Regulating Services Through Trade Agreements - A Comparative Analysis of Regulatory Disciplines Included in EU and US Free Trade Agreements

Abstract

Developed countries, led by the EU and the US, have consistently called for ‘deeper integration’ over the course of the past three decades i.e., the convergence of ‘behind-the-border’ or domestic polices and rules such as services, competition, public procurement, intellectual property (IP) and so forth. Following the collapse of the Doha Development Round, the EU and the US have pursued this push for deeper integration by entering into deep and comprehensive free trade agreements (DFTAs) that are comprehensive insofar as they are not limited to tariffs but extend to regulatory trade barriers. More recently, the EU and the US launched negotiations on a Transatlantic Trade and Investment Partnership (TTIP) and a Trade in Services Agreement (TISA), which put tackling barriers resulting from divergences in domestic regulation in the area of services at the very top of the agenda. Should these agreements come to pass, they may well set the template for the rules of international trade and define the core features of domestic services market regulation. This article examines the regulatory disciplines in the area of services included in existing EU and US DCFTAs from a comparative perspective in order to delineate possible similarities and divergences and assess the extent to which these DCFTAs can shed some light into the possible outcome and limitations of future trade negotiations in services. It also discusses the potential impact of such negotiations on developing countries and, more generally, on the multilateral process.