ASEAN Framework Agreement on Services
[AFAS]
The AFAS was signed by ASEAN Economic
Ministers [AEM] with the objectives of:
Enhance co-operation in services among
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Member States in order to improve the
efficiency and competitiveness, diversify
production capacity, and supply and
distribution of services within and outside
ASEAN.
Eliminate substantially restrictions
●●
to trade in services among Member
Countries.
Liberalise trade in services by expanding
●●
the depth and scope of liberalisation
beyond those undertaken by ASEAN
Member Countries under GATS with
the aim of realising a free trade area in
services.
AFAS has provided a basis for ASEAN Member
States to improve Market Access [MA] and ensure
equal National Treatment [NT] for service suppliers
in all four modes of services supply.
The four modes of supply are:
Mode 1 [Cross Border Supply], meaning
●●
services flow from the home Country into
the country of another.
Mode 2 [Consumption Abroad], meaning a
●●
service consumer from the home country
moves into another country to obtain
service.
Mode 3 [Commercial Presence], implying
●●
a service supplier from another country
establishes a territorial presence,
including through ownership or lease of
premises, in the home country to provide
a service.
Mode 4 [Movement of Natural Persons],
●●
meaning persons of one Member Country
entering the territory of another Member
Country [the home country] to supply a
service.
ASEAN liberalisation targets for AFAS has
suggested the following specific equity thresholds
under Commercial Presence [Mode 3]
Priority Sectors:
49% by 2006, 51% by 2008,
70% by 2010
Non-priority Sectors: 30% by 2006, 49% by 2008,
51% by 2010, 70% by 2015
Engineering Services
Engineering services is categorised as non-priority
sector.
ASEAN provided for 15% overall flexibility of the
sub-sectors list, which may not be committed and/
or may not comply with the agreed parameters of
liberalisation.
ASEAN through AEM also agreed that Market
Access [MA] limitations for a few sub-sectors
in the schedules of commitments can still be
maintained, such as a maximum of two types of
MA limitations for priority services sectors.
It should also be noted that AEM has also
agreed that NT limitations will be removed on a
volunt