GATS' Prudential Carve Out in Financial Services and Its Relation with Prudential Regulation
International and Comparative Law Quarterly, Vol. 57, pp. 613-648, July 2008
36 Pages Posted: 12 Mar 2009 Last revised: 12 Jan 2012
Date Written: June 1, 2008
The General Agreement on Trade in Services (GATS) has been the leading force of trade liberalization in services. This article attempts to decipher the implications of GATS in financial services. It explains the schedules of commitments made by Member States, and the way countries engage in commitments in financial services. These are critical in understanding how the GATS rules are applied by each Member, and whether GATS has been effective.
The so-called 'prudential carve out' is analysed in detail with consideration to the general prudential regime of the financial system since it has implications for the stability and integrity of the financial system. The article concludes with some policy analysis on how prudential carve out might be better implemented.
Keywords: WTO, prudential regulation, financial services
JEL Classification: F13, G20, K23
Suggested Citation: Suggested Citation