Much has changed since CompuServe introduced its “Electronic Mall” as the first major retail e-commerce platform in 1984. Digital technologies have driven down costs and improved access and opportunities for producers and consumers, manufacturers and farmers, and above all, users. Digital technologies have transformed how a large part of the global economy operates. A broad range of goods are now digital and thereby intangible, being made up of bytes. Likewise, many services that previously required costly face-to-face contact between the firm and consumer are now available remotely.

Technology has opened international trade – in the form of e-commerce – to a broad range of firms and sectors that beforehand would have been the sole domain of larger multinational companies. Most importantly, technology and the Internet reduced the transaction costs and information asymmetries associated with international trade. Social networks like Facebook and Twitter and search engines like Google and Bing give large and small businesses alike easy ways to advertise services to people around the world.

This chapter elaborates on the relationship between digital services and the GATS. First, the characteristics of the GATS are explained, including the recognised four modes to supply services, the specific commitments WTO Members have included in their Services Schedules and how this impacts the Members’ obligations under this agreement. Digital services are not explicitly referred to in the GATS, but through an analysis of the scope of the GATS, this chapter explains why measures that affect digital services trade are covered by the GATS. Moreover, electronic delivery of services fits within the four modes of supply as recognised within the GATS. The chapter also elaborates on the principle of technological neutrality and how it applies to the GATS. Finally, the chapter discusses the work that has been undertaken by WTO Members in the context of the Work Programme on Electronic Commerce, which was established in 1998. The lack of substantive progress in the context of this Work Programme illustrates the divergent positions of WTO Members on digital issues.

This chapter discusses the classification of digital services using the GATS services classification system. The chapter first elaborates on how services are classified under the GATS and the role of the evolutionary approach, the customary rules of treaty interpretation, the existence of integrated services and the focus on outputs. The chapter subsequently distinguishes between three classification methodologies (the textual approach, the component-based approach and the teleological approach) and explains why the technological approach to services classification is preferable. The teleological approach is then applied to examples of both digital infrastructure services and digitally enabled services. The chapter elaborates on the distinction between transmission and content, the confusion on how to classify ‘new’ services and the misplaced focus on the service suppliers’ revenue source. This chapter thereby proposes a clear and consistent classification methodology that allows for straightforward classification of digital services.

The chapter starts Part III of the book, which concentrates on empirical study of services agreements. It explains earlier empirical research on services preferentialism and shows how the empirical methodology proposed in this book differs from such earlier works.

The chapter provides an introduction to the entire book. It starts by explaining the basic purpose and motivation behind the book and then provides a short summary of the contents of the book.

The chapter concludes by summarizing the key findings of the book and reminds of the relevance of the topic and the conclusions in the international trading environment of today.

The chapter puts forward a new methodology to study services commitments of preferential trade agreements. The method is suitable for all services agreements but is particularly applicable for the analysis and coding of services commitments by federal states and entities. The method is based on the legal criteria of Art. V GATS, as explained in previous Chapter 2 of Part I of the book.

This chapter takes stock of the dense network of trade agreements in services that has evolved in the East Asian region, and considers some of its prospects in the wake of the withdrawal of the United States from the TPP negotiations. Perhaps surprising for a region associated with booming economies, trade agreements in Asia have not always been driven by economic considerations. At the same time, it remains unclear if services trade has been as much a factor in trade agreement formation as in other regions. Based on DESTA data, the chapter shows that services trade (at least in its cross-border and consumption abroad modes) and PTA formation go hand-in-hand in Asia as well, even though the panoply of agreements remains divided by two different and possibly incompatible approaches, as some countries prefer positive lists and others prefer negative lists. With the United States choosing to withdraw from regional PTA projects for the time being, the positive-list approach looks to be the most common in the near future, while liberalization prospects may be limited.

After three decades of companionship, investment protection rules and trade agreements are heading for a divorce. Investment chapters have been included in preferential trade and investment agreements (PTIAs) since the late 1980s, but they have recently come under fire. The U.S. administration considers privately enforceable investment protection obligations as an unwanted incentive to offshore American jobs, and the EU Commission seeks to omit them to benefit from the accelerated ratification process reserved for trade agreements that fall under exclusive EU competency. After decades of coexistence, investment protection rules and trade agreements are thus likely to go their separate ways. This chapter empirically evaluates the impact of their thirty-year companionship to assess the implications of their looming split. It finds that investment chapters remain little more than a bilateral investment treaty plugged into a trade agreement. PTIAs and self-standing investment treaties do not vary systematically in investment protection content, and the wider trade agreement context does little to affect the interpretation of investment rules in PTIAs. In spite of their coexistence in the same treaty, there is thus little evidence of cross-fertilization between trade and investment protection rules in PTIAs. This absence of normative convergence suggests that their looming split merely formalizes the continuous normative distinction between trade liberalization and investment protection.