1. Each Member State shall grant to the services and service providers of any other Member State with regard to all measures that affect the provision of services, a treatment no less favorable than that granted to its own similar services or similar service providers.
2. Specific commitments assumed in regard to this Article do not oblige Member States to offer compensations for intrinsic competitive disadvantages that are a result of the foreign character of services or of providers of pertinent services.
3. Each Member State may fulfill the terms of paragraph I, granting to services and service providers of other Member States a formally identical or formally different treatment to that granted to its own similar services and similar service providers.
4. It shall be considered that a formally identical or formally different treatment is less favorable if it modifies competitive conditions in favor of services or of service providers of a Member State in comparison with similar services or similar service providers from another Member State.

Member States may negotiate agreements regarding measures that affect trade in services but that are not subject to consignment in lists in regard to Articles IV and V, including those which refer to qualification certificates, norms, or to questions related to licensing. Such commitments shall be designated in the list of specific commitments of each Member State.

1. Each Member State shall specify in a list specific commitments sectors, sub-sectors, and activities in regard to which it will assume commitments and, for each mode of corresponding provision, indicate terms, limits, and conditions for market access and national treatment. Each Member State may also specify additional commitments in accordance with Article VI. When pertinent, each Member State shall specify time limits for implementation of commitments, as well as the date that these commitments enter into force.
2. Articles IV and V shall not apply:

1. to sectors, sub-sectors, activities or measures that are not specified lists of specific commitments;
2. to specific measures of their List of specific commitments that are incompatible with Article IV or with Article V;

1. Measures that are incompatible with Article IV and with Article V should be listed in the column relative to Article IV. In this case, such an indication shall be considered as a condition or restriction of Article V as well.
2. Lists of specific commitments shall be annexed to this Protocol and shall be an integral part of the same.

1. Each Member State shall promptly publish, before the date of its entry into force, except in the case of force majeur, all pertinent measures for general application referred to by this Protocol, or which affect its operation. Similarly, each Member State shall publish the international agreements of which it is a Member with any country and which refer to, or affect, trade in services.
2. When publication of the information referred to in the previous paragraph is not possible, the same shall be at the disposal of the public in another form.
3. Each Member State shall promptly, and at least once a year, inform the Trade Commission of MERCOSUR of the establishment of new laws, regulations, or administrative directives or of the introduction of modifications to those in force which it considers significantly affect trade in services.
4. Each Member State shall promptly respond to all requests for specific information made by other States Party to this Agreement on any of its measures of general application or international agreements referred to in Paragraph 1. Similarly, each Member State shall provide specific information to the States Party to this Agreement that so request, through the service or services established, according to Paragraph 4, Article III of the GATS, regarding all of these questions or regarding those that are subject to notification according to Paragraph 3.
5. Each Member State may notify the Trade Commission of MERCOSUR regarding any measure adopted by another Member State that, in its judgement, affects the functioning of the present Protocol.

No part of the present Protocol shall obligate any Member State to provide confidential information the dissemination of which could constitute an hindrance to obeying the law, be in any other way contrary to the public interest, or that may prejudice legitimate commercial interests of public or private companies.

1. Each Member State shall see to it that all general application measures that affect trade in services shall be administered in a reasonable, objective, and impartial manner.
2. Each Member State shall maintain or shall establish arbitration or administrative tribunals or judicial procedures that allow, at the request of an affected service provider, prompt review of administrative decisions that affect trade in services and, when justified, the application of appropriate solutions. When such review procedures are not independent of the agency responsible for the administrative decision itself, the Member State shall see to it that an objective and impartial review is carried out.

These terms shall not be interpreted in the sense of imposing on any Member State the obligation to establish such tribunals or procedures when doing so is incompatible with its constitutional structure or with the nature of its judicial system.

3. When a license, registration, certificate, or other type of authorization is required for providing a service, the competent authorities of the Member State in question, in a reasonable period after such presentation of a petition:

1. When the petition is complete, deliberation on the same informing the interested party; or
2. When the petition is not complete, it shall inform the interested party without unnecessary delay regarding the status of the petition, as well as regarding additional information that may be required according to the law of the Member State.

1. In order to assure that measures relative to technical norms, requirements and procedures for qualification certificates and requirements in terms of licensing do not constitute unnecessary impediments to trade in services, Member States shall see to it that these requirements and procedures, among other things:

1. are based on objective and transparent criteria, such as the competence and capacity for providing the service;
2. are not unnecessarily onerous for assuring quality of service, and
3. in the case of procedures in regard to licenses, do not constitute in themselves restrictions on the provision of services.

1. Each Member State may establish adequate procedures to verify the competence of professionals from other Member States.

1. When a Member State recognizes in a unilateral manner, or through an agreement, the education, experience, licenses, registrations, or certificates obtained in the territory of another Member State or in any country not part of the MERCOSUR:

1. nothing in the terms of the present Protocol shall be interpreted in the sense of demanding such a Member State to recognize the education, experience, licenses, registrations, or certificates obtained in the territory of another Member State; and
2. the Member State shall concede to any other Member State adequate opportunity to (i) demonstrate that education, experience, licenses, registrations, or certificates obtained in its territory should also be recognized; or (ii) that it may sign an covenant or agreement to the equivalent effect.

1. Each Member State commits itself to encourage competent entities in their respective territories, including governmental, associations, professional groups and others, in cooperation with competent entities from other Member States, to develop norms and mutually acceptable criteria for the exercise of pertinent activities and professions in the services sphere through the granting of licenses, registrations, and certificates to service providers, and to propose recommendations to the Common Market Group regarding mutual recognition.
2. The norms and criteria referred to in Paragraph 2 may be developed, among others, based on the following elements: education, examinations, experience, conduct and ethics, professional development and certification renewal, sphere of action, local recognition, consumer protection, and requirements of nationality, residence, or domicile.
3. Once the documentation referred to in Paragraph 2 is received, the Common Market Group shall examine it within a reasonable period in order to determine its consistency with this Protocol. Based upon this examination, each Member State shall commit itself to charging its competent authorities, when necessary, to implement that which has been decided by the competent areas of MERCOSUR, within a mutually agreed upon time period.
4. The Common Market Group shall periodically examine, and at least once every three years, the implementation of this Article.

The terms of the MERCOSUR Defense of Competition Protocol shall be applied to acts practiced in the provision of services by public or private service providers or by other entities with the objective of, or which do produce effects on competition within MERCOSUR and that affect commerce of services between Member States.

With the reservation that measures listed below not be applied in a way constituting a form of arbitrary or unjustifiable discrimination when similar conditions prevail between countries, or a hidden restriction to trade in services, no term of the present Protocol shall be interpreted as impeding a Member State from adopting or applying measures:

1. necessary to protect morals or to maintain public order. Such an exception regarding public order may only be invoked in the case of an imminent and sufficiently grave threat to the fundamental interests of society;
2. necessary to protect the lives and health of people and fauna or to preserve flora;
3. necessary to assure the observance of the law and of regulations that are not incompatible with the terms of the present Protocol, including those relative to:

1. the preservation of practices that foster errors and fraudulent practices, or of means to deal with the effects of disobedience of service contracts;
2. the protection of privacy of persons in regard to the treatment and dissemination of personal information and the protection of the confidential character of individual records and accounts;
3. to security;

1. incompatible with Article V, as expressed in this Protocol, in so far as differences of treatment have as an objective guaranteeing collection of fees or the equitable and effective collection of direct taxes referent to services or to the service providers of the other Member States, including measures adopted by a Member State in virtue of its fiscal system according to the stipulation of Article XIV, letter d) of the GATS.
2. Incompatible with Article III, as is expressed in this Protocol, in so far as a difference of treatment results in an agreement directed at avoiding double taxation contained in any other international agreement or pact that is linkable for the Member State that applies the measure.

1- No term of the present Protocol shall be interpreted in the sense of:

1. imposing on a Member State the obligation to provide information the dissemination of which it considers contrary to the essential interests of its security; or
2. impeding a Member State from adopting measures that it deems necessary for the protection of the essential interests of its security;

1. relative to the provision of services which directly or indirectly assure supplies for the armed forces;
2. relative to fissionable or fusionable materials or those used in their manufacture;
3. applied in times of war or in cases of serious international tension; or

1. impeding a Member State from adopting measures in the fulfillment of obligations assumed by it in virtue of the United Nations Charter for the maintenance of peace and of international security.

1. The MERCOSUR Trade Commission shall be informed of measures adopted under letters b) and c) of Paragraph 1, as well as their elimination.

1. Articles III, IV, and V shall not be applicable to the laws, rules, and regulations that govern government contracting of services directed at official functions, nor to commercial re-sale or to its utilization in the provision of services for commercial sale.
2. Maintaining the terms established in Paragraph 1, and recognizing that such laws, rules, and regulations may have distorting effects on trade in services, the Member States agree to establish common guidelines that in terms of government purchases in general shall be established in the MERCOSUR.

1. The Member States recognize that in certain circumstances subsidies may have distorting effects on trade in services. The Member States agree that common guidelines shall be applied that in the matter of subsidies in general shall be established in MERCOSUR.
2. The mechanism stated in Paragraph 2 of Article XV of GATS shall be applied.

A Member State may deny benefits derived from the Protocol to a service provider of another Member State, subject to notification and carrying out of consultations, when the former Member State demonstrates that the service is being provided by a person of a country that is not a Member State of MERCOSUR.

1. For the purposes of the present Protocol:

1. "measure" means any measure adopted by a Member State, whether as a law, regulation, ruling, procedure, decision, or administrative action, or in other form;
2. "provision of service" includes the production, distribution, offer to sell, sale, and delivery of a service;
3. "commercial presence" means all types of commercial or professional establishment, through, among other means, the constitution, acquisition, or maintenance of a legally constituted body, as well as in the form of branches and representation offices located within the territory of a Member State in order to provide a service.
4. "sector" of a service means:

1. in reference to a specific commitment, one or various sub-sectors of this service, or all of them, as specified in the List of specific commitments of a Member State;
2. in other cases, the totality of this sector of services, including all sub-sectors;

1. "service of another Member State" means a service provided:

1. from or within the territory of this other Member State;
2. in the case of the provision of service through a commercial presence or through the presence of persons, by a service provider of this other Member State;

1. "service provider" means any person who provides a service: when the service his not provided by a company directly, but rather through the intermediary of other forms of business presence – for example a branch or representative office, the service provider (that is, the company) shall receive, nevertheless the treatment granted to service providers in virtue of the Protocol. Such treatment shall be granted to the presence by which the service is provided, without it being necessary to grant it to any other part of the service provider located outside the territory in which it provides the service.
2. "service consumer" means any person who receives or utilizes a service;
3. "person" means an individual person or a company;
4. "individual person from another Member State" means an individual person who resides in the territory of that Member State or in any other Member State and who, according to the legislation of that other Member State, whether born in that other Member State or has the right to permanent residence in the Member State.
5. "company" means every juridical entity duly constituted or organized in accordance with the legislation applicable to it, for or not for profit, whether public, private, or mixed, and which is organized under any type of society or association;
6. "company from another Member State" means a company that is constituted or organized according to the legislation of another Member State that has within this State its headquarters and develops or plans to develop substantive commercial operations within the territory the latter Member State or within any other Member State.

1. In fulfillment of the objectives of this Protocol, the Member States shall maintain successive rounds of negotiations in order to complete in a maximum period of ten years, counting from the date of entry into force of this Protocol, a trade Liberalization Program for services within MERCOSUR. The rounds of negotiations shall take place annually and shall have as a primary objective the progressive incorporation of sectors, sub-sectors, activities and modes of modes of service provision to the Liberalization Program of this Protocol, as well as the reduction or elimination of the unfavorable effects of measures on trade in services as a means to assure effective access to markets. This process shall have as its purpose to promote the interests of all participants on the basis of mutual advantage and to achieve an over-all balance of rights and obligations.
2. The progressive liberalization process shall be carried forward in each round through negotiations directed at increasing the level of specific commitments assumed by Member States in their Lists of specific commitments.
3. In the development of the Liberalization Program, differences shall be accepted on the level of commitments assumed meeting the specific needs of different sectors and respecting the objectives cited in the following paragraph.
4. The liberalization process shall respect the right of each Member State to regulate and to introduce new regulations within their territories in order to achieve the objectives of national policies relative to the service sector. Such regulations may regulate, among other things, national treatment and access to markets, as long as they do not annul or prejudice the emerging obligations of this Protocol and specific commitments.

1. Each Member State may, during the implementation of the Liberalization Program referred to in Part III of this Protocol, modify or withdraw specific commitments included in its List of Specific Commitments.

This modification or withdrawal may only be applied from the date on which the principle of non-reciprocity is established and respected in order to preserve acquired rights.

2. Each Member State shall utilize the present regime only in exceptional cases and, in so doing, it notifies the Common Market Group and places before it the facts, reasons, and justifications for such modification or withdrawal of commitments. In such cases, the Member State in questions shall request consultations from the Common Market Group or from Member States that consider themselves affected in order to reach a consensus regarding the specific measure to be applied and the term of its validity.

The Common Market Council shall approve the results of negotiations in matters of specific commitments, as well as any modification and/or withdrawal of the same.

1. Negotiation in matters of services in the MERCOSUR is the responsibility of the Common Market Group. In regard to the present Protocol, the Common Market Group shall have the following functions:

1. convoke and supervise negotiations foreseen in Article XIX of the present Protocol. To such effects, the Common Market Group shall establish the scope, criteria, and instruments for the celebration of negotiations in matters of specific commitments;
2. receive notifications and results of consultations relative to the modification and/or withdrawal of specific commitments assigned in Article XX;
3. assume the functions as stated in Article XI;
4. periodically assess the development of trade in services with the MERCOSUR; and
5. carry out other tasks that are assigned to it by the Common Market Council in matters of trade in services.

1. For the effects of the functions stated above, the Common Market Council shall constitute an auxiliary entity and shall regulate its composition and functioning.

1. Without prejudice to the functions referred to in the above articles, application of the present Protocol shall by the responsibility of the MERCOSUR Trade Commission, which shall have the following functions:

1. receive information which, according to Article VII of this Protocol, is to be presented by Member States;
2. receive information from Member States with regard to exceptions treated in Article XIV;
3. receive information from Member States in regard to actions that may be considered to be abuses of dominant position or practices that distort competition and communicate with national entities the application of the Defense of Competition Protocol.
4. treat consultations and complaints presented by Member States in regard to the application, interpretation, or non-compliance to the present Protocol and to the commitments the assume on specific commitment Lists, applying mechanisms and procedures in force within MERCOSUR; and
5. carry out other tasks that may be assigned by the Common Market Group in matters of services.

1. In order to achieve the objective and end of the present Protocol, it may be revised, taking into account the development and regulation of trade in services within MERCOSUR, as well as the progress achieved in terms of services in the World Trade Organization and other specialized forums.
2. In particular, based on the development of the functioning of institutional provisions of the present Protocol, and of the institutional structure of MERCOSUR, Part IV may be modified in order that it be improved.

1. This Protocol, an integral part of the Treaty of Asuncion, shall be of indefinite duration and shall enter into force thirty days after the date of the third instrument of ratification.
2. The present Protocol and its ratification instruments shall be deposited with the government of the Republic of Paraguay, which shall send authenticated copies of the present Protocol to the governments of the other Member States.
3. Lists of specific commitments shall be incorporated into national law, according to procedures of each Member State.

The Government of the Republic of Paraguay shall notify governments of the other Member States of the deposit date of ratification instruments and of entry into force of the present Protocol.

In regard to adherence or renunciation, the norms established by the Treaty of Asuncion shall apply as a whole to the present Protocol. Adherence to or renunciation of the Treaty of Asuncion or the present Protocol mean, ipto jure, adhesion or renunciation of the present Protocol and of the Treaty of Asuncion.

The present Protocol shall be denominated the Montevideo Protocol on Trade of Services of MERCOSUR.

Done in the city of Montevideo, Republic of Uruguay, on the 15^th day of the month of December, in the year one thousand nine hundred and ninety-seven, in an original in the Spanish and Portuguese languages, both texts being equally authentic.