Since the Republic of Arcadia became a Member of the WTO in 1996, the Government of that country has been preoccupied by the low ratings of Arcadian-origin programmes broadcast on the country's single television network, ArcaTV. In order to change this state of affairs, the government decided to create the Arcadian Broadcasting Control Board (the "ABCB") in 1999. The ABCB is a non-governmental body that has been delegated broad powers to regulate television transmission services in Arcadia, and to issue mandatory directives to promote the development of a national television production industry.

In 2002, Arcadia and its neighbor, the Kingdom of Utopia, reached a bilateral agreement on mutual cooperation in the areas of culture and education. By the end of 2002, the ABCB amended the "Broadcast Directive" in order to implement the new bilateral agreement. Under the amended "Broadcast Directive", which entered into force on 1 January 2003, 15 per cent of total television transmission time shall be reserved exclusively for programmes of Utopian origin. The amended Directive also grants to Utopian television production companies the right to establish branches to produce television programmes in Arcadia. Such rights have not been extended to services or services suppliers of other WTO Members.

Required:

a) Is the "Broadcast Directive" a measure covered by the GATS?

b) Is the amended "Broadcast Directive" consistent with Article II of the GATS? (Please note that Arcadia did not schedule any Article II Exemptions).