Official Website
Lao Services
Portal
Register | Login

Services by Sector: Environmental Services

 

A. OVERVIEW OF ENVIRONMENT SERVICES IN LAO PDR

Background Information

The Lao PDR is a country with natural resources in abundance and is situated in the central Indochina peninsula between 13.54-22.31 degrees north and 100.05-107.42 degrees south. Being a landlocked country, more than 40% of which consists of stocked forestlands.[1] The Lao economy is very dependent on natural resources which are used as inputs into various services and manufacturing sectors, as such this services sector plays an integral role in the economic development and growth of Lao PDR.

The environment and natural resources of Lao PDR are threatened by a number of factors including, but not limited to soil erosion and poor soil quality; increased pressure on water resources through increased use for mining activities and hydropower development; threats to aquatic species resulting from pollution, whether by persistent organic pollutants (POPs), pesticides or herbicides; and potential impacts in downstream countries from improperly managed discharge. [2]

Recognizing the importance of the environment services sector, the Government of Lao PDR has placed great emphasis on protecting and developing the sector. The Lao government developed several action plans to promote natural resources management and sustainability, inclusive of the National Tropical Forestry Action Plan and the Environmental Action Plan.  To support the policy prescriptions of these action places, the government also enacted several primary and secondary legislation and has empowered the Science Technology and Environment Agency (STEA) which is the central agency within the Prime Minister's Office, to regulate environmental policy, systems development national and regional cooperation and other key activities that seek to regulate, promote and develop the services sector.

The environment services sector covers several services provided in the Lao PDR. The WTO Classification for this sector covers:

  • Sewage services
  • Refuse disposal services
  • Sanitation and similar services
  • Other services

In the Lao PDR, the Government of Lao PDR principally provides some of these services, while others are provided by the private sector, though they are regulated by public entities.

 

B. KEY IMPERATIVES AND INFORMATION FOR SERVICE PROVIDERS AND INVESTORS

I. Legal and Regulatory Environment of the Environment Services Sector

The legal and regulatory environment of the environment services sector comprises institutional and legal frameworks, which seek to regulate the services provided. Given that the government primarily provides many of these services, the sector is more so self-regulated.

II. Key Institutions in the Environment Services Sector

The Environment Services Sector is governed by key institutions which regulate, monitor and provide oversight for the services provided on this sector. These institutions include:

  • Ministry of Natural Resources and Environment

  • Ministry of Agricultural and Forestry

  • Ministry of Planning and Investment

  • Ministry of Energy and Mines

  • Ministry of Industry and Commerce

  • Provincial and district offices of the above Ministries

III.Legislation (Laws and Regulations) governing the Transport Services Sector

Relevant laws, which impact the Transport Services Sector include:

PRIMARY LEGISLATION

SECONDARY LEGISLATION

Decrees

Decisions

Instructions

Other

Environmental Protection Law (Amended) No.29/NA

Decree of the Environment Protection Fund No.94/Gov

Decision on Environmental Technical Services 0345/MNRE

Instruction on Environmental Management and Protection in Xiengkhouang Province No.17/Governor of Xiengkhouang

Ministerial Decision on Good Agricultural Practices for Environment Management Standard No.0538/MAF

Decision on Strategic Environmental Assessment No.0483/MNRE

Guideline on Initial Environmental Examination for Investment Projects and Activities No.8029/MAF

Decision on Environmental Impact Assessment for Industry and Handicrafts in Lao PDR No.1222/MOIH

Guideline on Environmental and Social Impact Assessment for Investment Projects and Activities No.8030/MAF

Decision on Approval and Declaration of the List of Investment Projects and Activities that are subject to Initial Environmental Examination or Environmental and Social Impact Assessment No.8056/MAF

 
 
 
 

Lao PDR Commitments in Environmental Services under Regional and International Agreements

Key agreements that the Lao PDR has signed in respect of the environment services sector are noted to be: 

  • WTO General Agreement on Trade in Services
  • ASEAN Framework Agreement on Services (9th Package of Commitments)
  • ASEAN – Australia/New Zealand Free Trade Agreement
  • Agreement on the Movement of Natural Persons Agreement
  • ASEAN – China Free Trade Agreement Trade in Services
  • ASEAN – India Agreement on Trade in Services

WTO General Agreement on Trade Services

The schedule of commitments for Lao PDR under the WTO General Agreement on Trade in Services notes that services considered as public utilities at a national or local level may be subject to public monopolies or to exclusive rights granted to private operators.

The agreement covers:

  • Wastewater management (part of CPC 9401)
  • Waste management (part of CPC 9402 and 9403)
  • Protection of ambient air and climate (part of CPC 9404)
  • Remediation and cleanup of soil and water (part of CPC 9406)
  • Noise and vibration abatement (part of CPC 9405

In respect of limitations on market access for these services, Lao PDR is unbound under mode 1, cross border supply of services, except in relation to consulting services. Lao placed no limitations on market access under modes 2 and 3, consumption abroad and the establishment of a commercial presence respectively. Lao PDR is unbound under mode 4, except as indicated in the horizontal section.

As it relates to limitations on national treatment, the same limitations as applied to market access are applied to national treatment.

ASEAN Framework Agreement on Services (9th Package of Commitments)

Under this agreement, the scope of commitments is extended to services in Vientiane Capital only.  It is also important to note that publicly funded services are excluded.

The agreement covers the following services:

  • Sewage services (CPC 9401)
  • Refuse disposal services (CPC 9402)
  • Sanitation and similar services (CPC 9403)
  • Cleaning of exhaust gases (Part of CPC 9404)
  • Noise abatement services (Part of CPC 9405)
  • Nature and landscape protection services (CPC 9406)

 

For these services above listed, Lao PDR has placed no limitations on market access and national treatment for the supply of these services under modes 1, 2 and 3.

ASEAN – Australia/New Zealand Free Trade Agreement

Under the ASEAN-Australia/New Zealand Free Trade Agreement, Lao PDR has not imposed any limitations on market access or national treatment for:

  • Sewage services (CPC 9401)
  • Refuse disposal services (CPC 9402)
  • Sanitation and similar services (CPC 9403)
  • Nature and landscape protection services (CPC 9406)

for modes 1 and 2, cross border supply of services and consumption abroad respectively.  As it relates to mode 3, the establishment of a commercial presence, Lao PDR has made no commitments in respect of national treatment, but horizontal commitments apply. In relation to limitations on market access for the same mode of supply of services, there are however no limitations applied.

For services provided in Urban Areas only, Lao PDR has made no commitments both in relation to national treatment and market access for the supply of Cleaning of exhaust gases services (CPC 9404) and Noise abatement services (CPC 9405) for modes 1 (cross border supply) and 2 (consumption abroad). For these same services, in respect of mode 3 (commercial presence), Lao PDR committed to applying no limitations on market access but made no commitments in relation to national treatment but will apply those as listed under horizontal commitments.

ASEAN Agreement on the Movement of Natural Persons

Under this agreement, the scope of environmental services covered is:

  • Sewage services (CPC 9401)
  • Refuse disposal services (CPC 9402)
  • Sanitation and similar services (CPC 9403)
  • Other:
    • Cleaning of exhaust gases (Part of CPC 9404)
    • Noise abatement services (Part of CPC 9405)
    • Nature and Landscape Protection Services (CPC 9406)

No sector specific commitments have been made in respect of any of these services. The only commitments that apply are horizontal commitments.

ASEAN – China Free Trade Agreement on Trade in Services

Under this agreement, Services considered as public utilities at a national or local level may be subject to public monopolies or to exclusive rights granted to private operators. The scope of the agreement covers:

  • Sewage Services (CPC 9401)
  • Refuse Disposal Services (CPC 9402)
  • Sanitation and Similar Services (CPC 9403)

In relation to providing these services through mode 1, cross border supply of services, Lao PDR is unbound except in relation to consulting services. In respect of mode 2, consumption abroad, Lao PDR placed no limitations on market access and national treatment. Specific to mode 3, establishment of a commercial presence, Lao limits market access, stipulating Foreign equity participation be limited to 70%, but placed no limitations on national treatment. In relation to mode 4, movement of natural persons, Lao PDR is unbound both in relation to market access and national treatment, except as indicated in the horizontal section.

ASEAN – India Agreement on Trade in Services

The scope of the agreement is extended to services in Vientiane Capital only.  It is also important to note that publicly funded services are excluded. The agreement covers:

  • Sewage services (CPC 9401)
  • Refuse disposal service (CPC 9402)
  • Sanitation and similar services (CPC 9403)
  • Cleaning of exhaust gases (Part of CPC 9404)
  • Noise abatement services (Part of CPC 9405)
  • Nature and Landscape Protection Services (CPC 9406)

Lao PDR placed no limitations on market access and national treatment both in relation to modes 1 and 2, cross border supply of services and consumption abroad. In relation to mode 3, the limitations on market access are as specified in the horizontal section, however in relation to national treatment, Lao PDR is unbound, except as stipulated in the horizontal section. In relation to mode 4, movement of persons, Lao PDR is unbound except as stipulated in the horizontal section, both in relation to market access and national treatment.