The Principle of Non-discrimination and Its Exceptions in Gats: Selected Legal Issues

Abstract

This chapter aims to highlight a few fundamental issues of the General Agreement on Trade in Services (GATS) focusing in particular on its two non-discrimination principles - Most-Favoured-Nation (MFN) Treatment of Article II and National Treatment (NT) of Article XVII - and the two main exceptions to these principles - Economic Integration of Article V and the General Exceptions of Article XIV. Given the dearth of WTO dispute settlement reports that have dealt with these GATS provisions, the analysis will rely on the interpretation of comparable provisions in other WTO Agreements. It examines the National Treatment provision focusing in particular on the 'less favourable treatment' standard and on the General Exceptions provision focusing in particular on the 'necessity' test. It then reviews the compatibility of bilateral investment treaties (BITs) with the MFN provision of Article II GATS and the applicability of the Economic Integration exception in Article V GATS to these treaties. Keywords: bilateral investment treaties (BITs); Economic Integration; exceptions; General Agreement on Trade in Services (GATS); less favourable treatment; Most-Favoured-Nation (MFN) treatment; National Treatment (NT); non-discrimination principles; WTO dispute settlement