Services Liberalisation in the EU and the WTO

According to the economic theory of comparative advantage, free trade in goods and services between sovereign States is beneficial for all participants. States, however, tend to introduce legal barriers for those parts of the economic exchange relation which they consider to be disadvantageous for their own interests. But even, in the absence of such a goal, the mere application of domestic rules to foreign suppliers is a barrier to trade. This attitude of national lawmakers makes a rules based international trade regime an economic necessity. It is for this reason that States agree to legally binding regimes, especially under EC- and WTO-Law, moderating such potential governmental restrictions on transborder economic activity. In principle, these regimes exist for both trade in goods (Free Movement of Goods under EC-Law, the GATT under WTO-Law) and services (Freedom to Provide Services and Freedom of Establishment, the GATS). For practical purposes, however, this only works with regard to goods on the European as well as global scale. As concerns the services markets their de facto non-integration prevents substantial economic benefits for national economies from being realised. In view of this economic background the envisaged project will analyse the major international legal instruments of cross border services regulation, i.e. the late-breaking EC-Services Directive against the background of existing EC (case) law and the WTO`s GATS with pertaining case law. This screening process shall focus particularly on the regulatory approaches adopted, the definition of services, the scope of application, selected sectors and the transposition under and consequences for national regulatory autonomy. On the basis of the analysis of the legal playing field in the EC and the WTO a comparison will be made between their main legal features. Methodologically applying a legal analysis procedure with a comparative law perspective, research outcomes shall be optimized through additional elements: Firstly, the project leader (Prof. S. Griller) and his team have broad expertise in transnational services regulation acquired through extensive specialisation in this field. Secondly, high- level academic conferences and discourses with the public are envisaged in the course of the project. Thirdly, far- reaching research networks (such as the likes of ECSA and FIDE) shall be established in the framework of this project, including representatives of organisations concerned such as the WTO as well as academia from other European countries. Finally, the interdisciplinary set-up of the Research Institute for European Affairs headed by Prof. S. Griller will greatly benefit the breadth of the project`s findings. Both the Institute`s legal department as well as the economics and the business administration departments have focused on transnational services liberalization in the past and will continue to do so in the future. The present project shall primarily result in a comprehensive evaluation of the current legal status-quo on transnational services provision on a European and global level identifying major legal reasons for its malfunctioning. This shall lead to a better understanding of the relevant legal framework for the parties involved, such as national governments, civil society and transnational corporations. This project, however, will go beyond the novelty of providing a combined analysis of EC- and WTO-law by striving to develop new "best" - in the sense of economically most effective - regulatory instruments for cross-border services provision. It thus aims at exerting an influence on future legislation in the European and global services sector. Research results shall be published in a project book as well as in internationally top-ranked law journals.

According to the economic theory of comparative advantage, free trade in goods and services between sovereign States is beneficial for all participants. States, however, tend to introduce legal barriers for those parts of the economic exchange relation which they consider to be disadvantageous for their own interests. But even, in the absence of such a goal, the mere application of domestic rules to foreign suppliers is a barrier to trade. This attitude of national lawmakers makes a rules based international trade regime an economic necessity. It is for this reason that States agree to legally binding regimes, especially under EC- and WTO-Law, moderating such potential governmental restrictions on transborder economic activity. In principle, these regimes exist for both trade in goods (Free Movement of Goods under EC-Law, the GATT under WTO-Law) and services (Freedom to Provide Services and Freedom of Establishment, the GATS). For practical purposes, however, this only works with regard to goods on the European as well as global scale. As concerns the services markets their de facto non-integration prevents substantial economic benefits for national economies from being realised. In view of this economic background the envisaged project will analyse the major international legal instruments of cross border services regulation, i.e. the late-breaking EC-Services Directive against the background of existing EC (case) law and the WTO`s GATS with pertaining case law. This screening process shall focus particularly on the regulatory approaches adopted, the definition of services, the scope of application, selected sectors and the transposition under and consequences for national regulatory autonomy. On the basis of the analysis of the legal playing field in the EC and the WTO a comparison will be made between their main legal features. Methodologically applying a legal analysis procedure with a comparative law perspective, research outcomes shall be optimized through additional elements: Firstly, the project leader (Prof. S. Griller) and his team have broad expertise in transnational services regulation acquired through extensive specialisation in this field. Secondly, high- level academic conferences and discourses with the public are envisaged in the course of the project. Thirdly, far- reaching research networks (such as the likes of ECSA and FIDE) shall be established in the framework of this project, including representatives of organisations concerned such as the WTO as well as academia from other European countries. Finally, the interdisciplinary set-up of the Research Institute for European Affairs headed by Prof. S. Griller will greatly benefit the breadth of the project`s findings. Both the Institute`s legal department as well as the economics and the business administration departments have focused on transnational services liberalization in the past and will continue to do so in the future. The present project shall primarily result in a comprehensive evaluation of the current legal status-quo on transnational services provision on a European and global level identifying major legal reasons for its malfunctioning. This shall lead to a better understanding of the relevant legal framework for the parties involved, such as national governments, civil society and transnational corporations. This project, however, will go beyond the novelty of providing a combined analysis of EC- and WTO-law by striving to develop new "best" - in the sense of economically most effective - regulatory instruments for cross-border services provision. It thus aims at exerting an influence on future legislation in the European and global services sector. Research results shall be published in a project book as well as in internationally top-ranked law journals.