RESTRICTEDWORLD TRADE
ORGANIZATIONGPA/W/76
18 September 1998
(98-3584)
Committee on Government Procurement Original:  English
REQUEST FOR INFORMATION PURSUANT TO PARAGRAPHS 1 AND 2
OF ARTICLE XIX OF THE AGREEMENT ON
GOVERNMENT PROCUREMENT
Communication from the United States
The following communication, dated 11 September 1998, has been received from the
delegation of the United States with the request that it be distributed to the Members of the Committee
on Government Procurement.
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During the last two years, the United States has repeatedly raised its concerns with the
procurement practices of the Korea Airport Construction Authority (KOACA).  As we indicated in the
25 June 1998 meeting of the WTO Government Procurement Committee, the United States remains
disturbed by Korea's repeated assertion that its commitments under the Agreement on Government
Procurement (GPA) do not apply to KOACA.  This assertion has serious implications for
United States commercial interests and for the bilateral balance of rights and obligations established
under the GPA.  The United States urges Korea to reflect on this issue and to affirm, on that basis, that
procurement conducted by KOACA is subject to and will be implemented in accordance with theprovisions of the GPA.
Pursuant to paragraphs 1 and 2 of Article XIX of the GPA and in order to expedite the
resolution of this important issue, the United States requests that Korea respond in writing to the
attached list of questions relating to KOACA and its procurement practices.  This information is
requested without prejudice to the United States' rights under Articles XXII and XXIV of the GPAand any other relevant provisions of the WTO.GPA/W/76
Page 2
ATTACHMENT
1. (a) Please explain the legal and operational relationship between the Korea Airport
Construction Authority (KOACA) and the Ministry of Construction and
Transportation.
(b) Please describe the extent to which the Ministry of Construction and Transportation
has legal responsibility for managerial oversight of KOACA.
(c) In what way does the Ministry of Construction and Transportation exercise that
responsibility?
(d) How are KOACA's president and other senior officials chosen?  What approvals are
required for each appointment?
(e) Please describe the extent to which the Ministry of Construction and Transportation
or any other entity of the Korean government has legal authority to approve
KOACA's budget and management plans.
(f) Please cite and provide copies of the legal or administrative authorities governing
these issues.
2. (a) What percentage of KOACA's annual budget is accounted for by appropriations from
the Ministry of Construction and Transportation or other Korean government entities?
(b) What percentage of KOACA's annual budget is provided by sales of Korean public
assets?
(c) What percentage of KOACA bonds or other debt, if any, is directly held or
underwritten by the Korean government?
(d) What percentage of KOACA's budget is funded from private sector investments or
other contributions?
(e) To what extent do any other Korean government entities have legal or budgetary
authority over KOACA?
3. Please explain the relationship between K OACA and the "New Airport Development Group
under the Ministry of Transportation", referred to in Korea's July 1991 written response to
United States questions regarding government procurement for airport construction.
4. Please explain the relationship between KOACA and the "airport construction division of the
Korea Airport Authority", referred to on KOACA's Internet web site at
http://www.airport.or.kr.
5. Please explain the relationship between th e "New Airport Development Group under the
Ministry of Transportation", referred to in Korea's July 1991 response to United Statesquestions regarding government procurement for airport construction, and the former airport
construction division of the Korea Airport Authority, referred to on KOACA's Internet
web site.GPA/W/76
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6. (a) At the time bilateral negotiations between the United States and Korea relating to
Korea's participation in the GPA were concluded (1993), to what extent was the
"New Airport Development Group under the Ministry of Transportation" responsible
for airport construction projects in Korea?
(b) Please identify all government entities that were responsible for airport construction
projects at that time and the relationship of those entities to KOACA, which was
established subsequently.
7. (a) Is KOACA responsible for all airport construction projects currently being planned or
implemented by government entities in Korea?
(b) If not, what other Korean government entities are responsible for planning and
implementing airport construction projects?
(c) Please provide information on the estimated budgets of these entities.
8. Recent KOACA tender announcements include the requirement that "foreign firms should
participate in the bid with local Firms (leading or prime company) as consortium members or
subcontractors".
(a) What is the intent of this provision?(b) Are there any circumstances in which United States or other non-Korean firms may
qualify independently (i.e., as a "leading or prime company") to participate in this and
similar KOACA procurement opportunities, or is partnership with a Korean firm a
mandatory condition for qualification?
(c) Under what legal authority does KOACA have the authority to impose this
requirement?
9. In recent KOACA tender announcements, all suppliers have been required to hold licenses
and registration for manufacturing operations in Korea in order to qualify to participate.
(a) What is the purpose of this requirement?
(b) Does this preclude suppliers that have not established manufacturing facilities in
Korea from qualifying as a prime contractor?
(c) For suppliers that do not have manufacturing facilities in Korea, can possession of
appropriate manufacturing licenses issued by United States or other non-Korean
authorities satisfy this requirement?  If so, under what circumstances?
(d) Under what domestic law does KOACA have the authority to impose this
requirement?
(e) Does KOACA require that equipment supplied under these contracts be produced in
Korea?GPA/W/76
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10. The United States requests that Korea provide complete copies of the following documents
(in English, if available):
1. The Korean Airport Authority Act, and any related implementing or enforcement
decrees.
2. The IIA Construction Promotion Law, promulgated or announced on or around
31 May 1991, and any other related laws and implementing or enforcement decrees
affecting what has become known as the Inchon International Airport.
3. The Seoul Metropolitan Area New International Airport Construction Corporation
Act, and any related implementing or enforcement decrees.
4. The General Construction Basic Law, and any related implementing or enforcement
decrees.
5. The Electrical Construction Law, and any related implementing or enforcement
decrees.
6. Regulations of the Ministry of Construction and Transportation or other entities
pertaining to the creation, purpose and functions of the "Corps of the New
International Airport Construction Project".
7. The Government Organization Act of the Republic of Korea.
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