WTO and Road Transport How it works

WTO and Road Transport – How it works – What it has achieved – What it may achieve in the future 1

WTO and Road Transport I. How it works 2

WTO and Road Transport GATS commitments: - Guarantee the conditions of operation of foreign services suppliers at a certain negotiated level of market access and national treatment - Ensure that this level cannot be deteriorated - Make this level available as a minimum to all WTO Members - Are subject to periodic negotiations with a view to improve them 3

WTO and Road Transport “Scheduling” principles: - Positive listing of sectors - Negative listing of restrictions - M. A: * discriminatory and non discriminatory measures * 6 exhaustive categories: number of suppliers, value of transactions/ assets, number of operations, number of persons, legal form, foreign capital 4

WTO and Road Transport Scheduling principles: (continued) - NT: any discriminatory measure de facto or de jure - The modes of delivery: cross-border, consumption abroad, commercial presence, temporary movement of natural persons - The additional commitments - The freedom to modulate - The minimum MFN standard effect 5

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WTO and Road Transport 11. Transport Services 7

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WTO and Road Transport The potential gains of GATS liberalization (i. e. opening the sector to foreigners) for the “offering” country: - More investment (secured through guaranteed conditions of access for investors) - State of the art technologies and management - More competition - Hence better services - Lower prices for the consumer - New opportunities in foreign markets (Win-Win effect) 11

WTO and Road Transport Policy choices The “dangers” for the offering country: – Competition for its national providers; – Disruption of the bilateral framework; – Risk of skimming off the traffic (urban transport); – Public service considerations: network, level of service, prices (urban transport); – Environmental considerations (road freight). 12

WTO and Road transport II. What it has achieved so far 13

WTO and Road Transport Key: 11. F. a. Passenger Transportation 11. F. b. Freight Transportation 11. F. c. Rental of Commercial vehicles with Operator 11. F. d. Maintenance and Repair of Road Transport Equipment 11. F. e. Supporting Services of Road Transport Services 14

WTO and Road Transport (Cont’d) Key: 11. F. a. Passenger Transportation 11. F. b. Freight Transportation 11. F. c. Rental of Commercial vehicles with Operator 11. F. d. Maintenance and Repair of Road Transport Equipment 11. F. e. Supporting Services of Road Transport Services 15

WTO and Road Transport – 38 MFN Exemptions – Among which: • 22 Countries with commitments; • 16 Countries without commitments (Bolivia, Chile, Colombia, Costa Rica, Cyprus, Egypt, Honduras, Hungary, Jordan, Peru, Poland, Sierra Leone, Switzerland, Tunisia, Turkey & Uruguay). 16

WTO and Road Transport What does this mean for you? • No guarantees on market access in 100 countries; • 44 countries have guarantees on market access but still some restrictions are posed. 17

WTO and Road Transport Main types of restrictions for passenger transport: Economic need test (taxis, limos and bus services); citizenship requirement, natural persons only or, to the contrary; incorporation required; establishment required; numerical quotas; exclusive licences by zones and routes; authorization required and not extended to foreign-registered vehicles; residency required; requirement of establishment in the country concerned to provide cabotage services; prior approval, obligation for entities established under mode 3 to use vehicles with national registration. 18

WTO and Road Transport Main types of restrictions for freight transport: Economic need test; foreign ownership restrictions; incorporation required; nationality of the board of directors; citizenship requirement; authorization required but not extended to foreignregistered vehicles; emergency safeguards on the number of services suppliers, of services operations and of services output, and limitations on the use of leased vehicles, requirement of establishment in the country concerned to provide cabotage services, prior approval; cargoes confined to containerized cargoes to be exported or imported; and requirement on established entities to use vehicles with national registration. 19

WTO and Road Transport What about Egypt? • Unlike 50 Members Egypt has no commitments • Egypt also has two MFN Exemptions (one general, one sectoral) 20

WTO and Road Transport Sector or Subsector ALL SECTORS Description of measure indicating its inconsistency with Article II Countries to which the measure applies Intended duration Conditions creating the need for the exemption Full national treatment is extended to foreign personnel of the countries indicated in column 3 Greece Iraq Jordan Libya Qatar Sudan United Arab Emirates Yemen and possibly: other countries This measure shall be maintained as long as the agreements referred to in column 2 remain in force or are exhausted To ensure opening of the markets in the countries referred to in column 3, as the major trading partners do not accord the Egyptian nationals satisfactory opportunities. The supply of road transport services by foreign suppliers into and across the territory of Egypt is limited to vehicles registered in the countries indicated in column 3, with which Egypt is a party in bilateral or multilateral agreements The Arab-League countries, and possibly: other countries This measure shall be maintained as long as the agreements referred to in column 2 remain in force or are extended To promote intra-Arab trade and facilitate movement of Arab citizens into Egypt as stipulated in the Arab. League Agreement 21

WTO and Road transport III. What it may achieve in the future 22

WTO and Road Transport • Negotiations started 1 January 2000 • 80 Negotiating proposals on the table • 2 on Road Transportation(EU, Japan) • 2 on Related Services (Hong Kong, Switzerland) 23

WTO and Road Transport The Japanese proposal is aiming at eliminating: – Restrictions on the participation of foreign capital; – Restrictions on the types of legal entity; – Numerical restrictions; – Measures that favour the providers of road transportation services of certain Members. 24

WTO and Road Transport The EU proposal is aimed at obtaining commitments in: – International passenger and freight transport, and rental of commercial vehicles with operator: (Mode 2 & 3); – Maintenance and repair of road transport equipment, supporting services for transport services: (Mode 1, 2 & 3). However it indicates that: – “Exemptions and/or restrictions my need to be taken into account on a case by case basis in Mode 3 for transport of passengers and freight. ” 25

WTO and Road Transport The Swiss proposal deals with: – Cargo handling services (CPC 741); – storage and warehousing services (CPC 742); – freight transport agency services including other auxiliary transport services (CPC 748); – other supporting and auxiliary transport services (CPC 749). 26

WTO and Road Transport And has identified the following obstacles: – Conditions for licenses; – Discriminatory security deposit requirement; – Preferential pricing. 27

WTO and Road Transport Finally, the Hong Kong, China proposal is aimed at obtaining commitments in: (a) (b) (c ) (d) (e) (f) (g) (h) (i) (j) Freight transportation services; cargo-handling services; storage and warehousing services; customs clearance services; transport agency services; container station and depot services; inventory management services; order processing services; production planning services; production control services. 28

WTO and Road Transport On 40 offers received so far. . . Only four mention road transport (three improvements, one new commitment) No Egyptian Offer yet 29