Asean Trade in Service Agreement

ASEAN has taken a number of initiatives to facilitate the mobility of people in the context of cross-border provision of services, which is a prerequisite for many aspects of trade in services. The Mutual Recognition Agreement (MRA) allows for the mutual recognition of professional qualifications in ASEAN Member States, which will facilitate the mobility of service providers in the region. Seven MRAs have been concluded so far: Singapore ratified the ASEAN Trade in Services Agreement (ATISA) on 5 April 2021, making it the first of the ASEAN Member States (AMS) to do so. Once fully implemented by all ASEAN Member States, ATISA, together with the ASEAN Agreement (ATIGA) and the ASEAN Comprehensive Investment Agreement (ACIA), will constitute the third and final part of the “troika” of the ASEAN Agreements of the ASEAN Agreements. These agreements aim to improve ASEAN`s economic and sectoral integration. Within ASEAN, the ASEAN Framework Agreement on Services (AFAS) was signed in 1995, which is intended to serve as a framework for the management and progressive opening of trade in services. AFAS adopted the WTO`s General Agreement on Trade in Services (GATS) as the basis for integration, with ASEAN-Glut agreeing to apply most-favoured-nation (MFN) and national treatment (NT) to cross-border trade in services. Nevertheless, there was little change in intra-ASEAN trade in services, which remained relatively constant at around 17% over the next two decades. Download the publication on ASEAN integration in services here In recognition of the growing importance of services, the ASEAN Economic Community (ACS) has included the objective of freedom to provide services as part of the plans for a single market and production base in 2015. This is expected to be achieved through the gradual liberalization of the services sector within ASEAN and with seven key partners – Australia, China, India, Japan, New Zealand, South Korea and Hong Kong. This led to the ASEAN Trade in Services Agreement (ATISA), which was finally signed in April 2019, replacing the original AFAS agreement.

ATISA builds on the existing provisions made under AFAS while committing Member States to achieve the objectives set under AFAS. A major change is that ATISA operates under a “negative list” approach. Countries can list the sectors or subsectors they wish to exclude from the agreement, but the default setting is that all services are considered liberalized. In November 2012, ASEAN Economic Ministers (WEAs) signed the ASEAN Agreement on the Free Movement of Natural Persons (NPM), which was to replace the previous elements of AFAS. The NPM is designed as a legal framework for the removal of almost all restrictions on the temporary cross-border movement of natural persons involved in the supply of goods, trade in services and investment. It only covers the types of services actively mentioned in flight schedules, including business travellers (BV), intra-company posted workers (ICT) and contract service providers (CSS), and does not cover permanent immigration to look for work or unskilled labour. In the longer term, the NPM is intended to be a mechanism to facilitate the free movement of skilled workers in ASEAN involved in the implementation of trade in goods, services and investment. In 2020, the service sector, with more than 1.89 million employees, accounts for more than 85% of employment in Singapore. While the ASEAN region has long been considered one of the world`s leading regions in terms of trade in goods, there is also a rapidly growing trade in services that has developed based on production. Logistics and transport services are required to transport goods to and from countries, often combined with legal, accounting and tax advisory services. In order to move up the global value chain, countries are increasingly focusing on research and development, design and intellectual property, which are increasingly the subject of international trade. At the same time, global trade has been facilitated by electronic communications and payment systems, as well as Internet banking.

The ASEAN region is Singapore`s third largest export destination for services. Thanks to the ATISA agreement, more service sectors will be opened up to foreign participation and there will be an increase in the limits of foreign participation allowed, in particular: the ten ASEAN member states have now concluded 10 packages of commitments under AFAS. Each of the packages contains details of each state`s obligations in different service sectors. Seven other commitment packages for financial services and eight packages for air services were also signed. In each of the packages, ASEAN has moved towards an increasingly liberalised services and investment sector, which now includes: the agreement will help strengthen services-related trade agreements between AMS and create a more stable and predictable environment for services trade in the region. It will increase transparency and legal certainty and allow businesses to learn about the applicable rules. Services is an increasingly important sector in ASEAN economies, accounting for 50.6% of ASEAN GDP in 2019. The ASEAN Qualifications Reference Framework (AQRF) was finally adopted in 2016 and is a common reference framework for comparing qualifications in all areas of education and training in ASEAN.

This system allows Member States to reference their qualifications at national level and compare them with those of other ASEAN regions in order to achieve a common understanding and mutual recognition of qualifications. This not only increases opportunities for increased mobility of workers, but also allows Member States to learn from the experience of others, develop better quality education systems and promote lifelong learning. More detailed information about the AQRF can be found here. Would you like to know more about the ASEAN Trade in Services Agreement? Do not hesitate to contact us using the form below. ATISA Annex on Auxiliary Air Transport Services.pdf Except as otherwise provided in this Agreement, the ASEAN Protocol on the Enhanced Dispute Settlement Mechanism, signed at Vientiane, Lao People`s Democratic Republic, on 29 November 2004, or its successor, shall apply to the settlement of disputes concerning the interpretation or application of this Agreement. 2012 ASEAN Agreement on the Free Movement of Natural Persons Annex I on Non-Compliant Measures (as of 24.05.2021 not available) ATISA extends the existing ASEAN Framework Agreement on Services (AFAS) and removes barriers “across the border”. . . .