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WTO push to finish Doha

The seven-year-old stand-off in the Doha Round may be at an end. Although WTO Director General Pascal Lamy has called top negotiators back to Geneva many times over the past few years in hopes of finalizing a deal, this time there may be sufficient movement to finish the round.  Several sources mentioned the Bush administration seeming eagerness to secure a deal—and many negotiating partners may prefer what they can get now rather than take their chances with a new administration and Congress.

The Doha Round includes talks on agriculture, ‘non-agricultural market access’, and services. This month’s ‘signaling’ conference in Geneva will focus first on tariff levels and market access for agriculture products and manufactured goods.  But as negotiators are able to make process in those areas, the spotlight will shift to services negotiations.  

States have particular concerns about one area of these negotiations: possible new ‘disciplines’ on domestic regulation.  The draft text released by the Chair of this GATS working party refers only to ‘national policy objectives.’  The concern is that ‘domestic regulation’ disciplines could limit state and local regulatory authority by requiring the United States to use—and enforce—a single national standard in policy areas in which, traditionally, have been the lawmaking domain of states and cities.

Overall, services are part of the Doha negotiating mix in three different ways:
•    The United States is a negotiating ally with the European Union in pressing advanced developing nations to open more of their service sectors (banking, insurance, express delivery, telecommunications, retail, etc.) to foreign service suppliers.  Under the GATS, member-states can decide which sectors to open.  The United States may make new sectoral commitments, as well.
•    India and others are pushing for new commitments in Mode 4—‘movement of natural persons’.   U.S. acceptance of this offer might lead to an increase in the number of H1B visas for skilled professionals—but this also may provoke tensions with Congress over responsibility for immigration policy.
•    Disciplines” on domestic regulation.  These disciplines would cover state and local regulation of energy, clean air and climate, utility infrastructure, health insurance, health facilities, higher education, coastal zone management, commercial zoning, and distribution of goods.

The WTO’s chair of negotiations on domestic regulation has asked each nation to complete its consultations with domestic regulators before a mid-May meeting in Geneva.   If a Doha Round ‘end-game’ is in sight, then US negotiators will come under increasing pressure to accept or compromise on proposals to:
•    Delete recognition of any “right to regulate” at the subnational level of government.  
•    Prohibit “disguised restrictions” on trade.  Practically speaking, this could require a consultation process with foreign governments for measures set at the state or local level (e.g., regulations that affect multinational companies in sectors like energy, retail distribution, higher education, engineering, insurance, etc.).
•    Publish detailed information on not just the content of technical standards, but also about how legislative and administrative codes work with regard to appeals, opportunities for citizen involvement in the regulatory process, and adhering to specific time-frames for decision-making.
•    Discipline domestic regulation in ways that neither Congress nor state legislatures have ever attempted.  These include a relevance test, an objectivity test, a pre-establishment test and a simplicity test.

At several points over the past two years, when previously it appeared the WTO might be on the verge of completing the Doha Round, states have made their concerns about domestic regulation known.  In the past, US trade negotiators defended state interests during those negotiations.  With the May 2008 meetings presenting perhaps the last opportunity for the administration to complete a WTO negotiating round that was launched in the first year of the Bush presidency, there is concern that domestic regulation disciplines will end up on the table as a ‘bargaining chip’.  This is an important time for state and local officials to look at how the WTO’s proposed disciplines will affect states laws and local administrative regulations.  

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