RESTRICTED  WORLD TRADE  
ORGANIZATION  S/WPGR/W/51 
11 November 2004 
 (04-4790) 
Working Party on GATS Rules  
  
 
 
MAIN APPROACHES TO THE UNDERTAKING OF COMMITMENTS ON 
GOVERNMENT PROCUREMENT IN ECONOMIC INTEGRATION AGREEMENTS: 
SUMMARY OBSERVATIONS  
 
Note by the Secretariat
1 
  
I. INTRODUCTION 
1. At the Working Party's meeting of 20 September 2004, the Secretariat was asked to prepare a 
Note summarizing main approaches taken in econom ic integration agreements with respect to 
commitments on government procurement, including  scheduling issues.  The summary observations 
in the next section were prepared after examining the relevant provisions in the economic integration 
agreements (EIA) reviewed in S/WPGR/W/49.
2  Part II is thus not inte nded to provide a description of 
approaches followed in each agreement, but to highlight  some of the main trends.  Further details on 
the scope of particular agreements, or their anne xes, might best be provided by parties to such 
agreements.   
II. SUMMARY OBSERVATIONS 
A. GENERAL STRUCTURE  
2. At the outset, it should be pointed out that government procurement provisions in EIAs 
typically do not refer to such terms as commitmen ts or schedules, which are used in the GATS.  
Rather, the application of liberalizing obligations (e .g., the sectors to which they apply) is generally 
determined by the Article relating to the scope or coverage of the whole set of government 
procurement provisions.  In most agreements, the sc ope and coverage (e.g., in  terms of thresholds, 
sectors, procuring entities) is further defined through annexes. 
3. Both goods and services are included within  the scope of the government procurement 
provisions of all agreements reviewed.3  Relevant obligations (non-di scrimination, award procedures, 
etc.) typically apply across the sectors covered, although a few exceptions exist in specific cases.4     
                                                      
1 This document has been prepared under the Secret ariat's own responsibility and without prejudice to 
the positions of Members and to their rights and obligations under the WTO.  
2 See Table 1 on page 5 of S/WPGR/W/49.  With respect to the EC, this Note focuses, unless indicated 
otherwise, on the recent EC Directive 2004/18/EC.  Given their close relationship with EC Directives, the EEA and the Europe Agreements with Bulgaria an d Romania are not examined in Part II.  
3 While EC Directive 2004/18/EC has broader coverage, EC Directive 2004/17/EC applies specifically 
to contracts awarded by entities in such sectors as water,  energy, transport and postal services sectors.  Such 
contracts can, however, involve the supply of goods or services.     
4 For example, the EC Directive sometimes make dis tinctions (e.g., Article 31 "Cases justifying the use 
of the negotiated procedure without publication of a contract notice"). S/WPGR/W/51 
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B. S
ERVICES COVERED  
4. Most agreements specify, in an  annex, the service sectors that are subject to procurement 
provisions.  While the EFTA-Mexico, EC-Mexico,  EC-Chile and EFTA Agreements, as well as the 
EC Directive, list the service sectors that are covered (i.e., positive-list approach) 5, the NAFTA, US-
Chile and US-Singapore Agreements use a negative-list  approach (i.e., all relevant service sectors are 
covered except those listed).  The Japan-Singapore Agreement specifies that all services listed in each 
country's relevant GPA annex (which is based on a positive list of services sectors for these countries) 
are covered except for certain sectors which are menti oned in its annex.  The Republic of Korea-Chile 
Agreement provides that all service sectors referred to in the Services Sectoral Classification List 
(MTN.GNS/W/120) are covered.  Other agreements  do not have country-specific annexes specifying 
sector coverage.   
C. ENTITIES COVERED  
5. Most agreements limit the scope of the provision s to procurement by specified entities.  The 
relevant lists are often structured by type of en tity, e.g., central government entities, sub-central 
government entities, government enterprises.  In a ddition, the annexes on entities in the US-Singapore 
and Japan-Singapore Agreements refer to entities in cluded in relevant anne xes of the Government 
Procurement Agreement (GPA), which also follow a positive-list approach.  In contrast, the Chile-El 
Salvador and Chile-Costa Rica Agreements use a ne gative-list approach.  The Australia-New Zealand 
and New Zealand-Singapore Agreemen ts do not contain lists of entities; the entities covered are those 
captured by the definition of government procurement.6  The definition of contracting authorities in 
the EC Directive includes, in add ition to State, regional or local authorities, bodies governed by public 
law, which themselves are further defined (see Article 1(9)).  A non-exhaustive list of bodies and 
categories of bodies governed by public law is annexed to the Directive.     
D. THRESHOLDS  
6. Agreements also typically limit the scope of th e provisions to procurement above a certain 
threshold value.  Thresholds often differ between  types of entity (e.g., central government entities 
versus sub-central government entities) and also vary between goods, constr uction services and other 
services (thresholds are generally higher for construction services than other services).  Apart from construction, however, agreements do not have different thresholds across services sectors or similar 
types of entities.  The Australia-New Zealand, Singapore-Australia, Chile-Costa Rica and Chile-El 
Salvador are the only agreements that do not have specific thresholds.   
E. 
CLASSIFICATION  
7. Agreements that include lists of service sectors (either those covered or those excluded) tend 
to make reference, at least in part, to either  the provisional CPC and/or the Services Sectoral 
Classification List.  Exceptions are the NAFTA (where the US and Canada refer to the Common Classification System)
7 and the US-Chile Agreement (where the Common Classification System is 
used by both signatories).   
                                                      
5 While the EC-Chile Agreement uses a positive list approach for the EC, the relevant annex for Chile's 
sectoral coverage provides that no services from th e universal list of services (W/120 and relevant CPC 
categories) are excluded.   
6 Article 48(e) of the New Zealand-Singapore Agreem ent and clause 1(e) of the Australia-New Zealand 
Government Procurement Agre ement (Revised 1997).  
7 See Appendix 1001.1b-2-B of Annex 1001.1b-2 of NAFTA for more information.  For construction 
services, the Common Classification System is based on CPC Division 51.  Mexico's temporary schedule of services refers to the CPC.  Canada's schedule refers to the Common classification system, but notes that the 
appropriate CPC definitions will continue to be ap plied until such time as definitions under the NAFTA 
classification system are mutually agreed upon.    S/WPGR/W/51 
 Page 3 
 
 
F. COUNTRY -SPECIFIC RESERVATIONS  
8. While the agreements reviewed do not prov ide for the inscription of limitations or 
reservations to particular liberalization obligations , many provide for country-specific exclusions from 
the coverage of the set of provisions.  These typi cally take the form of Notes in annexes, which 
typically exclude, for example, certain forms of  procurement or certain services.  They do not 
specifically permit price preferences or other discr iminatory measures, although Mexico has reserved 
certain rights in that regard in the agreements to  which it is party.  The extent to which country-
specific derogations are included in agreements might  depend on the scope of common exceptions or 
derogations that parties have agreed to (typically found in the text of the agreement), as well as on the 
comprehensiveness of an agreement. 
9. Examples of country-specific derogations include :  (a) a derogation regarding contracts for 
the acquisition, development, pro duction or co-production of programme material by broadcasters and 
contracts for broadcasting time (for EFTA States in the EFTA Mexico Agreement);  (b) a derogation 
allowing Mexico to impose certain local content requirements for particular types of projects (in NAFTA, the EFTA-Mexico, and EC-Mexico Agreements );  (c) a derogation for contracts awarded 
under an international agreement and intended for the joint implementation or exploitation of a project 
by signatory States and for contracts awarded under the particular procedure of an international 
organization (for EFTA States in the EFTA-Mexico Ag reement);  and (d) a derogation for set asides 
for small and minority businesses (for the US and Canada in the NAFTA). 
G. 
MODAL COVERAGE  
10. The agreements reviewed generally do not ma ke distinctions between different modes of 
supply.  The only mode-specific derogations that coul d be identified in the context of this study are 
the following: Article 16.02(4)(c) of the Chile-El Sa lvador and Chile-Costa Rica Agreements which 
exclude cross-border financial services from the chap ter's coverage; and Article 2(2)(e) of Chapter 6 
of the Singapore-Australia Agreement which excl udes from coverage the procurement of goods and 
services outside the territory of the procuring Pa rty, for consumption outside this territory. 
 
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