Australia's Role in GATS and TISA: A Comparative Analysis

This research compares Australia's role in GATS and TISA and examines the potential impact of TISA on the country's economy. It explores the rules and commitments of GATS and TISA, as well as the specific conditions and limitations for Australia. The research also discusses the benefits and challenges of these agreements for Australia and other WTO member countries.

"Compare Australia's role in GATS and its role in TISA and consider the possible impact of
TISA on Australia if the treaty eventuates and Australia ratifies it”
Introduction
Australia is a developed country, which had received the huge benefit of inter-trade supported by
the World Trade Organization, thus helping leverage living standards on Australian natives and
immigrants due to its strong economic trade. However, very recently, the most powerful economic
country, The U.S.A., led by the current President, Donald Trump has officially announced global
economic policy, disintegrating World Trade Organization System while limiting the eligibility on
trade benefits on other WTO members by changing the rules-based international order. This USA
official economic announcement is equivalent to changing the systems and rules of WTO especially
as to imposition on taxes and tariffs on its trade partners, including Australia, which will be
inevitably subject to a significant decrease in a multilateral trading system. In this circumstance, it
is necessary for Australia to make the best preparation for having kept its economy at a steady
growth, while being ready to cope with the globalisation changes in a global economy, including a
so-called border adjustment tax1.
According to the new economic policy influencing the WTO system by Trump administration, it is
mandatory for America to adjust tax systems to make its trade account of the country balanced.
These would pose international trade competitiveness to Australia, such as exporting products to
China and the U.S.A by having to pay more taxes and tariffs, while having to deal with the
disruption of trade flow. Australia needs to pay more intensive attention to adjust Australia
economic in General Agreement of Trade and Services(GATS) supported by WTO and Trade in
Service Agreement(TISA), which is also buttressed by WTO as its member to counterbalance the
new changing system of WTO led by the U.S.A.
What is the GATS?
The General Agreement on Trade in Services (GATS) is an agreement that is signed by all the
members of the World Trade Organisations with Australia being a member. GATS sets all the rules
of international trade and aims at giving its members equal access to the various services available
to some markets. Under the GATS, each of the members specifies given access to Foreign Service
providers2. These providers influence the market in such a way that member states are treated
1 Giovanni Di Lieto, ‘Australia has to prepare for life after the World Trade Organisation’ (6 Aug 2018)
<http://theconversation.com/australia-has-to-prepare-for-life-after-the-world-trade-organisation-100522>.
2 Tania Voon, ‘Balancing Regulatory Autonomy with Liberalisation of Trade in Services: An Analytical Assessment of
Australia's Obligations under Preferential Trade Agreements’ (2017) 18(2) Melbourne Journal of International Law

differently from the local service providers of the country in operation. GATS has been designed to
apply to all the types of services within a given sector in Australia except for the government
services.
What is the TiSA?
The Trade in Services Agreement (TiSA) is also a trade agreement signed by member states that are
service oriented only. Australia, the EU, and the United States jointly lead TiSA. The body is
charged with the responsibility of addressing the various barriers to international services and
promotes the expansion of all the services being provided in Australia. TiSA negotiations are
carefully designed to set a new international standard in services liberalisation that will feed into the
future of Australian multilateral negotiation3. The structure of TiSA has been designed to suit the
World Trade Organisation General Agreement on Trade in Services and at the same time
incorporating various elements from FTAs having a high level of ambition.
The aims of the research
The purpose of this research is to have Australia's role in GATS and its role in TISA compared with
each other, aside from taking into account the plausible influence of TISA on Australia economy
providing that Australia make TISA ratified and eventuated.
Problems or research gap to be addressed
Australia is another country member of the World Trade Organisation, which allows is to have
global trade liberalisation as well as global trades in services with being less subject to taxes and
tariffs. The enormous benefits of trade Australia receives from WTO, regardless of the ability of
Australian government to provide public services to their people, are under the responsibility of two
forms of WTO global treaties, GATS and TISA. Not only GATS but also TISA has yielded huge
trade benefits to Australia and other WTO member countries. Reaching General Agreement of
Trades in Services with WTO would facilitate local government of Australia to provide improving
public services to their people4, while TISA encourages Australia and other 20 member countries
tied to WTO to promote foreign market access for the WTO country members’ service sectors5
896 - 908.
3 Pierre Sauvé and Anirudh Shingal, ‘Why Do Economies Enter into Preferential Agreements on Trade in Services?
Assessing the Potential for Negotiated Regulatory Convergence in Asian Services Markets +’ (2011) 33(1) Asian
Development Review 96-103.
4 Jonathan Pickering, ‘GATS, public services and domestic regulation: current issues and implications for local
government in Australia’ (2004).
5 Giovanni Di Lieto, ‘Backdoor for Investor-State Disputes in TiSA’ (2016)
<https://www.internationalaffairs.org.au/australianoutlook/backdoor-for-investor-state-disputes-in-tisa/>.

In recent time, the WTO Appellate Body has been disturbed and blocked its systems, to a certain
extent, by the U.S. policy which has the profound impacted on enforcement and eligibility of WTO
members, including Australia to reap the benefit of globalised trades and services. It is precarious
for all WTO members including Australia to make it ready to cope with the changing systems of
WTO of which the rules are most unlikely to be enforced and implemented while making
‘Appellate Body of WTO’ inactive anymore6. Mainly owing to undermining Appellate Body of
WTO would have an adverse impact on free trades and services of all WTO members, including
Australia. It is necessary to investigate the role in GATS and the role in TISA of Australia to
evaluate how much General Agreement on Trades and Services and The Trade in Service
Agreement in the context of trade liberalisation has an impact on Australia of its eventuate and
ratify this international WTO treaty.
Australia's role in GATS
Every World Trade Organization country members get advantages from GATS in the form of free
access to trade services as well as being ensured to global business. Holding GATS commitment
with the WTO, each country member is eligible for the right to provide public services to their
people, such as healthcare service, electricity, water supply, or even education. Australia is another
WTO country member that has become committed to GATS since 1994, contained as another vital
component of the Uruguay Round Negotiation7.
With regard to Australia’s commitment to General Agreement of Trade and Service, the schedule of
a specific commitment of Australia to WTO has the modes of supply, which composes of cross-
border supply, consumption abroad, commercial presence, and the presence of a natural person8.
Nevertheless, the qualification of GATS by Australia had limitation to market access in that the
condition of the policy supporting foreign investment in Australia would prioritize on financial
sectors and international transportation sector under the close supervision and monitor of the
Australian government. Aside from this, Australia’s commitment to GATS also embraces limitation
on national treatment. In this way, the guidelines of policy supporting international investment can
be applicable for enterprises from foreign countries coming to invest in Australia. Additionally,
according to GATS, the local government of Australia has to provide public services to indigenous
people, especially water supply, education standards, and healthcare services. Put differently,
6 Giovanni Di Lieto ‘Backdoor for Investor-State Disputes in TiSA’ (2016)
<https://www.internationalaffairs.org.au/australianoutlook/backdoor-for-investor-state-disputes-in-tisa/>.
7 Australian Department, ‘International services trade & the WTO’ (2019) <https://dfat.gov.au/trade/services-and-
digital-trade/services-trade-and-the-wto/Pages/services-trade-and-the-wto.aspx>.
8 GATS/ SC/ 6, ‘General Agreement of Trade and Service’ (15 April 1994)

Australian indigenous people and native businesses are eligible for receiving public services from
the local government of Australia as the first priority9.
In addition, the role of Australia in GATS get involved with the specific condition for controlling
domestic matters which gives privilege to the local government of Australia, such as determining
the standards of building construction and giving approval for building and expanding the facilities
if waste management. In spite of challenge to WTO, leading to width disputes over the matters of
liberalising foreign investment in Australia with expected to be liberalised but it was cited that
Australia was being under pressure from persistent negotiation with GATS aiming at promoting
liberalisation on service sectors under the close supervision of the local government of Australia.
Free Trade Agreement between U.S.A and Australia (AUSFTA) however have has persistent
disputes over mutual trade benefits for the two sides, which has profound impacts on many areas of
Australia, especially the matter of healthcare service provided by the government. According to the
Free Trade Agreement between U.S.A and Australia, the Australian government has aroused
AUSFTA to give full support to health service sectors as well as the Pharmaceutical Benefits
Scheme (PBS) of the country10. What’s more, the government of Australia has a high expectation of
AUSFTA give full benefits to other vital sectors of the country, which include agricultural sector,
intellectual property on pharmacy, professional services, and plasma fraction system. Nonetheless,
at the same time, Australia anticipates AUSFTA to undermine the capacity of the local government
of Australia to provide public services with respect to the health issue, media functions, and
political situation. According to Mercurio gave the final conclusion about the issue of Free Trade
Agreement between U.S.A and Australia (AUSFTA) that it does not pose negative effect to
Pharmaceutical Benefits Scheme (PBS) of Australia, even though AUSFTA may lead the
academicians to feel discontent over some limitation to health service issues of the country.
Australia's role in TISA
In addition to the General Agreement of Trade and Services, Australia has become the WTO
member, which is eligible for Trade in Services Agreement (TISA). At the current, there are up to
23 TISA member countries under the supervision and management by WTO11. Additionally, more
than 70% of these TISA member countries put importance on the interests and benefits of
international trades and services among WTO members. Nonetheless, in fact, the General
9 GATS/ SC/ 6, (1994).
10 Bryan Mercurio. ‘The Impact of the Australia-United States Free Trade Agreement on the Provision of Health
Services in Australia’ (May 2005)
<https://www.researchgate.net/publication/228146590_The_Impact_of_the_AustraliaUnited_States_Free_Trade_Agree
ment_on_the_Provision_of_Health_Services_in_Australia>.
11 Australian Government, ‘Trade in Services Agreement (TiSA)’ (May 2019)
<https://dfat.gov.au/trade/agreements/negotiations/tisa/Pages/trade-in-services-agreement.aspx>.

Agreement on Trade in Services (GATS) by WTO is the root of the emergence in Trade in Services
Agreement (TISA). The main target of TISA is to expand or broaden international trade markets as
well as to improve and determines trade rules and regulations managed by WTO, which yields
benefits to all TISA member countries. These international trade benefits embrace financial
services, licensing rights, marine transportation and logistics system, e-commerce
telecommunication, and other essential fundamental services at global standards. Overall, this aims
at giving services to all TISA member countries.
European Commission stated that the main priorities of Trade in Services Agreement (TISA) by
WTO are to focus on facilitating in services, building networks and international connection among
WTO country members, convincing other countries to join TISA, placing importance on
transparency and reliability, improvement on sustainability impact assessment, and fair play and
international operation12.
With respect to expediting trade in services, TISA places importance on the global economy that
is mainly located in Europe continent. TISA allows the EU to play a pivotal role in exporting not
only products and services but also labours to other WTO member countries, especially those in
Europe13. Put differently, TISA enables the EU to become the most influential exporters of services
and labours in the EU, which is responsible for expanding and enlarging EU workforce markets. In
particular, the World Trade Organization places TISA to promote multilateral negotiations that are
favourable for many member countries of WTO. On this ground, Australia can have and proceed in
multilateral negotiations with other WTO 22 member countries, especially China, Canada, Japan,
New Zealand, Switzerland, Korea, Norway, and The United States, which all have power
economies that can be shared among other 23 member countries according to TISA. More
importantly, Australia would get the benefit of free trade based on TISA with these powerful TISA
member countries. Moreover, not only does TISA allow all 23-member countries to gain
transparency in free trade but it also helps broaden WTO agreement while convincing other
countries to join and become the members of WTO. Besides, it is important to bear in mind that
Australia, aside from EU and The United States, is responsible for sharing the meeting and
organisation of TISA in Geneva14.
12 European Commission, ‘Trade in Services Agreement (TiSA)’ (2019)
<http://ec.europa.eu/trade/policy/in-focus/tisa/>.
13 European Commission, ‘Trade in Services Agreement (TiSA)’ (2019)
<http://ec.europa.eu/trade/policy/in-focus/tisa/>.
14 European Commission, ‘Trade in Services Agreement (TiSA)’ (2019)
<http://ec.europa.eu/trade/policy/in-focus/tisa/>.

On top of this, It was stated that TISA aims at promoting sustainability impact assessment, of
which the study aims at improving economic, social, and environmental agreement among 23 TISA
member countries. Furthermore, it was TISA, which is accountable for enhancing legal reliability,
and certainty, which assists the TISA member countries and trade partners in decreasing cost of
international trade by 3.4 percent in the Organization for Economic Co-Operation and Development
markets as well as for reducing low to middle-income markets, with regard to international trades in
services15.
Written expression
Although General Agreement on Trade and Service (GSTS) and Trade in Services Agreement
(TiSA) aims at promoting liberalisation in international trades among WTO member countries, as
for Australia, its roles in GATS and in TISA has three different aspects as follows. In term of
capacity and the potential of the local government of Australia in providing public service is raised
the question by Australia depending on GATS. Since Australia entered to become the member of
GATS of WTO in 1995, Australia receiving special privilege by GATS allowing it to have special
protection on interests of the Australian state, this country has been raised the question over whether
it has potential to provide public service to Australian citizens and business with global standards.
Moreover, Australia receives the benefits from GATS mainly via the improving performance of a
local government that has committed to protect and regulate public interests. Simply put,
Australia’s role in GATS is limited to simply local government regulation and provision.
With regard to Australia’s role in Trade in Services Agreement (TiSA), it extends national
responsibility beyond local government regulation and provision. Firstly, Australia, the United
States, and the EU are alternate for sharing and setting the meeting of TISA in Geneva. Rather than
simply focus on the local government regulation in accordance with GATS, Australia’s role in
TISA allows the country to reap more international trade benefits by being eligible for reducing
trade barriers to international services among 24 TISA member countries while being able to
promote the expansion of export sectors of the country. These privileges are extensively beyond
providing public services by the local government of Australia in accordance with GATS.
In addition, Australia’s role in GATS mainly focuses on environmental service, and commercial
service, aside from public, which is all under the responsibility of the local government of Australia.
However, GATS still has Australia to Still clinging to the side of GATS, Australia’s role in GATS
15 European Commission, ‘Trade in Services Agreement (TiSA)’ (2019)
<http://ec.europa.eu/trade/policy/in-focus/tisa/>.

has been the controversial issue of fairly approving GATS mutual agreement. This is because
GATS agreement by Australia is seen as undermining the potential and capacity in providing public
services as well as to reduce the efficiency for protecting the public interests of Australian local
government because Australia has to comply with the rules and regulations over providing public
services, environmental services, and commercial services by GATS regulated by WTO. It seems
that the more Australia becomes committed to GATS, the less potential and efficiency of public
services provided by the local Australian government. On this ground, there is the incoming
requirement for reviewing GATS commitment as well as consultation in the next negotiation.
It is obvious that EU proposal is responsible for promoting dispute resolution, instead of
controversial issues due to the commitment to GATS, by allowing the complaining TISA member
countries to choose to adopt governmental regulation; the TISA member countries can have the
wider alternative to choose supports by either World Trade Organization or Free Trade Agreement.
These two alternatives will contribute to the economic policy of Australia according to a different
economic situation during a certain period.
Concerning a framework of GATS agreement, the prospective new member countries of GATS are
most likely to be uncertain about many issues that have still been unsettled in the Uruguay round.
The undesirable consequence is that Australia focusing on GATS will be less able to attract the new
member countries especially those from developing economy to become trade partners with
Australia. On the other hand, its role in TIFA would be able to attract more new member countries,
particularly from the underdeveloped economy to become the new member of TIFA as well as trade
partners with Australia. This is owing to the fact that all countries that become TIFA members
become profoundly divided on the application of Most Favoured Nations’ rules thanks to the chain
effect of TIFA agreement. Unless TISA would be negligent of adopting all most favoured nations’
rules as well as of setting many limitations on free trade, the new underdeveloped countries will
receive better treatment from TISA without limitation and complex conditions, which being
spontaneously granted to the new country members of TIFA. On this ground, by playing a role in
TISA, Australia will attract more emerging countries to become TISA members as well as trade
partners with Australia.
In particular, if Australia decides to ratify Trade in Services Agreement (TiSA), this will have a
positive impact on the country in many aspects. The first is the economic benefits of Australia,
which can select talented workforces because TISA allows the EU to act as the biggest exporters of
labours and services to other TIFA member countries. What’s more, if Australia makes such an
important decision by eventuating TISA, Australia will get splendid facilitation of trade services
with four powerful countries of all 23 members, which are The United Stated, Japan, China, and the

EU, which will not only increase export values of Australia but also introduce the newest
technology and innovation from these powerful countries. Aside from this, eventuating and
ratifying Trade in Services Agreement (TiSA), Australia will be able to reduce the cost of
international trade since TISA is responsible for improving and enhancing legal certainty among all
23-member countries. In addition to Australia receiving more transparency from TISA, the country
is less likely to be subject to a controversial issue, unlike GATS commitment, because TISA is
traditionally not set the meeting in the public, but sends a confidential document to all 23 TISA
member countries privately.
Conclusion
It is reasonable for Australia to play a pivotal role in becoming a member of both the General
Agreement of Trade and Services (GATS) and The Trade in Services Agreement (TiSA) in parallel.
By choosing to become WTO members, Australia will gain economic advantages in term of free
accesses to trade services while being promoted to enter the globalisation markets. At the meantime,
Australia’s role in TIFA will also help Australia expedite trade services by trading and dealing with
other leading 23 member countries of TIFA. Especially, the EU and America will help Australia
address and reduce international trade barriers and promote export values of the country. However,
when Australia focuses on TIFA more than GATS, it will benefit from dispute resolution because
TIFA aims at setting the new international standard while promoting liberalisation as well as
multilateral negotiation without limitation. More importantly, TISA would give Australia global
economy benefits by dealing with other 23 member countries besides lots of the incoming TISA
member countries in the future. TISA will help all member countries gain eclectic benefits as to
global financial services, licensing rights, marine transportation and logistics system, e-commerce
telecommunication, and other essential fundamental services at global standards, unlike GATS,
which makes Australia eligible for environmental, public, and commercial services under the
responsibility of Australian local government.
Bibliography
Articles/Books/Reports
• Pickering, Jonathan , ‘GATS, public services and domestic regulation: current issues and
implications for local government in Australia’ (2004)
• Sauvé, Pierre and Anirudh Shingal, ‘Why Do Economies Enter into Preferential Agreements on
Trade in Services? Assessing the Potential for Negotiated Regulatory Convergence in Asian
Services Markets +’ (2011) Asian Development Review 96 - 103

• Voon, Tania, ‘Balancing Regulatory Autonomy with Liberalisation of Trade in Services: An
Analytical Assessment of Australia's Obligations under Preferential Trade Agreements’ (2017) 18
Melbourne Journal of International Law 896 - 908
Government Websites
• Australian Government. ‘Trade in Services Agreement (TiSA)’ (May 2019)
<https://dfat.gov.au/trade/agreements/negotiations/tisa/Pages/trade-in-services-
agreement.aspx>
• Bryan Mercurio. ‘The Impact of the Australia-United States Free Trade Agreement on the
Provision of Health Services in Australia’ (May 2005)
<https://www.researchgate.net/publication/228146590_The_Impact_of_the_AustraliaUnite
d_States_Free_Trade_Agreement_on_the_Provision_of_Health_Services_in_Australia>
• European Commission, ‘Trade in Services Agreement (TiSA)’
(2019)<http://ec.europa.eu/trade/policy/in-focus/tisa/>
• GATS/ SC/ 6,‘General Agreement of Trade and Service’ (15 April
1994)<https://dfat.gov.au/trade/topics/Documents/australias_original_gats_commitments.pdf>
• Lieto, Giovanni, Di, ‘Australia has to prepare for life after the World Trade Organisation’ (6 Aug
2018) <http://theconversation.com/australia-has-to-prepare-for-life-after-the-world-trade-
organisation-100522>
• Lieto, Giovanni, Di, ‘Backdoor for Investor-State Disputes in TiSA’
(2016)<https://www.internationalaffairs.org.au/australianoutlook/backdoor-for-investor-state-
disputes-in-tisa/>
• World Trade Organization, Australia accepted as new party to government procurement pact, (17
Oct 2018) <https://www.wto.org/english/news_e/news18_e/gpro_17oct18_e.htm>