§ Lord Kennetasked Her Majesty's Government:
What are the implications for the British and European Union sovereign decision-making of the Global Open-trade Pact in Banking, Insurance and other Financial Services, currently being negotiated in Geneva.
§ Lord McIntosh of HaringeyWTO negotiations on trade in financial services were successfully concluded last weekend. Participating countries have agreed to legally binding and permanent, non-discriminatory commitments in respect of access to their markets for banking, securities and insurance.
Under EC and member states' existing GATS Most Favoured Nation (MFN) commitments, it is no longer possible to invoke EC or national provisions to limit access by financial service suppliers from third countries on the grounds that access into those third countries is more restricted or less favourable than that into member states.
108WAAlmost all other countries which have made financial services commitments in the WTO have done so on a similar MFN basis. This will create new certainty for financial services suppliers, and provides a solid foundation for developing open and competitive markets in the future.
The GATS does not prevent countries from taking measures for prudential reasons, or to ensure the integrity and stability of the financial system.