The capacity of a firm or country to sell products and services across borders refers to market
access. In local and foreign trade market access can be utilized, even if the latter is the more
usual situation. Free-trade access to the market is not the same as the market access.
The opportunity to commercialize in the market is typically coupled with taxes, levies or
even quotas, but free trade involves the cross-border movement of products and services
without governmental additional charges. However, market access is considered an early
stage in establishing commercial links. In contrast to genuine free trade, the declared
objective of trade talks is increasingly market access.
In the era of globalization international trade has become the most significant part in terms of
accumulating of global wealth by different countries. International trade is the trade between
two countries or more countries wherein these countries enter into an agreement to carry on a
trade between them. This agreement involves complex negotiations amongst the most
important is of the market access. Countries no more follow free trade practice as they have
recognized it has a threat to their domestic producers or industries and have instead shifted to
negotiate in terms of market access.
During all these negotiations, the parties usually advocate market access to their export
sectors while seeking to restrict market access to import items that could be competitive with
sensitive or politically strategic domestic businesses. Market access is regarded as separate
from free trade as the negotiating process is targeted towards profitable commerce that may
not require further free trade.
The World Trade Organization is an international organization that regulate trade between
trade agreements and disputes or negotiations arising out of those trade agreements between
its member countries. All the above-mentioned negotiations take place on a platform set up
by the WTO.
GATS is the only multilateral trade agreement that governs the flow of services between the
member countries of WTO. The agreement covers the following 4 modes of supply related to
services:
1. Cross-border provision is designed to encompass the flow of services into other
Member territory (e.g., bank services or architecture sent by telecommunications or
mail) from one Member's territory to another;
2. Consumption abroad refers to circumstances in which the consumer of a service (e.g.
the tourist or sick) enters the territory of another member for a service;
3. Commercial presence indicates that a service provider of one member creates a
territorial presence in another member's area in order to provide a service, including
through ownership or rental of buildings (e.g. hotel chains, etc.)
4. The presence of natural persons consists of persons from one member visiting another
member's territory to provide a service (e.g. accountants, doctors or teachers).
However, it is specified in the Annex on the Movements of Natural Persons that
members are free to take permanent actions on citizenship, residency, or access to the
labor market.
Market access in respect of trade in services is stated in Article XVI of General Agreement of
Trade in Services also known as GATS 1995. Access to the market in specific areas is a
negotiated obligation. The provisions of Article XVI may be subject to different kinds of
constraints (2). The number of service providers, services businesses and workers involved,
the number of transactions, the legal structure of the service supplier or the participation of
foreign capital, for instance, may be subject to limits.
Each member of the WTO must establish a schedule of special commitments identifying the
services for which it ensures market access, national treatment and any other restrictions.
Additional undertakings in respect, for instance, of adoption of certain standards or regulatory
principles may also be made under the schedule of specific commitments. Commitments are
made to each of the four main service delivery type as mentioned above.
CONCLUSION
Market access is the most important area that needs negotiation on the service trade
agreements entered into by the member nations or governments with respect to trade in
services. There is a specific provision related to Market Access specified under Article XVI
of the GATS agreement. Countries no more follow free trade practice as they have
recognized it has a threat to their domestic producers or industries and have instead shifted to
negotiate in terms of market access.
