ASEAN FRAMEWORK AGREEMENT ON SERVICES (AFAS)

NOTE ON THE MEETING OF 17 JUNE 2025

Chairperson: H.E. Mr José VALENCIA (Ecuador)

1.1.  The 113^th Session of the Committee on Regional Trade Agreements (hereinafter "CRTA" or the "Committee") was convened in Airgram _WTO/AIR/RTA/39/Rev.1 dated 6 June 2025.

1.2.  Under Agenda Item 7.1, the CRTA considered the ASEAN Framework Agreement on Services, (AFAS). The Chair stated that the Factual Presentation had been prepared by the Secretariat on its own responsibility in full consultation with the Parties, in accordance with paragraph 7(b) of the Transparency Mechanism for Regional Trade Agreements (document _WT/L/671).

1.3.  The Agreement had entered into force on 12 August 1998. The Parties had notified the Agreement to the WTO on 21 December 2022 under Article V:7(a) of the GATS as an agreement establishing a free trade area in services (document _S/C/N/1125). The text of the Agreement, the Annexes, and any follow-up Protocols were available on the Parties' official websites and in the WTO RTA database. The Factual Presentation (document _WT/REG457/4) and the Questions and Replies (document _WT/REG457/5) had been distributed.

1.4.  The representative of Malaysia, speaking on behalf of the ASEAN member states, delivered the following statement:

1.5.  Thank you Chair for the floor. As Malaysia assumed the role of ASEAN Chair for 2025, I am honoured to deliver this statement on behalf of the ASEAN member states, namely Brunei Darussalam, Cambodia, Indonesia, Lao PDR, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Viet Nam. Chair, firstly we would like to commend the WTO Secretariat's effort in the preparation of the Factual Presentation on ASEAN Framework Agreement on Services (AFAS). ASEAN highly appreciates the Factual Presentation, as it provides a clear and comprehensive overview of the Agreement. The Secretariat's work affords a solid basis for understanding AFAS within the broader context of regional trade agreements and multilateral trade rules.

1.6.  On this note, let me share a brief background on AFAS and the benefits it brings to the region. AFAS, signed on 15 December 1995, covers 12 broad services sectors aimed at enhancing regional cooperation, improving competitiveness, and liberalising trade in services within ASEAN. Services liberalization under AFAS follows a "positive list" approach similar to the GATS. Commitments have evolved through successive rounds of negotiations, expanding sectoral coverage and reducing trade barriers. Liberalisation was carried out through successive packages of commitments, with ten packages concluded to date along with additional sector‑specific packages in financial and air transport services. Over the years, AFAS has significantly deepened ASEAN's economic integration by enhancing competitiveness, expanding market access, promoting intra-ASEAN investment, creating jobs, and strengthening regulatory cooperation. It has also improved ASEAN's global positioning and acts as a catalyst for innovation and digital transformation. This progress laid a strong foundation for deeper integration through the eventual transition to the ASEAN Trade in Services Agreement (ATISA), which entered into force in 2021.

1.7.  During the preparation of the Factual Presentation, ASEAN has also provided collective comments to ensure factual accuracy, particularly regarding the legal status of AFAS, implementation modalities and institutional arrangements. ASEAN would like to express its appreciation to China for its interest in AFAS and acknowledges China's written questions. ASEAN welcomes the constructive dialogue and would like to share that we've provided a coordinated response to those questions. At this critical juncture where global trade remains uncertain, the ASEAN member states in Geneva reaffirm ASEAN's strong commitment to the rules-based multilateral trading system. We view AFAS as an example where collective liberalisation and regional cooperation complements and reinforces the global effort towards progressive liberalisation of trade in services under the WTO framework.

1.8.  The representative of Malaysia delivered the following statement in her national capacity:

1.9.  Thank you Chair, please allow me now to deliver a statement in my national capacity. For Malaysia, AFAS has been a pivotal instrument in our economic development. It has systematically opened up services markets across ASEAN, providing Malaysia's service providers with enhanced market access in various sectors and attracting crucial foreign investment and expertise. This has boosted the competitiveness and efficiency of our enterprises, particularly SMEs, and facilitated the mobility of skilled professionals, leading to improved service quality and innovation across the region.

1.10.  Presenting AFAS at the WTO is a strategic contribution to strengthening the multilateral trading system. It enhances transparency and predictability, allowing all WTO Members to understand the evolving landscape of regional services trade. AFAS showcases how regional blocs can forge deeper commitments, generating best practices and insights that can inform future multilateral negotiations. Ultimately, AFAS serves as a compelling example of successful regional economic integration in services where our regional efforts are outward-looking. By sharing our experiences, Malaysia aims to contribute to a more transparent, predictable, and ultimately stronger multilateral trading system that benefits all. Thank you.

1.11.  The representative of China indicated the following:

1.12.  We thank the ASEAN member states for their responses to China's written questions and in particular for sharing with us their valuable experience in transitioning from the request‑offer approach to the use of a quantitative threshold in the negotiation process, which has notably enhanced the efficiency and the practicality of the negotiation. We sincerely look forward to deepening cooperation with ASEAN member states in the field of trade in services and beyond, jointly upholding and advancing free trade and ejecting greater certainty into the global trade. Thank you.

1.13.  The representative of the European Union noted the following:

1.14.  The EU would like to thank the WTO Secretariat for preparing this Factual Presentation and the Parties for the comprehensive information and transparency provided. According to the Factual Presentation, the new ASEAN Trade in Services Agreement (ATISA) entered into force in April 2021 and builds on the AFAS (ASEAN Framework Agreement on Services), which is under consideration today. We would appreciate if members could provide more information on the transition from the Parties' commitments under AFAS to ATISA and what are the new elements?

1.15.  The representative of Malaysia delivered the following statement:

1.16.  Thank you Chair for the floor. ASEAN appreciates Members' interest to engage with us, and with regard to the EU's question, I wish to share the following:

1.17.  It is important to note that the transition from AFAS to ATISA marks a significant step forward in ASEAN's services liberalization agenda. In principle, the ATISA, signed in October 2020 and effective from April 2021, aims to deepen the integration and liberalization of services sectors across the region. AFAS operated primarily under a "positive list" approach. Hence, while AFAS achieved significant progress through its various commitment packages, this approach led to a lack of transparency and predictability, as well as less clarity for service suppliers. The move to ATISA was driven by the desire to further enhance services integration and address the limitations of the positive list approach. The ASEAN Economic Community (AEC) Blueprint 2025 specifically called for broadening and deepening services integration, leading to the negotiation and eventual signing of ATISA. Currently, the ASEAN member states are now in the process of transitioning their existing commitments under AFAS, which were based on a positive list, into schedules of non‑conforming measures under ATISA's "negative list" approach. The ATISA provides a legally binding guarantee of the widest preferential services market access into ASEAN markets to date, building upon and superseding AFAS.

1.18.  In conclusion, ATISA represents an evolution of ASEAN's commitment to services liberalization, moving from a "positive list" approach to a more transparent and predictable "negative list" approach, that reflect ASEAN readiness to subscribe the best practices in trade in services agreements. Last but not least, Malaysia and other ASEAN member states are ready to further engage with the EU and other interested party on this matter, and we are glad to provide more detailed response if required. Thank you.

1.19.  The representative of Cambodia delivered the following statement:

1.20.  Good morning, colleagues. First of all, Cambodia would like to align itself with the statement delivered by Malaysia on behalf of the ASEAN member states. We would like to express our appreciation to the Chair for convening this 113^th session of the CRTA. We also thank the Secretariat for the preparation of the Factual Presentation on the AFAS. We also wish to recognise the interest of China by sending the questions where ASEAN has also comprehensively responded in written. Similarly, we thank our colleagues from the EU for their question, which our colleague from Malaysia has also comprehensively clarified just now.

1.21.  Cambodia is pleased to highlight that under AFAS, we have made notable progress in the liberalisation of the trade in service. Compared to our GATS commitments, Cambodia has expanded and deepened its commitments across several sectors, particularly in business, communication, education, and transport services. We have also enhanced commitments on the movement of natural persons, aligning with ASEAN objectives of deeper regional integration. We reaffirm our commitment to the ongoing transition to the ASEAN Trade in Service Agreement, which builds upon AFAS, and look forward to continuing collaboration among ASEAN members and with other partners under the multilateral trading system. Thank you.

1.22.  The representative of Singapore delivered the following statement:

1.23.  Thank you, Chair. Singapore associates with the statement made by Malaysia on behalf of ASEAN. Allow me to make three points. First, Singapore expresses its appreciation to the Secretariat for preparing the Factual Presentation and playing an important role in the upkeep of the transparency mechanism on RTAs.

1.24.  Second, the ASEAN Framework Agreement on Services is a key pillar of economic integration within the region. Through its successive negotiation packages, AFAS has progressively and substantially removed restrictions on market access, encouraging greater cross‑border supply of services. In particular, AFAS has enhanced access to the ASEAN market for regional service providers including in sectors such as finance, telecommunications and professional services. With its regional coverage, AFAS fosters greater predictability and stability for ASEAN businesses to transact with one another, to bolster collaboration and partnerships.

1.25.  Third, Singapore remains committed to working with ASEAN member states on further regional economic integration as well as other WTO Members to strengthen the multilateral trading system with the WTO at its core. In this regard, the ASEAN Trade in Services Agreement (ATISA), signed in 2020, is the "successor" of the AFAS and is the first ASEAN agreement where all ASEAN member states adopted a negative-list approach. It represents the next bound of rules-based services cooperation in ASEAN. Moving forward, we hope to continue working with ASEAN member states to effectively implement the ATISA, which will allow businesses better engage in services trade in the region. Thank you.

1.26.  The Chair noted the consideration of the ASEAN Framework Agreement on Services had allowed the Committee to clarify a number of questions and concluded oral discussion of the RTA in accordance with paragraph 11 of the Transparency Mechanism. Any delegations wishing to ask follow-up questions were invited to forward submissions in writing to the Secretariat by 24 June 2025 and Parties were asked to submit replies in writing by no later than 8 July 2025. In accordance with paragraph 13 of the Transparency Mechanism all written submissions, as well as minutes of the meeting, would be circulated promptly, in all WTO official languages, and made available in the WTO database on RTAs.

1.27.  The Committee took note of the comments made.

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