Discussion On Negotiating And Legislating Agreement On Trade In Service Of Regional Comprehensive Economic Partnership

After World Trade Organization(WTO) took the place of General Agreement on Tariffs and Trade(GATT), subjects under discussion on international trade become more and more complicated. Since WTO members hold divergence of views, the Doha Round which had started since 2001 suspended. Until December 2013, that 159 members agreed to the Bali Package which aims to ease barriers to international trade was regarded as a major breakthrough.At the same time, due to the great effect of the regional integration(commonly in form of Free Trade Agreement, hereinafter referred to as “FTA”) on tariffs reduction, non-tariffs barrier elimination, free movement of goods and service and even on diplomatic policy, most of countries sheered off to establish their free trade zones. In the past 20 years, trade in service strongly promoting the growth of economic has exceeded trade in goods on the speed of average annual growth rate and been included in more than half FTAs.China signed first preferential trade agreement between countries called “the Asia-Pacific Trade Agreement”, then the second one Ascean-China Free Trade Zone, both of which are on the basis of close region. Furthermore, the limit of district was broken up, and until may 2015, China has signed Free Trade Agreements with 11 countries and 2 districts(Hong kong, Macau),additionally, a framework with Taiwan district named “Cross-Straits Economic Cooperation Framework Agreement”. All of these Free Trade Agreements contains the part of trade in service. Nevertheless, Cross-strait agreement on trade in services has been suspended since march 2014.In this context, to compare the signed FTAs by China on horizontal(between countries) and on vertical(based on timeline) then summarize changes,and furthermore propose advice will make great sense for China to negotiate and legislate FTA clauses on trade in service in future especially in Regional Comprehensive Economic Partnership( hereinafter referred to as “RCEP”).This thesis comprises of the introduction,five main chapters and conclusion. The instruction contains the reason for the topic choice, literature review and practical significance, in addition the concept of FTA on trade in service. The first main chapter is overview of global FTAs on trade in service. FTAs are set up fast, related to a large number of countries, like a bowl of spaghetti. Among some emerging economies, as the contracting state of GATS, and a state with 11 FTAs, China is enjoying dynamical increase on trade in service. Since GATS established the first legal format for contemporary trade in service, as well as the sample of many FTAs, at the beginning of the thesis, in order to logically understand other FTAs, it is necessary to introduce the basic concepts in GATS under WTO frame, for example, most favorite nation treatment, domestic regulation, schedule of specific commitments, market access, etc.The second chapter selects North American Free Trade Agreement(hereinafter referred as to NAFTA)and the Trans-Pacific Partnership which is in process as two typical examples so as to present various formats of FTAs with trade in service other than GATS.As the example within negative list of specific commitments, NAFTA differs widely from that of GATS. The significant character of NAFTA is that among reservations with respect to existing measures that do not conform with obligations under principle of NAFTA, domestic regulations are clearly referred to plus specific explanations, which enhances the transparency and will be a useful method to avoid the conflicting situation contemplated in Article 27 of “Vienna Convention on the Law of Treaties”.Afterwards some reservations may be eliminated by new negotiation, for contracting states it is easy to position particular clauses which shall be amended.The third chapter which is mainly on China’s obligations under GATS paves the way to analyze clauses of trade in service in FTAs, since all of FTAs on trade in service which China has signed consist with GATS in form. The fourth chapter is the first significant part in this thesis. In this chapter,clauses of trade in service from FTAs signed by China are analyzed in detail, including China-Ascean, China-Chile, China-Pakistan, China-Peru, China-Costa Rica, China-Singapore, China- New Zealand, China-Iceland, China-Zwitzerland etc, additionally referring to recently signed FTAs: China-Korea, China-Australia.By taking GATS as benchmark, via elaborated comparisons between countries, and comparisons based on timeline, we conclude that on horizontal(between countries),FTAs are negotiated and legislated on the principle of reciprocity, focusing on parties’ demands; on vertical(based on timeline), it is not the fact that each latter FTA becomes opener than earlier ones. Then we are able to summarize China’s bottom-line and demands upon a great deal of analyses. The fifth chapter comes the next significant part. China is currently under the negotiation of RCEP initiated by ASCEAN. China, Japan, Korea,Australia, New Zealand, India are invited to join(10+6).The members of RCEP cover population of 3.4 billion, 17 trillion economic gross accounting for 28.4% of global GDP. As of October 5 2015,the 12 parties of TPP have made consensus. For China, it is still uncertain whether it is willing or it is allowed to join TPP.Hence, RCEP shall be an opportunity of great importance. In this chapter we propose advice for China’s negotiation and legislation on clauses of trade in service in RCEP on four aspects, with respect to diminishing the double recognition requirement of service suppliers, absorbing most favorite nation treatment, free movement of natural persons, improving schedule of specific commitments etc. The last part of this thesis is conclusion. At international level, after GATS, China signed a number of FTAs via which China has opened free trade in service with multi-layer, and can be evaluated high level of openness in most of sectors and sub-sectors.However, the negative list of specific commitments has not be utilized yet.At domestic level, the necessity of coordination requires to update the connection of international and domestic regulations timely, and strengthen the rule of law at the national and international levels.