U.S. Chamber of Commerce
Association of American Chambers of Commerce in Latin America
U.S. Section of the Brazil-U.S. Business Council

Recommendations for the Services Negotiating Group
Executive Summary

The U.S. Chamber of Commerce, the Association of American Chambers of Commerce in Latin America (AACCLA), and the U.S. Section of the Brazil-U.S. Business Council welcome this opportunity to present our views on the emerging Free Trade Area of the Americas (FTAA). We strongly support free trade in the hemisphere, and we have previously submitted recommendations to the Committee of Government Representatives on the Participation of Civil Society and to the previous seven meetings of the Americas Business Forum giving our perspective on how the agreement should be framed.

International trade in services is a rapidly growing element of total trade, and we believe that throughout the FTAA agreement, there should be a maximum liberalization of all modes of supply, as well as national treatment for service providing companies operating in foreign markets. Beyond the necessary market access issues that negotiators face, they will need to provide for simplified business travel procedures. Other key elements for services trade include clear professional qualification requirements, and technical standards and licensing requirements based on objective criteria, such as professional competence. Negotiators should also provide for transparency in rule making, with opportunity for public comment on proposed rules, and harmonization or mutual recognition of professional standards. In addition to our specific recommendations, we would also like to reiterate our support for the recommendations that were endorsed during the VI Americas Business Forum in Buenos Aires, Argentina.

U.S. Chamber of Commerce
Association of American Chambers of Commerce in Latin America
U.S. Section of the Brazil-U.S. Business Council

Recommendations for the Services Negotiating Group
 

The U.S. Chamber of Commerce, the Association of American Chambers of Commerce in Latin America (AACCLA), and the U.S. Section of the Brazil-U.S. Business Council welcome this opportunity to present our views on the emerging Free Trade Area of the Americas (FTAA). We strongly support free trade in the hemisphere, and we have previously submitted recommendations to the Committee of Government Representatives on the Participation of Civil Society and to the previous seven meetings of the Americas Business Forum giving our perspective on how the agreement should be framed.

Specifically we recommend that the governments in the hemisphere agree during the Quito FTAA Ministerial to take the following actions to build a strong foundation for the final FTAA Agreement, including endorsing the following measures:

• Recognizing that there are 2 divergent views on the issue, as established during the VI Americas Business Forum 2001 services negotiation workshop, we would like to recommend that the FTAA countries negotiate liberalization according to a top-down (“negative list”) approach, whereby all sectors are liberalized except where a particular FTAA country negotiates a reservation for a particular sector or measure.
• The FTAA Agreement should provide for an obligation for an FTAA Party to: 1) remove non-discriminatory quantitative restrictions; 2) guarantee access to and use to publicly-provided telecommunications networks; and 3) not impose local presence requirements (for example, a representative office or any form of company) in its territory as a condition for the cross-border provision of a service.
• With respect to the proposal to include labor standards in the text of the FTAA - a subject discussed in the services negotiating group - we wish to register our opposition. Nearly all economists agree that trade liberalization raises incomes, and higher incomes lead in turn to improvements in labor standards. Efforts to block trade liberalization in the interest of promoting workers’ rights fly in the face of these facts. All too often, calls for trade-linked mechanisms to enforce labor standards are simply protectionism by another name. In fact, advocates of labor rights often seek to restrain trade in the very sectors where Latin America’s economies are at their most competitive. Thus, while we support efforts to improve working conditions and ensure workers’ rights, it is not appropriate to address this issue in the text of a trade agreement.
• Potentially, even before completion of the FTAA Agreement, the FTAA countries should encourage the use of the WTO Guidelines for Mutual Recognition Agreements in Accounting by responsible authorities within the Western Hemisphere for the development of sector-specific agreements on mutual recognition of equivalency of licensing and qualification requirements for professions (e.g., architecture, engineering, and accountancy), where appropriate.
• We support the incorporation of a framework for transparency within the FTAA, as recommended by the 2001 services negotiation workshop at the VI Americas Business Forum, which ensures that laws, regulations, and procedures affecting trade in services are promptly published or otherwise made available to the private sector, with appropriate opportunity for advance comment by interested parties. Additionally however, the FTAA countries should take the necessary steps to ensure transparent and timely authorization procedures, where authorization is required to supply a service.
• At the earliest possible date - and potentially even before completion of the FTAA Agreement - we would like to support the creation of the proposed “FTAA Visa”, established during the 2001 services workshop at the VI Americas Business Forum. Furthermore, the FTAA countries should agree to provide business visa treatment on a most-favored nation basis to all FTAA countries including the implementation of simplified procedures for temporary entry of business people, establishing multiple entry visas as the norm and eliminating special requirements for those providing technical assistance.
• The FTAA countries should indicate implementation dates for each of two phases of the Inter-American Telecommunications Commission (CITEL) mutual recognition agreement (MRA) for conformity assessment of telecommunication equipment.
• The FTAA Agreement should recognize Express Delivery Services as a distinct service sector.
• The FTAA countries should recommit themselves to the complete and rapid implementation of the customs-related business facilitation measures adopted at the 1999 Toronto Trade Ministerial. The business facilitation process is an essential part of the FTAA, and implementation of the business facilitation measures should remain a priority in the FTAA process.

• We support the recommendation, established during the VI Americas Business Forum 2001 services negotiation workshop, that the principles of most-favored nation (MFN) treatment and national treatment should be the rule for the FTAA Agreement’s provisions related to all service sectors and service suppliers. As we understand, MFN treatment would mean treatment that is no less favorable than the treatment a Party to the FTAA Agreement provides, in like circumstances, to service suppliers of another country, whether or not that country is a Party to the FTAA Agreement. National treatment would mean treatment that is no less favorable than the treatment an FTAA country provides, in like circumstances, to its own service suppliers.
• We would like to express our support for the continued liberalization in telecommunications services including provisions outlined in the WTO Basic Telecommunications Reference Paper as recommended in the VI Americas Business Forum 2001 services negotiation workshop, in order to elevate commitments among all 34 FTAA countries and foster effective implementation of the pro-competitive regulatory principles set forth in the WTO agreement.