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Banking and investment services: WTO financial services deal

United Kingdom
10/02/1998
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WTO financial services deal

Agreement was reached in Geneva on 13 December 1997 to liberalise the world-wide financial services sector. The new pact should make it easier for banks, insurers, brokers and other financial services providers to set up foreign subsidiaries, and more difficult for governments to impose regulations that favour local rivals. Pressure on the US and the Far Eastern financial crisis both helped seal the pact.

The intention is to create a predictable and transparent international regime for financial service companies, insurance houses and banks.

According to US estimates, the agreement covers services involving US$ 18 trillion (ECU 16 trillion) in global securities assets, $38 trillion in global bank lending and about $2.5 trillion in world-wide insurance premiums.

Meanwhile, the Council has signed up to the Fifth Protocol to the WTO General Agreement on Trade in Services (GATS), one of the agreements constituting the WTO intended to contribute to the liberalisation of world trade. The Fourth protocol applying the GATS to telecommunications services was agreed in early 1997.

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