of EU trade agreements? CETA and TTIP from an EU perspective Due to the repercussions of a potential transatlantic deal on the two most advanced economies in the world, TTIP has sparked a significant controversy in the wake of leaks of several draft chapters of the deal. As expected, this did not help dispel increasing public opposition on both sides of the Atlantic. In the USA, any discussion about the benefits of North American Free Trade Agreement (NAFTA) and Transpacific Partnership (TPP) instigates suspicion against mega-regionals of this type. In the EU, on the other hand, the debate about TTIP is even more heated due to the trauma that the EC Hormones and the associated genetically modified organisms (GMO) saga caused but also due to the EU-peculiar concept of public services, that some see being put in jeopardy if a trade agreement with the USA is to occur. Notably with regard to TTIP, statistics show that, even in times of crisis, the EU has had a steadily positive trade balance with the USA and Canada in the last decade, making the case for further integration a ‘tough sell’ to EU citizens anxious about their standards of living and the future of their welfare state so much hit by the recent Great Recession.10 To answer to such concerns, the Commission resorted to more transparency, which makes TTIP the first EU trade agreement whereby so many negotiating texts have been released from official (notably, the EU Commission) but also leaked through unofficial sources.11 Such events at the national and EU level have also accompanied the CETA negotiations until the final approval of the text by the European Parliament in February 2017.12 Like TTIP, at the epicentre of criticism has been the dispute settlement provisions enshrined in CETA, but also the impact of mega-regionals on the regulation of public services. Such voices can only be expected to multiply in view of an ever-increasing transfer of powers to the EU in commercial matters and a general anti-globalization sentiment that followed the financial crisis of 2007–08. In the case of CETA, and in order to alleviate the fears of Member States expressed ahead of the vote of the European Parliament, the EU and Canada signed a joint interpretative statement to confirm that Member States will still have a role to play in regulating the supply of services in the public interest and in the specifics of the bilateral regulatory cooperation.13 The statement reiterates the flexibility of CETA in accommodating regulatory concerns and preferences of the parties to the agreement. Before being put on hold by the Trump administration, the EU and the USA concluded 15 rounds of TTIP negotiations. The negotiations that started between the EU and the USA in July 2013 have only intensified since mid-2015 and showed significant progress in certain areas.14 In terms of the ever-evolving EU external trade relations law and seen through the lens of EU bilateral trade activity, TTIP is an interesting legal construct. To be sure, it is not the first Free Trade Agreement (FTA) that the EU negotiates nor is it the first FTA that the EU concludes after the entry into force of the Lisbon Treaty. The EU FTA with Korea, EU’s first with an Asian country, which was also concluded recently,15 is the first agreement of what the Commission calls the new generation of EU FTAs. This agreement was concluded as a ‘mixed’ agreement, which in the EU jargon means that both the EU and its Member States acting together shall conclude the agreement.16 From an EU constitutional law viewpoint, mixity has important ramifications, as it requires ratification by all Member States after the European Parliament has given its consent to a mixed agreement before it can produce any legal effects unless the Council decides unanimously in a separate act to provisionally apply the agreement.17 Such provisional application would only cover those areas of the agreement coming under the EU competence. The recently concluded CETA was also considered as a mixed agreement despite the European Commission’s initial position that the agreement fell under EU’s exclusive competence in commercial matters. The Commission seized this opportunity to test the waters vis-à-vis the other European institutions, arguing that by now the Union alone shall conclude trade agreements with third countries. However, in July 2016, the Commission buckled under the pressure of the Council by formally proposing to the Council to sign and conclude CETA as a mixed agreement.18 The agreement was approved by the European Parliament in February 2017 and will formally enter into force after the conclusion of the ratification process by the national and regional Parliaments of the EU Member States. The Council decided to provisionally apply CETA awaiting ratification by Member States,19 but excluded CETA’s provisional application in certain areas such as investment protection, market access for portfolio investment (but not FDI), and the investment court system accepted by the parties.20 Both FTAs with Canada and Korea were concluded based on respective mandates that were addressed to the European Commission prior to the entry into force of the Lisbon Treaty, with much confusion surrounding the normative character of the changes brought about by the then forthcoming introduction of the new Lisbon treaty rules on EU’s trade policy.21 The TTIP negotiating mandate, on the other side, was approved by the Council of the EU in 2013.22 Thus, all related decisions and acts were adopted after the entry into force of the Lisbon Treaty, making it the first mega-regional that the EU negotiates in the post-Lisbon era. Another, less mediatized agreement also has similar characteristics: the FTA with Singapore, negotiations for which were finalized in October 2014.23 The FTA with Singapore, however, is not as prominent as TTIP in terms of trade flows: Singapore is EU’s 17th trading partner. Still, the FTA with Singapore is of high constitutional significance for the evolution of EU external trade relations law, as the European Commission decided to take the extra mile and claim exclusive competence for the conclusion of this agreement based on the new Lisbon framework. The new Article 207 of the Treaty on the Functioning of the EU (TFEU) appears to suggest that CCP, including investment, is an exclusive EU competence with varying decision-making procedures (that is, qualified majority combined with unanimity when liberalization of audiovisual or public services is at stake). The Commission’s request for an Opinion by the Court of Justice of the European Union (CJEU) based on Article 218:11 TFEU constitutes a yardstick for all subsequent EU ‘new generation’ FTAs, including TTIP. In her conclusions regarding this request for an Opinion, AG Sharpston argued that while the EU exclusive competence in commercial matters has expanded to cover several new areas, it still is not as broad as to cover certain areas such as some types of transport services or types of investment other than foreign direct investment (FDI). Therefore, in her view, both the EU and its Member States share the competence to conclude the agreement with Singapore.24 The Court reached the same conclusion with AG Sharpston, but on different grounds. After clarifying that the Commission’s request for an Opinion related to the nature of the competence and not to the compatibility of the agreement with EU law (thereby leaving open to challenge those provisions relating to dispute settlement), the Court confirmed the broad substantive scope of the EU exclusive competence in commercial matters. The Court found that the EU has exclusive competence in all matters covered by the EU-Singapore FTA, including transport services, sustainable development or intellectual property. Notably as far as transport services are concerned, the Court found that rail, road but also maritime transport services fall by now under EU’s exclusive competence. Overall, the Court confirmed the assumption of many that at the current stage of integration and treaty evolution, the substantive scope of the CCP has significantly expanded. Having said this, the EU competences in investment matters remain limited. In this regard, the Court interpreted strictly Article 207:1 TFEU to find that the term ‘foreign direct investment’ does not cover portfolio investment or any matter other than FDI.25 The Court went on to find that investor–state dispute settlement but also dispute settlement among EU and Singapore also constitute a competence shared by the EU and its Member States.26 The Opinion offers much-needed clarity to the critical issue of competence in EU commercial matters after the entry of the Lisbon Treaty into force. Crucially, such judicial development may have the unintended result of incentivizing the European Commission to propose the conclusion of bilateral investment treaties outside the EU’s FTAs leading to unnecessary fragmentation between trade-related and investment-related (non-FDI) issues. B. The TTIP negotiating mandate adopted by the Council The Council unanimously adopted the negotiating directives (the ‘mandate’) addressed to the Commission in June 2013. Such directives are typically based on a proposal (‘recommendations’) submitted by the Commission, which has the power to initiate EU action in a given area after assessing whether the conclusion of a given international agreement is in EU’s interest.27 In the case of exclusive competence like in trade matters, the Commission is not only the initiator, but also the sole negotiator. Thus, at these first stages of the process, the institutional balance tilts in favour of the Commission. In its directives, the Council sets the general guidelines which convey the general objectives that the Commission should strive to achieve during the negotiations. The Council first posits the negotiations within the framework that the new Article 21 of the Treaty on EU (TEU) establishes for the EU external action. Interestingly, the mandate emphasizes that the EU and the US share values and principles enshrined in Article 21, including protection of human rights, democracy and rule of law, sustainable development and the right to regulate to protect non-economic objectives, including, quite controversially, the promotion of cultural diversity. Instantly, in paragraph 9, the mandate attempts to shield, for all practical purposes the cultural sector (alias, audiovisual services) from the scope of any future agreement between the EU and the USA.28 For all practical purposes, this exclusion applies to every EU trade agreement and maintains the position that the EU expressed on these services since the end of the Uruguay Round in 1994. The Council further underlines the significance of the successful conclusion of the negotiations as a herald of new global standards emanating from the two leading global trade powers. This sets the bar high with respect to the level of aspiration and expectations at least on the side of the EU. The mandate calls for a trade agreement that will be quite traditional—in that it would cover duties and market access and at the same time innovative in that it encompasses regulatory matters, regulatory cooperation in issues such as technical barriers to trade and food safety regulations as well as investment protection. Indeed, the trust-building intentions of the Council are reflected in the regulatory cooperation chapter29 which reflects the intention to promote good governance that the EU has advanced in all FTAs that it has concluded to date, in a gradually revealing pattern of creating an external regulatory policy.30 C. The Commission’s mandate with respect to services liberalization in TTIP Publicly, the EU confirms its interest in concluding WTO-consistent bilateral agreements although it is hardly conceivable achieving substantial progress on both the bilateral or plurilateral and the multilateral front simultaneously.31 Perhaps services are the only area where the EU appears to be committed to the bilateral route (through agreements with the USA, Canada or Korea) and the multilateral/plurilateral route (through TiSA within the WTO framework). Additionally, services are by now the only sector whereby bilateral agreements with big developed economies can be meaningful vectors for extensive market access reciprocal offerings and deep regulatory convergence. Finally, the EU can by now design a more integrated policy in services, as the Lisbon Treaty normalized the position of services within CCP, by establishing the EU’s exclusive competence in the area of external trade in services and for all GATS modes of supply.32 Further opening specific global markets for EU service suppliers has been one important motivation for the EU to take the bilateral route in view of the never-ending stalemate in the WTO Doha negotiations. Drawing lessons from previous negotiations on services, the EU and the USA, like most developed economies seek to capitalize on existing levels of openness in services. Indeed, the TTIP mandate emphasizes the importance of locking in the existing level of liberalization as the starting point for negotiations in services. Thus, both parties to the FTA should be willing to offer more appealing conditions to each other’s service suppliers than to the suppliers of their existing FTA partners.33 Due to the remaining controversy regarding the actual level of ‘GATS-plus’ liberalization that existing FTAs achieve,34 the Council gives the green light to the Commission to be ambitious in these negotiations save for certain sensitive services sectors. In this regard, the mandate underlines the importance of safeguarding the EU-specific framework on services of general (economic) interest. The mandate refers to Protocol No. 26 on services of general interest and recalls that the protection of services of general (economic) interest forms integral part of the shared values of the Union. By virtue of Article 21 TEU, the EU is required to pursue the shared values internally as well as in its external action. In other words, the EU should either attempt to ‘export’ this concept to its FTAs (as it did with its partners of the European Neighbourhood Policy (ENP) or otherwise exclude the sector altogether from any negotiations involving liberalization of services unless a higher level of protection is aimed at by the parties to a given bilateral agreement.35 To reassure citizens and NGOs which were mobilized against the prospective deal, the EU and the USA recently pledged to approach public services in a manner that takes into account the important preferences and values that underlie the provision of such services.36 Water, education, health and social services are mentioned as mere examples of sectors in which important sensitivities on both sides of the Atlantic are recognized. Furthermore, the horizontal chapter on regulatory cooperation proposed by the EU essentially excludes services of general interest (i.e. public services) from the scope of that chapter.37 Thus, not only liberalization but even any regulatory cooperation in such services appears unlikely based on the EU’s proposals. This is in line with the EU’s consistently reluctant stance in its FTAs with respect to public services (which leads to the introduction of a so-called ‘public utilities exception’ in EU’s FTAs).38 Thus, just like with audiovisual services, the Commission is instructed to negotiate with caution and essentially avoid any liberalizing commitments that undermine or interfere with public services regulation within the EU. The situation is no different in the TiSA negotiations nor in the final text of CETA although the EU has adopted an overall offensive liberalizing stance in all three negotiations.39 Fears of the unintended consequences that the choice of a negative list approach (i.e. parties agree to liberalize all services sectors subject to the listed reservations) can have are not unrelated to this development. In turn, the European Parliament (whose consent will be necessary in the end for TTIP to be concluded40) invited the Commission to exclude public services from the scope of TTIP to ensure full flexibility with respect to the supply of such services.41 Notably, the Parliament suggested the exclusion of public healthcare services from the negotiations due to the differing approaches between the EU and the USA. In addition, the Parliament sided with the Council on the exclusion of the audiovisual sector. The Parliament spelled out further this carveout by asking the Commission to actively pursue the introduction of a provision that would allow the EU and its Member States to continue subsidizing and providing financial support to cultural industries and cultural, educational, audiovisual and press services. The European Parliament was very specific as to the objectives that the EU negotiator should focus on during the TTIP negotiations. According to the Parliament, an ambitious and balanced deal with the USA would entail the removal of US restrictions on foreign ownership of transport services and airlines; better access to US telecommunications markets and liberalization of the US public procurement market at all levels of government. The same level of ambition should apply to establishment (commercial presence in the GATS/FTA parlance) whereby restrictions to national treatment should only be allowed to certain specific services sectors. Having said this, the Parliament draws the Commission’s attention to the EU’s high level of data protection and conditions for data flows, an issue which in the aftermath of the Schrems case law remains open despite the recent EU-US Privacy Shield agreement.42 Finally, the Parliament calls for the convergence of regulations relating to professionals which still hamper mutual recognition of equivalent standards. Indeed, the facilitation of mobility for professionals should be an important objective of the EU which would benefit both partners. Interestingly, it matches similar levels of ambition expressed within the TPP, which incorporates a separate chapter on professional services.43 Securing new market access commitments that will reflect the high level of ambition save for sensitive services sectors, and reinforcing the regulatory, due process-related disciplines on domestic regulation (GATS Article VI-type of commitments) of both parties lie at the heart of the negotiating mandate. For a long time, several FTAs have incorporated commitments on non-discriminatory measures that aim to ensure the quality of services and additionally referred to the possibility of including in their bilateral setting the results of the negotiations conducted under Article VI GATS.44 However, absent concrete progress in the WTO negotiations on domestic regulation in services, both the EU and the USA take the view that it is high time binding commitments on transparency, impartiality and due process with respect to licensing and qualification requirements and procedures were included in bilateral FTAs at least.45 The EU seeks deepened regulatory convergence regarding non-discriminatory measures that aim to enhance the quality of the service in its FTAs, with CETA being the most prominent example, followed by TTIP. Notably with respect to professional qualifications, the Council calls for the development of a framework allowing for mutual recognition of professional qualifications. This is no coincidence: all three WTO Members involved have very high professional standards and there is evidence suggesting that this type of agreements warrant a high level of homogeneity between trading partners.46 In addition, all three participated in previous efforts made to integrate professional services in a regional context [NAFTA and Asia-Pacific Economic Cooperation (APEC) or the EU itself] with varying yet relatively high degree of integration at least in certain professional services, thereby accumulating invaluable experience.47 D. The EU’s services strategy in the wake of Brexit Although the Lisbon Treaty appears to give for the first time so many tools for the design of a more integrated policy in services and clarified the issue of EU’s external competences in services, the withdrawal of the UK from the EU comes to reshape EU’s negotiating leverage in the global arena. Indeed, it would be ill-advised to argue that Brexit will not affect the EU services strategy internally and EU’s influence externally, knowing that the UK accounts for over 20 percent of total EU trade in services with third countries and for an even higher share in financial services.48 Indeed, some 85 percent of EU’s hedge funds and over 60 percent of its private equity funds are in the UK, whereas over one-third of EU’s services exporting to the USA originate in the UK. Thus, the UK withdrawal will not only affect the UK’s appeal as services hub in general but also EU’s negotiating leverage at the international level. Whereas once outside the EU, the UK will be unable to automatically benefit from the preferential access that the EU FTAs have ensured (and this applies equally to the EU mixed agreements, as the UK can benefit from them only in its capacity as EU Member State),49 nothing prejudges that the EU FTA partners will not be willing to seek a rebalancing of EU’s obligations stemming from those agreements. Indeed, an EU without the UK may be requested to grant additional concessions to neutralize UK’s withdrawal from those agreements. As the possibility to seek the application of those agreements and the ensuing rights to the UK will vanish, exporters from the countries affected will lobby for compensatory adjustments leading to more trade opportunities within the EU’s remaining Member States. Thus, while many commentators rightly underscore UK’s heavy duty of re-negotiating trade agreements with countries with which, being an EU Member State, it used to have concluded FTAs,50 the EU will most likely be in a similar position albeit not to such an extent. This applies not only at the bilateral level but also at the WTO level. The EU’s services schedules will need to be revised and WTO Members may legitimately request negotiations with the EU with a view to agreeing on concessions that would rebalance the EU’s level of openness. Indeed, pursuant to Article XXI GATS and the procedures for rectification or modification of Schedules, the EU will technically modify its Schedule and withdraw commitments to reflect UK’s withdrawal from the EU; this gives rights to the other WTO Members to seek redress, potentially through arbitration.51 As one can infer, such negotiations to ensure an orderly withdrawal of the UK and a disentanglement from the EU’s commitments will take time and effort not only on the side of the UK but also on the side of the EU. As negotiations between UK and the EU are about to start, no impressive results at the EU commercial policy level should be expected before the EU clarifies with its trading partners the technical details of Brexit and the future trade relationship with the UK. Be this as it may, the proponents of trade liberalization in general and services liberalization in particular will lose a very important advocate in the aftermath of UK’s withdrawal. It is argued that it will not take long for the EU to realize that a new trade strategy based on a new consensus among the EU27 will be warranted. III. ‘DEEP(ER)’ LIBERALIZATION OF TRADE IN SERVICES? CETA, TTIP AND TISA A. Services liberalization in CETA The EU is Canada’s second most important trade and investment partner after the USA. Bilateral trade in services accounts for over €28 billion. Compared to the GATS, the CETA adopts a fragmented approach when dealing with trade in services in that it includes rules related to services trade in various chapters. By way of illustration, cross-border trade in services (Modes 1 and 2 in GATS jargon) is dealt with in Chapter 9, temporary entry and stay of natural persons for business purposes (Mode 4) in Chapter 10, and commercial presence (Mode 3) in Chapter 8 under the investment chapter, whereas horizontal transparency rules are to be found in Chapter 27 and domestic regulation disciplines for rules relating to licensing and qualification requirements and procedures are enshrined in Chapter 12. In this regard, CETA appears to replicate the basic structure and logic of NAFTA’s provisions relating to trade in services, notably Chapter 12, which also distinguishes between cross-border trade in services, investment (Chapter 11) and temporary entry for business persons (Chapter 16). CETA is a GATS-plus agreement in that it builds on the WTO framework to also call for deeper integration in the areas of recognition of professional qualifications (Chapter 11), financial services (Chapter 13), international maritime transport services (Chapter 14), telecommunications and e-commerce (Chapters 15 and 16, respectively). In incorporating various WTO legal provisions by reference but also by including institutionalized mechanisms for regulatory cooperation and by addressing trade-related issues not yet picked up at the WTO level, the CETA is the most ambitious WTO-plus agreement that the EU concluded to date.52 1. The substantive rules in CETA – scope and sectoral exclusions CETA is the first deal in which the EU decided to undertake market access commitments through a negative list approach, thereby liberalizing all services sectors subject to explicitly listed reservations.53 A careful look in previous agreements concluded by Canada and the EU with third countries suggests that this is not the only instance where Canada convinced the EU to follow the Canadian approach to the regulation of trade in services. Indeed, it appears that the services-related chapters in CETA rely heavily on recent trade agreements Canada (rather than the EU) has concluded, notably the one with Korea and Peru. Although the EU was probably equally keen to liberalize trade in services, the fact remains that the Canadian approach to dealing with trade in services has dominated in the CETA negotiations.54 As noted earlier, the EU and Canada decided to exclude from the scope of the agreement audiovisual (EU) and cultural (Canada) services. Furthermore, both parties excluded social services, gambling and betting services as well as the collection, purification and distribution of water. In addition, the EU excluded health and education services, while Canada excluded aboriginal and minority affairs. Thus, in addition to the sensitivities associated with public services, which as mentioned earlier, was a source of constant concern for some, EU and Canada also agreed to include a broad exclusion of gambling and betting. The US experience with implementing the US – Gambling ruling by the WTO adjudicating bodies has arguably worsened the possibilities for liberalization in the sector anytime soon. The EU in particular, has also excluded the possibility for intra-EU liberalization in the sector by excluding it from the scope of the EU Services Directive.55 Chapter 9 on the supply of cross-border services covers measures affecting Modes 1 and 2, but excludes from its scope audiovisual services (for the EU) and cultural industries (for Canada), as well as financial services. Just like in the GATS, services in the exercise of governmental authority;56 air services, government procurement, and subsidies are equally excluded. Chapter 9 includes obligations on national treatment,57 most-favoured nation (MFN)58 and market access, which are conditional on the reservations undertaken by the two parties in their respective lists of reservations. It also includes an obligation enshrined in Article 9.4 allowing Members to maintain measures that prescribe formal requirements in connection with the supply of a given service such as those relating to obtaining a license or certification as long as they are not applied in a way that constitutes arbitrary or unjustifiable discrimination. Article 9.4 is akin to Article VI:4 GATS but incorporates a test which does not call for a scrutiny of the necessity of such measures. At the same time, it appears to cover a broader set of measures that lay down requirements in connection with a given service. Importantly, this obligation is not subject to the reservations that the two parties listed pursuant to Article 9.7. Article 9.4 should be read together with the obligations under Chapter 12 on domestic regulation which applies to measures relating to qualifications and licensing requirements and procedures and is applicable to cross-border supply (which, as noted, includes both cross-border and consumption abroad), commercial presence and temporary movement of natural persons for business purposes (thus, all four GATS modes of supply). The chapter on domestic regulation provides that requirements and procedures relating to licensing and qualifications shall be based on clear and transparent, objective, pre-established and publicly accessible criteria with a view to precluding any arbitrariness on the side of the competent authorities. In the remaining, the 16 paragraphs of Article 12.3 on qualifications and licensing include due process obligations that aim at minimizing any leeway for arbitrary and unnecessarily excessive behaviour by regulatory authorities. Overall, the text on domestic regulation appears to have been inspired by the most recent efforts to finalize a text on domestic regulation under the GATS in fulfilment of the negotiating mandate set out in Article VI:4 GATS.59 Indeed, as early as in 2009, the Working Party on Domestic Regulation (WPDR), which administers these negotiations, has developed a consolidated text that has been further refined by the WTO Members ever since in informal talks.60 The current plurilateral negotiations for a TiSA are also inspired by the efforts made within the WPDR in previous years. In the TiSA negotiations, however, the most recent leaked draft annex on domestic regulation seems to include a tentative necessity test through reference to Article VI:4(b) GATS, which would outlaw measures that are more burdensome than necessary to ensure the quality of the service at stake.61 However, it is also well-known that the USA considers such test as too intrusive and therefore the chances for incorporating such a test in the final TiSA text should be regarded as slim. For now, it seems that EU has failed to convince Canada of the importance of incorporating such a necessity test in the domestic regulation chapter of CETA, which is indicative of the low chances of persuading a broader set of countries within the TiSA negotiations. Finally, ambitious transparency-related provisions are a necessary component of the trust-building efforts between Canada and the EU and are further spelled out in the provisions relating to transparency and regulatory cooperation.62 The transparency-related provisions go further than the GATS in that they require that advance publication and notice and comment procedures for proposed measures be available to ‘interested persons and the other party’. Additionally, administrative proceedings are to be open and as informative as possible to offer a fair chance to be heard to those affected. All this is coupled with a commitment to cooperate in other fora where transparency-related initiative on trade and investment are discussed. Many of the transparency-related provisions within CETA are to be operationalized and monitored by several specialized committees that the agreement establishes pursuant to Article 26:2. Much of the agreement’s success will indeed depend on the smooth functioning of this transatlantic comitology process. Article 28.3 clarifies the type of general exceptions that the CETA parties can invoke. With respect to investment the agreement incorporates Article XX GATT. Interestingly, paragraph 1 includes an interpretive note clarifying that, for the purposes of this agreement, the parties agree that Article XX(b) can also cover measures taken on environmental grounds, whereas Article XX(g) covers the conservation of both living and non-living exhaustible natural resources, thereby codifying the US – Shrimp case law. With respect to the other service-related chapters mentioned above, Article 28.3.2 incorporates Article XIV GATS for all practical purposes. The wording and the reference to the GATT suggests that the WTO case law will play an instrumental role in the judicial review of any measure under the CETA. 2. How much actual liberalization in CETA? In terms of architecture, CETA lists in two annexes existing and future reservations, respectively, against obligations enlisted in the chapters on cross-border services trade; investment; financial services; and maritime transport services. Such reservations deviate, inter alia, from the non-discrimination obligation (both national treatment and MFN) and the market access obligation as well as performance requirements imposed under the investment chapter. Annex III incorporates all Canadian reservations in the area of financial services at the provincial level.63 Other than the reservations listed, the parties to CETA must liberalize access in their respective services sectors. Amendments of non-conforming measures are possible as long as such amendments do not decrease the conformity of the measure. Thus, CETA introduces a standstill obligation.64 Annex I lists a limited number of EU reservations relating to agriculture, transport, and R&D programmes limiting the bite of the national treatment principle, followed by a country-specific catalogue of reservations relating to existing measures. With respect to future measures listed in Annex II, the EU reserves in all sectors in the area of investment (but, interestingly, not of cross-border supply) for market access only any different treatment relating to the supply of public services through the by now standard ‘public utilities exception’.65 Furthermore, the CETA shields from the MFN obligation on investment and services from all those agreements the EU concludes that seek to establish an internal market, including the European Economic Area (EEA) and the agreements with Switzerland, but also the pre-EU accession agreements. Another notable aspect of EU’s Annex II reservations is that the EU liberalizes the telecommunication sector but for broadcast transmission services, in which it reserves the right to impose market access and national treatment restrictions in both investment and cross-border services supply. As noted earlier, the Annex II further introduces a carveout for gambling services (except for Malta) and also for education services. Certain types of restrictions are also reserved in the areas of health and social services notably as far as investment is concerned. A series of restrictions on transport services, as well as country-specific reservations follow. For instance, France reserves the right to take any measure relating to the production of electricity limiting market access in investing in this sector. This binary character of the EU annex regarding future measures renders certain overlaps inevitable. For instance, despite EU’s broad reservation on water-related services, Germany also listed a reservation on waste management services. Similar overlaps appear to occur in healthcare-related reservations. In addition, certain EU Member States such as France or Italy took a defensive stance regarding any Canadian investment in newly privatized or ‘strategic’ sectors, allowing for the exercise of discretionary powers by the relevant domestic authorities.66 B. The TTIP proposal for a services, investment, and e-commerce chapter by the EU67 1. The scope of the proposed rules The EU’s draft chapter on services and investment (hereinafter, the ‘draft chapter’) under TTIP calls for progressive reciprocal liberalization in these fields as well as e-commerce without jeopardizing Parties’ right to regulate in the pursuit of public policy objectives including the protection of public order, public health, or consumer protection. In this respect, it reflects the dynamic nature of the prospective trade deal, obliging the two parties to review rules and commitments at regular intervals. The draft chapter distinguishes between rules on investment and rules on cross-border supply. Thus, just like under CETA, the draft chapter merges Modes 1 and 2 under the concept of ‘cross-border supply’, while Mode 3 is now dealt with under investment, which, however, and quite crucially, also includes investment in areas other than services. The subheading on investment clarifies that it applies to measures adopted or maintained by a Party affecting the establishment of an enterprise or the operation of an investment by an investor of the other Party in its territory, thereby covering both pre- and post-establishment restrictions. In addition, according to the general provisions of the draft chapter, the concept of cross-border supply includes the possibility of supplying a service through remote means (whereby the supplier and the consumer do not move from their respective territories) but also the situations whereby the service recipient moves in the territory of the other Party to receive the service. Mode 4 relating to the temporary movement of natural persons is dealt with in a separate subheading. The draft chapter concludes with: (i) a subheading relating to the regulatory disciplines that apply to services and investment, including transparency, equivalence, and mutual recognition as well as sector-specific regulatory disciplines; and (ii) a subheading on e-commerce. In the end of the draft chapter, a general exception provision is introduced which combines elements from both Articles XX GATT and XIV GATS and is applicable to all subheadings mentioned above, offering a safety valve for genuine regulatory interventions in the public interest. In line with the negotiating mandate and EU practice, the draft chapter excludes audiovisual services and governmental services from its purview. Furthermore, it is clarified that subsidies are dealt with in a separate subheading relating to competition and state aid. The same applies to government procurement which is subject to another subheading relating to public procurement. These exclusions apply to both investment and cross-border supply of services. In terms of territorial scope, the draft chapter clarifies that it applies throughout the territory of the parties, including any subdivision of government. In the leaked consolidated version of the disciplines on cross-border trade in services, financial services and air services are equally excluded, as there are sector-specific rules for these two fields. In addition, both the EU and the USA appear to agree on the sweeping territorial scope of the draft rules, covering every level of government as well as self-regulatory bodies that are tasked with regulatory powers. In addition, both parties acknowledge the importance of periodic reviews of the implementation of the agreed rules. Finally, they seem to agree on the need for the establishment of a new body or committee which would be tasked with amending if needed the annexes to the FTA that includes specific commitments and reservations. Importantly, the USA proposes that the parties consult annually upon issues of mutual interest that pertain to the implementation of the FTA. 2. The proposed rules on investment With respect to the investment disciplines proposed by the EU, the draft chapter appears to only cover establishment and post-establishment matters, but not any pre-establishment situations. However, the draft chapter includes a broad definition of ‘investor’ to also cover natural or legal persons which seek to make an investment in the territory of the other party.68 The proposal replicates for all practical purposes the relevant chapter on investment under CETA: the rules incorporated in this section echo the main liberalizing instruments set out in the GATS and call for periodic reviews of the investment regime in the territories of the two Parties. More specifically, Article 2-2 on market access prohibits quantitative restrictions such as limitations on the number of enterprises, the total value of transactions or assets the total number of natural persons that can be employed or the total quantity of output in sectors where commitments are undertaken. These prohibitions cover both discriminatory and non-discriminatory measures that impose maximum ceilings of this type. Like in Article XVI of the GATS, limitations on legal form and foreign capital participation are also prohibited unless a reservation is scheduled in this regard. Significantly, no market access reservations are allowed other than at the level of local government and the ones inscribed in Annex III. Such market access reservations are inscribed in a positive listing. In other words, the EU proposes that the parties shall list only those sectors in which they commit to apply no quantitative limitations. Non-discrimination is the second important principle of this subheading relating to investment and applies the standard wording relating to this obligation. Article 2-3 calls for equality of competitive opportunities in like situations among the investors of both parties and their investments regarding establishment and operation of companies, whereas Article 2-4 extends to investors and investments of the two Parties more favourable treatment of investors and investments of any third party. Finally, and quite importantly, the subheading relating to investment outlaws a series of performance requirements. This provision seems to flesh out the prohibitions regarding market access mentioned above, but it also goes beyond these by referring to typical investment-related restrictions found in investment treaties. A series of reservations on non-discrimination and performance requirements are listed in the various annexes to the draft chapter. Contrary to market access, a negative list is used to schedule reservations in this case. However, the effect of this approach is minimized by the inclusion in the draft chapter of a grandfathering provision for existing non-conforming measures at all levels of government. The publicly available draft chapter does not include any rules on investment protection. Thus, no rules on fair and equitable treatment (FET) are proposed.69 On the contrary, in an attempt to circumscribe the often elusive concept of FET,70 CETA Article 8.10 incorporates a closed list of types of behaviour by the regulating State which would constitute a breach of FET. These include denial of justice, a fundamental breach of due process, manifest arbitrariness or treatment amounting to coercion, duress and harassment.71 In addition, this CETA provision makes reference to the possibility for the arbitral tribunal to take into account representations to the investor by the host State that may have created legitimate expectations which were subsequently frustrated. This is the first time that the concept of legitimate expectations appears in an investment treaty. These concepts of ‘specific representations’, ‘inducement’ and ‘reliance’ are not free from controversy in international investment litigation. Within the EU, the CJEU has considered the protection of legitimate expectations as a fundamental principle of EU law, suggesting that any economic operator whom an EU institution has, by giving her precise insurances, caused to entertain justified expectations may rely on this principle. However, the CJEU has been very careful, at equipoise, to weigh in favour of the EU institution, typically the Commission.72 It is uncertain whether an investment tribunal would be equally lenient to the public authority. To date, the Commission’s internal draft chapter on services, investment and e-commerce of September 2015 reveals the willingness of the Commission to eventually replicate the CETA provisions relating to the treatment of investors and the rules relating to the resolution of investment disputes enshrined in CETA Chapter 8.73 Of course, the USA does not seem to share for now the EU’s view on the need for a multilateral investment court. However, the EU’s desire to create a largely harmonized space for investment among three powerful trading partners where the same investment rules would apply is not without significance. On the contrary, it arguably constitutes a tentative sketch of an incremental international agreement incorporating the investment rules of the future. Importantly, the insulation of the right to regulate; clarifications that aim to rationalize the potentially far-reaching scope of indirect expropriation; a delimitation of the FET concept; a partial exclusion of investment claims against sovereign debt restructuring; a two-instance dispute resolution system and a code of conduct for arbitrators and mediators all constitute integral part of this new investment-related framework preached by the EU. 3. The proposed rules on cross-border supply The subheading relating to cross-border service supply resembles part III of the GATS relating to market access and national treatment, but is adjusted to only cover GATS Modes 1 and 2. Thus, for instance, the provision on market access only refers to limitations relating to the number of service suppliers, the total value of service transactions and the total number of service operations or output. Like in the case of investment, such quantitative limitations of both discriminatory and non-discriminatory nature are not allowed unless they are maintained at the local level of government74 or they are inscribed as reservations in committed sectors included in Annex III using a positive list. The provisions relating to national treatment and MFN treatment resemble the provisions on investment discussed above. However, the national treatment provision under this subheading in particular incorporates the codification of WTO case law on national treatment that was included for the first time in paragraphs 2 and 3 of Article XVII GATS. By way of comparison, in CETA the EU did not consider necessary to include a similar reference. Rather, it opted for the use of the concept of assessing less favourable treatment based on ‘like situations’. This latter concept has sparked controversy notably with respect to its relationship with the concept of ‘like circumstances’ found in NAFTA and ‘like products’ found in the WTO jurisprudence. Arguably, the EU has allowed here for unnecessary uncertainty; rather, an approach opting for the WTO view on the standard of national treatment would cater for higher levels of predictability and legal certainty. Finally, non-conforming measures can only be saved if included in the subsequent Annexes in a negative list. A provision on progressive liberalization is also built in this subheading of the draft chapter. The subheading on temporary movement of national persons (GATS Mode 4) focuses on facilitating the entry and stay of specific categories of personnel such as intra-corporate transferees, business sellers or business visitors/personnel engaged in establishment. 4. The rules on domestic regulation in services and the ‘necessity test 2.0’ With respect to domestic regulation, the EU proposes a framework based on due process and more transparency for those sectors in which the two Parties undertook specific commitments and provided that they are not subject to any reservation in the Annexes. Crucially, the draft chapter extends the application of domestic regulation rules to the realm of investment, thereby extending the scope of such rules beyond services.75 In this regard, the EU ensures some level of coherence with CETA, which in Article 12.2 equally extends domestic regulation rules in the realm of commercial presence. Following the due process and good administration rationale, Article 5-2 of the draft chapter further calls for the establishment or maintenance of appropriate and independent remedial mechanisms in case of negative administrative decisions. In addition, paragraph 5 of Article 5-2 requires the use of an impartial and transparent selection procedures of licensees in case of limited availability of licenses due to scarcity of natural resources or technical capacity.76 Provided that liberalizing commitments in telecommunications (a sector that the EU is willing to fully liberalize and has aggressive export interests) and energy are undertaken, this provision can have broad repercussions on the further integration of the transatlantic market. Paragraph 6 confirms Parties’ right to select the licensee based on economic but also non-economic criteria such as health, safety, consumer protection, the protection of the environment, or the preservation of cultural heritage. Articles 5-2 and 5-3 spell out good governance and due process principles as applied in licensing and qualification procedures and follow the spirit if not the letter of Article 12.3 CETA. The draft provision calls for clarity, transparency, objectivity, and impartiality, as well as independent review, simplicity, and administrative neutrality. Any fees should be cost-oriented and processing of applications should be completed within a reasonable period of time. Rejection of applications should be duly communicated and a giving reasons requirement should be adhered to upon request.77 Against this framework, and taking into account that the USA has opposed the introduction of a necessity test on domestic regulation in the GATS negotiations,78 the EU puts on the negotiating table with its two most important North American trading partners an obligation similar to the one included in the EU Services Directive regarding conditions for the granting of authorizations.79 Rather than focusing on necessity, the EU uses as proxies for identifying regulatory arbitrariness by authorities a list of criteria. The traits of the criteria identified in Article 5-2 of the draft chapter codify some 40 years of case law delivered by the CJEU in the area of free movement law.80 Thus, according to this draft provision, the criteria on which the Article 5-2 measures are based shall be proportionate to a legitimate public policy objective; clear and unambiguous; objective; pre-established; made public in advance; transparent and accessible. Although in Article 12.3.2 of CETA the criterion of proportionality is not mentioned, the EU included it in the proposed Article 5-2.2 of the TTIP chapter. Therefore, it seems opportune to explain briefly the intricacies of this principle deeply rooted in the EU legal system.81 a) Proportionality under EU law For our purposes, other than the procedural character of these traits relating to transparency, objectivity and so on,82 proportionality is the substantive requirement of interest here, as it constitutes EU’s attempt to export in the transatlantic trade relationship a central notion of the EU constitutional law and a milestone of the rule of law à la EU. Proportionality is one of the most flexible and volatile yet highly developed concepts in the EU legal edifice.83 The CJEU recognized proportionality as forming part of the general principles of EU law84 and by now an obligation that the EU legislator is expected to abide by. Established CJEU case law suggests that a measure is proportionate if it is: (i) suitable or appropriate to achieve the objective pursued (suitability); (ii) necessary, i.e. the least onerous among several appropriate measures (necessity or proportionality lato sensu); and (iii) proportionate in that the disadvantages (these are usually the damages to individual interests) are not disproportionate to the objectives which usually serve the public or the EU interest (stricto sensu proportionality).85Stricto sensu proportionality entails a cost-benefit analysis, the only difference being that the CJEU will not necessarily invalidate an act solely on the premise that the costs exceed the benefits.86 Generally, the application of proportionality has been fairly accommodating to protect different interests and thus the degree of judicial review has varied considerably.87 Again, in numerous cases in which the assessment of measures taken by the EU institutions was at stake, the CJEU confined its judicial review in an assessment of whether the challenged measure is manifestly inappropriate in the light of the objective pursued by the competent institutions. According to the CJEU, such deference is premised on and justified by the complex assessments of political, economic, and social nature that the EU institutions may be called upon to undertake.88 In other cases, the CJEU, au lieu of expressly scrutinizing whether the measure at stake was stricto sensu proportionate, it favoured the undertaking of a ‘marginal review’ of costs and benefits of the contested measure under the guise of the necessity requirement. Nevertheless, this should not be taken as suggesting that the judicial review focuses on the existence of alternatives, since the quintessence of proportionality seems to be a balancing test weighing the objective of a given measure against its adverse effects.89 In recent cases (for instance, those relating to gambling services), the Court has also been quite reluctant to interfere with the regulatory sovereignty of EU Member State courts. In Garkalns,90 for instance, the Court first reminded that proportionality would require that national legislation be appropriate for ensuring attainment of the objective pursued only if it genuinely reflects a concern to attain it in a consistent and systematic manner.91 However, in sensitive sectors such as gambling where public order and morality considerations play a prominent role, States enjoy a sufficient measure of discretion to protect consumers and preserve public order. In Garkalns, this margin of discretion would allow local authorities in Latvia to refuse authorization to open a casino, amusement arcade, or bingo hall if the authorities found that the interests of the state and of the residents of the relevant administrative area were substantially impaired. Instead of deciding on whether this type of economic needs test goes beyond what is necessary to protect consumers and other societal concerns, the Court preferred to merely say that the exercise of the discretionary power should be transparent so that the impartiality of the authorization procedure can be monitored and then left the issue for the referring Latvian court to decide. b) Attempts to ‘export’ the EU proportionality test (or elements thereof) Necessity is an intrinsic feature of the proportionality test in EU law. Therefore, one cannot decide whether a given measure is proportionate without first examining whether the measure goes beyond what is necessary to achieve the public policy objective pursued. The EU proposed the introduction of a ‘light’ proportionality test in the GATS at the beginning of the GATS negotiations in 2001 without success.92 Therefore, the wording of paragraph 2 of Article 5-2 proposed by the EU in the TTIP negotiations attempts to introduce an enhanced necessity/proportionality test for measures relating to licensing and qualification requirements and procedures with the overall objective of eschewing arbitrary exercise or abuse of power by competent authorities. However, as the discussion above suggests, the EU proportionality test is more volatile and unpredictable than the WTO necessity test, as developed in cases like Korea – Beef and US – Gambling. One of the reasons is that the WTO judiciary’s analysis of the necessity of a given regulatory measure focuses on the thorough comparison of alternatives. If the USA agrees to this insertion to the services chapter of TTIP, then approaching the EU as a ‘normative power’ would be even more of a truism in virtually balanced bilateral relationships (as compared with asymmetrical, ENP-type of relationships). However, it appears highly unlikely that the USA will agree with such a sovereignty-hostile test, notably in case that a new international dispute settlement organ is created, tasked with applying this test. As noted, the CETA does not include a proportionality criterion in Article 12.3, but only calls for transparency and objectivity. One would plausibly think that the EU has attempted to include the criterion of proportionality, albeit without success. Nothing would suggest that the chances of success would be better when negotiating with the USA, notably with an administration that has ardently criticized trade agreements. 5. Mutual recognition of professional qualifications Mutual recognition of professional qualifications ranks high in the list of priorities of the EU not only in the international trade policy domain but also internally. Indeed, an unambiguous dialectic appears to exist between internal market integration and efforts to create a ‘global market for professions’ at least with those trading partners with which a certain regulatory homogeneity exists.93 Advances in any of the two fronts are expected to create élan for further integration in the other. While a highly integrated area, recognition of professional qualifications within the EU is a never-ending story. The EU’s centrepiece of the effort to complete the single market, the Single Market Act, is very eloquent as to the importance of recognition of professional qualifications for the smooth functioning of the four fundamental freedoms.94 To be sure, the determination of the EU institutions to move forward in the area of professional qualifications internationally should not be seen independently from the internal dimension of such recognition. Arguably, agreements such as CETA, TTIP, or TiSA are instruments that can potentially mobilize all these forces, which under internal but also external pressure, may allow for improved mobility of service suppliers and self-employed persons in an ever-expanding, largely homogeneous regulatory space that the EU has become but also outside it in cooperation with like-minded trading partners. a) A snapshot of the EU framework for the recognition of professional qualifications The most conspicuous horizontal consolidation of the relevant legislation at the EU level took place with the adoption of Directive 2005/36/EC (the Professional Qualifications Directive–PQD),95 which introduced a flexible and automatic procedure for recognition of qualifications. PQD replaced three general and 12 sectoral directives relating to recognition of professional qualifications.96 PQD applies to regulated professions97 and covers both employed and self-employed activities within the EU. Through the recognition of professional qualifications of a natural person, the host Member State allows access in that EU Member State to the profession for which she is qualified in the home Member State and to pursue it under the same conditions as host country nationals. The profession can be considered as being the same if the activities are ‘comparable’.98 Otherwise, compensatory measures such as additional training or an aptitude test may be warranted. Few professions, which have been harmonized initially through sectoral directives, benefit from automatic recognition. These include: doctors, nurses in charge of general care, dentists, veterinary surgeons, midwives, pharmacists, and architects. For such recognition to occur, the Directive sets minimum training requirements and notably the minimum duration of studies for every profession coming under the above categories. Any service supplier meeting these requirements can automatically practice in any MS. One of the novelties of PQD vis-à-vis the previous legislative instruments is the partial liberalization of the provision of services. When the freedom to provide services is exercised, the Directive provides that access to the market of the host MS cannot be made conditional on the recognition of qualifications by that MS if the service supplier is legally established in a given MS and pursues there the same profession. The PQD creates a presumption that the qualifications of an applicant entitled to pursue a regulated profession in one MS are sufficient for the pursuit of that profession in other MS.99 In this way, the PQD essentially set out a framework for the mutual recognition of temporary movement of professionals. If the profession is not regulated in the home MS, then the service supplier can legitimately be requested to provide evidence of two years of professional experience gained over the previous 10-year period. The Services Directive leaves no doubt as to the full application of the chapter of PQD relating to the freedom to provide services (Title II) with respect to issues associated with professional qualifications for regulated professions such as commercial communications, multidisciplinary practices, tariffs or fees, and so on. Nevertheless, the service supplier can be subject to professional rules of a professional, statutory or administrative nature which are directly linked to professional qualifications such as the definition of the profession, the use of titles and codes of conduct aimed as consumer protection and safety which are applicable in the host MS to professionals supplying the same services.100 PQD was recently amended by Directive 2013/55 to introduce the European professional card (EPC) which aims at simplifying the recognition of professional qualifications.101 EPC is an electronic proof that a given professional passed administrative checks and that her professional qualifications were recognized by the host state, or, alternatively, that the conditions for the temporary provision of services were met.102 The Directive also introduced the possibility for partial access to a given profession based on CJEU’s case law.103 More importantly, it set the ground for harmonization of curriculum and training programmes which, in the medium run, should lead to quicker, quasi-automatic recognition of professional qualifications. b) Recognition of professional qualifications in CETA and TTIP Striving to facilitate mobility between the USA, Canada, the EU, and selected WTO partners is a shared objective of all EU institutions, notably in the case of high-skilled professionals. Just like the CETA chapter, the TTIP draft chapter reflects the reality of regulation of professions globally: such an initiative cannot yield the desired results without the active and genuine participation of professional bodies. In this regard, the CETA and proposed TTIP provisions relating to the recognition of professional qualifications are identical for all practical purposes. Both CETA and the draft chapter call for the creation of a Committee on Mutual Recognition of Professional Qualifications (‘MRA Committee’) which will receive, administer, recommend, and eventually monitor mutual recognition agreements (MRAs) submitted by regulatory authorities or professional bodies. As expected, the EU does not promise the extension of the PQD framework to the USA nor Canada. Whereas individual EU Member States are free to do this at the national level, other Member States are not obliged to offer to these third-country nationals the benefits deriving from the EU fundamental freedoms of establishment and services.104 However, third-country legal and natural persons that have a primary establishment within the EU can rely on EU law in the case of secondary establishment if they can prove that they have effective and continuous links with the EU Member State of primary establishment. In all other cases, MRAs appear to be the only possibility, in which case the MRA Committee, based on recommendations by regulators or professional bodies, will decide whether an MRA should be negotiated and concluded. Recommendations should give information relating to the economic value of the prospective MRA; the existing level of market openness; industry needs and business opportunities as well as the expected gains. Based on this information, the MRA Committee will give the green light to the entities that made the initial recommendation to submit a draft MRA text to the Committee. Quite optimistically, the draft chapter assumes that several MRAs will be ready by the time the TTIP is ready to enter into force. To date, there is work underway in the architectural profession, with auditors and lawyers being considered as possible candidates for such MRAs.105 EU–US MRAs would offer to US citizens EU-wide recognition of qualifications, thereby constituting an additional layer to the existing EU framework for the recognition of professional qualifications. Therefore, such agreements may have a very important positive effect on transatlantic mobility of high-skill professionals in the medium term. The provisions of the draft chapter relating to the regulatory framework conclude with an annex incorporating guidelines for the negotiation and conclusion of MRAs. Although both Parties have claimed that TTIP aims to set the new rules for global trade in the 21st century, this does not mean that inspiration cannot come from the past. In fact, in a clear signal of the extant path dependencies in international trade regulation, the EU proposed non-binding guidelines and the CETA MRA guidelines106 build on the non-binding guidelines for MRAs in the Accountancy Sector,107 the first attempt within the WTO Council for Trade in Services (CTS) some 20 years ago to flesh out the substantive content of Article VI:6 GATS relating to professional services.108 Some similarities between the CETA and TTIP rules on MRAs, on one hand, and the accountancy guidelines for MRAs, on the other, are indeed striking both with respect to the procedure for negotiation of an MRA and the substantive content thereof. Like the accountancy guidelines, the guidelines proposed by the EU and agreed upon under CETA aim at providing practical guidance with a view to assisting the negotiation and conclusion of MRAs among the Parties. Thus, their non-binding nature should not affect their use by professional entities and relevant regulatory authorities. According to the proposed guidelines, MRAs should clearly identify the participants; the purpose of the agreement; the details of the mutual recognition provisions, including eligibility requirements for recognition and specification of the conditions under which any additional supplementary requirements may apply; or any further licensing or related requirements; the rules and procedures relating to monitoring, review, enforcement, and remedies. Building on the accountancy guidelines, the proposed guidelines for MRAs in professional services propose a four-step process for the recognition of qualifications: (i) verification of equivalency: this step requires a careful comparison of qualifications in the respective jurisdictions. Assessment of equivalence of the content of education, the system of accreditation, or the system for granting rights to practice may fall into this category and is a precondition for any agreement to mutually recognize respective regulatory frameworks.109 Overall equivalence should be confirmed if there are no substantial differences between jurisdictions as regards the qualifications of the regulated profession or the scope of rights to practice; (ii) evaluation of substantial differences: these differences may relate to the duration or content of the training or the subject matter of the qualifications; (iii) compensatory measures: in case of substantial differences, an adaptation period or, if required, an aptitude test should be considered. However, before that, each negotiating entity should carefully examine whether professional experience in the home jurisdiction would be sufficient to remedy the differences. In this regard, the guidelines build on the EU experience with compensatory measures in the area of professional qualifications; (iv) identification of the conditions for recognition: this step concerns setting the scene for future recognition and finalizing the MRAs. There is nothing erroneous with building on previous legislative work notably when it expresses a critical mass of multilateral consensus.110 However, in the last 20 years, these guidelines have been barely used. Obviously, the fact that the accountancy disciplines adopted at the WTO level remained a draft for over 20 years (the disciplines adopted in 1998 must be integrated into the GATS at the end of the Doha Round whenever that occurs)111 created high levels of uncertainty which may have deterred potentially interested entities from using them. Thus, it should be expected with great interest the use of the MRA modalities by EU and Canadian regulatory bodies as well as the reaction by the US professional bodies and relevant regulatory authorities on the EU proposal. Importantly, the EU took a much more determined stance in the TTIP negotiations in that it clarified that the acceptance of a binding framework for MRAs and the actual conclusion of MRAs in individual professional services sectors are prerequisites for the validity of the EU offer on professional services.112 6. Sector-specific rules of the services chapter proposed by the EU The draft chapter proposed by the EU goes on with sector-specific rules: section III focuses on computer services and proposes an understanding on computer services; section IV deals with postal and courier services and, interestingly, includes a provision on universal service providing that universal service obligations should not be regarded as anti-competitive per se, as long as they are administered in a transparent, non-discriminatory and competitively neutral manner and are not more burdensome than necessary to achieve the policy objective pursued, typically relating to accessibility, affordability and quality. In the EU’s view, express delivery services should not be subject to universal service obligations. A similar rule on universal services is included in CETA but only with respect to telecommunications services.113 More recently, the EU presented a text proposal on delivery services, including express delivery, which focuses on cross-subsidization; universal service obligations, transparency of licensing requirements and procedures as well as the independence of the relevant regulatory bodies.114 Electronic communications networks and services is one of the areas where negotiations are in an advanced stage and the EU and USA have produced a tentative consolidated text,115 which goes further than the GATS Annex on telecommunications in enhancing transparency, due process, fair competitive opportunities and regulatory/administrative neutrality. Such market access-increasing initiatives are in line with the EU’s upcoming wave of changes in further consolidation in the sector as part of the EU single digital market.116 a) Rules on financial services in CETA and TTIP The inclusion or not of financial services, including regulatory cooperation in this sector, has been contentious since the very beginning of the TTIP negotiations. In view of the high level of integration in the transatlantic financial market, regulatory divergence constitutes the most important trade barrier.117 Reduction of barriers in this sector may lead to a trade increase of as such as 4.2 percent.118 At the outset, for regulatory cooperation to be effective, no coupling with a trade agreement may be necessary; and this applies to both goods and services. Secondly, many in the financial industry appear quite pleased with the results that a ‘soft’, bottom-up approach has produced to date on both sides of the Atlantic. And, thirdly, on both sides of the Atlantic there are doubts as to whether advances in financial regulation post-crisis may be undermined by a trade agreement that uses pre-crisis wording and rules.119 In CETA, as financial services are treated in a separate chapter, certain deviations from TTIP burgeon. For instance, CETA adopts an unnecessarily complicated approach regarding financial services, as several provisions from other chapters such as the one on cross-border supply of services or the one on domestic regulation are incorporated by reference. In TTIP, on the other hand, the relevant financial services provisions are included in sub-section IV of the TTIP draft chapter proposed by the EU, which essentially mirrors the GATS financial services Annex. Some further elaborations are still included. For instance, new financial services are in principle permitted but either party may impose a particular legal form and/or require authorization for the supply of that service. Such authorization can be refused only based on prudential reasons. A virtually identical provision is incorporated in Article 13.14 CETA, also echoing Article 11.7 TPP. This is an unequivocal trust vote to financial innovation in a post-crisis environment. Both TTIP and CETA also include a provision on financial data processing and transfer allowing for cross-border flows, alluding to the importance of safeguards to protect privacy and to comply with the relevant legislation of the party where the transfer originates. Prudential regulation still is a topical issue 10 years after the global financial crisis. In the wake of the recent Argentina – Financial Services dispute120 brought by Panama, challenging Argentina’s discriminatory treatment based on whether certain countries cooperate or not in the area of tax information exchange, more emphasis should be expected to be put on the drafting of the so-called prudential carveout, perhaps linking it to international standards in the area such as those adopted by the Organization for Economic Cooperation and Development (OECD). On the other hand, due to the broad interpretation of paragraph 2 of the GATS Financial Services Annex that the Appellate Body advanced, accepting that any measure affecting the supply of financial services can in principle be regarded as a measure taken for prudential reasons, WTO Members may be less incentivized to seek regulatory convergence in this area. In TTIP, the EU proposes the introduction of a necessity test to assess the compatibility with the agreement of measures taken for prudential reasons, whereas the USA supports the anti-circumvention approach reflected in paragraph 2 of the GATS financial services Annex but also in Article 11.11.1 TPP. For the sake of comparison, the EU-Canada CETA does not include either of the two different approaches but allows parties to take or maintain reasonable measures for prudential reasons.121 Article 13.16 CETA elaborates on paragraph 2 of the GATS Financial Services Annex clarifying that requiring the registration of cross-border activities and of suppliers offering such services cannot ipso facto be regarded as a non-prudential measure. By the same token, while it recognizes parties’ right to prohibit in a non-discriminatory manner a particular financial service or activity on prudential grounds, it outlaws any attempt to prohibit all financial services or a complete subsector such as banking or insurance. To date, the scope of a potential TTIP dispute settlement system and any sector-specific provisions that may be needed in view of the peculiarities of the financial sector are subject to negotiations. For its part, the USA has previously supported the introduction of the nuanced system set out in TPP, which allows dispute settlement proceedings brought by investors in financial services but establishes sector-specific rules relating to procedures and compensation.122 Interestingly, the EU-CETA includes similar provisions which call for different rules in terms of procedure and substance when financial services are stake.123 To start with, Article 13.20.5(b) shields the financial sector from cross-retaliation, outlawing any suspension of benefits in that sector if the claim does not relate to financial services. Additionally, and when it comes to measures allegedly taken for prudential reasons, the newly established Financial Services Committee (FSC) exerts an important role. CETA extends the application of the investor–state dispute settlement system established in section F of Chapter 8 to investment disputes in which a prudential justification is invoked. In this framework, the responding State may request a decision by the FSC as to whether the invoked justification is a valid defence to the claim by the investor. The FSC (or the CETA Joint Committee in certain cases) must reply in three months. Absent any decision by the FSC, the investor can proceed with the claim. If the FSC replies in the affirmative, the claim is regarded as withdrawn. If, however, the FSC finds that the measure is valid on prudential grounds only partly, then the arbitral tribunal is bound by such determination for those parts of the claim.124 In deciding, the FSC is required to apply certain high-level principles which are listed in a non-exhaustive manner.125 For instance, parties are allowed to seek a higher level of prudential protection than the one ensured via the implementation of common international prudential standards such as Basel III; the urgency of a situation shall be taken into account; or that any determination should seriously consider and if applicable defer to decisions and risk assessment by financial regulatory authorities relating to prudential issues. However, the Annex introduces a presumption—albeit ‘soft’—of conformity for those measures which comply with international prudential commitments undertaken by both Canada and the EU. Overall, and with all its weaknesses, introducing such principles is an innovative feature of CETA’s annex regarding the interpretation of prudential measures. In addition, the subheading relating to financial services proposes a framework under which regulatory cooperation in financial services could occur. This provision also links this draft chapter with the chapter on horizontal regulatory cooperation, something that the USA opposes to. For now, the EU proposes a soft, best-endeavour obligation to achieve mutual compatibility of the regulatory and supervisory financial regulatory frameworks of the two parties and later reflect on the possibility of recognizing equivalence when comparable outcomes are achieved. The EU has signalled that its financial services offer is conditional upon ‘satisfactory engagement in regulatory cooperation’.126 More importantly, the proposed Article 5-38 calls for upstream regulatory cooperation, which, crucially, is not new between the EU and the USA in the area of financial services. The Financial Markets Regulatory Dialogue (FMRD), established in 2002, and cooperation in international fora in the aftermath of the crisis witness enhanced bilateral collaboration between the two parties.127 The proposed chapter wants to further institutionalize and upgrade cooperation through the Joint EU/US Financial Regulatory Forum (FRF), bringing together representatives of regulators, supervisors and competent authorities. In fact, the FRF replaced the FMRD and has been active outside TTIP since 2016 even though its current function does not match EU’s ambition, which is to establish regulatory cooperation not only at the federal level but also between EU Member States and the US States.128 As negotiations come closer to a deal, it is submitted that market forces in this sector will seriously question the added value of trade-bound regulatory cooperation in financial services. In the USA, a bottom-up approach outside a preferential trade agreement (PTA) appears to be the preferred option, as those interested and affected by changes are more incentivized to get together and contribute to alleviate any market distortions jointly. There are successful examples for such cooperation not only in services but also in manufacturing. The US–Canada regulatory cooperation council has delivered very satisfactory results in cutting red tape and improving regulatory cooperation without any apparent link to NAFTA and the respective trade ministries.129 The recently leaked TTIP texts130 reveal that, shortly before the US transition in administration, the EU and the USA had agreed on the contours of a separate chapter on financial services, probably à la TPP and CETA paving the way for a consolidated version, attempting to agree on the actual scope of that chapter. The USA seems to prefer rules that focus on financial institutions only rather than on the broader category of financial service suppliers that the EU advanced in its draft chapter. More interestingly, it is still unclear whether finance-related investor–state dispute settlement will be allowed. CETA does allow for such a possibility notably for non-discrimination-related claims131 so it appears unlikely at first blush to exclude such a possibility in TTIP. At the same time, positive harmonization in financial services in the short run within CETA seems doubtful, as Annex 13-C merely calls for a regulatory dialogue to take place within the FSC. Other than that, no separate chapter on regulatory cooperation in financial services was agreed upon within CETA. b) Other sector-specific rules in the transatlantic trade deals The remaining two sector-specific sections relate to maritime and air transport services. Maritime transport under CETA goes much further than the EU’s current TTIP proposal in that it makes measures relating to the supply of maritime services subject to the investment and cross-border chapters of the agreement and it also expands the national treatment obligations for the most important aspects of the supply of such services.132 On the other hand, air transport services are excluded from the scope of the cross-border supply chapter and are subject to the investment chapter only in part133 under CETA, and this is coupled with some sweeping reservations listed in the Annexes. However, the EU managed to convince Canada to include for the first time in a Canadian FTA ground handling and airport operation services, which, again, are subject to significant reservations on the side of Canada.134 Under TTIP, the EU strives for more openness which, if agreed upon, may lead to important changes in the map of international aviation. Other than applying the relevant obligations enshrined in the proposed TTIP chapters on investment, cross-border supply and temporary movement of personnel, the air transport chapter calls for liberalizing ground handling services, airport operation services, rental of aircrafts and, crucially, ownership and control of air carriers. In this last point, the EU proposes that no limitation regarding ownership and control to natural persons or enterprises, including for the purpose of granting an operating license for the operation of air transport services, should be maintained,135 thereby going beyond than the EU–US air transport agreement in terms of liberalization.136 The last subheading of the draft chapter lays down rules in the area of e-commerce. It clarifies that it covers trade enabled through telecommunications and other ICT means, but excludes gambling, broadcasting, audiovisual services, services of notaries, or similar professions and legal representation services. It should be expected that the USA will strive to include more detailed rules, matching the level of ambition reflected in the relevant TPP chapter, including rules on digital products. However, the EU clarified that such rules cannot run counter to the EU’s expressed preference to exclude audiovisual services from the scope of the agreement. In this respect, it is argued that CETA Chapter 16 on e-commerce could constitute a good basis to build upon in the EU–US negotiations. To date, one of the scenarios discussed is to have a separate chapter on digital trade that would apply to all sectors.137 7. The EU current offer relating to services liberalization in TTIP138 As noted earlier, services negotiations within TTIP are undertaken under the first pillar of the prospective agreement that relates to parties’ access to each other’s market. The EU proposal focuses on three types of sectors: first, growth-enabling sectors that boost the digital economy such as computer and telecommunication services; second, sectors that determine the pace of integration of global value chains such as (maritime and air) transport, courier services, or business services; and third, certain key economic sectors such as construction, distribution, energy and environmental services. The EU offer in the areas of services, investment, and e-commerce is included in three annexes to the draft chapter. The annexes include sectoral commitments and exceptions thereto (so-called ‘reservations’). In terms of classification, the EU uses the CPC 1.0 of 1991.139 Whereas this is the classification system used for the completion of the GATS Schedules of Commitments at the end of the Uruguay Round in the early 1990s, the decision not to use the more sophisticated version of CPC 2.0 of 2015 appears to be a missed opportunity, as CPC 1.0 constitutes by now an outdated classification system notably in the area of services.140 On the other hand, the use of the same classification system as in the GATS arguably indicates the EU willingness to ensure comparability with its GATS commitments (but also other FTA commitments) and this is only possible through the use of the CPC 1.0. Most similarities with the GATS scheduling system are to be found in Annex III of the EU offer whereby the EU uses a positive list approach to identify these services sectors in which it commits to refrain from applying quantitative limitations. Like in the GATS, limitations (or reservations) to these commitments are exhaustively listed in Annex III (negative listing). This means that, other than those listed, no quantitative limitation can be applied on the services sectors that are explicitly listed. However, for commitments other than market access, Annexes I and II follow a negative list approach. In this respect, the EU’ TTIP approach resembles the approach taken in the TiSA negotiations, which is hybrid in that it combines a positive listing for market access and a negative listing for reservations on the otherwise horizontal application of national treatment.141 Nevertheless, the EU used a negative list approach in the EU–Canada CETA and the same goes for the current negotiations with Japan.142 Like in CETA, the commitments in Annexes I and II relate to national treatment, performance requirements, rules applying to senior management and board of directors, and most favoured treatment. Annex I lists reservations for existing measures, whereas Annex II lists reservations for existing and future measures. The measures included in Annex I are subject to a ratchet clause, leading to bind future additional liberalization. Importantly, though, the very first reservation in Annex I is a type of grandfathering provision excluding all existing non-conforming measures from virtually all pertinent obligations set out in TTIP. Annex II, on the other hand, includes reservations typically found in the horizontal section of GATS Schedules such as discriminatory measures relating to commercial presence and investment, acquisition of real estate or the entry and temporary stay of natural persons. Liberalizing commitments taken under Annex II are reversible, contrary to the Annex I commitments and reservations. Furthermore, the public service exception is disentangled in Annex II. The Annex includes a reservation of health, education, social services and water. An additional reservation in Annex II relates to new services, for instance, as a result of technological advances. Finally, Annex II includes reservations to the MFN with a view to shielding differential treatment granted before the entry into force of TTIP as well as future EU enlargement, pre-accession agreements, the EEA as well as the EU–Switzerland agreements. Annex III includes market access limitations following a positive list approach. It starts with the by-now-standard public utilities exception that the EU introduces in its FTAs to shield public monopolies, exclusive rights and services of general economic interest.143 Limitations to public services, acquisition of land, and movement of natural persons are listed as per the GATS four modes of supply, which is inconsistent, as the draft chapter does not refer to the GATS classification of service supply. Annex III promises liberalization of commercial presence (alias, investment) in various areas of manufacturing from petroleum products to food products and tobacco to motor vehicles. In addition, it offers full opening of market access in certain sectors such as postal and courier services; telecommunication services; computer services; research and development services; and various business services.144 Finally, it is worth mentioning the treatment of two strategic services sectors for the EU: energy and financial services. Energy is an important sector with public good characteristics in which negotiations could produce tangible results, notably as the USA resolutely becomes the biggest energy producer in the world145 and the EU moves towards establishing an Energy Union to address the challenges that EU dependency of foreign energy sources raises.146 Ambitious commitments of the side of EU to liberalize access may not be welcome by all Member States, as internal disagreements remain regarding the usefulness of monopolies, the appropriate extent of exclusive rights, and the scope of public service obligations. In its recommendations, the European Parliament called for a high level of ambition on a reciprocal basis. It recommended the elimination of existing restrictions of export for fuels, including liquefied natural gas and crude oil, in order to create a non-discriminatory energy market, thereby allowing for diversification of energy resources and contributing to security of supply.147 Previously, the Council also underlined the importance of an open, transparent and predictable business environment in energy among the two partners and of making sure that access to raw materials is sustainable and unrestricted.148 The EU tabled a proposal for a TTIP chapter on energy and raw materials in July 2016.149 Two important elements of this proposal are the elimination of all existing restrictions on the export of natural gas and the prohibition of export pricing. A provision on third-party access to energy transport infrastructure is equally included, whereas positive integration is also envisaged in terms of convergence of standards (for instance, on energy efficiency or renewable energy generation) and mutual recognition of test results. In terms of commitments, Annex II includes various conditional commitments in the energy sector subject to reciprocal commitments on the side of the USA. According to the offer, the EU is willing to liberalize extraction of crude petroleum and natural gas; mining of uranium and thorium ore; processing of nuclear fuel; generation of nuclear-based energy in the EU Member States which allow it; the production of energy, transmission, and distribution of electricity on own account; as well as the manufacture of gas and the distribution of gaseous fuels through mains on own account. As noted earlier, with respect to financial services, the EU includes financial regulation in the draft chapter by drawing on the GATS financial services Annex. In the aftermath of the financial crisis, the EU as a block takes a cautious approach in financial services and is prepared to make bold steps only if accompanied by similar action on the USA side. For the time being, the reluctance seems to be reciprocal, as for the USA any liberalization on financial services does not appear to be a priority either. Both parties are currently in the process of an overwhelming regulatory reform of financial regulation; the USA with the implementation of the Dodd–Frank Act and the EU with the implementation of the banking and fiscal union. Whereas for some both parties should concentrate on cleaning up the slate internally, for others this moment of restructuring is in fact the ideal instance for increased cooperation and regulatory convergence based on the prudential considerations that regulatory authorities in both parties are bound to pursue. In addition, the fact that internal reforms take place does not ipso facto exclude the possibility of advancing international cooperation simultaneously, as evidenced by the recent decisions relating to central counterparties in derivatives markets.150 The EU has put on the negotiating table the issue of more efficient regulatory cooperation in financial services,151 partly supported by the financial industry on both sides of the Atlantic.152 In fact, as mentioned above, the European Commission has linked the two issues in that it conditions the EU financial services offer on progress in the area of financial regulatory cooperation. Recently, the EU has presented its conditional offer on financial services,153 which appears to suggest that, as negotiations intensify, perhaps we may indeed witness important developments in the area of regulatory cooperation in this sector. In this offer, the EU has included a limited number of reservations on cross-border supply of insurance and banking services in both Annexes I and II. As to Annex III relating to market access limitations, the EU added virtually no liberalization with respect to direct insurance services, but allowed the cross-border provision of financial information and financial data processing as well as advisory and other auxiliary services (except intermediation). As to commercial presence (Mode 3), the EU added that non-discriminatory limitations on the legal form of legal persons may apply in both insurance and banking services. Overall, EU’s conditional offer appears to be ambitious and reflects the EU’s aggressive export interests in the sector. C. TiSA – GATS 2.0 or the next best thing for global service regulation? If CETA is a proxy for TTIP then TiSA is a proxy for the next version of the GATS. To be sure, the cause for further service liberalization remains compelling: restrictions to trade in services remain substantial, with tariff equivalent rates of over 40 percent,154 suggesting that global gains from new impetus through TiSA could be as large as $1 trillion.155 TiSA is a US-led initiative and the stakes for the USA are clear: almost 80 percent of US exports and about 90 percent of US imports through commercial presence would be covered by a forthcoming agreement in these negotiations.156 Some would argue that such initiatives are triggered by a corporate-led attempt to serve their self-interests. To be sure, a look at the negotiations for a TTIP would nicely fit into this frame. Trade diversion, in certain areas at least, appears to be the fear of many when this agreement materializes. However, this would be too simplistic an observation for both developed and developing countries move towards the ‘preferential route’. Brazil, Russia, India, China, and South Africa (BRICS) have also moved more resolutely towards stronger forms of integration. More crucially for our purposes, this can be a sign of increasing distrust and doubt as to the potential of the WTO to overcome differences, build sustainable bridges among varying views and function within an increasing diversity of Members. In the area of services, the most interesting development by far is the TiSA, currently, negotiated by 23 WTO Members (taking the EU as one). The BRICS do not participate in the negotiations, whereas Mauritius is the first African country to join the discussions. TiSA negotiations cover about 70% of world trade in services; they include major service-led economies such as the EU, USA, Japan, Canada, and the Republic of Korea. By November 2016, 21 negotiating rounds have taken place, showing the magnitude of the endeavour but also the lack of available resources that could also focus on the GATS negotiations. The possibility for multilateralizing the negotiating process and/or the results of the negotiations was intentionally left open. For the EU at least, it has always been important that the trade block is not accused of undermining the multilateral negotiations. Thus, it is telling that the negotiating mandate of the Council addressed to the European Commission many times refers to the need to act consistently with the GATS, adopt its basic architecture and cater for TiSA’s eventual multilateralization but at the same time try to address those elements that did not seem to work at the GATS level.157 The possibility to eventually include TiSA in the GATS framework limits the leeway for any innovation or alternative paths in the negotiations and offers. Some of the key features of TiSA include a standstill obligation (locking-in autonomous levels of liberalization); a ratchet clause (capturing any future removal of discriminatory measures) for national treatment only; possibility for phase-in commitments (bind to future liberalization); a positive list approach for market access, but a negative list approach for national treatment. This means that, contrary to the GATS, national treatment would apply horizontally subject to the reservations/exemptions that the TiSA parties would list. As noted earlier, starting with TiSA and CETA, this evinces EU’s acceptance of the limits of an exclusively positive list approach that the EU has traditionally opted for. Discussions for a TiSA have been taking place in secrecy and the quest for more transparency regularly makes headlines. Due to the magnitude of the current negotiations and the economies involved, curiosity about the actual proposals and drafts on the negotiating table is mounting. This bottom-up transparency may be unsatisfactory in terms of rule of law and governance, but gives an indication as to the directions chosen by negotiators. For instance, the leaked text on domestic regulation within TiSA158 is very similar to the most recent draft text discussed within the WPDR at the WTO and the text chosen in CETA but also proposed by the EU within TTIP. This would suggest that there is a certain level of frustration among the most developed countries as to the unjustified deadlock that the services negotiations were led to due to uncompromising views in other areas. Thus, whereas, for a long time, the possibility to have trade-offs among various trade areas was regarded as one of the WTO’s advantages, it seems now that a ‘services-only’ agreement may have much better chances of being finalized. Of course, divergences as those seen earlier in the TTIP negotiations remain. Take for instance the leaked financial services annex of TiSA,159 whereby it becomes clear that the EU proposes the inclusion of a best-endeavour provision seeking to ensure that internationally agreed standards for regulation and supervision in the financial sector and for the fight against tax evasion and avoidance are implemented and applied in parties’ territory. However, the US, as it traditionally has been the case, opposes such provision from becoming part of TiSA. Even so, TiSA’s success is for the EU an important gamble that increased resources will need to be invested to make sure that the WTO objectives are served. In other words, TiSA constitutes a litmus test for the EU’s commitment to the WTO cause and depending on the outcome, significant dynamics will be developed at the WTO level. Regarding TiSA, we currently know most of the contours of the proposed agreement.160 What remains to be clarified is the level of openness. This is crucial because previous PTAs have delivered mediocre liberalization results, sometimes even not going as far as the GATS. This begs the question: why abandon the negotiating table at the WTO for a second-best option? The EU and other TiSA parties have made public their (revised) offers but a systematic study of them is yet to take place.161 Knowing more ex ante about the liberalization offers would allow trade experts and scholars to make sure that any negotiations outside the WTO are monitored and critically reviewed. If WTO Members are to work with alternatives to the WTO, then they have to make a strong case for it. For the EU that has long preached the benefits of multilateralism to its circles of influence among developing countries, such an exercise is of outmost importance. IV. Conclusion The EU external trade policy in services is at the crossroads, swinging between shallow multilateralism and ‘deep’ bilateralism with selected trading partners. This article advanced three distinct theses through a thorough analysis of current developments: The first is that, while ambitious, the EU current strategy in services is contained by internal conflicts and disagreements regarding, inter alia, the adequate level of openness in certain still sensitive silos such as audiovisual or public services.162 The withdrawal of the UK from the EU will be a significant distraction when it comes to services liberalization pending the clarification of the bilateral relationship but also the WTO situation for both the EU and the UK. The second argument is that deep(er) integration agreements that incorporate distinct regulatory components are interesting from a legal standpoint but also useful from a policy viewpoint for a quasi-federal entity such as the EU, as they can accelerate domestic regulatory reform and openness in the service sector. Finally, the third thesis suggests that, if the EU is serious with its commitment to multilateralism, then it must carefully handle its negotiations under TiSA. With regard to TiSA in particular, the EU has been criticized for bypassing the WTO through its leadership in the TiSA negotiations. Coupled with the middling progress in preferential trade negotiations for the conclusion of economic partnership agreements (EPAs) with its African, Caribbean and Pacific (ACP) partners, the TiSA initiative creates some cracks in the EU’s trust-building efforts vis-à-vis the developing world in trade matters. On the other hand, the EU’s approach to TiSA negotiations has been WTO-friendly in that it is premised on a modular approach163 whereby all TiSA results are incorporated into annexes which could later become part of the GATS. However, the fact remains that there is a growing disconnect between developing and developed counties that the EU should be wary of and which has had an impact on the levels of commitment at the WTO level. If reduced commitment suggests an increasing distrust and doubt as to the potential of the WTO to overcome differences, build sustainable bridges among varying views and function within an increasing diversity of members, then the EU, as one of the few reliable powers in commercial matters globally, should undertake a more active, balancing leadership role in the international trade arena. Perhaps paradoxically at first blush, a potential renewed engagement with TTIP on the side of the USA could revive countries’ interest to the WTO in that it would remind them of the gains of freer trade and allow for some much-needed creativity in dealing with pressing trade-related matters by the two leading trade powers. Despite the uncertainty surrounding the dealings of the Trump administration with respect to trade in the short run, the case for a transatlantic deal remains compelling, as both parties would appear to benefit.164 With a combined transatlantic trade volume of around €400 billion in 2015, accounting for over half of global trade in services, services is a key component of a future transatlantic deal. TTIP constitutes a turning point for global regulation and liberalization of services and will have significant signalling effects to the rest of the world as to the possible directions to be taken in this area. The EU cannot ignore such dynamics, all the more because services is one of the few areas where the EU attempts to keep a balance between preferentialism and multilateralism. Arguably, the recent Opinion 2/15165 can only liberate further all these forces that call for a more coordinated approach on the opening of services sectors and some coherence in scheduling limitations. Whereas regulatory preferences in areas such as public services, audiovisual services or government procurement differ, services markets for trade-enabling services sectors such as financial, telecommunications or business services are highly interoperable and, in certain instances, interdependent. Recent agreements recognizing the equivalence of substantive requirements in several areas (e.g. financial services) are concrete examples. Not only do such characteristics create significant levels of trust on which both parties should build, but they could also herald new opportunities for open preferentialism and diffuse reciprocity.166 However, distributional effects would need to seriously be taken into account in this new cooperative framework. This brings us to the issue of regulatory reform through regulatory cooperation or coherence. Such reform, while negotiated bilaterally, will have beneficial effects even vis-à-vis non-participants, as most interventions regarding streamlining regulatory processes or increasing transparency cannot possibly be applied on a discriminatory basis. Thus, third countries will also benefit if such negotiations are successful. For TTIP specifically, regulatory cooperation appears a thorny issue, but it is submitted that it may not be as complicated as suggested by some: both sides have experimented with soft-law regulatory approaches at the bilateral level and thus, moving to the next level is the natural evolution of previous efforts. Regulatory cooperation between the EU and the USA is everything but new.167 Efforts for cooperation at the level of regulatory authorities have started in the early noughties and intensified after the creation of the EU–US High-Level Regulatory Cooperation Forum in 2005. Indeed, in its recommendations, the European Parliament reminds of the progress made in previous cooperation initiatives and urges the European Commission to build upon that experience. Adopting disciplines on regulatory coherence, transparency and regulatory compatibility has also been a central recommendation of the US–EU High-Level Working Group created under the aegis of TEC.168 The Group went further to propose that such coherence should be achieved through early (upstream) consultations on significant regulations; joint impact assessments; periodic review of existing regulatory measures; and application of good regulatory practices. It also suggested that the USA and the EU can consider various integrationist strategies such as regulatory harmonization, equivalence or mutual recognition in well-specified sectors in goods and/or services. For the EU, regulatory cooperation has been an important, inextricable part of its global market access strategy to address non-tariff barriers in its third-country relations but also internally.169 Regulatory convergence has been no less a priority for the USA both within its FTAs and at the WTO level. For instance, the USA has consistently underlined the importance of transparency and detailed procedural rights in trade matters in general and in services in particular. Cooperation in financial matters is less self-evident due to the fact that, compared to the EU, private parties are more involved in the regulatory process in the USA. Thus, the EU’s demand for financial regulatory cooperation may in the end fail due to pressures by lobbies in the USA. This development begs the question: how essential it is for regulatory cooperation and convergence efforts to be couched in trade agreements? Already in the EU–US regulatory cooperation history, much cooperation occurred without any formal bilateral trade deal in place. A case that illustrates this point is the most recent agreement on mutual recognition of inspection of medicine manufacturers which constitutes the most recent update of the EU–US mutual recognition agreement of 1998.170 This example of successful cooperation between the European Commission, the European Medicines Agency and the US Food and Drug Administration despite an implied decision to put the TTIP negotiations on hold demonstrates how determined regulators can reach mutually beneficial outcomes to cut red tape and reduce compliance costs outside trade deals. Thus, trade negotiators may need to make a more compelling case to convince regulators of the benefits of including regulatory cooperation provisions in trade agreements. As far as regulatory cooperation in services is concerned, another argument questioning the usefulness of such rules in a trade agreement relates to the exclusion of the possibility for individual service suppliers to enforce such obligations. For all practical purposes, both CETA and TTIP exclude the possibility of directly invoking any of its provisions in the domestic legal systems.171 The EU’s proposal for institutional arrangements under TiSA incorporates an identical provision.172 This denial of direct effect constitutes regression and a potential clash with EU constitutional law.173 In the specific case of services such construct is even more problematic, particularly because the investor–state system (for instance, the one established under section F of CETA Chapter 8) applies to complaints relating to the chapters on cross-border supply and domestic regulation, thereby offering means of redress to investors that are not offered to other service suppliers. More research will be needed to identify the pros and cons of an expedited dispute settlement system to which individual services suppliers and small and medium enterprises would have access with a view to resolving disputes in a timely and cost-effective manner. Footnotes 1 See European Council Conclusions of 16 September 2010, EUCO 21/1/10, 12 October 2010, para 4. 2 See European Commission Communication, ‘Trade Policy as a core component of the EU’s 2020 strategy’, COM(2010) 612 final, 9 November 2010, at 11. 3 See European Commission Communication, ‘Trade for All: Towards a More Responsible Trade and Investment Policy’, 2015. 4 TTIP is one of the top 10 priorities that Jean-Claude Juncker set for his term as European Commission’s president. 5 European Council Conclusions, above n 1, para 7b. See also, more recently, European Council Conclusions of 18–19 February 2016, EUCO 1/16. 6 See European Commission Communication, above n 3. 7 Cf. C-615/13 P ClientEarth and PAN Europe v EFSA (2005) ECLI:EU:C:2015:489, para 56. 8 See Ian Manners, ‘Normative Power Europe: A Contradiction in Terms?’, 40 Journal of Common Market Studies 235 (2002). 9 See Gráinne de Búrca, ‘EU External Relations: The Governance Mode of Foreign Policy’, in Bart Van Vooren, Steven Blockmans, and Jan Wouters (eds), The EU’s Role in Global Governance: The Legal Dimension (Oxford: Oxford University Press, 2013), at 39. 10 See, for instance, Eurostat, ‘US EU International Trade and Investment Statistics’, Statistics in focus 2/2015, 11 September 2015. 11 See Panagiotis Delimatsis, ‘TTIP, CETA, TiSA Behind Closed Doors: Transparency in the EU Trade Policy’, TILEC Discussion Paper, 2016-020, September 2016. 12 Together with CETA, the European Parliament approved by a large majority the EU–Canada Strategic Partnership Agreement dealing with non-trade issues such as foreign and security policy or counterterrorism. 13 See Joint Interpretive Instrument on the Comprehensive Economic and Trade Agreement (CETA) between Canada and the European Union and its Member States [2017] OJ L11/3. 14 See US–EU Joint Report on TTIP Progress to Date, 17 January 2017. 15 See Council of the European Union, ‘EU–South Korea free trade agreement concluded – Press release’, 1 October 2015, available at http://www.consilium.europa.eu/en/press/press-releases/2015/10/01-korea-free-trade/ (visited 1 June 2017). The Council had decided to provisionally apply the FTA as of July 2011. See Council Decision of 16 September 2010 on the signing, on behalf of the European Union, and provisional application of the Free Trade Agreement between the European Union and its Member States, of the one part, and the Republic of Korea, of the other part [2011] OJ L 127/1. 16 See Christophe Hillion, ‘Mixity and Coherence in EU External Relations: The Significance of the “Duty of Cooperation”’, in Christophe Hillion and Panos Koutrakos (eds), Mixed Agreements Revisited – The European Union and its Member States in the World (Oxford: Hart Publishing, 2010), at 87. 17 See Geert De Baere, Constitutional Principles of EU External Relations (Oxford: Oxford University Press, 2008), at 231ff.; see also C-28/12 Commission v Council (2005) ECLI:EU:C:2015:282, para 52. 18 In the proposal for signature of CETA, the Commission underscored the need to review the situation in case the CJEU decides in favour of the European Commission in Opinion 2/15 discussing whether the EU alone can conclude the EU–Singapore FTA. See European Commission, Proposal for a Council Decision on the signing on behalf of the European Union of the Compehensive Economic and Trade Agreement between Canada of the one part, and the European Union and its Member States, of the other part, COM(2016) 444 final, 5 July 2016, at 4. As noted below, the Court did not agree with the Commission in this regard. See CJEU Opinion 2/15 of 16 May 2017, para 238. 19 See Council Decision on the provisional application of the Comprehensive Economic and Trade Agreement (CETA) between Canada, of the one part, and the European Union and its Member States, of the other part, 19974/16, 5 October 2016. 20 The possibilty for the provisional application of CETA was challenged before the German Constitional Court, which found that the exclusion of certain areas from such application and the fact that Germany could end such application anytime suffice for rejecting any complaint against such application. See BVerfG, Decision of the Second Chamber of 7 December 2016, 2 BvR 1444/16. 21 See also Piet Eeckhout, EU External Relations Law, 2nd ed. (Oxford: Oxford University Press, 2011), at 57. 22 Council of the European Union, ‘Press Release - 3245th Council meeting’, 10862/13, 14 June 2013. The document was declassified in October 2014: see Council Directives for the negotiation on the TTIP between the European Union and the USA, ST 11103/13, 17 June 2013. Previously, the Council adopted negotiating directives for an EU–Japan FTA in November 2012, but negotiations intensified only recently, with prospects for an agreement in 2017 being relatively high. 23 The EU Council agreed to launch bilateral negotiations with individual ASEAN countries, starting with Singapore in December 2009 and continuing with Malaysia (September 2010); Vietnam (May 2012); Thailand (February 2013); and the Philippines (November 2015). After Singapore, the EU concluded negotiations with Vietnam and the preliminary text of the FTA is currently in the legal scrubbing phase. See also Council of the European Union, ‘Outcome of the Council Meeting – 3430th Council meeting (Foreign Affairs – Trade Issues)’, 14688/15, 27 November 2015. All negotiations with ASEAN countries are based on the Council negotiating directives obtained in April 2007. The directives were updated to include investment protection in July 2011 for the negotiations with Singapore. They were updated again in October 2013 to include investment protection for the negotiations with the remaining ASEAN countries. 24 See AG Sharpston’s Opinion in Opinion procedure 2/15, ECLI:EU:C:2016:992, delivered on 21 December 2016. 25 See CJEU Opinion, above n 18. 26 Ibid, paras 285ff. 27 Cf. Opinion of AG Wathelet in Case C-425/13 European Commission v Council of the European Union, ECLI:EU:C:2015:174, para 69. 28 For all practical purposes, this exclusion apply to every EU trade agreement. 29 See European Commission, ‘TTIP–EU proposal for Chapter: Regulatory Cooperation’, 21 March 2016. Also Bernard Hoekman, ‘Fostering Transatlantic Regulatory Cooperation and Gradual Multilateralization’, 18(3) Journal of International Economic Law 609 (2015). 30 Cf. Marise Cremona, ‘Expanding the Internal Market: An External Regulatory Policy for the EU?’ in Van Vooren, Blockmans and Wouters, above n 9, 162. 31 European Commission Communication, above n 3, at 27. The Communication recalls the by now maintream idea that FTAs can be laboratories where countries may test policies and measures before multilateralizing them. For instance, the new EU ambitious agenda for including investment disciplines in its FTAs is based on the premise that in the medium run it will be possible to introduce such disciplines at the WTO level, an attempt that failed in the Seattle Ministerial (the so-called ‘Singapore issues’). 32 See Opinion 1/08, GATS Schedules [2009] ECR 1-11129, para 119; also, by analogy, C-414/11 Daiichi Sankyo (2013) ECLI:EU:C:2013:520, para 55; also Panos Koutrakos, EU International Relations Law, 2nd ed. (Oxford: Hart Publishing, 2015), at 40. 33 See also the final report of the US-EU High-Level Working Group on Jobs and Growth (HLWG), 11 February 2013, at 3, available at: http://trade.ec.europa.eu/doclib/docs/2013/february/tradoc_150519.pdf (visited 1 June 2017). 34 See, for instance, Rudolf Adlung and Sébastien Miroudot, ‘Poison in the Wine? Tracing GATS-Minus Commitments in Regional Trade Agreements’, 46(5) Journal of World Trade 1045 (2012). 35 Cf. EU Parliament Resolution, ‘Recommendations to the European Commission on the negotiations for the Transatlantic Trade and Investment Partnership (TTIP)’, 2014/2228(INI), 8 July 2015. 36 See Joint Statement on Public Services by Ambassador Froman (USTR) and EU Commissioner Malström (DG Trade), 20 March 2015 available at: http://europa.eu/rapid/press-release_STATEMENT-15-4646_en.htm (visited 1 June 2017). 37 See European Commission, above n 29, para 3. 38 Such a clause was introduced previously in the EU FTA with South Korea or the EU–Cariforum Economic Partnership agreement. See Panagiotis Delimatsis, ‘Services of General Interest and the External Dimension of the EU Energy Policy’, in Markus Krajewski (ed.), Services of General Interest Beyond the Single Market – External and International Law Dimensions (The Hague: Springer, 2015), 345ff; also Markus Krajewski, ‘Model Clauses for the Exclusion of Public Services From Trade and Investment Agreements’, February 2016. 39 With respect to both audiovisual services and public services, see the European Parliament’s Resolution on the opening of negotiations on a plurilateral agreement on services (TiSA), 2013/2583(RSP), 4 July 2013. See also Article 7.7, 9.2.2(b) or 12.2 of CETA. The adopted text is available at: http://data.consilium.europa.eu/doc/document/ST-10973-2016-INIT/en/pdf (visited 1 June 2017). 40 See Article 218:6(a)(v) TFEU. 41 See EU Parliament Resolution, above n 35, para 2(a)vii. 42 Case C-362/14 Schrems (2015) ECLI:EU:C:2015:650; and European Commission Communication, ‘Transatlantic Data Flows: Restoring Trust through Strong Safeguards’, COM(2016) 117 final, 29 February 2016. 43 See Annex 10-A of TPP. 44 Pierre Latrille and Juneyoung Lee, ‘Services Rules in Regional Trade Agreements – How Diverse and How Creative as Compared to the GATS Multilateral Rules?’, WTO Staff Working Paper ERSD-2012-19, October 2012. 45 The USA also is like-minded in this respect: see Obama’s administration letter to the US Congress on 20 March 2013, at 3, available at: http://www.ustr.gov/sites/default/files/03202013%20TTIP%20Notification%20Letter.PDF (visited 1 June 2017). 46 See Juan Marchetti and Petros Mavroidis, ‘I Now Recognize You (And Only You) As Equal: An Anatomy Of (Mutual) Recognition Agreements In The GATS’, in Ioannis Lianos and Okeoghene Odudu (eds), Regulating Trade in Services in the EU and the WTO – Trust, Distrust and Economic Integration (Cambridge: Cambridge University Press, 2012), 415. 47 With respect to engineering and architectural services, see Panagiotis Delimatsis, ‘The Future of Transnational Self-Regulation – Enforcement and Compliance in Professional Services’, 4(1) Hastings International and Comparative Law Review 1 (2017), at 23. 48 See Eurostat Statistics, http://appsso.eurostat.ec.europa.eu/nui/show.do?dataset=bop_its6_tot&lang=en (visited 13 January 2017). 49 Mixed agreements are signed by the EU and its Member States jointly and thus European States can benefit only if they form part of the EU. Thus, even if the UK had opted for a customs union with the EU or sought to be a member of the EEA, it would still be unable to continue enjoying the benefits from those mixed agreements. This clearly has repercussions for the UK when it comes to EU’s deep integration agreements in particular such as those with Korea or Canada (CETA) or even a prospective agreement with the USA (TTIP). See also European Council, ‘Guidelines following the United Kingdom’s notification under Article 50 TEU’, EUCO XT 20004/17, 29 April 2017, para 13. 50 See Panos Koutrakos, ‘Negotiating International Trade Treaties After Brexit’, 4 European Law Review 469 (2016). For now, the UK appears to opt for advocating a grandfathering approach vis-à-vis those countries that have concluded an FTA with the EU. However, it is doubtful as to whether these third country will be willing to offer access equal to the one offered to the EU without first negotiating deeper concessions by the UK. See also House of Commons – International Trade Committee, ‘UK Trade Options Beyond 2019 – First Report of Session 2016–17’, 1 March 2017, at 51. As to the EU–UK bilateral trade in services, the Brexit White Paper of the UK Government is hardly informative regarding the UK strategy in ensuring access to the EU services market. See HM Government, ‘The United Kingdom’s exit from and new partnership with the European Union’, February 2017, at 41. 51 See WTO, Trade in Services, ‘Procedures for the Implementation of Article XXI of the GATS’, S/L/80, 20 October 1999; and WTO, Council for Trade in Services, ‘Procedures for the Certification or Rectifications or Improvements to Schedules of Specific Commitments’, S/L/84, 18 April 2000. 52 See also Erich Vranes, ‘The Contents of CETA, TTIP and TiSA: The (Envisaged) Trade Discisplines’, in Stefan Griller, Walter Obwexer, and Erich Vranes (eds), Mega-Regional Agreements: CETA, TTIP, TiSA – New Orientations for EU External Economic Relations (Oxford: Oxford University Press, 2017). 53 Negative lists are generally considered as leading to more liberalizing commitments and offering higher levels of transparency. A negative list was used most prominently in the North American Free Trade Agreement (NAFTA). 54 See Todd Allee, Manfred Elsig, and Andrew Lugg, ‘Is the European Union Trade Deal with Canada New or Recycled? A Text-as-data Approach’, Global Policy (2017), doi:10.1111/1758-5899.12420. 55 See Directive 2006/123/EC on services in the internal market [2006] OJ L 376/36, Article 2.2(h). 56 For the scope of this exception, see Eric Leroux, ‘What is a “Service in the Exercise of Governmental Authority” Under Article I:3(b) of the General Agreement on Trade in Services?’, 40(3) Journal of World Trade 345 (2006). 57 However, Annex 9-A clarifies the common understanding that Canadian service suppliers cannot request treatment equal to the one foreseen in EU’s free movement law as laid down in the TFEU. Similarly, EU service suppliers cannot benefit from the treatment foreseen in the Canadian internal market. Of course, in accordance with the ‘single passport’, Canadian companies or firms which are established in an EU Member State are to be treated in a non-discriminatory manner pursuant to Article 54 TFEU. 58 Thus, CETA incorporates a dynamic provision allowing for the parties to benefit from the best available treatment given by any of them to service suppliers of a third country. 59 See also Markus Krajewski, ‘Domestic Regulation and Services Trade: Lessons from Regional and Bilateral Free Trade Agreements’, in Pierre Sauvé and Martin Roy (eds), Research Handbook on Trade in Services Cheltenham: (Edward Elgar, 2016), 216 at 236. 60 See Panagiotis Delimatsis, ‘Concluding the WTO Services Negotiations on Domestic Regulation – Hopes and Fears’, 9:4 World Trade Review 443 (2010). 61 Greenpeace, TiSA Annex on Domestic Regulation leaked on May 2016, available at: https://wikileaks.ch/tisa/document/20151010_Annex-on-Domestic-Regulation/20151010_Annex-on-Domestic-Regulation.pdf (visited 1 June 2017). See also infra. 62 Cf. Marise Cremona, ‘Negotiating the Transatlantic Trade and Investment Partnership (TTIP)’, 52 Common Market Law Review 351 (2015), at 353. 63 It is worth noting that intra-Canadian trade is yet to be liberalized. The recently signed Canadian Free Trade Agreement (CFTA) that replaced the Agreement on Internal Trade signed in the aftermath of NAFTA aims at preparing Canada for the application of CETA and reducing the possibility for better treatment of European traders when compared to Canadian traders. See The Economist, ‘Blurring borders – Canada agrees on free trade with itself’, 12 April 2017. 64 See CETA, Article 8.15(c) (investment) and Article 9.7(c) (cross-border supply of services). 65 Only in the case of water-related services, the EU has included reservations applicable to both market access andnational treatment in the field of investment and also cross-border trade in services. 66 It bears mentioning that, within the EU, the CJEU condemned such practices in a series of so-called ‘Golden Shares’ cases already in early 2000s. 67 European Commission, ‘Trade in Services, Investment and e-commerce’, 31 July 2015. We only discuss the EU proposals here, as the US offer has not been made public to date in accordance with the US Executive Order 13526 of 29 December 2009 that authorizes confidential treatment of foreign government information. See TTIP negotiating document procedures as descibed in an USTR letter, available at: https://ustr.gov/sites/default/files/US%20signed%20conf%20agmt%20letter_0.pdf (visited 1 June 2017). When applicable, we also draw from the recently leaked consolidated version of the chapter on cross-border trade in services of 30 November 2015, available at: https://www.ttip-leaks.org/menelaos/doc3.pdf (visited 1 June 2017). 68 In the financial services chapter of TPP, it is clarified in a footnote that concrete action or actions (e.g. channelling resources or capital in order to set up a business, or applying for permits or licenses) are required for that person to be regarded as an investor for TPP purposes. Similar clarifications shall be welcome in the relevant TTIP chapters. 69 For the importance of this standard, see, among others, Campbell McLachlan QC, Laurence Shore, and Matthew Weiniger, International Investment Arbitration – Substantive Principles (Oxford: Oxford University Press, 2007), at 201. 70 See, among others, Mesa Power Group v Canada, NAFTA Arbitral Tribunal Award of 24 March 2016, paras 495ff. 71 See also Waste Management Inc. v Mexico, ICSID Case No. ARB(AF)00/3, 30 April 2004, paras 98–99. 72 See Case C-510/11 P Kone and Others v Commission (2013) ECLI:EU:C:2013:696, para 76. 73 See Article 3 of the text available at: http://trade.ec.europa.eu/doclib/docs/2015/september/tradoc_153807.pdf (visited 27 April 2017). 74 Again, it bears mention that the draft chapter only exempts existing measures at the local level of government. New measures would have to be saved through the positive list in Annex III. 75 To date, it seems that the USA is reluctant to accept such an extension of rules that have been typically associated exclusively with trade in services under the GATS. See also European Commission, ‘Note – Tactical State of Play of the TTIP Negotiations – March 2016’, at 6, available at: https://www.ttip-leaks.org/pandaros/doc16.pdf (visited 1 June 2017). 76 For an identical obligation at the intra-EU level, see Article 12 of the EU Services Directive. 77 Interestingly, there is no such requirement in the EU Services Directive. 78 Having said this, the USA does not oppose the use of necessity tests at a sector-specific level. For instance, in the US draft chapter on telecommunications services that was recently leaked, the USA proposes that universal service obligations are not more burdensome than necessary for the kind of universal service a given party has defined. Additionally, the USA has already accepted the same obligation under Articles 13–17 of TPP. CETA incorporate an identical provision under Article 15.8.2. Even if this obligation is virtually identical to the one under the Telecommunications Reference Paper agreed upon at the WTO in 1996, the continuous adherence to this rule by the USA has its meaning. Indeed, the US claims in Mexico – Telecoms appear to suggest that the USA sees the utility of maintaining such a rule. See WTO Panel Report, Mexico – Measures Affecting Telecommunication Services, WT/DS204/R, 2 April 2004, paras 4.302–3. 79 See Directive of the European Parliament and of the Council on services in the internal market [2006] OJ L 376/36, Article 10. 80 See, among others, Vassilis Hatzopoulos, Regulating Services in the European Union (Oxford: Oxford University Press, 2012); also European Commission, ‘Handbook on implementation of the Services Directive’, 2007, at 25. 81 It is also worth noting that in CETA, the FSC can consider certain measures as being justified on prudential grounds pursuant to Article 13.16 if they have a prudential objective and are not so severe in light of their purpose that it is manifestly disproportionate to the attainment of their objectives. See CETA, Annex 13-B, para 8.(d). 82 On the importance of these procedural guarantees (which in fact have been discussed by the CJEU under the proportionality analysis), see C-203/08 Sporting Exchange [2010] ECR I-4695, para 50. 83 See Wolf Sauter, ‘Proportionality in EU Law: A Balancing Act?’, 15 Cambridge Yearbook of European Legal Studies 439 (2013). 84 Case 331/88, The Queen v Minister for Agriculture, Fisheries and Food and Secretary of State for Health, ex parte Fedesa and Others, [1990] ECR I-4023, para 13, and Case C-180/96 United Kingdom v Commission (BSE) [1998] ECR I-2265, para 96. 85 Joined cases T-125/96 and 152/96, Boehringer Ingelheim Vetmedica GmbH and C.H. Boehringer Sohn v Council of the European Union (T-125/96)H and Commission (T-152/96) [1999] ECR II-3427, paras 73ff. 86 See Panagiotis Delimatsis, ‘Determining the Necessity of Domestic Regulations in Services – The Best is Yet to Come’, 19(2) European Journal of International Law 365 (2008) at 383. 87 See Gráinne de Búrca, ‘The Principle of Proportionality and its Application in EC Law’,13 Yearbook of European Law 111 (1993); also Case C-384/93, Alpine Investments BV v Minister van Financiën [1995] ECR I-1141, para 51. The US Supreme Court appears to endorse a similar approach when adjudicating on regulatory measures under the Dormant Commerce Clause: see Meinhard Hilf and Sebastian Puth, ‘The Principle of Proportionality on its Way into WTO/GATT Law’, in Armin von Bogdandy, Petros C. Mavroidis, and Yves Mény (eds), European Integration and International Coordination – Studies in Transnational Economic Law in Honour of Claus-Dieter Ehlermann (The Hague: Kluwer Law International, 2002), at 208. See, however, Mathis’ analysis which suggests that the US Supreme Court would apply a more deferential approach notably in cases of non-discriminatory state laws than one would expect from the CJEU. See James Mathis, ‘Balancing and Proportionality in US Commerce Clause Cases’, 35(3) Legal Issues of Economic Integration 273 (2008). 88 See Case C-380/03 Germany v Parliament and Council (Tobacco Advertising II) [2006] ECR I-11573, para 145. 89 See Case C-169/91 Council of the City of Stoke-on-Trent and Norwich City Council v B & Q plc.I [1992] ECR I-6635, para 15. 90 See Case C-470/11 Garkalns SIA (2012) ECLI:EU:C:2012:505. 91 See Gjermund Mathisen, ‘Consistency and Coherence as Conditions for Justification of Member State Measures Restricting Free Movement’, 47 Common Market Law Review 1021 (2010). 92 WTO (WPDR), ‘Domestic Regulation: Necessity and Transparency’, Communication from the European Communities and their Member States, S/WPDR/W/14, 2001. 93 See also Marchetti and Mavroidis, above n 46. 94 See European Commission Communication, ‘Single Market Act – Twelve levers to boost growth and strengthen confidence: ‘Working together to create new growth’’, COM(2011) 206 final, 13 April 2011, at 7. 95 Directive 2005/36/EC of the European Parliament and of the Council of 7 September 2005 on the recognition of professional qualifications [2005] OJ L 255/22. 96 Some sectoral directives are still in force such as the Directive 98/5 of the European Parliament and the Council to facilitate practice of the profession of lawyer on a permanent basis in a Member State other than that in which the qualification was obtained [1998] OJ L 77/36 (Lawyers Directive). 97 According to the Directive, ‘”regulated profession” is a professional activity or group of professional activities, access to which, the pursuit of which, or one of the modes of pursuit of which is subject, directly or indirectly, by virtue of legislative, regulatory or administrative provisions to the possession of specific professional qualifications; in particular, the use of a professional title limited by legislative, regulatory or administrative provisions to holders of a given professional qualification shall constitute a mode of pursuit’. The draft chapter narrows down this definition, but only slightly: regulated profession is a professional service, the exercise of which, including the use of title or designation, is subject to the possession of specific qualifications, by virtue of legislative, regulatory or administrative provisions. See Article 5-5.1(f). 98 See Article 4 of the Directive. 99 Cf. C-274/05 Commission v Greece [2008] ECR I-7969, para 30. 100 Cf Article 4:1 of the Council Directive 77/249/EEC to facilitate the effective exercise by lawyers of freedom to provide services [1977] OJ L 78/17. See also Articles 6 and 7 of Directive 98/5. Directive 2005/36 provides that the two lawyers’ Directives remain applicable, although the PQD regulates the recognition of professional qualifications for lawyers for the purpose of immediate establishment under the professional title of the host MS. See Recital 42 of the Directive. 101 See Directive 2013/55/EU of the European Parliament and of the Council amending Directive 2005/36/EC on the recognition of professional qualifications and Regulation (EU) No 1024/2012 on administrative cooperation through the Internal Market Information System (‘the IMI Regulation’) [2013] OJ L 354/132. The ensuing consolidated version of Directive 2005/36/EC is available at: http://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:02005L0036-20140117&from=EN (visited 1 June 2017). 102 In June 2015, the European Commission adopted the Implementing Regulation 2015/983 regarding the procedure for issurance of the EPC and the application of the alert mechanism according to the PQD [2015] OJ L 159/27. As of January 2016, the EPC will first be available for nurses in charge of general care, pharmacists, physiotherapists, mountain guides, and real estate agents. Other professions are expected to follow soon. For now, the EPC is a voluntary instrument available for the professions which express an interest in benefitting from the new system. See also European Commission’s staff working document accompanying the Commission Imlementing Regulation 2015/983, SWD(2015) 123 final, 24 June 2015. 103 See C330/03 Colegio de Ingenieros de Caminos, Canales y Puertos [2006] ECR I801, para 38 ; and, more recently, C-575/11 Nasiopoulos (2013) ECLI:EU:C:2013:430, paras 21ff. 104 European Commission, ‘Services and Investment Offer of the European Union’, 31 July 2015, Reservation No. 4, at 13. 105 Cf. European Commission, ‘Report of the Eleventh Round of Negotiations for the Transatlantic Trade and Investment Partnership (Miami, 19–23 October 2015)’, at 7. 106 CETA, Annex 11-A. 107 WTO, ‘Guidelines for Mutual Recognition Agreements or Arrangements in the Accountancy Sector’, adopted by the CTS on 28 May 1997, S/WPPS/W/12/Rev.1 and S/L/38. 108 Article VI:6 GATS provides: ‘in sectors where specific commitments regarding professional services are undertaken, each member shall provide for adequate procedures to verify the competence of professionals of any other member.’ 109 Cf. Kalypso Nicolaidis and Gregory Shaffer, ‘Transnational Mutual Recognition Regimes: Governance Without Global Government’, 68 Law and Contemporary Problems 263 (2005) at 290. 110 Recall that the CTS adopted the MRA guidelines for accountancy services by consensus. 111 See WTO, ‘Decision on Disciplines Relating to the Accountancy Sector’, S/L/63, 15 December 1998. 112 See also European Commission, above n 104, at 3. 113 See above n 78. 114 See EU Text Proposal on delivery services in TTIP, 23 February 2016, available at: http://trade.ec.europa.eu/doclib/docs/2016/march/tradoc_154376.pdf (visited 1 June 2017). 115 See https://www.ttip-leaks.org/agamemnon/doc4.pdf (visited 1 June 2017). 116 See European Commission Communication, ‘A Digital Single Market Strategy for Europe’, COM(2015) 192 final, 6 May 2015. 117 See also Ecorys, ‘Sustainability Impact Assessment (SIA) in support of the negotiations on a Transatlantic Trade and Investment Partnership (TTIP) – Final Report’, prepared for DG Trade, March 2017, at 29. 118 Ibid, at 104. 119 See also Shawn Donnan, ‘EU–US Trade Talks Hit Roadblock Over Financial Services’, Financial Times, 16 June 2014. 120 One of the most controversial issues dealt with in this case was whether financial service suppliers from non-cooperating countries, on the one hand, and such suppliers from cooperating countries are like. The Panel answered in the affirmative but the Appellate Body resolved the dispute before reaching this central question. See Appellate Body Report, Argentina – Measures Relating to Trade in Goods and Services, WT/DS453/AB/R, 14 April 2016. 121 See EU-CETA, Article 13.16. 122 See Articles 11.21ff of TPP. 123 See EU–CETA, Articles 13.19ff. 124 EU–CETA, Article 13.21. Importantly, this provision relating to investment disputes in financial services is excluded from the provisional application of CETA. See Council Decision, above n 19. Furthermore, TPP foresees a mechanism similar to Article 13.21, the difference being that the authorities of the respondent and the party of the claimant shall attempt in good faith to make a joint determination no later than 120 days. If no determination is made, any party can seek a panel decision as to the validity of the defence to the claim. See TPP, Article 11.22. 125 See Annex 13-B (‘Understanding on the Application of Articles 13.6.1 and 13.21’). 126 See above n 75, at 6. The EU’s financial services offer of July 2016 was recently made public (only few days after being presented to the US) and is available at: http://trade.ec.europa.eu/doclib/html/154794.htm (visited 1 June 2017). 127 See also European Commission, ‘EU–US Transatlantic Trade and Investment Partnership (TTIP) – Cooperation on financial services regulation’, 27 January 2014, at 2. For a recent update on the achievements of FMRD, see US–EU FMRD Joint Statement of February 2016, available at: https://www.treasury.gov/press-center/press-releases/Pages/jl0352.aspx (visited 1 June 2017). 128 For the most recent report of FRF’s activities, see: https://ec.europa.eu/info/sites/info/files/eu-us-joint-financial-regulatory-forum-joint-statement-06042017_en.pdf (visited 1 June 2017). 129 The RCC works through a hub-and-spoke model with annual work plans and regulators-led working groups. See also http://www.trade.gov/rcc/ (visited 1 June 2017). 130 See above n 75. 131 EU–Canada CETA, Article 13.2.4. 132 See EU–Canada CETA, Article 14.2. 133 That is, not subject to market access and non-discrimination obligations, but only to investment protection provisions, i.e. FET as well as expropriation. 134 See also Armand de Mestral, ‘When Does the Exception Become the Rule? Conserving Regulatory Space under CETA’, 18(3) Journal of International Economic Law 641 (2015) at 642. 135 TTIP proposed chapter, Article 5-40.4. 136 See Decision 2007/339/EC [2007] OJ L 134/1 (the ‘Open Skies Agreement’), as amended by Decision 2011/708/EU [2011] OJ L 283/1. Trade unions have already expressed their concerns about such a possibility of further opening the aviation sector at the bilateral level. See Transportation Trades Department (TTD, AFL-CIO), ‘U.S. Trade Negotiators Must Keep Aviation and Maritime Out of TTIP’, 28 October 2015. 137 See TTIP Advisory Group, ‘Expert’s meeting on Sectors and Digital Trade’, Meeting Report, 28 June 2016, at 7. 138 European Commission, above n 104. 139 Provisional Central Product Classification (CPC), Statistical Papers, Series M No.77, United Nations (1991). 140 See also Panagiotis Delimatsis, ‘Trade in Services and Regulatory Flexibility – 20 years of GATS, 20 Years of Critique’, 7 European Yearbook of International Economic Law 153 (2016). 141 See the EU’s initial offer in TiSA negotiations of November 2013, available at: http://trade.ec.europa.eu/doclib/docs/2014/july/tradoc_152689.pdf (visited 1 June 2017). 142 See also European Commission, ‘Services and investment in EU trade deals – Using ‘positive’ and ‘negative’ lists’, April 2016. 143 See, generally, Krajewski, above n 38. 144 These liberalization commitments do not include Mode 4; this is dealt with in a separate section. 145 See Bloomberg Business, ‘US Ousts Russia as Top World Oil, Gas Producer in BP Data’, 10 June 2015, available at: http://www.bloomberg.com/news/articles/2015-06-10/u-s-ousts-russia-as-world-s-top-oil-gas-producer-in-bp-report. In 2014, the US produced around 90 percent of the energy it consumed last year (visited 1 June 2017). 146 See European Commission Communication, ‘A Framework Strategy for a Resilient Energy Union with a Forward-Looking Climate Change Policy’, COM(2015) 80 final, 25 February 2015. 147 See EU Parliament Resolution, above n 35, para 2(d)vii et seq. 148 See above n 22, para 37. 149 See EU Textual Proposal, ‘Energy and Raw Materials’, 14 July 2016. 150 See Commission Implementing Decision 2016/377 on the equivalence of the regulatory framework of the United States of America for central counterparties that are authorised and supervised by the Commodity Futures Trading Commission to the requirements of Regulation 648/2012 of the European Parliament and the Council [2016] OJ L 70/32; and Commodity Futures Trading Commission (CFTC), Comparability Determination for the European Union: Dually-Registered Derivatives Clearing Organizations and Central Counterparties, 81 FR 15260 (2016). 151 See European Commission, ‘TTIP and Regulation: An Overview’, 10 February 2015, at 17. 152 See ‘The CityUK co-signs letter to TTIP negotiators calling for financial and related professional services issues to be part of an ambitious and comprehensive agreement’, 30 January 2015, available at: http://www.thecityuk.com/media/latest-news-from-thecityuk/thecityuk-co-signs-letter-to-ttip-negotiators-calling-for-financial-and-related-professional-services-issues-to-be-part-of-an-ambitious-and-comprehensive-agreement/ (visited 1 June 2017). See also Financial Services Forum, ‘Financial Industry Associations Urge TTIP Negotiators to Include Financial Services Regulatory Coordination in US-EU Trade Agreement’, 14 July 2014, available at: http://financialservicesforum.org/2014/07/financial-industry-associations-urge-ttip-negotiators-to-include-financial-services-regulatory-coordination-in-us-eu-trade-agreement/ (visited 1 June 2017). 153 See above n 126. 154 See Lionel Fontagné, Amélie Guillin, and Cristina Mitaritonna, ‘Estimations of Tariff Equivalents for the Services Sector’, No 2011-24 (Paris: Centre d’Etudes Prospectives et d’Informations Internationales, 2011). 155 See Gary Clyde Hufbauer and Cathleen Cimino-Isaacs, ‘How will TPP and TTIP Change the WTO System?’ 18(3) Journal of International Economic Law 679 (2015) at 689. 156 See Juan Marchetti and Martin Roy, ‘The TISA Initiative: An Overview of Market Access Issues’, WTO Staff Working Paper ERSD-2013-11, 27 November 2013, at 27. 157 See Council of the European Union, ‘Draft Directives for the Negotiation of a Plurilateral Agreement on Trade in Services’, 6891/13, ADD1, 8 March 2013. 158 See https://wikileaks.org/tisa/domestic/TiSA%20Annex%20on%20Domestic%20Regulation.pdf (visited 1 June 2017). 159 See https://ttip-leaks.org/tisa/05-financial-services/ (visited 1 June 2017). 160 See also Rachel Fefer, ‘Trade in Services Agreement (TiSA) Negotiations: Overview and Issues for Congress’, Congressional Research Service, 3 January 2017. 161 See EU’s TiSA second revised offer of 21 October 2016, available at: http://trade.ec.europa.eu/doclib/docs/2016/november/tradoc_155096.pdf (visited 1 June 2017). 162 Cf. Sophie Meunier and Kalypso Nicolaïdis, ‘The European Union as a Conflicted Trade Power’, 13(6) Journal of European Public Policy 906. 163 European Commission, ‘A Modular Approach to the Architecture of a Plurilateral Agreement on Services’, Non-Paper, September 2012. 164 World Trade Institute (WTI), ‘TTIP and the EU Member States – An Assessment of the Economic Impact of an Ambitious Transatlantic Trade and Investment Partnership at EU Member State level’, 2016. 165 See CJEU Opinion, above n 18. 166 Cf. Robert Keohane, ‘Reciprocity in International-Relations’, 40(1) International Organization 1 (1986). 167 For a useful chronology of instances of regulatory cooperation, see Tamara Takács, ‘Transatlantic Regulatory Cooperation in Trade – Objectives, Challenges and Instruments for Economic Governance’, in Elaine Fahey and Deirdre Curtin (eds), A Transatlantic Community of Law – Legal Perspectives on the Relationship Between the EU and US Legal Orders (Cambridge: Cambridge University Press, 2014), 158, at 167. 168 See above n 33, at 4. 169 See European Commission Communication, ‘On the external dimension of the Lisbon Strategy for growth and Jobs: Reporting on Market Access and Setting the Framework for More Effective International Regulatory Cooperation’, COM(2008) 874 final, 16 December 2008. 170 See Agreement on mutual recognition between the European Community and the United States of America [1999] OJ L 31/3; and Decision No 1/2017 of the Joint Committee established under Article 14 of the Agreement on Mutual Recognition between the European Community and the United States of America, of 1 March 2017 amending the Sectoral Annex for Pharmaceutical Good Manufacturing Practices (GMPs), C(2017) 1323 final, 1 March 2017. 171 For CETA, see Article 30.6. 172 See TiSA proposal for TiSA institutional arrangements, October 2016, available at: http://trade.ec.europa.eu/doclib/docs/2016/october/tradoc_154991.pdf (visited 1 June 2017). 173 See also Ernst-Ulrich Petersmann, ‘Transformative Transatlantic Free Trade Agreements without Rights and Remedies of Citizens?’, 18(3) Journal of International Economic Law 579 (2015). © The Author 2017. Published by Oxford University Press. All rights reserved.
TI - The Evolution of the EU External Trade Policy in Services – CETA, TTIP, and TiSA after Brexit
JF - Journal of International Economic Law
DO - 10.1093/jiel/jgx024
DA - 2017-09-01
UR - https://www.deepdyve.com/lp/oxford-university-press/the-evolution-of-the-eu-external-trade-policy-in-services-ceta-ttip-qv0LgjZ0D0
SP - 583
VL - 20
IS - 3
DP - DeepDyve
ER -