Movement of Capital and Trade in Services:Distinguishing Myth from Reality Regarding the GATS and the Liberalization of the Capital Account

This article will analyze the interplay between capital movements and trade
in services as structured in World Trade Organization (WTO) law, and it will
assess the implications of the capital account liberalization for the freedom of
WTO Members to pursue their economic policies. Although the movement
of capital is largely confined to the domain of international financial or monetary
policy, it is regulated by WTO law due to its role in the process of
financial services liberalization, which generally requires liberalized capital
flows. From a legal perspective, the interplay between capital movements
and trade in services requires striking a delicate balance between the right
of market access and the parallel right of economic stability. Indeed, a liberalized
regime for capital movements could pose serious stability problems
during times of crisis. For this reason, it is necessary that Members are able
to derogate from their obligations and adopt emergency measures.
Regulating the movement of capital in the General Agreement on Trade in
Services (GATS) requires stretching the regulatory oversight of WTO law
over different aspects of international economic policy. Indeed, capital movements are a fundamental component of the balance of payments and have a
major role in shaping monetary, fiscal, and financial policies. This article will
analyze how the discipline provided by the GATS on capital movements will
affect not only trade in services, but also the Members’ policy space on
monetary and fiscal policy. The article will conclude that while the GATS offers enough policy space for the maintenance of financial stability, it does
not fully take into consideration the need of Members to control capital
movements in order to conduct monetary policies.

Certificate for One Share of Capital Stock in Nicola Valley Coal and Coke Company

Certificate for 1 share of capital stock in Nicola Valley Coal and Coke Company to Welland D. Woodruff, May 13, 1905.

Certificate for Twenty-One Shares of Capital Stock in Nicola Valley Coal and Coke Company

Certificate for 21 shares of capital stock in Nicola Valley Coal and Coke Company to Welland D. Woodruff, Oct. 16, 1905.

Certificate for One Thousand Shares of Capital Stock in Lincoln-Nipissing Development Co. Ltd.

Certificate for 1,000 shares of capital stock in Lincoln-Nipissing Development Co. Ltd. to Hamilton K. Woodruff, Feb. 21, 1907.

Certificate for One Share of Capital Stock in St. Catharines Golf Club Ltd.

Certificate for 1 share of capital stock in St. Catharines Golf Club Ltd. to Dr. Thos. Woodruff, April 15, 1911.

Certificate for One Share of Capital Stock in the Lincoln County Greater Production Company

Certificate for 1 share of capital stock in the Lincoln County Greater Production Company to Hamilton K. Woodruff, Jan. 20, 1919.

Certificate for Six Shares of Capital Stock in Gove Motor Car Company, Detroit, Michigcan

Certificate for 6 shares of common capital stock in Gove Motor Car Company, Detroit, Michigan to Hamilton K. Woodruff, June 13, 1921.

Certificate for Two Shares of Capital Stock in The Henley Aquatic Association Limited

Certificate for 2 shares of capital stock in Henley Aquatic Association Limited to Hamilton K. Woodruff, Oct. 15, 1921.

Certificate for Sixty Shares of Capital Stock in High Pressure Oil and Gas Syndicate, Limited

Certificate for 60 shares of capital stock in High Pressure Oil and Gas Syndicate, Limited to Hamilton K. Woodruff, Nov. 1, 1922.

Certificate for Ten Shares of Accumulative Preference Shares of Capital Stock in Lincoln Manufacturing Company Limited

Certificate for 10 shares of accumulative preference shares of capital stock in Lincoln Manufacturing Company Limited to Hamilton K. Woodruff, July 4, 1923.

Certificate for Eight Shares of Capital Stock in Insurance Investments Limited

Certificate for 8 shares of capital stock in Insurance Investments Limited to Hamilton K. Woodruff, Aug. 12, 1929.

Certificate for Twenty Shares of Capital Stock in Skyway Limited

Certificate for 20 shares of capital stock in Skyways Limited to Hamilton K. Woodruff, Sept. 2, 1929.

Certificate for Five and Four Fifths Shares of Capital Stock in Insurance Investments Limited

Certificate for 5 4/5 shares of capital stock in Insurance Investments Limited to Hamilton K. Woodruff, Jan. 15, 1930.

Certificate for Fifty Shares of Capital Stock Skyways Limited

Certificate for 50 shares of capital stock Skyways Limited to Hamilton K. Woodruff, Jan. 31, 1930.

Certificate for One Share of Capital Stock in St. Catharines Lawn Bowling Club

Certificate for 1 share of capital stock in St. Catharines Lawn Bowling Club to executors of the estate of Hamilton K. Woodruff, Dec. 23, 1933.