Friday, 11 April 2008

Wild Thoughts of a WTO Imperialist

As it's often said among the trade law circle, "anyone who reads GATT is likely to have his sanity impaired." To give an example to the dear readers of the blog, or at least those who still have their sanity intact, I would like to refer to some discussion we had at the International Economic Law and Policy Blog on the relationship between Olympic Boycott and WTO.

Enjoy, but I should say that this is not for the faint-hearted and please do stop when you feel that your sanity is at a dangerously low level (hint: the earliest sign of this is when you start to wonder which CPC number this could be classified under or which mode of supply this would fit).

Since I already made my disclaimer, don't blame me if this does cause some harm on you: blame the "evil" WTO instead!

An Olympic Boycott and the WTO

All the recent talk about a boycott of the Olympics, or the opening ceremonies at least, has me wondering:  Is there a WTO violation here? My guess is no, but I have more questions than definite answers.  Some questions:

-- First, services seems like the most promising place to look, but what is the service to be considered here?  Given that the athletes would be boycotting, is the proper UN CPC category "Services of athletes"?

-- What mode of service supply is involved?  My first thought was that it would be the movement of natural persons, with non-Chinese athletes providing their services in China, to the Olympic games themselves.  But maybe the services are really being provided to the fans, Chinese and non-Chinese, in China and elsewhere.  In that case, the mode could be consumption abroad or cross-border trade.

-- Would these services benefit from the exception for "services supplied in the exercise of governmental authority"?  Governments do have a fairly important role here, after all.

-- And, of course, the most important question:  Have the potential boycotting governments made any commitments in their GATS Schedules that would be relevant here?  I'm having a hard time with this part, in particular relating the actual services supplied to possible commitments that might have been made.

That's as far as I got with the analysis before my head started to spin.  Anyone with clearer thoughts on this should feel free to set me straight. 


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Simon, I have to ask, what's the goal here and in similar posts? Is this just a fun intellectual exercise or do you actually think that we should seek to interpret WTO agreements in ways they were never intended and into realms that were never considered at a time when the global trading system is in such poor public repute.

It might be fun to think this puzzle though, but in reality the WTO says nothing about Olympic boycots nor should we try to force it to.

I guess Judah's answer is "no".

I would also be inclined to say no, the main problem being that the athletes are amateurs, and not professionals. I know that there are billions on corporate money involved in the Olympics, but I do not think the amateur athletes themselves are "service suppliers" within the meaning of the GATS, because of their amateur status.

As atheletes don't get "paid" for any services rendered, it stands to reason that they are not providing any services.


It's just some idle speculation. I suppose it's possible that by posting on topics like this, others might pick up on the ideas and they might spread. But generally speaking, I figure that these ideas are not that original -- others will have thought of them, too. Also, I would be very surprised if any government actually brought a complaint as a result.

At the same time, I think it's worth noting that the WTO contains some general principles that could be applied to areas that may not have been intended to be included by the original drafters.

With regard to whether athletes get paid, it's true that they don't get paid directly by the Olympic organizers. They do get medals for winning, though. Also, don't some countries give money to athletes who win medals? Would this affect the analysis?

While I agree that it's hard to find a trade angle to such problems, I don't think Simon's inquiry is frivolous for the following reasons:

First, to start with, it's much better that people try to resolve their differences through the WTO dispute settlement system rather than attempting to use other alternatives, such as war. Even though people also fight with each other in WTO proceedings, they do so in a much more civilized manner.

Second, the fact that the Olympic Games are never intended to be covered by the GATS is irrelevant. Accordingly to the sacred teachings of the AB, we should try to look at the plain meaning of the words and intentions generally don't matter. That's why the US is found to have scheduled gambling services even though it protested that it never intended it as the word "gambling" is never mentioned in its schedule! Same applies to the accounting rate regime of Mexico. At least with regard to services, you see more and more attempts by countries to stretch other Members' GATS commitments beyond recognition, with the case against China on financial info services being another example.

Third, I think a case can be made here saying that the Games are covered by the GATS. The sectors immediately come to mind are sporting and other recreational services, while entertainment services is another possibility.

Fourth, I don't think the question of payment matters. Google doesn't charge people for using their web search service, but that doesn't prevent people from treating the blockage of Google in China as a services issue. Even if we think the payment question is relevant, the focus should be on the deal between the athletes (or rather the governments behind them) and China (think about a customer who demolished his house in the hope that the contractor will rebuild it but this never happened), or maybe the focus should be the hotel operators in China and the foreign governments (prohibition of Mode 2)? I also start to lose my sanity here but this is still very entertaining…

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