III. The plurilateral Agreement on Government Procurement back to top
A. Brief background to the development of the GPA
Early efforts to bring government procurement under internationally agreed trade rules were undertaken in the OECD framework. This matter was brought into
the ongoing Tokyo Round of Trade Negotiations in 1976. As a result, the first Agreement on Government Procurement was signed in 1979 and entered into force in 1981. It covered central government entities and procurement of goods only. It was amended in 1987, with this amended version entering into force in 1988.
In parallel with the Uruguay Round, Parties to the Agreement held
negotiations to broaden the coverage of the Agreement to purchases by
sub-central government entities and other public enterprises and to the services and construction services sectors. Following these negotiations, the
Agreement on Government Procurement (1994) (‘GPA’) was signed in Marrakesh on 15 April 1994, at the same time as the Agreement Establishing the WTO.
The GPA entered into force on 1 January 1996. It led to an estimated ten-fold increase in the value of procurement subject to international competition under its rules, as compared to the approximate annual value, between 1990 and 1994, of US$30 billion of covered procurement under the Tokyo Round Agreement. The value of coverage has expanded considerably
since then, with economic growth, inflation and the expansion of the
coverage and membership of the Agreement. In December 2011, a decision on the outcomes of the re-negotiation of the Agreement, which had been on-going for more than a decade, was taken at Ministerial level in Geneva. This political decision was confirmed, on 30 March 2012, by the formal adoption of the Decision on the Outcomes of the Negotiations under Article XXIV:7 of the Agreement on Government Procurement (GPA/113).
B. The nature and content of the Agreement
The GPA is a plurilateral agreement under the
WTO Agreement, meaning that not all Members of the WTO are bound by it.
The Agreement en compasses provisions relating to:
Currently, the GPA is the main instrument in the WTO that provides a framework for the conduct of international trade in government procurement markets among the participating countries. Additionally, it can be considered to serve broader purposes relating to good governance and the attainment of value for money in national procurement systems.
C. Parties and Observers to the Agreement
Currently, forty-two WTO Members are covered by the WTO Agreement on Government Procurement. These comprise: Armenia, Canada, the European Communities, including its 27 member States; Hong Kong, China; Iceland; Israel; Japan; Korea; Liechtenstein; the Kingdom of the Netherlands with respect to Aruba; Norway; Singapore; Switzerland; Chinese Taipei and the United States.
Twenty-two other WTO Members have observer status under the Agreement.
These are: Albania, Argentina, Australia, Bahrain, Cameroon, Chile, China, Colombia, Croatia, Georgia, India, Jordan, the Kyrgyz Republic, Moldova, Mongolia, New Zealand, Oman, Panama, Kingdom of Saudi Arabia, Sri Lanka,Turkey and Ukraine. In addition, four intergovernmental organizations, namely the International Monetary Fund (IMF), the International Trade Centre (ITC), the Organization for Economic Co-operation and Development (OECD), and the United Nations Conference on Trade and Development (UNCTAD) also have observer status in the WTO Committee on Government Procurement, which administers the Agreement.
D. Accession to the Agreement
Accession to the Agreement on Government Procurement is open to all WTO Member governments (Article XXIV:2). The process of accession involves negotiations on coverage issues (in particular, on the
“Appendix I offer” of the acceding Party) and verification of the consistency of the acceding Party’s national legislation with the norms and requirements of the GPA(2).
Currently, nine WTO Members are in the process of acceding to the Agreement on Government Procurement: Albania, China, Georgia, Jordan, the Kyrgyz Republic, Moldova, Oman, Panama and Ukraine. In addition, a further six WTO Members have provisions in their respective Protocols of Accession to the WTO with regard to accession to the Agreement. These additional Members are: Croatia, the Former Yugoslav Republic of Macedonia (FYROM),
Mongolia, Montenegro, the Russian Federation and Saudi Arabia.
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Plurilateral Agreement on
Government Procurement (GPA)
IV. Negotiations under GATS Article XIII back to top
XIII:1 of the General Agreement on Trade in Services (GATS) provides that government procurement of services is subject neither to the most-favoured-nation requirement of the GATS (Article II) nor to specific commitments on market access (Article XVI) and national treatment (Article XVII). WTO Members are consequently not subject to any obligations on market access or non-discrimination in the field of government procurement of services under the GATS at this time.
Paragraph 2 of Article XIII then goes on to say that there shall be multilateral negotiations on government procurement in services within two years from the date of entry into force of the Agreement.
A Working Party on GATS Rules was established by the Council on Trade in Services in March 1995 to carry out, among other tasks, the negotiating mandate contained in the GATS on government procurement in services.
GATS Article XIII:2 does not specify an end date for the negotiations.
However, the Guidelines and Procedures for the Negotiations on Trade in Services, adopted by the Special Session of the Council for Trade in Services in March 2001(3), provide that Members shall aim to complete the negotiations in various rule-making areas, including those pursuant to
Article XIII, prior to the conclusion of the Doha Round negotiations on specific commitments.
WTO Members hold different views with respect to the scope of the mandate for negotiations contained in
Article XIII. Some Members take the view that negotiations under this mandate can involve market access and non-discrimination as well as transparency and other procedural issues. Other Members do not share this interpretation, considering that Article XIII excludes MFN treatment, market access and national treatment from the scope of the mandated negotiations.
The Ministerial Declaration issued by the Hong Kong Ministerial Conference in December 2005 included the following provision regarding the work on government procurement mandated in the GATS:
“Members should engage in more focused discussions and in this context put greater emphasis on proposals by Members, in accordance with
Article XIII of the GATS”(4).
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GATS negotiations on services procurement
V. Working Group on Transparency in Government Procurement back to top
At the 1996 Singapore Ministerial Conference, Ministers decided to set up a Working Group to conduct a study on transparency in government procurement practices, taking into account national policies and, based on this, to develop elements suitable for inclusion in an appropriate agreement(5).
The Working Group on Transparency in Government Procurement which was established to carry out this mandate began its work in 1997 by examining the transparency-related provisions in existing international instruments and national practices. It then developed and carried out a study of twelve issues (twelve so-called
‘Items on the Chairman’s Checklist of Issues’(6)) relating to a potential agreement on transparency in government procurement(7), spanning the following four broad subject-areas:
(i) the definition of government procurement and the scope and coverage of a potential agreement;
(ii) the substantive elements of a potential agreement on transparency in government procurement, including various aspects of access to general and specific procurement-related information and procedural matters;
(iii) compliance mechanisms of a potential agreement; and
(iv) issues relating to developing countries, including the role of special and differential treatment as well as technical assistance and capacity building.
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Working Group on
Transparency in Government Procurement