ANNEX H:

FINANCIAL SERVICES

I.  BANKING, SECURITIES AND RELATED FINANCIAL SERVICES

SUMMARY

Stability of domestic financial markets is reinforced by the healthy participation of local and

international firms on a non discriminatory basis who are equally encouraged to invest capital,

talent and technology in environments marked by regulatory strength and transparency. In order

to take advantage of the significant contribution financial services can make to all sectors in

countries' economies, negotiators should achieve substantive commitments for cross border and

local presence activities consistent with the following goals:

Remove barriers to establishment by foreign investors in the financial sector and allow

competitive operations through wholly owned subsidiaries, branches or other forms of

presence. Remove "economic needs tests" and other geographic or product specific

restrictions.  Commit to grandfather existing investment in operations and activities.

Schedule commitments to support financial services provided cross border without local

establishment and by consumption abroad.

Schedule commitments to facilitate the temporary entry of key financial services

personnel required for managerial, technological, systems or risk managements purposes.

Schedule commitments to support the provision and transfer of financial information,

financial data processing and the provision of advisory and software related services.

In addition, the countries should take into account the following forward looking factors which

should be reflected increasingly in the formulation of commitments:

Schedule strong commitments to ensure market access and national treatment for asset

management and pension fund services provided by the full range of financial services

firms.

Remove discriminatory treatment of capital requirements applied to foreign bank

branches.

The attached sections from the Financial Leaders Group's paper on Trade Barriers in Banking,

Securities, and Other Related Financial Services and Commentary on Proposals for

Liberalization in Financial Services examine sectoral negotiating priorities in greater detail.

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