GATS classifies the supply of services into four modes, which are the following:
1. Mode 1 [Cross Border]:
It is the most straightforward form of trade in services. In this mode, the service itself crosses the border, and covers business processing services (such as those provided by the call centres), consultancy, software, and medical transcription, etc.
2. Mode 2 [Consumption Abroad]:
In this case, the consumer travels to the .country of the service supplier, typical examples being a traveler or a student going to a foreign country.
powtoon-um1.s3.amazonaws.com
3. Mode 3 [Commercial Presence in the Consumer Country]:
In this case, the supplier of the service (such as a bank, an insurance company, a legal advisor company, or a communication company) opens a branch office or a subsidiary in the consumer country.
In addition, the service provider may bring in the residents of the service supplying country [termed natural persons] in the consumer country. To the extent the supplier brings in the natural persons [foreigners], it becomes a case of Mode 4.
4. Mode 4 [Presence of natural Persons, that is, presence of service providing foreigners in the country of consumers]:
In this Mode, foreigners are sent by the service supplier to the service-consuming country for providing the service. A typical example of this is the one where a software engineer or a worker goes to a service-consuming foreign country for providing a service (the employer may be a local company or a company from the country of the migrant or from a third country).