Concluding the WTO services negotiations on domestic regulation – hopes and fears

The negotiations under the aegis of the World Trade Organization (WTO) on the creation of rules on domestic regulations affecting trade in services have entered a critical stage. Within a general atmosphere of reflection and reluctance characterizing the Doha negotiations, this is the only front in recent years in which tangible progress is evident. This paper critically analyses the potential rules that Members currently appear to support and attempts to identify their shortcomings as well as those modifications or clarifications which are necessary to improve the impact and efficacy of the forthcoming rules (so-called ‘disciplines on domestic regulation’ in the parlance used in the General Agreement on Trade in Services – GATS). At the heart of the paper lies a thought-provoking proposal for a necessity test applicable across services sectors. Arguably, only a necessity test can allow for the elimination of unnecessary barriers to trade in services and regulatory arbitrariness.