The Nature and the Scope of MFN Obligation under GATS

The General Agreement on Trade in Services (GATS) is one of the WTO agreements that regulates trade in services among members of WTO. WTO recognized the important role of services in the global economy by adopting the GATS, which is the first and the only multilateral agreement covering international trade in services. One of the basic principles of WTO and GATS is Non-Discrimination principle. Non-Discrimination under the GATS consists of two elements; Most-Favored-Nation (MFN) and National Treatment (NT) obligations. Article II of the GATS enshrines the MFN obligation which requires no less favorable treatment among different WTO Members than that is accorded to like services or service suppliers of any other country. This treatment shall accord immediately and unconditionally. A Member may maintain a measure inconsistent with MFN provided that such a measure is listed in and meets the conditions of the Annex on Article II Exemptions. MFN, also, has some exemptions which stipulate the GATS provisions. The general exceptions justifying discriminatory measures contained in Articles XIV and XIV bis of the GATS, apply to general obligations and specific commitments. Additional exemptions to the MFN obligation are scattered across the GATS and will be discussed separately in this study.