Practicing ArchitectureInternational Union of Architects Professional Practice Commission

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INTERNATIONAL UNION OF ARCHITECTS

Roles and Responsibilities in National Governments:- GATS Negotiations

Esa Bin Mohamed

UIA PPC MEETING -MARRAKECH, 12TH, DECEMBER, 2008

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INTERNATIONAL UNION OF ARCHITECTS

World Trade Organisation (WTO)

•Established: 1 January 1995 upon conclusion of the Uruguay Round of negotiations (1986-94)

Members – 153 countries

•WTO : The only multilateral organisation that seeks to develop and strengthen market international trade rules to improve market access for goods and services

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INTERNATIONAL UNION OF ARCHITECTS

General Agreement on Trade
In Services (GATS) 1995

•First multilateral trade agreement to cover trade in services.

Two main pillars:

- ensure increased transparency and predictability of rules and regulations

- promote progressive liberalisation

•Covers all services, except governmental services and air transport (traffic rights)

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INTERNATIONAL UNION OF ARCHITECTS

GATS : SECTORAL COVERAGE

Business Services

• Communication

• Construction

• Distribution

• Education

• Environmental

Health Related Services

• Financial Services

• Tourism

• Recreation, Culture, Sports

• Transport

• Other Services

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INTERNATIONAL UNION OF ARCHITECTS

OBLIGATIONS UNDER THE GATS

Most Favoured Nation Treatment ( MFN )

No discrimination among services or service suppliers of other Members

Market Access

Liberalisation of services on progressive basis through modes of supply

National Treatment

No discrimination against foreign services or service suppliers in relation to domestic ones

Transparency

Promptly publish, or make otherwise publicly available, all relevant measures and international agreements

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INTERNATIONAL UNION OF ARCHITECTS

Horizontal and Sector Specific Commitments

•Schedule of Commitments

•Identifies services sectors that Member guarantees market access and national treatment and any limitations that may be attached

Consists of Horizontal Section and Sector-Specific Sections

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INTERNATIONAL UNION OF ARCHITECTS

Modes of Supply of Services

MODES

Criteria

Supplier Presence

Mode 1:

Cross-border

supply

Service delivered within the territory of the Member, from the territory of another Member. The advancement of technology has made this possible. e.g. internet, tele-medicine

Service supplier not physically present within the territory of another Member

Mode 2: Consumption abroad

Service delivered outside the territory of the Member to a service consumer of another Member. It involves the consumer of services traveling to the other country in which the service is produced. e.g. tourism and education services.

Service supplier not physically present within the territory of another Member

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INTERNATIONAL UNION OF ARCHITECTS

Modes of Supply of Services

MODES

Criteria

Supplier Presence

Mode 3: Commercial presence

Service delivered by a service provider of one country through commercial presence in the territory of another Member. e.g. FDIs, bank, hotel, branch office

Service supplier physically present within the territory of another Member

Mode 4: Movement of natural persons

Service delivered by a service personnel of one country who travels to another country to provide the service. e.g. services provided by expatriates, business and professionals and foreign workers.

Service supplier physically present within the territory of another Member

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INTERNATIONAL UNION OF ARCHITECTS

Sector/sub-sector

Limitations on Market assess

GATS Specific commitment by Australia on Architectural Services CPC 8671

Limitations on National Treatment

Additional commitments

d) Architectural Services

1) None

2) None

3) None

4) Unbound, except as indicated in horizontal section.

1) None

2) None

3) None

4) Unbound, except as indicated in horizontal section.

MODES; 1) CROSS BORDER, 2) CONSUMPTION ABROAD,

3) CMMERCIAL PRESENCE, 4) PRESENCE OF NATURALPERSON

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INTERNATIONAL UNION OF ARCHITECTS

Services Negotiations in the WTO

•Services negotiations now focused on improving market access (made under Uruguay Round in 1995). Current round of negotiations is called the Doha Round.

•Developed countries are seeking for ambitious market access commitments in selected services sectors

- want Members to bind existing autonomous liberalisation

- increase existing foreign equity ownership to at least 51%

•Developing countries want:

- progressive liberalisation of services sectors.

- undertake market opening in sectors where they have export interest.

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INTERNATIONAL UNION OF ARCHITECTS

Negotiation Procedure

•Services negotiations in WTO undertaken on “request-offer” approach.

•Based on the principle of progressive liberalisation, commensurate with capacity of industry

•Liberalisation of commitments of members are multilateralised (applicable to all Members).

•Services undertaken through four modes of delivery.

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INTERNATIONAL UNION OF ARCHITECTS

Domestic Regulation

Draft text on disciplines for domestic regulation, dated 23 January 2008, being discussed in WTO and include:

scope of application;

• transparency;

• licensing requirements and procedures;

• qualification requirements and procedures; and

• technical standards.

Disciplines on Domestic Regulation are needed to ensure that domestic regulation does not constitute an unnecessary barrier to trade.

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INTERNATIONAL UNION OF ARCHITECTS

WTO Ministerial Conferences

The Ministerial Conference is the organization’s highest-level decision-making body. It meets “at least once every two years”, as required by the Marrakesh Agreement Establishing the World Trade Organization — the WTO’s founding charter

>Singapore 9–13 Dec. 1996

>Geneva 18 & 20 May 1998

>Seattle 30 Nov–3 Dec 1999

>Doha 9-14 Nov 2001

>Cancun 10-14 Sep. 2003

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INTERNATIONAL UNION OF ARCHITECTS

GATS Timeline

January 2000: Negotiations begin

March 2001: Guidelines and the Procedures for the Negotiations on Trade in Services are adopted

14 November 2001: Doha Development Agenda is adopted

30 June 2002 : Submission of initial requests

March 2003: Deadline for receiving “initial offers”

July 2004: “July Package” resuscitates negotiations and establishes deadline of May 2005 for submission of revised offers

December 2005: Hong Kong Ministerial Conference reaffirms key principles of services negotiations

July 2006: Doha negotiations suspended

January 2007: Resumption of Doha negotiations

May 2008: Report on services issued

July 2008: Services Signalling Conference held as part of “July 2008” package

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INTERNATIONAL UNION OF ARCHITECTS

Requests by Other Countries

•Made during bilateral meetings in May and July 2008

•Australia, Japan, Korea, Canada and Switzerland want further liberalisation under Professional Services: Architectural and Engineering Services and Construction Services.

•Malaysia: Improvements made:

•10% foreign equity in multidisciplinary practices (MDP) firms allowed

•Foreign construction companies not locally incorporated can carry out work on a project-by-project basis with local contractors for projects wholly foreign-financed or 100% Malaysian funded projects where local expertise not available

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INTERNATIONAL UNION OF ARCHITECTS

Malaysia’s Offer @ DOHA

SECTOR

MARKET ACCESS LIMITATION

NATIONAL TREATMENT LIMITATION

Architectural Services (CPC8671)

Mode 1 and Mode 2 : None

Mode 3 (Commercial presence)

(a) may be supplied only by a natural person.

(b) for multi-disciplinary practices, foreign equity up to a maximum 10 per cent for joint-ventures by professionals who are registered in the country of origin. Foreign directorship not allowed.

Mode 4 (Movement of Natural

Persons)

Unbound except as indicated in the horizontal section. In respect of (2b) professionals only an architect who is a consultant to a project in collaboration with a Malaysian professional architect for wholly foreign funded projects.

Mode 1 and Mode 2: Architectural services must be authenticated by a licensed professional architect in Malaysia

Mode 3

(a) None

(b) Unbound

Mode 4

Unbound except for the categories of natural persons referred to under market access.

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INTERNATIONAL UNION OF ARCHITECTS

Sector/sub-sector

Limitations on Market assess

Specific committment by USA on Architectural Services CPC 8671

Limitations on National Treatment

Additional commitments

d) Architectural Services

1) None

2) None

3) Two‑thirds of the officers, partners, and/or directors of an architectural firm in Michigan must be licensed in Michigan as architects, professional engineers and/or land surveyors.

4) Unbound, except as indicated in horizontal section.

1) None

2) None

3) None

4) None

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INTERNATIONAL UNION OF ARCHITECTS

Sector/sub-sector

Limitations on Market assess

Initial Offer by USA on Architectural Services CPC 8671

Limitations on National Treatment

Additional commitments

d) Architectural Services

1) None

2) None

3) Two‑thirds of the officers, partners, and/or directors of an architectural firm in Michigan must be licensed in Michigan as architects, professional engineers and/or land surveyors.

4) Unbound, except as indicated in horizontal section.

1) None

2) None

3) None

4) None

Will consider undertaking commitments for architects similar to those adopted for accountants in the WTO Disciplines in Regulation of the Accountancy Sector (adopted in 1998), if others

do the same.

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INTERNATIONAL UNION OF ARCHITECTS

Sector/sub-sector

Limitations on Market assess

Revised Conditional offer by EC on Architectural Services CPC 8671

Limitations on National Treatment

Additional commitments

d) Architectural Services

1. All Member States except BE, CY, EL, IT, MT, PT, PL, SI: None

BE, CY, EL, IT, MT, PT, PL, SI: Unbound

1. All Member States except AT, BE, CY, DE, EL,IT, MT, PT, PL: None

AT: Unbound except for pure planning services;

BE, CY, EL, IT, MT, PT,PL: Unbound

DE: Application of the national rules on fees and emoluments for all services which are performed from abroad

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INTERNATIONAL UNION OF ARCHITECTS

Sector/sub-sector

Limitations on Market assess

Revised Conditional offer by EC on Architectural Services CPC 8671

Limitations on National Treatment

Additional commitments

d) Architectural Services

0All Member States: None

0All Member States except, ES, FR, IT, PT: None

ES: Access is restricted to natural person

FR: Provision through SEL (anonyme, à responsabilité limitée ou en commandite par actions) or SCP only.

2) All Member States :None

2. All member states except EE: None

EE: None except that at least one responsible person (project manager or consultant) must be resident of Estonia

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INTERNATIONAL UNION OF ARCHITECTS

Sector/sub-sector

Limitations on Market assess

Revised Conditional offer by EC on Architectural Services CPC 8671

Limitations on National Treatment

Additional commitments

d) Architectural Services

3) IT, PT: Access is restricted to natural persons. Professional associations. (no incorporation) among natural persons permitted.

LV: Practice of 3 years in Latvia in the field of projecting and university degree required to receive the licence enabling to engage in business activity with full range of legal responsibility and rights to sign a project

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INTERNATIONAL UNION OF ARCHITECTS

Revised Conditional offer by EC on Architectural Services CPC 8671

Sector/sub-sector

Limitations on Market assess

Limitations on National Treatment

Additional commitments

d) Architectural Services

4) ICT, and BV, CSS and IPs

All Member States except CY, LT, LV, PL: Unbound except as indicated in the horizontal section and subject to the following specific limitations:

AT: For CSS and IP, unbound execept for pure planning services

FI: For CSS and IP, the natural person must demonstrate that s(he) possessess special knowledge relevant to the service to be supplied

4) ICT, and BV, CSS and IPs

All Member States except CY, FI, LV, MT, PL: Unbound except as indicated in the horizontal section and subject to the following specific limitations

EL, CZ, HU, IT, PL, SK: Residence requirement (only for ICTs in EL)

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Liberalisation of Architectural Services
Pertubuhan Akitek Malaysia [PAM]

WTO

through progressive liberalisation [General Agreement on Trade in Services- GATS]

- started in 2001 and still committed to better the offer,

- to be undertaken through 4 Modes of delivery; - M1 [cross border trade]

- - M2 [consumption abroad]

- - M3 [commercial presence]

- - M4 [movement of natural person]

ASEAN

-through ASEAN Framework Agreement on Services - AFAS

-

- AFAS 5 to be completed by end of 2008

- Equity targets under delivery Mode 3 - 49% by 2008,

- 51% by 2010,

- 70% by 2015

NOTE: Government has requested response [nov 2008] from stake holders if it were to open up with equity at 100% by 2012 in ASEAN

Bilateral & Regional Free Trade Agreement - FTA

- through binding of commitments in GATS

Status of Current Commitments
Services Sector is undertaken in;

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Liberalisation of Architectural Services
Pertubuhan Akitek Malaysia [PAM]

Status of Current Commitments
Bilateral & Regional Commitments;

Free Trade Agreements [FTA]

ASEAN - China [came into force 1 Jul 2003, signed 14 Jan 2007]

ASEAN - Korea [came into force 1 Jul 2006, signed 21 Nov 2007]

§ ASEAN - Australia - New Zealand [to be concluded in Dec 2008]

§ Malaysia - Australia [under negotiation]

§ Malaysia - New Zealand [under negotiation]

§ Malaysia - Chile [under negotiation]

§ Malaysia - India [under negotiation]

§ Malaysia - Pakistan [under negotiation]

§ ASEAN - Japan [under negotiation]

§ ASEAN - India [under negotiation]

§

§Mutual Recognition Agreements [MRA]

with ASEAN countries [mandate given 5 Nov 2001, signed 19 Nov 2007]

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Liberalisation of Architectural Services
Pertubuhan Akitek Malaysia [PAM]

ASEAN Architects Council [AAC]

•Malaysia initiate formation of AAC

•Malaysia is bidding to host inaugural AAC secretariat [AACS]

ARCASIA [Non-Governmental Organisation]

•Council of ARCASIA consists of all the presidents of 17 members institutes in Asian Region

Meet annually to deliberate common issues and collective directions

•Malaysia chaired

Ar Dato’ Dr Kenneth Yeang Chairman (1987-88)

Ar Dato’ Haji Esa Mohamed Chairman (1995-96)

Ar Datuk P Kasi Chairman (1999-2000)

APEC Architect [on volunteer basis]

•Malaysia is a founding member of Steering Committee, Provisional Council, and Central Council

•LAM hosted and PAM supported Second Steering Committee Meeting in year 2002

1. Participations by LAM / PAM

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3. PAM's Strategic Planning

Liberalisation of Architectural Services
Pertubuhan Akitek Malaysia [PAM]

s1. Review / update on the Current Status & Commitments

Prmoting the adoption of the UIA Accord

s2. Identify & amend related domestic regulations

s3. Identify Opportunities in other Countries / Economies

networking and cooperation with other foreign architects

s4. Identify Opportunities in Areas of Expertise

Examples

Housing ° Timber Construction

• Town Planning ° Project Management, etc

• Sustainable design ° Energy Efficient technologies

s5. Identify incentives & cooperative efforts with governments

Examples

tax exemption, export promotion funds

• Professional Services Development Corporation (PSDC)

• National Professional Services Export Council (NAPSEC)

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Liberalisation of Architectural Services
Pertubuhan Akitek Malaysia [PAM]

s6. Promotions to create strong presence & opportunities

§Hosting International Events Locally; Architects Convention Regional Meetings; ARCASIA, ASEAN Architects, APEC Architect Project

§Publications; Architects Malaysia [every 2 months] , Architects Asia [every 4 months]

§participations in international organisations, exhibitions, competitions

§participations of well known architects in locally organised competitions

§participation in the relevant international events / projects ; Architectural Biennale - Venice Biennale [ arts & architecture ] as well as with government agencies

§parallel projects with government agencies participating in international events

§Participations in Trade Mission organised by government and government agencies

§Establish information & network centre

§

§s7. Capacity Building -capability , resources [quantity] & financial

§

§s8. Establish & monitor Milestones up to 2015

§Identify list of tasks under each strategies for each milestones

§

3. PAM's Strategic Planning

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INTERNATIONAL UNION OF ARCHITECTS

FREE TRADE AGREEMENTS

NAFTA : North American Free Trade Agreement

NAAEC : North American Agreement on Environmental Cooperation

NAALC : North American Agreement on Labour Cooperation

: North American Community

CAFTA : Central American Free Trade Agreement

EFTA : European Free Trade Association

Trans Atlantic Agreements

MARRAKECH, 12TH, DECEMBER, 2008

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INTERNATIONAL UNION OF ARCHITECTS

WAY FORWARD

1. PROMOTE THE ADOPTION OF UIA ACCORD.

ENGAGE MEMBERS OF THE MEMBER SECTIONS ON THE VIRTUES OF THE ACCORD AND IMPACTS OF GATS.

ENGAGE REGULATORS ON THE WORK OF UIA PPC AND THE ACCORD;- EDUCATION, VALIDATION, INTERNSHIP, LICENSURE, CAPACITY BUILDING.

BRIDGING THE GAP BETWEEN REGULATORS AND TRADE REPRESENTATIVES, MINISTERIES, ETC.TO NEUTRALISE THE EFFECTS OF THEIR NEGOTIATIONS ON ARCHITECTS

PROMOTE MRA BETWEEN MEMBER SECTIONS BY REGIONS.

MARRAKECH, 12TH, DECEMBER, 2008

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INTERNATIONAL UNION OF ARCHITECTS

THANK YOU

MARRAKECH, 12TH, DECEMBER, 2008