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The Doha round of negotiations for the WTO had a focus on services, but that round has not been concluded.

Does that mean that trade in services between trading partners without a preferential trade agreement in place, for example the EU and the USA is effectively prohibited? Or legislated for on a case-by case basis?

Or is trade in services effectively unaffected by the traditional tariff model of the WTO?

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Trade in services is typically restricted by non-tariff barriers. Examples might include:

  • Restrict professional service provision to your citizens and graduates of your universities, passing your qualifying exams
  • Restrict public procurement to companies owned by citizens of your country, staffed by your citizens and with staff cleared by your security services
  • Restrict road and sea transport to vehicles and vessels registered in your country using crews based on your citizenship
  • Require international banks and insurance companies to comply with your regulations and deposit reserves in your central bank and buy your government debt
  • Require service providers to have local subsidiaries incorporated and locally controlled in your country rather than branches controlled from their home county
  • Require companies providing services in your country to comply with your environmental regulations outside your country
  • Prevent third-country carriers from providing air services within or to/from your country
  • Prevent information technology companies from transferring data across borders
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    $\begingroup$ Thanks. So services are typically exempt from MFN rules because they do not accrue tariffs in the same way? $\endgroup$ – Ben May 5 at 23:07
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    $\begingroup$ @Ben In the US, lawyers from many states cannot practise in others, though some states have reciprocity agreements. So in that example there is not even MFN status for services within a single country $\endgroup$ – Henry May 5 at 23:33
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    $\begingroup$ Thank you. Do you know if there are agreements in place between the EU and the US to facilitate trade in services? There is no FTA, but perhaps there might be individual separate agreements? $\endgroup$ – Ben May 5 at 23:51
  • $\begingroup$ There are some, such as the EU–US Open Skies Agreement $\endgroup$ – Henry May 6 at 6:19
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It's definitely not prohibited; the US-EU trade in services is worth some $200 billion (each way).

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    $\begingroup$ I’m trying to understand the state/bloc interventionism in the trade of services. In goods it is simpler. Tax the physical import and export of something. But do states/blocs control the purchasing of insurance or the sale of consulting services? Or is this left to individual companies and to decide whether to purchase services according to need? Countries are protectionist about goods: are they protectionist about services and do MFN rules apply to services? $\endgroup$ – Ben May 5 at 21:39

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