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One of the major achievements of the Uruguay Round negotiations on the General
Agreement on Trade in Services (GATS) was
the agreement on four modes of delivery or
ways in which services may be exported:
Mode 1: Cross-border trade, where the trade takes place from one country
into the other. Only the service itself crosses the border.
Mode 2: Consumption abroad, where the customer travels to the country
where the service is supplied.
- Mode 3: Commercial presence, where the supplier establishes a commercial
presence abroad.
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- Mode 4: Movement of natural persons, where the provider of the service
crosses the border.
Any of the four modes above are considered “Trade in Services”, as long as a local firm is being paid by a foreign firm ("non-resident"), no matter where the service is actually provided.
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