WTO SymposiumWTO SymposiumMODE 4 OF THE GATS –MODE 4 OF THE GATS –
TAKING STOCK AND MOVING FORWARDTAKING STOCK AND MOVING FORWARD
Geneva, 22-23 September 2008Geneva, 22-23 September 2008
Session 4: Session 4: Mode 4 in practiceMode 4 in practice
– Perspectives from immigration, labour and trade– Perspectives from immigration, labour and trade
Experience in the Separate Customs TerritExperience in the Separate Customs Territory of Taiwan, Penghu, Kinmen, and Matsory of Taiwan, Penghu, Kinmen, and Mats
uu
Professor Shin-yi PengProfessor Shin-yi Peng
Tsing Hua UniversityTsing Hua University
33
OutlineOutline Mode 4 Trade in East AsiaMode 4 Trade in East Asia
General Review of the GATS Commitments(& the RTAs)General Review of the GATS Commitments(& the RTAs) Existing Regime for Labor Mobility (within GATS mode 4 Existing Regime for Labor Mobility (within GATS mode 4
Framework)Framework) Current Flows of Foreign Natural Persons in Chinese TaipeiCurrent Flows of Foreign Natural Persons in Chinese Taipei
Legal FrameworkLegal Framework Statistical AnalysisStatistical Analysis
Potential Implications and Main ConcernsPotential Implications and Main Concerns Policy Debates and Legal IssuesPolicy Debates and Legal Issues
As a Host CountryAs a Host Country As a Home CountryAs a Home Country
Mode 4 LiberalizationMode 4 Liberalization The APEC ExperienceThe APEC Experience Concluding Remarks Concluding Remarks
44
Mode 4 Trade in East AsiaMode 4 Trade in East Asia General Review of the GATS CommitmentsGeneral Review of the GATS Commitments Existing Regime for Labor Mobility (within Existing Regime for Labor Mobility (within
GATS mode 4 Framework)GATS mode 4 Framework)
55
Mode 4 in East Asia--Mode 4 in East Asia--GATS CommitmentsGATS Commitments
Major Entry Major Entry Conditions & Conditions & LimitationsLimitations
East Asian WTO Members East Asian WTO Members
Link to Mode 3 Link to Mode 3 Chinese Taipei, Thailand, Singapore, Chinese Taipei, Thailand, Singapore, Malaysia, Korea, Japan, Indonesia, Malaysia, Korea, Japan, Indonesia, Hong Kong-China and China. Hong Kong-China and China.
Pre-employment Pre-employment Chinese Taipei, Singapore, Malaysia, Chinese Taipei, Singapore, Malaysia, Korea, and Hong Kong, China.Korea, and Hong Kong, China.
ENT ENT The Philippines, Malaysia, Indonesia, The Philippines, Malaysia, Indonesia, and China.and China.
66
ASEAN?ASEAN?
Others?Others?
APEC?APEC?
Japan-Japan-Singapore Singapore FTA?FTA?
More More successful successful
??
The empirical
facts disprove
that!
Regional ContextRegional Context
77
Selective East Selective East Asian WTO Asian WTO Member Member
Greater Market Access in Mode 4 Initial/Revised OffersGreater Market Access in Mode 4 Initial/Revised Offers
Employment Employment by Domestic by Domestic FirmsFirms
Lower Lower Level of Level of SkillsSkills
De-linked De-linked with Mode with Mode 33
Intra-Intra-corporate corporate TransfereesTransferees
OtherOther
Brunei DarussalamBrunei Darussalam XX XX XX XX XX
ChinaChina X X XX XX XX XX
CambodiaCambodia XX XX XX XX XX
Hong Kong, ChinaHong Kong, China XX XX XX √√ XX
IndonesiaIndonesia XX XX √√ √√ XX
JapanJapan XX XX √√ √√ √√
KoreaKorea XX XX √√ √√ XX
MalaysiaMalaysia XX XX XX XX XX
Macao, ChinaMacao, China XX XX XX √√ XX
MyanmarMyanmar XX XX XX XX XX
The PhilippinesThe Philippines XX XX XX XX XX
SingaporeSingapore XX XX XX √√ XX
Chinese TaipeiChinese Taipei XX XX XX XX XX
ThailandThailand XX XX √√ √√ XX
88
Chinese Taipei--Chinese Taipei-- GATS Commitments and the Existing Regime GATS Commitments and the Existing Regime
Business visitorsBusiness visitors
Intra-corporate Intra-corporate TransfereesTransferees
Contract SuppliersContract Suppliers
•Employment Services Act•Enforcement Rules
Other Law or Regulation:•Attorney Act
•Certified Public Accountant Act
•The Reviewing Standards and Employment Qualifications for Foreigners Engaging in the Jobs
Specified in the Employment Service Act
GATS CommitmentsLabor Law and Major Regulations
99
Chinese Taipei--Chinese Taipei-- GATS Commitments and the Existing Regime GATS Commitments and the Existing Regime
Labor LawMode 4
Commitments
e.g., Business Business visitorsvisitors
e.g., Less skilledLess skilled
workersworkerse.g.,
Annex on Mode 4
1010
Current Flows of Foreign Natural Persons Current Flows of Foreign Natural Persons in Chinese Taipeiin Chinese Taipei
Legal FrameworkLegal Framework Statistical AnalysisStatistical Analysis
1111
Legal Framework—Legal Framework—Employment Services Act (Article 46)Employment Services Act (Article 46)
Unless otherwise provided for in the present Act, the Unless otherwise provided for in the present Act, the work a Foreign Worker may be employed to engage work a Foreign Worker may be employed to engage in within the territory of Chinese Taipei is limited to in within the territory of Chinese Taipei is limited to the following:the following:
1212
1. Specialized or technical work;1. Specialized or technical work;
2. Director/Manager/Executive of a business invested in or set 2. Director/Manager/Executive of a business invested in or set up by foreigners with the authorization of the government;up by foreigners with the authorization of the government;
3. Teacher at schools;3. Teacher at schools;
4. Full-time teacher teaching courses on foreign languages at a 4. Full-time teacher teaching courses on foreign languages at a short-term class registered for supplementary schooling in short-term class registered for supplementary schooling in accordance with the Supplementary Education Act;accordance with the Supplementary Education Act;
5. Sports coach and athlete;5. Sports coach and athlete;
6. Religious, artistic, and show business work;6. Religious, artistic, and show business work;
Mode 4 Commitments under GATS
1313
7. Crew member of a merchant vessel, working vessel, and vessel 7. Crew member of a merchant vessel, working vessel, and vessel ad hoc permitted by the Ministry of Transportation and ad hoc permitted by the Ministry of Transportation and Communication;Communication;
8. Marine fishing/netting work;8. Marine fishing/netting work;
9. Household assistant;9. Household assistant;
10. Work designated by the competent authority in response to 10. Work designated by the competent authority in response to major construction projects or economic/social development needs; major construction projects or economic/social development needs; andand
11. Other specialized work ad hoc approved by the competent 11. Other specialized work ad hoc approved by the competent authority due to the lack of such specialist in the domestic authority due to the lack of such specialist in the domestic employment market and the business necessity to retain the service employment market and the business necessity to retain the service of such specialist therefore.of such specialist therefore.
Outside the GATS Commitments
1414
Special Professions or Technical Special Professions or Technical AssignmentsAssignments
1. Architecture and civil engineering.1. Architecture and civil engineering.2. Transportation.2. Transportation.3. Tax and financial service.3. Tax and financial service.4. Real estate agency.4. Real estate agency.5. Immigration service.5. Immigration service.6. Attorney ( legal services).6. Attorney ( legal services).7. Technicians.7. Technicians.8. Medical and/or Health Care.8. Medical and/or Health Care.9. Environmental protection.9. Environmental protection.10. Cultural, sports and recreation services.10. Cultural, sports and recreation services.11. Academic research.11. Academic research.12. Veterinarian.12. Veterinarian.13. Manufacturing.13. Manufacturing.14. Wholesale.14. Wholesale.15. Other job descriptions designated by the competent 15. Other job descriptions designated by the competent authorities along with the specific industry authorities. authorities along with the specific industry authorities.
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Mode 4 in practice-Mode 4 in practice- Current Flows of Foreign Natural Persons in Current Flows of Foreign Natural Persons in
Chinese TaipeiChinese Taipei Statistical AnalysisStatistical Analysis
Time PeriodTime Period: From 2004/01-2008/07: From 2004/01-2008/07 DataData: Bureau of the Employment and Vocational Training : Bureau of the Employment and Vocational Training
(BEVT) under the Council of Labor Affairs, Science Park (BEVT) under the Council of Labor Affairs, Science Park Administration, Export Processing Zone AdministrationAdministration, Export Processing Zone Administration
Type of Work PermitsType of Work Permits: Foreign Professionals under the : Foreign Professionals under the definition of the Employment Services Act (Article 46)definition of the Employment Services Act (Article 46) Specialized workSpecialized work Director/Manager/ExecutiveDirector/Manager/Executive Teacher at schoolsTeacher at schools Teacher for supplementary schoolingTeacher for supplementary schooling Sports coach and athleteSports coach and athlete Religious and artistic workReligious and artistic work
1616
Pemitted
6% (9563) 2% (3014)
0% (423)
22% (32848)
26% (39121)44% (66532)
Specialized work
Director/Manager/Executive
Teacher at schools
Teacher for supplementaryschooling
Sports coach and athlete
Religious and artistic work
1717
16245
1414
3270
6188
71
2118
0
2000
4000
6000
8000
10000
12000
14000
16000
18000
Specialized work Director/Manager/Executive Teacher at schools Teacher for supplementaryschooling
Sports coach and athlete Religious and artistic work
Valid Employment
1818
117945
115080
37402
36425
0 20000 40000 60000 80000 100000 120000
Male
Female
Applied Permitted
1919
Permitted
22% (33052)
1% (2115) 0% (605) 3% (4390)
7% (10509)
67% (100834)
Ph.D. Master Bachelor High School Junior High School Others
2020
3450
338134793317
31633041
27202665
2416235123832298
2272
218217681723
1586
1543
0 500 1000 1500 2000 2500 3000 3500
Australia
Russia
Thailand
France
Indonesia
Singapore
Hong Kong
Ukraine
New Zealand
Applied Permitted
2121
387093812522716
2214514865
1446281377979
63036147
58015633
56925487
43324226
38243771
37223590
0 5000 10000 15000 20000 25000 30000 35000 40000
Japan
US
Canada
UK
South Africa
The Philippines
Malaysia
Korea
Germany
India
Applied Permitted
2222
Blue-Collar
0
30,000
60,000
90,000
120,000
1 6 12 1 6 7
Indonesia
Malaysia Mongolia
Vietnam
Thailand
The Philippines
2323
Potential Implications and Main ConcernsPotential Implications and Main Concerns Policy DebatesPolicy Debates
As a Host Country As a Host Country As a Home Country As a Home Country
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Mode 4Mode 4Mode 3Mode 3
De-linking
Intra-corporate Transferees executives, managers, and specialists?
Making the negotiations easier for liberalizing mode 4 on its own
Making the linking of modes 3 and 4 unnecessarily complicated.
Mode 3 v. Mode 4Mode 3 v. Mode 4
2525
Sector/Sub-sectorSector/Sub-sector Market AccessMarket Access
Horizontal Horizontal CommitmentsCommitments
All SectorsAll Sectors Entry and Temporary Stay of Natural Entry and Temporary Stay of Natural Persons. Persons. Unbound, except for measures…Unbound, except for measures…
Intra-Corporate TransfereesIntra-Corporate Transferees
-Can the services be delivered exclusively through mode 4?
-Are the Services normally supplied by natural persons as an adjunct to a foreign investment due to the technology facilities and business models ?
De-Linking with Mode 3?De-Linking with Mode 3?Horizontal Approach v. Sectoral ApproachHorizontal Approach v. Sectoral Approach
2626
Sub-sectorSub-sector Market AccessMarket Access
Sector-Specific Sector-Specific CommitmentsCommitments
Computer Computer ServicesServices
The situations where the movement of persThe situations where the movement of persons alone can be a feasible mode of supplyons alone can be a feasible mode of supply
Basic Telecom Basic Telecom ServicesServices
The situations where the movement of persThe situations where the movement of persons is mainly for the purpose of facilitating ons is mainly for the purpose of facilitating trade trade in in mode 3mode 3
Any undertaking should therefore be made on the basis of Any undertaking should therefore be made on the basis of individual sectors in order to yield the greatest possible individual sectors in order to yield the greatest possible Liberalization for mode 4.Liberalization for mode 4.
De-Linking with Mode 3?De-Linking with Mode 3?Horizontal Approach v. Sectoral ApproachHorizontal Approach v. Sectoral Approach
2727
TerminologiesTerminologies ““Temporary”?Temporary”? ““Professionals”?Professionals”?
Discretionary Discretionary PowerPower Unpredictability
Lack of TransparencyLack of Transparency No explicit criteriaNo explicit criteria No clear definitionNo clear definition
Trade Officials:Trade Officials:How to access How to access the degree of the degree of reciprocity?reciprocity?
Play it Safe
Toward Greater Mobility--Toward Greater Mobility--Regulatory Transparency of Mode 4 TradeRegulatory Transparency of Mode 4 Trade
2828
The APEC ExperienceThe APEC Experience APEC Individual Action Plan (IAP) APEC Individual Action Plan (IAP) In Chapter 13 of the IAP “Mobility of Business People”In Chapter 13 of the IAP “Mobility of Business People”
to enhance the mobility of business people who are to enhance the mobility of business people who are engaged in the conduct of trade and investment activities in engaged in the conduct of trade and investment activities in the Asia-Pacific region.the Asia-Pacific region.
to enhance the use of information and communications to enhance the use of information and communications technology (ICT) to facilitate the movement of people technology (ICT) to facilitate the movement of people across borders.across borders.
to exchange information on regulatory regimes in regard to to exchange information on regulatory regimes in regard to the mobility of business people in the regionthe mobility of business people in the region
to streamline short-term entry requirements for business to streamline short-term entry requirements for business peoplepeople..
2929
The APEC ExperienceThe APEC Experience To carry out those promises, Members update their To carry out those promises, Members update their
relevant measures by the following format on an relevant measures by the following format on an annual basis:annual basis:
Chapter 13: Mobility of Business People, IAPChapter 13: Mobility of Business People, IAP
Chinese Taipei’s Approach to Business MobilityChinese Taipei’s Approach to Business Mobility
Section Section Improvements Improvements Implemented Since Last Implemented Since Last IAPIAP
Current Business Current Business Mobility Related Mobility Related Policies and Policies and Arrangements Arrangements
Further Further Improvements Improvements PlannedPlanned
3030
Concluding RemarksConcluding Remarks To the extent that labor policy authorities are being asked to To the extent that labor policy authorities are being asked to
respond to the inquiries for achieving further liberalization of respond to the inquiries for achieving further liberalization of mode 4, they have been cautious in their response, which is mode 4, they have been cautious in their response, which is understandable.understandable.
It is important to be reminded of the fact that the mission of It is important to be reminded of the fact that the mission of most labor authorities is to administer legislations, not to most labor authorities is to administer legislations, not to facilitate movement of foreign services suppliers, since their facilitate movement of foreign services suppliers, since their functions are largely defensive in nature.functions are largely defensive in nature.
The problems associated with mode 4 requires a new level of The problems associated with mode 4 requires a new level of policy co-ordination between relevant regulatory agencies, policy co-ordination between relevant regulatory agencies, particularly those responsible for trade, immigration and the particularly those responsible for trade, immigration and the labor market, in order to find workable solutions and to move labor market, in order to find workable solutions and to move forward with liberalization.forward with liberalization.
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Concluding RemarksConcluding Remarks
Labor and trade authorities should engage in an intensive and Labor and trade authorities should engage in an intensive and productive dialogue on the further liberalization of mode 4.productive dialogue on the further liberalization of mode 4. The legal framework of labor law, in most cases, although The legal framework of labor law, in most cases, although
consistent with GATS in substance, is complicated and the consistent with GATS in substance, is complicated and the language does not correspond exactly to the GATS horizontal language does not correspond exactly to the GATS horizontal commitmentscommitments
For most Members, the interface between labor policy-making For most Members, the interface between labor policy-making related to foreign interests is somehow weak. The most difficult related to foreign interests is somehow weak. The most difficult part seems to be that the policy fails to determine who is best part seems to be that the policy fails to determine who is best positioned to respond to these demands for liberalization.positioned to respond to these demands for liberalization.
The different groups in charge of trade, labor and migration The different groups in charge of trade, labor and migration policies in the capitals of the Members must increase their policies in the capitals of the Members must increase their collaboration.collaboration.
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Concluding RemarksConcluding Remarks There is a need for predictability of actual entry conditions. There is a need for predictability of actual entry conditions.
The criteria for mode 4 entry must be more specific so as to The criteria for mode 4 entry must be more specific so as to assist and guide foreign services suppliers. assist and guide foreign services suppliers. There are many vague terminologies and definitions used There are many vague terminologies and definitions used
in the Schedule of Commitments that leave much room for in the Schedule of Commitments that leave much room for administrative discretion.administrative discretion.
Since much of the terminology can be interpreted Since much of the terminology can be interpreted differently by different Members, it becomes rather differently by different Members, it becomes rather difficult if not impossible to assess the overall degree of difficult if not impossible to assess the overall degree of liberality. liberality.
The existing GATS transparency rules are not adequate in The existing GATS transparency rules are not adequate in terms of mode 4. Consideration should be given to terms of mode 4. Consideration should be given to developing specific disciplines for mode 4.developing specific disciplines for mode 4.
Shin-yi PENGE-mail: [email protected]
Website: http://sypeng.myweb.hinet.net SSRN Author page: http://ssrn.com/author=723329
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