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2020 | OriginalPaper | Chapter

Telecommunications and Media Services in Preferential Trade Agreements: Path Dependences Still Matter

Author : Mira Burri

Published in: Coherence and Divergence in Services Trade Law

Publisher: Springer International Publishing

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Abstract

The chapter seeks to trace developments in preferential trade agreements (PTAs) with regard to the telecommunications and the media services sectors by looking at a few recent and advanced trade deals of the United States and the European Union respectively. It examines in particular the Comprehensive and Progressive Agreement for Transpacific Partnership (CPTPP) and the United States-Mexico-Canada Agreement (USMCA), as well as the Comprehensive Economic and Trade Agreement (CETA) and the EU-Japan free trade agreement. The chapter maps the differences in the commitments and potentially in the treaty language in these PTAs and the corresponding chapters for telecom and media services vis-à-vis the commitments and the language under the World Trade Organization. Thereby the chapter tests the hypothesis that the PTA developments have been too path-dependent and have not adequately reflected the technological and policy developments that have occurred after the end of the Uruguay Round.

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previous chapter Upping the Ante: The Movement of Natural Persons (Mode 4) and Non-Services Migration in EU and Asian PTAs

next chapter “Parallel Convergences” in Free Trade Agreements on Financial Services: Select Issues

The International Telegraph Union was transformed into the International Telecommunication Union (ITU) in 1932 combining the International Telegraph Convention of 1865 and the International Radiotelegraph Convention of 1906.

Walden (2001), p. 347.

Drake (2008).

The scheme used for negotiating the commitments adopted a distinction made in the US in the so-called Computer Inquiries. It listed as basic telecommunications services: voice telephone; packet-switched data transmission; circuit-switched data transmission; telex; telegraph; facsimile and private leased circuit services and other (lit. (a) to (g) and (o)). The remaining telecommunications services of the W/120 classification list were framed as value-added services (lit. (h) to (n)). See WTO, Draft Model Schedule of Commitments on Basic Telecommunications, Job. No 1311 (1995).

Section 1 Annex on Telecommunications. Section 2(b) explicitly excludes from the scope of the Annex “measures affecting the cable or broadcast distribution of radio or television programming”.

Section 2(c)(i) Annex on Telecommunications; WTO Panel Report, Mexico – Measures Affecting Telecommunications Services (Mexico – Telecommunications), WT/DS204/R, adopted 2 April 2004, at paras 7.290–7.294.

Section 5 Annex on Telecommunications.

It should not be concluded however that the scope of application of the Annex is solely directed at value-added telecommunications services. As clarified by Mexico – Telecom (paras 7.273–7.288), the scope of the Annex also includes basic telecommunications services, when commitments for these services had been made, as is now conventionally the case.

Cameron (2004), p. 21.

Article XX:3 GATS.

Article XVIII GATS.

Bronckers and Larouche (2008).

The far-reaching effect of these rules was confirmed by Mexico – Telecommunications. See Fox (2006).

Section 2 Reference Paper.

For a detailed analysis, see Geradin and Kerf (2004) and Burri (2007).

Weller and Woodcock (2013).

The debate has to do with the dual nature of cultural products and services, which while being an object of trade can also be carriers of values and identities. The EU, and especially France, have pushed for the exclusion of culture-related goods and services from the economically centred rules of the WTO and for their special treatment. The US on the other hand has favoured a trade-oriented approach that does not allow for any particular special treatment of cultural goods and services and subsumes them under the basic WTO rules. See e.g. Burri (2008, 2015b).

Burri (2015a).

Roy (2005), p. 941; Singh (2007).

WTO, European Communities and their Member States, Schedule of Specific Commitments, Trade in Services, Supplement 3, GATS/SC/31/Suppl. 3 (1997).

WTO, European Communities and their Member States, Final List of Article II (MFN) Exemptions, GATS/EL/31 (1994).

Roy (2005); WTO, Audiovisual Services, Background note by the Secretariat, S/C/W/310 (2010).

Roy (2005), pp. 940–941.

Graber (2004), pp. 166–170; Roy (2005), pp. 931–936.

WTO, Communication from the European Communities and its Member States, Draft consolidated GATS Schedule, S/C/W/273 (2006).

WTO, Audiovisual services, Background note by the Secretariat, S/C/W/310 (2010).

WTO, Communication from Switzerland, GATS 2000: Audio-visual Services, S/CSS/W/74 (2001).

UNESCO Convention on the Protection and Promotion of Cultural Diversity (adopted 20 October 2005; in force 18 March 2007). For appraisal, see Craufurd Smith (2007) and Burri (2010).

Burri (2017b).

See famously, Easterbrook (1996).

See e.g. Johnson (2019).

See e.g. Sacerdoti et al. (2006) and Bernauer et al. (2012).

Many seminal GATS cases have an Internet element: see e.g. Panel Report, United States – Measures Affecting the Cross-Border Supply of Gambling and Betting Services (US – Gambling), WT/DS285/R, adopted 10 November 2004; Appellate Body Report, United States – Measures Affecting the Cross-Border Supply of Gambling and Betting Services (US – Gambling), WT/DS285/AB/R, adopted 7 April 2005; Panel Report, China – Measures Affecting Trading Rights and Distribution Services for Certain Publications and Audiovisual Entertainment Products (China – Publications and Audiovisual Products), WT/DS363/R, adopted 12 August 2009; Appellate Body Report, China – Measures Affecting Trading Rights and Distribution Services for Certain Publications and Audiovisual Entertainment Products (China – Publications and Audiovisual Products), WT/DS363/AB/R, adopted 21 December 2009.

Cooney and Lang (2007) and Lang and Scott (2009).

Burri and Cottier (2012).

For a discussion of the application of technology neutrality to services classification, see Peng (2016).

Weber and Burri (2012).

This is true not only because of traditional media policies but also because of newly adopted ones. The promotion of local content in digitally delivered services is not limited to Europe either. The Chinese Ministry of Culture reportedly has classified online games as “cultural products” and has intensely supported the domestic industry. See USITC (2013), pp. 5–7.

WTO, Work Programme on Electronic Commerce, WT/L/274 (1998).

USITC (2013), p. 1; USITC (2014), p. 1.

See e.g. WTO, Communication from the European Union and the United States: Contribution to the Work Programme on Electronic Commerce, S/C/W/338 (2011).

Chander (2013) and Burri (2017b).

Mayer-Schönberger and Cukier (2013).

Henke et al. (2016), Burri (2017a) and WTO (2018).

USITC (2013, 2014); for a country survey, see Chander and Lê (2014, 2015).

See e.g. WTO (2011).

The information stems from an own dataset (TAPED: Trade Agreements Provisions on Electronic-commerce and Data) that seeks to comprehensively trace developments in PTAs in the area of digital trade governance. See Burri and Polanco (2020) and find the entire dataset available at: https://unilu.ch/taped

On positive versus negative list committing, see Adlung and Mamdouh (2013), Mattoo and Sauvé (2014) and Roy (2014).

Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam.

Torrey (2018).

See e.g. Voon (2013).

For a great overview of the CPTPP and how it consolidates previous trade deals between the CPTPP partners, see Polanco Lazo and Gómez Fiedler (2017), in particular pp. 30−39.

Article 13.3(1) CPTPP.

Article 13.3, paras 1−3 CPTPP.

Article 13.5(4). Each Party shall ensure that suppliers of public telecommunications transport services in its territory provide number portability for mobile services and any other services designated by that Party, on a timely basis and on reasonable terms and conditions. Certain exceptions apply to Brunei, Malaysia and Viet Nam (see footnote 6).

Article 13.22 CPTPP.

Article 13.6(1) CPTPP.

Article 13.6(2) CPTPP.

Article 13.23(1). Paragraph 2 clarifies that when a Party finances the development of advanced networks, it may make its financing conditional on the use of technologies that meet its specific public policy interests. It is clarified further in a footnote that “advanced networks” includes broadband networks.

Article 18.15 USMCA.

Article 13.26 CPTPP; Article 18.27 USMCA.

Article 18.14 USMCA.

Article 14.13(2) prohibits the Parties from requiring a “covered person to use or locate computing facilities in that Party’s territory as a condition for conducting business in that territory”. In addition, “[e]ach Party shall allow the cross-border transfer of information by electronic means, including personal information, when this activity is for the conduct of the business of a covered person” (Article 14.11(2) CPTPP).

Hazucha (2013).

Gibson (2007), p. 1475. The case was settled diplomatically, as China decided to forbear from mandating the WAPI standard.

The provision does not prevent law enforcement actions and does not apply to networks owned or controlled by the government, or to government measures related to supervision, investigation, or examination of financial institutions or markets (Sections A.4 and A.5).

Liu (2017).

CPTPP, Annex 8-B, Section C.

CPTPP, Annex 8-B, Section B.

EU FTAs tend to cover more WTO-plus areas while having less liberal commitments. For a detailed analysis, see Horn et al. (2009).

CETA, Chapter 15.

CETA, Article 15.10.

CETA, Annex 9-B: Understanding on new services not classified in the united nations provisional central product classification (CPC), 1991, at para. 1.

It is clarified that this regime does not apply to an existing service that could be classified under the CPC but that could not previously be provided on a cross-border basis due to lack of technical feasibility. Id., at para. 4.

See Proposal for a Council Decision on the conclusion of the Economic Partnership Agreement between the European Union and Japan, COM(2018) 192 final, 18 April 2018. For updates and the text of the Agreement, see https://ec.europa.eu/trade/policy/in-focus/eu-japan-economic-partnership-agreement/.

Article 8.45 EU−Japan FTA.

Article 8.57 EU−Japan FTA.

Article 18.11 USMCA and Article 13.13 CPTPP.

Article 18.12 USMCA and Article 13.14 CPTPP.

Article 18.13 USMCA and Article 13.15 CPTPP.

Article 18.15 USMCA and Article 13.23 CPTPP.

Article 8.70(3) EU−Japan FTA.

Article 8.81 EU−Japan FTA.

Article 8.41(2) EU−Japan FTA.

Article 8.6(2)(c) EU−Japan FTA.

Article 8.14(2)(d) EU−Japan FTA.

Article 8.70(5) EU−Japan FTA.

Article 12.3(7) EU−Japan FTA.

Reservation 11, Annex II: Reservations for Future Measures, Schedule of the European Union, EU−Japan FTA.

CETA, Chapter 32 “Exceptions”.

Article 1.1 CETA; also Article 32.6(1) USMCA. Canada uses this definition consistently also in other FTAs, such as for instance in its Bilateral Investment Treaty with Costa Rica.

Article 7.7 CETA.

Burri (2010); CETA, Preamble, Recitals 6, 7.

Cultural cooperation and market access commitments have been peaked for the EU with the EU−Cariforum and EU−South Korea FTAs, largely as an effect of the 2005 UNESCO Convention on Cultural Diversity implementation. See e.g. Burri and Nurse (2019).

See US Congress, Bipartisan Trade Promotion Authority Act of 2001, H. R. 3005, 3 October 2001; Wunsch-Vincent (2003).

The DR–CAFTA includes Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and the Dominican Republic.

Wunsch-Vincent (2006), pp. 119−120.

Wunsch-Vincent (2003), pp. 15–16; Voon (2007), pp. 25–26.

Bernier (2004).

100

US–Australia FTA, Annex I.

101

US–Australia FTA, Annex II.

102

Article 32.6 USMCA.

103

Article 32.6(4) USMCA: Notwithstanding any other provision of this Agreement, a Party may take a measure of equivalent commercial effect in response to an action by another Party that would have been inconsistent with this Agreement but for paragraph 2 or 3.

104

Article 32.6(5) USMCA.

105

Panel Report, Canada – Certain Measures Concerning Periodicals (Canada – Periodicals), WT/DS31/R, adopted 14 March 1997; Appellate Body Report, Canada – Certain Measures Concerning Periodicals (Canada –Periodicals), WT/DS31/AB/R, adopted 30 June 1997. The case signalled the unwillingness of the WTO adjudicative bodies to engage in balancing trade versus culture values, as the case was decided by the panel and the Appellate Body to the benefit of the US, and despite CUSFTA’s cultural exception clause.

106

See e.g. Jackson (2018).

107

On path dependence in law, see e.g. Liebowitz and Margolis (2000); Hathaway (2001); also Meunier and Morin (2015).

108

See e.g. Neuwirth (2015).

109

Paoletta (2019).

110

Paoletta (2019); also Kotlowitz and Voon (2013).

111

Federal Communications Commission (FCC), Restoring Internet Freedom, 33 FCC Rcd 311(1), 4 January 2018.

112

One expert notes that 80% of new submarine capacity is built by the OTT providers like Google and Facebook, and while these “content” providers are the dominant force in new subsea capacity, they control more than 50% of global bandwidth, in any segment; the number is estimated to be over 80% by 2027. Paoletta (2019).

113

Kotlowitz and Voon (2016).

114

See the chapter by Willemyns in this volume.

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Title: Telecommunications and Media Services in Preferential Trade Agreements: Path Dependences Still Matter
Author: Mira Burri
Publisher: Springer International Publishing
Book: Coherence and Divergence in Services Trade Law
Print ISBN: 978-3-030-46954-2

Electronic ISBN: 978-3-030-46955-9

Copyright Year: 2020
DOI: https://doi.org/10.1007/978-3-030-46955-9_8