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IV. trade policies by sector - page 19 / 50

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WT/TPR/S/208Trade Policy Review Page 108

1.

Under the GATS, Switzerland has bound measures affecting market access and national treatment in all construction activities, with the exception of certain construction work for civil engineering (ex CPC 513),  special trade construction work (CPC 515),  and rental services for construction equipment (CPC 518).  Switzerland has also scheduled certain MFN exemptions, as well as qualification requirements reflecting restrictions on access to its labour market.  The MFN exemptions are:  assembly and erection of prefabricated buildings and installation work for energy, heating, water, communications, and lifts. A variety of activities in these areas require permits or authorizations by cantonal or local bodies.

2.

Construction spending in Switzerland has increased steadily since 2003 and amounted to over Sw F 50.6 billion in 2006 (Chart IV.3).  The increase was driven mainly by strong growth in private spending for housing, and commercial and industrial buildings, whereas public construction spending has remained at constant levels since the mid 1990s.

3.

Restrictions to trade in this subsector used to be fourfold:  standards and technical regulations have traditionally been both particularly stringent and specific to Switzerland;  several professions in the subsector continue to be regulated at cantonal level;  in the past, there have been a relatively large number of restrictive arrangements and other anticompetitive practices among suppliers that limited entry of new, including foreign, suppliers;  and the limits on work permits for foreign employees hamper the competitiveness of this labour-intensive subsector.  Together, these factors have contributed to high construction costs by international comparison. According to EUROSTAT data, the price level in the Swiss construction subsector was 36.4% higher than in neighbouring countries, only part of which can be attributed to higher salaries.31

31 OECD (2008), p.2.

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