doha photo



Applying the fundamental WTO principle of transparency to how governments buy goods and services

For the last four-and-a-half years the WTO has actively pursued a work programme on the subject of transparency in government procurement. This has been based on a mandate adopted by ministers at the WTO Singapore Ministerial Conference held in December 1996 to: “establish a working group to conduct a study on transparency in government procurement practices, taking into account national policies, and, based on this study, to develop elements for inclusion in an appropriate agreement”.

The Singapore mandate reflects the heavy emphasis placed throughout the WTO system of rules and practices on transparency. Transparency is often referred to as one of the three fundamental principles of the WTO, the others being most-favoured-nation and national treatment. The role of transparency is perhaps of greatest importance in situations where the extent to which rules of general application determine trading conditions is limited and the scope for discretionary decision-making is greatest. Government procurement is a notable example. The GATT and now the WTO have for a long time had a plurilateral Agreement, currently with 26 parties out of the 142 WTO members, with detailed requirements in respect of transparency in government procurement. The object of the transparency provisions in this Agreement is not only to ensure that adequate information on procurement opportunities is made available and that decisions are fairly taken, but also to facilitate monitoring of the commitments made under that Agreement not to discriminate against suppliers and supplies from other Parties.

The focus of the multilateral work presently under way on transparency in government procurement is somewhat different. First, as indicated, this work is multilateral in nature and aimed at drawing up an agreement to which all 142 WTO members will be parties. Second, the focus is on transparency as such, rather than on transparency as a vehicle for monitoring market access commitments. However, some members have indicated that they would wish future negotiations to have a broader mandate that could provide, in the long term, for the exploration of the scope for market access on a multilateral basis.

The WTO Working Group on Transparency in Government Procurement, since its first meeting in May 1997, has met 13 times. The Working Group initiated its work by hearing presentations from other intergovernmental organizations which have international instruments and activities relevant to transparency in government procurement, notably the United Nations Commission for International Trade Law (UNCITRAL) and the World Bank. It then considered a WTO comparative study of the transparency-related provisions in existing international instruments on government procurement procedures as well as in national practices. This covered the procedures under the plurilateral WTO Agreement on Government Procurement, the UNCITRAL Model Law and the World Bank Guidelines, as well as available material on national practices.

The next stage in the work of the Working Group was the systematic study of 12 issues that were identified as important in relation to transparency in government procurement. These are: definition and scope of government procurement; procurement methods; publication of information on national legislation and procedures; information on procurement opportunities, tendering and qualification procedures; time-periods; transparency of decisions on qualification; transparency of decisions on contract awards; domestic review procedures; other matters related to transparency; maintenance of records of proceedings; information technology; language; fight against bribery and corruption; information to be provided to other governments; WTO dispute settlement procedures; and technical cooperation and special and differential treatment for developing countries. Written contributions on national practices, on issues meriting study and setting out ideas for action have been presented by many members to the Working Group. A number of members tabled texts of draft agreements before the Seattle Ministerial Conference.

In addition to these subjects, the Working Group — since the Seattle Ministerial — has also heard experiences of countries on the application of information technology in government procurement. members also have reported on national experiences in respect of regional initiatives and agreements on government procurement in the context of the Free Trade Area of the Americas (FTAA) negotiations and the Government Procurement Experts Group of the Asia-Pacific Economic Cooperation (APEC) as well as a number of regional trade agreements.

The work of the Working Group has shown that there seems no disagreement among members about the importance of transparency in government procurement and of the desirability of the WTO pursuing its work in this area. The differences essentially relate to how this should be done. In the run-up to the Doha Ministerial, a number of members argue that after the intensive work during the past four-and-a-half years, the WTO is now in a position to negotiate a transparency agreement in the context of a new round. A number of developing countries, on the other hand, have expressed concerns about enforcement rules in this area, including application of the WTO dispute settlement system, and whether the issue is ripe for the launching of negotiations.