RESTRICTEDWORLD TRADE
ORGANIZATIONWT/WGTGP/W/17
25 May 1998
(98-2143)
Working Group on Transparency
in Government Procurement Original:  English
COMMUNICATION FROM THE EUROPEAN COMMUNITIES
The following communication, dated 18 May 1998, has been received from the Permanent
Delegation of the European Commission with the request that it be circulated to Members.
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ENSURING THAT TRANSPARENCY IN PROCUREMENT POLICIES AND
PRACTICES IS ACHIEVED
This contribution considers only what elements are required to ensure that transparency in
procurement policies and practices is achieved.  As such it does not consider more horizontal issues
which would need to be addressed in developing a WTO transparency agreement, such as definition
and scope, exchange of information between governments or technical assistance.
Transparency means ensuring that information on procurement rules, practices and
opportunities are made widely available in an easily usable form to all interested parties (and
particularly potential suppliers), as well as ensuring the right of access to that information.
Furthermore, procurement policies and practices shou ld be seen to be transparent and information
provided should be respected.  In addition, transparency can be a useful tool to encourage open and
competitive procurement regimes, thereby helping both purchasers and suppliers to achieve economicbenefits.
The following points have been raised to date as requiring consideration in relation to this:
1. Choice of procurement method
The method of procurement used should not undermine the principles and objectives of a
transparency agreement to encourage open and competitive regimes.  Any provision relating to
procurement methods should be sufficiently flexible to accommodate the diversity of different
procurement methods used, and should allow for the possibility of using methods which are not basedon tendering.
1
The use of methods which, from the outset, severely restrict competition (e.g. single-source
procurement) should only be used in justified and exceptional cases.  An illustrative list of such
exceptional cases should be developed. This should be based on existing widely-found practices
including, but not necessarily limited to, the following:
                                                     
1 Whilst the methods used by WTO Members - at least for larger value contracts - mostly seem to be
based on the principle of tendering (open, selective, li mited), they are not necessarily limited to this (e.g.
purchase cards, electronic catalogues).WT/WGTGP/W/17
Page 2
- reasons of extreme urgency brought about by circumstances unforeseeable by the
procuring entity;
- national security reasons;
- in procurements involving the protection of patents, copyrights or other exclusive
rights;  or
- in the absence of responsive bids under methods which do not severely restrict
competition.
2. Providing information on national legislation and procedures
It is essential that all interested parties know in advance what the domestic procurement rules
are, what procurement opportunities they can expect to be open to them and the general environment
in which they are expected to operate.  Therefore, laws, regulations, policy guidance and
administrative procedures should be readily and easily accessible in a usable form to all interested
parties, including potential foreign suppliers.  This information should be provided at no more thancost.  The medium through which this information is provided (e.g. publication in a Gazette, or in
electronic format) should be left to the discretion of Members.
It would be desirable if interested parties were to know either where to go to locate this
information, or who to ask.  A requirement to noti fy either the source of this information and/or to
establish and notify an enquiry point (which could take the form of an Internet Website) should beconsidered.
3. Publication of procurement opportunities and procedural requirements
Procurement opportunities and procedural requirements relating to those opportunities should
be made known and be generally available through an accessible source.
The source used should be left to the discretion of WTO Members, but its level of availability
should be proportionate to the likely level of interest in the procurement.  In other words, where a
procurement opportunity is likely to attract international interest, procurement opportunities should be
published through a source which potential foreign suppliers and service providers have access to, as
opposed, for example, to posting a notice in a town hall.
Interested parties should know what the source is and have access to it.Electronic publication should be used where feasible and taking into account the level of
development of individual WTO Members.  Electronic publication offers significant benefits in terms
of both time and cost, and (based on current trends) will be used increasingly in the coming years.
However, at the present time, not all WTO Members have the capability to make use of electronic
means of procurement, neither do all suppliers.  Some flexibility will therefore be needed.Nevertheless, it seems safe to assume that potential suppliers to those Members who use electronic
publication are likely to have access to the Internet.  To enable WTO Members to meet such a
requirement, suitable technical assistance should be provided.
Exceptions to the obligation to publish procurement opportunities (e.g. to take account of
limited tendering in the case of the EC) should only be permitted in exceptional and justified cases.
These circumstances should be the same as those set out for the use of procurement methods which
severely restrict competition.WT/WGTGP/W/17
Page 3
3.1 What information should be provided?
All information required for potential suppliers to assess their interest in a procurement
opportunity or a registration/qualification system, and to prepare a responsive offer should be made
available.  This includes both information pertaining to the supplier and information pertaining to the
goods/services to be procured.  Members should be able to decide whether this is done just through
the use of tender notices, or whether the bulk of information is contained in the tender documentationor by other means.
Where procurement takes place by means of tendering, this general principle could usefully
be further elaborated through the development of an illustrative list of the sort of information which
must be provided including, but not necessarily limited to the following:
- full contact details of the procuring entity, as well as coordinates of a contact point
from which additional information may be requested, the final date for making such
requests and, if applicable, the cost of such information;
- an identifiable description of the goods and/or services to be provided, together with
their quantity or an indication of their extent;
- the place of delivery, site or place of performance of the service and, if applicable, the
time-limit for delivery, completion or duration of the contract;
- any requirements relating to the supplier or service provider, for example economic
or qualification requirements;
- any technical requirements;
- the criteria for the award of the contract;  and
- the final date for the receipt of bids or requests to participate, the address to which
this must be sent and details of any language requirements in this respect.
3.2 Time-limits
Sufficient time should be allowed for the preparation, submission and receipt of responsive
bids to individual procurement opportunities.  Any time-limits which are set should not undermine the
principles and objectives of a transparency agreement.  They should be determined with due
consideration to the particular circumstances of the procurement (including the likely level of interest)as well as the complexity of the procurement.
4. Transparency of decision-making
Decisions on supplier qualification and contract award should be taken only on the basis of
criteria (including in relation to technical specifications) which have been made known in advance.
Where procurement is carried by means of tendering, this information should be made known througheither the tender notice or the tender documentation.  A transparency agreement would not, as a
general rule, set out what those criteria should be.  Nevertheless, as far as technical specifications are
concerned, transparency is increased if these are defined in accordance with international standards
where these exist.WT/WGTGP/W/17
Page 4
In addition, a public announcement about the contract awarded is essential to provide bidders with the
opportunity to assess whether the procurement rules and practices have indeed been followed.  It is
also of interest to industry generally (as potential future bidders) and to governments which will want
to see the transparency agreement working in practice.  The means by which this is done should be a
matter of choice for individual WTO Members, but it should be known to interested parties.
It would also be desirable if unsuccessful bi dders were provided with information, when they
themselves request it, as to why their bid was rejected and/or the winning bid was chosen.  This is an
important guarantee of transparency, particularly in circumstances where limited information on the
contract awarded is provided.
It is, however, important that the issue of safeguarding confidential information is taken into
account.  Procuring entities should not be obliged to provide confidential information which would
prejudice the legitimate commercial interests of particular enterprises (whether public or private).
5. Domestic review
It is not sufficient that rules are introduced to ensure transparency in government procurement
practices.  There must also be a domestic mechanism to introduce accountability into the process and
to ensure that the rules are respected by everyone involved in the process.  This mechanism should
itself be transparent and provide a guarantee of independence.
This can be achieved through the combination of a variety of means:- procuring entities should be required to maintain a proper record of proceedings;
- at their request, unsuccessful suppliers should be informed of the outcome of their
bids and debriefed.  Individual WTO Members should be able to choose how to do
this, but interested parties should know what the method is;
- WTO Members should be required to provide a transparent, fair and independent
procedure for the review of complaints which should be available to all potential
suppliers, including foreign suppliers.  The choice of procedure should be left to
individual WTO Members.  It should resu lt in a published and reasoned conclusion.
6. Language
WT/WGTGP/W/6 shows that documents and other information relating to tendering
proceedings are generally provided in the official language(s) of the country of the procuring entity.
As a rule, documents and other information relating to procurement procedures and individual
procurements should be allowed to be provided to potential suppliers and service providers in an
official language of the country of the procuring entity.  In general, potential suppliers wishing to do
business in another country will have the necessary language facilities available.  There should not bea specific requirement to provide such information in a WTO language.  Nevertheless, procuring
entities could be encouraged to provide information in a WTO language where a particular
procurement opportunity is likely to attract international interest.
The issue of notification requirements to other governments and the WTO should be
considered separately.WT/WGTGP/W/17
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. Use of information technology
A transparency agreement should provide for the possibility of using IT tools to disseminate
information as an alternative to more traditional methods of communication.  It is particularly useful
for the dissemination of information about procurement opportunities and contracts awarded.  Indeed,
as mentioned in section 4 above, electronic means of disseminating information about procurement
opportunities should be used wherever this is feasible.  However, where they are used, IT tools shouldnot undermine the basic principle of guaranteeing access to information.
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