Trade Law and RTE
Pursuing free trade in the education sector requires dealing with education according to trade law principles. This conflicts with the protection of the right to education in international human rights law. Nearly every country worldwide has ratified one or more of the relevant international human rights treaties that elevate the right to education to a fundamental human right. The former UN Special Rapporteur, Katarina Tomasevski, examined conflicts between the human rights law and trade law conflict in a number of Annual Reports and Country Specific Reports to the United Nations Commission on Human Rights, wtitten between 1998 and 2004.
Why is the World Trade Organization important for education?
The World Trade Organization – the forum for the building tension between international trade and human rights law – is an international economic organization that was established after 11 years of intensive negotiations. These negotiations are known as the Uruguay Round. One hundred and twenty states formally signed an agreement to establish the WTO in Marrakesh, Morroco on 15 April 1994. This foundation agreement is called the Marrakesh Agreement. By 1 January 1995 a sufficient number of states had ratified the Marrakesh Agreement, paving the way for the WTO to become a reality on this date.
Prior to the formal establishment of the WTO, international trade rules and dispute resolution processes evolved under another international agreement, the General Agreement on Tariffs and Trade (GATT), which dated back to 1948. However, there was no institutional structure to oversee the development of trade rules, and the WTO is intended to fill this gap. The WTO complements the other major international economic organizations, the World Bank and the International Monetary Fund (IMF). All three organizations affect prospects for progressive realization of the right to education. The WTO continues the trade liberalization project commenced in 1948 under the original GATT – only trade in services has now been added to the liberalization agenda.
As of 9 March 2003, there are 145 members of the WTO, with 31 additional countries having observer status. Many of these observer states are in the process of applying for membership, including Russia. Membership in the WTO is reserved for states and state-like entities. Although most WTO members are sovereign states, there are important exceptions, including the European Union, Hong Kong, and Taiwan (See the membership list on the WTO website: http://www.wto.org/.).
The three "pillar" trade agreements
In addition to establishing a formal institution, the Marrakesh Agreement includes three "pillar" agreements regulating international trade:
The General Agreement on Tariffs and Trade 1994 (GATT 1994)
The GATT 1994 is an updated version of the original GATT, revised and refined before its incorporation into the WTO framework. The GATT 1994 regulates trade in goods, and is complemented by a host of smaller agreements that also apply to trade in goods. GATT 1994 reflects many of the developments that occurred under the original GATT since 1947. Therefore, it is the most developed of the three "pillar" agreements.
The General Agreement on Trade in Services (GATS)
GATS is a new international trade agreement, setting out the rules for trade in services, including for the education sector. It is the relevant WTO agreement here. The purpose of GATS is to facilitate increased trade liberalization across many services sectors. The WTO negotiations under GATS pose significant danger for the campaign to realize universal education for all.
The Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPs)
TRIPs sets out the rules for the protection of intellectual property rights that affect international trade in good and services. WTO negotiations under TRIPS have had a high profile over the last couple of years, as developing countries have attempted to negotiate trade rules that would permit them to source life-saving medicines, including for the HIV/AIDS pandemic, at affordable prices. So far, it appears that the United States is refusing to relax the rules under TRIPs to allow this.
The creation of GATS is a major new chapter in international trade history. From the 1980s, international trade in services grew significantly faster than the traditional trade in goods. This growth provided the impetus for adopting GATS – at least from the perspective of industrialized countries, which benefit from services trade considerably more than do developing countries. GATS provides a skeletal regulatory framework applying to trade in services that requires development over time. The continuing negotiations at the WTO aim to flesh out the GATS framework, a process that could take anywhere from 15 to 30 years to reach completion. The provisions of GATS can be accessed on the WTO website (See http://www.wto.org/).
The broad coverage of education in GATS
One of the problems with GATS from a human rights perspective relates to the broad definition of "services." Numerous, varied services sectors are covered under GATS, including education. Other sectors include: energy, environmental, financial and telecommunication services. In all sectors with a human rights dimension, then, the tension between international human rights law and international trade law is likely to develop as GATS negotiations progress.
There is an important exemption in GATS: it does not extend to services provided "in the exercise of governmental authority." Articles 1(3)(b) and (c) of GATS set out this legal exclusion:
- "services" includes any service in any sector except services supplied in the exercise of governmental authority;
- "a service supplied in the exercise of governmental authority" means any service which is supplied neither on a commercial basis, nor in competition with one or more service suppliers.
Despite the WTO’s claims to the contrary this exclusion appears very narrow. The WTO suggests this exemption covers social security schemes and any other public services, such as health or education that is provided at non-market conditions. The key is the WTO’s reference to "non-market conditions." For example, despite being contrary to international human rights law, many governments levy a fee for the provision of compulsory education services to its child citizens. The provision of "for fee" education services may therefore be on a "commercial basis," and not "in the exercise of governmental authority." Alternatively, a government may provide "free" compulsory education, but in "competition" with private "for fee" educational institutions. Under the exclusionary rule in GATS, this education would be supplied "in competition with one or more services suppliers," and not "in the exercise of governmental authority." Therefore, the exclusionary rule appears inadequate to protect domestic education sectors from international trade pressures under GATS.
The former UN Special Rapporteur documented the practice of charging fees in public primary education which should be free. Impoverishment of public education often leads to parental choice which is not free in every sense of this word. Similarly, the choice of individual countries is constrained by debt servicing the tension between progressive realization of the right to education and progressive liberalization of trade in education services necessitates an effective human rights strategy.
In addition to the Right to Education Project other non-governmental organizations are concerned at the WTO’s liberalization agenda and the dangers posed by the education sector’s inclusion within the ambit of GATS.
The WTO negotiations under GATS proceed on the basis that individual WTO members will commit to opening up particular services sectors to international trade, with the aim of "achieving a progressively higher level of liberalization."
WTO negotiations are predicated on members making two major commitments in the education sector:
Market Access (See Article 16 of GATS)
A market access commitment means that a WTO member agrees not to impose limits on the number of foreign education service providers, the number of foreign services personnel that may be employed in the education sector, the legal form of a foreign-owned/based education service provider, or the use of foreign capital. It is permissible for WTO members to enter partial commitments, with some reservations to aspects of the market access requirement.
National Treatment (See Article 17 of GATS)
A national treatment commitment means that a WTO member agrees not to modify the conditions of competition in favour of domestic education services providers. In other words, this commitment means that governments must facilitate an "equal playing field" for both domestic and foreign education service providers.
WTO members may enter into additional commitments.
Five subsectors of education
GATS divides education services into 5 subsectors:
- primary education: this includes both primary and preschool education.
- secondary education: this includes all generally and higher secondary schooling, technical and all technical and vocational training below the university level.
- Note: Under international human rights law the primary and secondary education sectors constitute "compulsory" education.
- higher education: this includes all post-secondary education, particularly education leading to a university degree or its equivalent, and sub-degree technical and vocational training.
- adult education: this includes education for adults outside the regular school or university infrastructure – e.g. day or evening language classes.
- other education services: this is a "catch-all" category that includes all other types of education. This subsector has not clearly been defined.
WTO members make commitments in each of the subsectors separately. The number of commitments entered into across education subsectors (i) – (iv) is relatively constant. It is surprising that as many liberalization commitments have approximately been entered for primary education as for higher education. Current international trade involving higher education is much greater than that for primary education. Other education is the least committed subsector.
The Need To Halt And Reverse Conversion Of Education From A Human Rights Into A Commodity For Sale
Liberalization increasingly converts education into a tradable commodity, which directly undermines rights-based education, namely as a "public good" with governments assuming the primary regulatory role. It threatens to undermine progressive realization of the right to education, which requires the enforcement of governmental obligations, as required by international human rights law.
At present, proposals for liberalizing the export education industry typically focus on post-compulsory education, pledging that private education and training will supplement rather
Current liberalization proposals under GATS do not – as yet – directly threaten the public provision of compulsory education. However, a conceptual shift towards characterizing education as a "property right" may be a precursor to the subjecting of all education – including compulsory education - to liberalization pressures. In guaranteeing education for all, private institutions and self-regulation are an inadequate proxy for state responsibility, policy and control.
The Need To Facilitate – Not Undermine – The Right To Education In Developing Countries
In most industrialized countries the dichotomy between public and private – free and for-fee – schools has always been part of the educational landscape. Increasing the proportion of private educational institutions to facilitate trade, while controversial in western societies, will not be revolutionary. However, this is not true for many developing countries. Deregulating the education sector to facilitate trade will present complex and unfamiliar policy problems for governments.
The agreed negotiating guidelines for GATS incorporate the overarching principle of flexibility for developing and least-developed countries. Some suggest that the guidelines, therefore, appropriately balance the degree of sensitivity required for public education policy against the importance of achieving higher levels of liberalization. However, the guidelines are of dubious value. Although the WTO is structured democratically, it seems often to generate outcomes favourable to minority interests: despite their numerical majority status, developing countries’ bargaining power at the WTO is very low. If developing countries do grant industrialized countries market access to their education sectors they should, as a minimum, retain a solid regulatory framework that preserves governmental obligations to provide universal compulsory education.
Trade liberalization in the education sector is likely to gather considerable momentum. Many western educational institutions are experiencing funding shortages. Generating revenue by selling places to overseas students is considered a critical survival strategy. Therefore, governments are under intensifying pressure to facilitate trade in education services. They may pursue liberalization at the expense of development assistance.
As the export education industry expands, more students will flow into industrialized countries. Governments may consider that this student flow provides a source of goodwill that, in effect, replaces the goodwill earned through development assistance. A burgeoning export education industry may further undermine aid for education.