WORLD TRADE
ORGANIZATIONGPA/44
2 November 2000
(00-4609)
REPORT (2000) OF THE COMMITTEE ON
GOVERNMENT PROCUREMENT
I. GENERAL
1. This Report is submitted pursuant to Article XXIV:7(a) of the Agreement on Government
Procurement, which requires the Committee to revi ew annually the implementation and operation of
the Agreement and to inform annually the General Council of developments during the periods
covered by such reviews.
2. The Agreement on Government Procurement entered into force on 1 January 1996.  The
period covered in this Report is November 1999-October 2000, but the Report also reflects, where
necessary, the work of the Committee up to November 1999 (GPA/8 and Add.1, GPA/19, GPA/25
and GPA/30).  The Committee on Government Procurement held two meetings in 2000:  on 8 March
and 29 September 2000 (GPA/M/13 and 14).1
3. The following WTO Members are Parties to the Agreement:  Canada;  the European
Community and its fifteen member States;  Hong Kong, China;  Israel;  Japan;  Korea;  Liechtenstein;
the Kingdom of the Netherlands with respect to Aruba;  Norway;  Singapore;  Switzerland;  and the
United States.  Eighteen WTO Members have observer status:  Argentina, Australia, Bulgaria, Chile,
Colombia, the Czech Republic, Estonia, Georgia, Iceland, Jordan, the Kyrgyz Republic, Latvia,
Mongolia, Panama, Poland, the Slovak Republic, Sl ovenia and Turkey.  Four non-WTO Members,
Croatia, Lithuania, Chinese Taipei and Moldova and three intergovernmental organizations, the IMF,
the ITC and the OECD, also have observer status.
II. IMPLEMENTATION OF THE AGREEMENT
Modifications of Appendices to the Agreement
4. Article XXIV:6 of the Agreement requires Parties to notify rectifications of a purely formal
nature or other modifications relating to Appendices I through IV, which set out the mutually agreedcoverage provided under the Agreement.  Consequential rectifications or modifications become
effective once they are agreed to pursuant to the procedures under this Article.  Since the 1999 Report
of the Committee, modifications relating to their respective Appendices were made by
Hong Kong, China (GPA/W/102, 105 and 116) with entry into force respectively on 4 February 2000
(WT/Let/328), 17 February 2000 (WT/Let/332) and 26 August 2000 (WT/Let/355) and by Japan(GPA/W/115) with entry into force on 22 Augu st 2000 (WT/Let/354).  Furthermore, Switzerland
proposed modifications to its Annex 1 of Appendix I in document GPA/W/106 and Corr.1.  In
response to a request for clarification received from the delegation of the United States (GPA/W/111),
an explanatory note was subsequently submitted by the delegation of Switzerland identifying the
differences between the proposed modifications and the existing Annex 1 (GPA/W/114).  The
                                                     
1 GPA/M/14 will be circulated shortly.GPA/44
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modifications by Switzerland entered into force with effect on 29 September 2000 (WT/Let/356).
With regard to the proposed modifications notified by Japan on 6 September 1999 in document
GPA/W/91, Canada, the European Community and the United States communicated their objection to
the proposed modifications taking effect pending further consultations with Japan regarding the
withdrawal of an entity from its Annex 3, Appendix I.  Since the Committee's previous report,
consultations have been held between Japan and the delegations of the United States, the European
Community and Canada on the basis of the questions put to Japan by these delegations (GPA/W/97,
GPA/W/99, GPA/W/100 and GPA/W/ 100/Add.1) and Japan's an swers thereto (GPA/W/104,
GPA/W/104/Add.1, GPA/ W/107 and GPA/W/108).
Loose-leaf system for Appendices
5. The Appendices to the Agreement in the form of a loose-leaf system, pursuant to the Decision
of the Committee of 4 June 1996, were certified on 1 March 2000 (WT/Let/330).  In accordance with
the procedures for future changes to the loose-leaf system agreed by the Committee on
24 February 1997, subsequent modifications notified by Parties are certified and issued as
replacement pages to be inserted in the loose-leaf  system once they become effective in accordance
with the procedures of Article XXIV:6.  In addition to being made available in hard copy form, theloose-leaf system is circulated to Parties and other WTO Members in electronic form through the
WTO Document Dissemination Facility.  An up-to-date copy of the loose-leaf system is also available
to the general public through the government procurement site on the WTO Home Page on the
Internet (http: //www.wto.org/wto/ govt/loose.htm).
Thresholds
6. In accordance with the Decision on Modalities for Notifying Threshold Figures in National
Currencies (GPA/1, Annex 3), Ca nada (GPA/W/101/Add.1) and Hong Kong, China (GPA/W/101)
notified threshold figures in their national currency for the period 2000-2001, Japan
(GPA/W/101/Add.2) for 2000-2002 and Switzer land (GPA/W/101/A dd.3) and Norway
(GPA/W/101/Add.4) for 2000.
Notification and review of national implementing legislation
7. Pursuant to the Decision on the Procedures for the Notification of National Implementing
Legislation (GPA/1/Add.1), Canada;  the European Community;  Hong Kong, China;  Israel;  Japan;
Korea;  Norway;  Singapore;  Switzerland;  and th e United States have notified national implementing
legislation including their responses to the Ch ecklist of Issues (GPA /13, GPA/20, GPA/27, GPA/34,
GPA/37, GPA/12/Rev.1, GPA/10, GPA/ 39, GPA/15 and Add.1 and GPA/23, respectively).  At its
meeting on 8 March 2000, the Committee continued the review of national implementing legislation,
initiated in October 1998 (GPA/25), by taking up th e legislation of Hong Kong, China; and Norway in
addition to taking up outstanding points relating to the legislation of Canada, Korea and the United
States.  At its meeting on 29 September 2000, it initiated the review of Singapore as well ascompleting the reviews of the national implementing legislation of Canada;  Hong Kong, China;
Korea;  and Norway.  In accordance with the arrangements and the schedule for the review agreed by
the Committee, these reviews were conducted on the basis of responses provided by the Parties being
reviewed to written questions put by other Parties in advance of the review meeting at which their
respective national legislation was taken up.  At the next meeting, the Committee will revert to theoutstanding points relating to the legislation of  the United States and Singapore and take up the
review of the legislation of Israel, Japan, Liechtenstein and the Kingdom of the Netherlands with
respect to Aruba.GPA/44
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8. The Committee discussed the follow-up to Canada's offer, contained in its Appendix I,
Annexes 2 and 3, to cover sub-central government en tities and enterprises in all 10 Provinces, on the
basis of commitments received from the Provinces,  with a final listing to be provided within
18 months after the conclusion of the Agreement.  Canada's stated position since the entry into force
of the Agreement, linking the tabling of its schedule at the sub-central level to achieving increasedmarket access in sectors of priority interest to Canadian suppliers and improving security of market
access through circumscribing the use of small business and other set-aside exceptions under the
Agreement, remained unchanged.  Some other Pa rties expressed their disappointment over the
situation, they stressed the need for Canada to honour its commitments and considered that the
problems raised by Canada with respect to expanded coverage of the Agreement could only be
addressed once Canada had come forward with offers pursuant to its commitments in its Annexes 2
and 3.  Canada has asserted that it did not undertake obligations regarding Annexes 2 and 3, and hasreiterated that its coverage was to be based on commitments received from the Provinces.  Canada has
also asserted that, as no commitments have been received, it is under no obligation to put forward an
offer under these Annexes.
Statistical reporting
9. Article XIX:5 requires Parties to collect and provide on an annual basis statistics their
procurements covered by the Agreement.  During the period under review,  Switzerland provided
statistics for 1997 (GPA/22/Add.3), Japan fo r 1997 and 1998 (GPA/22/ Add.2 and GPA/29/Add.1),
Norway for 1998 (GPA/29/ Add.2), and Hong Kong, China for 1999 (GPA/40).
Consultations and dispute settlement
(i) United States – Measures Affecting Government Procurement
10. In July 1997, the European Communities and Japan requested, respectively, consultations
with the United States pursuant to Article XXII of the Agreement on Government Procurement andArticle 4 of the Understanding on Rules and Procedur es Governing the Settlement of Disputes (DSU),
regarding the Act Regulating State Contracts with Companies Doing Business with or in Burma
(Myanmar) enacted by the Commonwealth of Massachusetts on 25 June 1996
(WT/DS88/1-GPA/D2/1 and WT/DS88/2;  WT /DS95/1-GPA/D3/1 and WT/DS95/2).  On
21 October 1998, pursuant to the requests of the European Communities (WT/DS88/3 of
8 September 1998) and Japan (WT/DS95/3 of 8 Sept ember 1998), the DSB established a single panel
in accordance with Article 9 of the DSU and with standard terms of reference pursuant toArticle XXII:4 of the Agreement on Government  Procurement (WT/DSB/M/49).  The Panel was
constituted on 6 January 1999.  In a communication to the Chairman of the DSB, dated
10 February 1999, the Chairman of the Panel stated that, in the context of a United States court ruling
barring the implementation of the measure at issue, the European Communities and Japan had
requested the Panel to suspend its work in accordance with Article 12.12 of the DSU and that thePanel had agreed to this request (WT/DS88/5 and WT/DS95/5).  Since the Panel had not been
requested to resume its work within 12 months, pursuant to Article 12.12 of the DSU, the authority
for the establishment of the Panel lapsed as of 11 February 2000 (WT/DS88/6 and WT/DS95/6).
(ii) Korea – Measures Affecting Government Procurement
11. In a communication dated 16 February 1999, the United States requested consultations with
Korea pursuant to Article 4 of the DSU and Article XXII of the GPA (WT/DS163/1 and GPA/D4/1)
with respect to certain procurement practices of the Korean Airport Construction Authority and other
entities concerned with the procurement of airport construction in Korea.  Pursuant to the request by
the United States, dated 11 May 1999 (WT/DS163/4), the DSB established a panel on 16 June 1999 inaccordance with the provisions of Article 6 of the DSU and Article XXII of the Agreement, with theGPA/44
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standard terms of reference provided for in Article XXII:4 of the GPA (WT/DSB/M/64).  The
European Community participated as a third  party in the Panel proceedings in relation to the
complaint raised by the United States and Japan rese rved its rights in this respect.  The Panel was
constituted on 30 August 1999 (WT/DS163/5).  Its report, circulated on 1 May 2000 in
document WT/DS163/R, was adopted at the meetin g of the Dispute Settlement Body held on
19 June 2000 (WT/DSB/M/84).
Procedural matters
12. In accordance with its Decision on Procedures for the Circulation and Derestriction of
Documents (GPA/1/Add.2), Parties are considering a proposal for the derestriction of the documents
listed in document GPA/W/119 as of 15 November 2000.
III. ACCESSIONS
13. Iceland applied for accession to the Agreement on 22 June 1998.  Following the bilateral
consultations held between Iceland and Parties over the period 1998 to 2000, the Committee adopted,
at its meeting on 29 September 2000, a Decision providing for the accession of Iceland to the
Agreement on the basis of the terms attached to that Decision (GPA/43).  Under that Decision,
Iceland has one year to deposit its instrument of accession.
14. During the period under review, Jordan, Estonia and Bulgaria applied for accession on
12 July 2000, 4 September 2000 and 27 September 2000, respectively (GPA/38, GPA/41 and
GPA/42).  Estonia also submitted a draf t offer on 4 September 2000 (GPA/SPEC/9).
15. Latvia applied for accession to the Agreement on 16 June 1999 and initiated bilateral
consultations with interested Parties in February  2000 on the basis of its draft offer (GPA/SPEC/5).
Information on Latvia's national legislation on government procurement has been made available to
Parties in document GPA/28.  Latvia has also provided written responses to the questions and
comments that have been previously received from the United States (GPA/SPEC/8/Rev.1).  At each
of its meetings during the review period, the Committee took note of the status of bilateral
consultations with respect to the accession of the Kyrgyz Republic, Panama and Chinese Taipei.2
Informal plurilateral consultations will be held between Latvia and interested Parties in January 2001
and, if appropriate, with Jordan, Panama and Estonia.
16. During the period under review, the Committee has also carried out work on the streamlining
of the accession process.  This led to the adoption of a Checklist of Issues for the provision of
information by applicant governments relating to accession to the Agreement (GPA/35).  Work is
under way on the establishment of an indicative time-frame for accession negotiations and of
arrangements for reporting on the pr ogress of work (GPA/W/109/Rev.1).
                                                     
2 Panama applied for accession to the Agreement and tabled an initial offer on 24 June 1997
(GPA/W/53 and GPA/SPEC/3).  Panama pursued bilateral consultations with interested Parties in 1999 and
2000 on the basis of a revised offer submitte d on 10 December 1998 (GPA/SPEC/3/Rev.1).
Chinese Taipei applied for accession to the Agreement in June 1994 (GPA/IC/5) and submitted a draft
offer which was subsequently revised on 19 March 1997 (GPA/SPEC/1/Rev.1).  The domestic legislation ofChinese Taipei of 1998 was circulated in document GPA/36.
The Kyrgyz Republic applied for accession to the Agreement and tabled an initial offer on
11 May 1999 (GPA/SPEC/4).  The written questions and comments received from the United States were
circulated in GPA/SPEC/7.GPA/44
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IV. NEGOTIATIONS UNDER ARTICLE XXIV:7
17. Article XXIV:7(b) and (c) of the Agreement calls on the Parties, not later than the end of the
third year from the date of its entry into force,  to undertake further negotiations, with a view to
improving the Agreement and achieving the greatest possible extension of its coverage among all
Parties and eliminating any remaining discriminatory measures and practices.  As stated in its1996 Report to the General Council (GPA/8), the Committee agreed to undertake an early review
which was initiated in February 1997 in informal consultations, with an examination of modalities.
This review has covered, in particular, the following elements:  simplification and improvement of the
Agreement, including, where appropriate, adaptation to advances in the area of information
technology;  expansion of the coverage of the Agreement;  and elimination of discriminatory
measures and practices which distort open procurement.  An objective of the negotiations under
Article XXIV:7 is the expansion of the membership of the Agreement by making it more accessible tonon-Parties.  In this connection, a communication was sent in April 1997 by the Chairman of the
Committee to the WTO Members, drawing their attention, as well as the attention of governments
which are in the process of acceding to the WTO, to  this work and inviting them to participate as
observers in the meetings of the Committee (WT/L/206).  During the period covered by this report,
Parties pursued their consultations in three informal meetings held in March, June andSeptember 2000 on the basis of proposals by delegations.  These have been reflected in successive
versions of an informal note reflecting the discussions on the draft texts of the modifications to the
Articles of the Agreement proposed by various Partie s "Suggested Drafting Changes to the Text of the
Agreement" (the latest revision of which was circulated as Job No. 5749).
18. During the review period, Parties have also considered the time-frame for carrying forward
the negotiations provided for under Article XXIV:7 and the overall work programme that should be
envisaged within that time-frame.  On the issue of time-frame, there is a general view that delegations
should be guided by a target date of mid-2001 or the Fourth Ministerial Conference if that is held
around that time and that intermediate time-frames should be set for the different stages of work.
Based on a categorization of issues agreed to at the June 2000 meeting, Parties had extensivediscussions under the Article-by-Article review relating to Articles VII-XV and XVIII, paragraphs 1,
3 and 4 (June meeting), the basic principles of the Agreement (Articles XIX:1, III, IV, XVI, XVII:1),
technical specifications (Article VI), and bid review (Articles XVIII:2, XX) (September meeting).  In
addition, at the September meeting, Parties had a further exchange of views on the basis of the
proposals put forward earlier on Articles VII-XV and Article XVIII, paragraphs 1, 3 and 4, including
those presented by the United States at the Ju ne meeting (GPA/W/112 and GPA/W/113), taking into
account the written questions of other Parties and the United States' answers relating to theseproposals that had been circulated as Job No 5595 and Job No. 4954/Add.1. At both the June and
September meetings, Parties also considered the other aspects of the Article XXIV:7 negotiations - the
elimination of discriminatory measures and the expansion of coverage.  It was noted that, at the next
informal meeting to be held in the last week of January 2001, when issues of coverage and scope
would be discussed, Parties would have a special focus on these other aspects.  As agreed at the Junemeeting, the Parties will consider at that time,  in addition to the issues of scope and coverage
(Articles I, II and Annexes), exceptions (Articles XXIII, V), institutional provisions (Articles XIX:2,
XIX:5, XXI, XII, XXIV, XVII:2) and statistical reporting (Article XIX:5).
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