Poison in the Wine?

Commitments in regional trade agreements (RTAs) that fall short of the same countries' obligations under the General Agreement on Trade in Services (GATS) are a relatively frequent phenomenon. However, they have gone widely unnoticed in the literature to date and drawn very little attention in relevant WTO fora either. Nevertheless, 'minus commitments' are potentially poisonous and, for various reasons, would deserve close attention. Given the broad definitional scope of the GATS, extending inter alia to commercial presence, such commitments may impinge upon the rights of third-country investors in the RTA economies. Their existence casts doubts on the legal status of the respective agreements under the GATS and can have severe implications for the trading system overall. If not complemented by comprehensive Most-favoured-Nation clauses, the RTAs concerned are disconnected from the WTO and virtually impossible to multilateralize. Based on a review of some 80,000 commitments in 66 agreements, this study seeks to develop a reasonably comprehensive picture of the frequency of 'minus commitments' and their dosage in terms of sectors, measures and modes of supply. It also discusses potential remedies from a WTO perspective.