Principal with the Department of International Trade and Economic Affairs under the MOFCOM Answers Questions on Implementation of China-Chile FTA Service Trade Agreement

Question: What is the main content of the China-Chile FTA Service Trade Agreement signed in April 2008 and implemented as of August 1, 2010?

Answer: The Agreement is a legal document regulating relevant issues of China and Chile in further opening up service markets and dealing with service trade based on the WTO rules, its structure and content generally referring to the mode of the WTO General Agreement on Trade in Service (GATS).

The Agreement has altogether 22 Articles and 2 Annexes, mainly including objectives, scope and coverage, national treatment, specific commitments of tariff elimination, domestic regulations, mutual recognition, settlement of disputes, general exceptions & security exceptions, limitations on ensuring international balance of payment, and definitions.

The main body consists of 4 parts by content: definitions and scope, obligations and disciplines, specific commitments, and institutional provisions.

The 2 Annexes are schedules of specific commitments concerning the temporary entry of business people and the service openness of both parties. The details (including both parties’ schedules of specific commitments) may refer to the website of the MOFCOM (www.mofcom.gov.cn).

Question: What impact will the China-Chile FTA Service Trade Agreement bring to both parties? What service domains are further opened up?
Answer: China-Chile FTA Service Trade Agreement is a mutually beneficial arrangement for trade in services, emphasizing on further opening up the market between the both parties.

According to the Agreement, 23 sectors of China, including computer, management consulting, mining, environment, sports, and air transport, as well as 37 sectors of Chile, including laws, architectural design, engineering, computer, research and development, real estate, advertising, management consulting, mining, manufacturing, leasing, distribution, education, environment, tourism, sports, and air transport, will be further opened up to each other on the basis of their respective WTO commitments.

Question: How can enterprises seize the business opportunities brought by the China-Chile FTA Service Trade Agreement?

Answer: As for most of Chinese service enterprises, the implementation of the China-Chile FTA Service Trade Agreement is an excellent opportunity to further expand the service market in Chile, even the Latin America.

As per the China-Chile FTA Service Trade Agreement, over 20 sectors and sub-sectors of Chile have outdone their offers in the WTO Doha Round.
Therein, the newly increased sectors provide greater opening-up, such as manufacturing services, distribution services, educational services, mining services, sports services, and air transport services (partial). Moreover, Chile’s commitments on these sectors are exclusive, that is, only enterprises providing services "originating" in China can enjoy such offers rather than all the enterprises providing services for Chile.

It is hoped that Chinese service enterprises can seize the opportunity and actively understand relevant preferential policies of the FTA and the laws and regulations of relevant industries of Chile, to speed up their pace and intensity of "going out" and achieve faster development in a greater and more open market in the economic globalization and fierce international competition.