WORLD TRADE  
ORGANIZATION  WT/WGTGP/7 
15 July 2003 
 (03-3835) 
 
   
REPORT (2003) OF THE WORKING GROUP ON TRANSPARENCY IN  
GOVERNMENT PROCUREMENT TO THE GENERAL COUNCIL 
 
  
I. INTRODUCTION 
1. In the year 2002, the Working Group conti nued its work under the Chairmanship of 
Ambassador Ronald Saborío Soto (Costa Rica) pursuant to the mandate provided in the Singapore 
Ministerial Declaration and paragraph 26 of the D oha Ministerial Declaration (WT/MIN(01)/DEC/1).  
Paragraph 26 reads as follows: 
26. Recognizing the case for a multilateral agreement on transparency in 
government procurement and the need for e nhanced technical assistance and capacity 
building in this area, we agree that negotia tions will take place after the Fifth Session 
of the Ministerial Conference on the basis of a decision to be taken, by explicit consensus, at that Session on modalities of negotiations.  These negotiations will build on the progress made in the Working Group on Transparency in Government 
Procurement by that time and take into acc ount participants' development priorities, 
especially those of least-developed country pa rticipants.  Negotiations shall be limited 
to the transparency aspects and therefore w ill not restrict the scope for countries to 
give preferences to domestic supplies and suppliers.  We commit ourselves to 
ensuring adequate technical assistance and support for capacity building both during the negotiations and after their conclusion. 
2. As agreed at an informal meeting of the Working Group which took place on 
29 January 2003, in addition to the work mandate d by paragraph 26, the Working Group had a focus, 
at each of its meetings in 2003, on the matters of :  (a) transparency-related provisions in existing 
international instruments on government procurem ent and national procedures and practices;  and 
(b) technical assistance and capacity-building. 
3. At the Working Group's meeting held on 7 Fe bruary 2003, the Working Group discussed 
transparency-related provisions in existing intern ational instruments on government procurement and 
national procedures and practices.  In particular , comments were made on items I (definition and 
scope of government procurement), VIII (domest ic review procedures) and XI (WTO dispute 
settlement procedures)
1 in the informal note by the Chairm an entitled "List of Issues Raised and 
Points Made" contained in JOB( 99)6782 of November 1999.  Further, the Working Group discussed 
technical assistance and capacity building as called for by paragraph 26 of the Doha Ministerial 
Declaration. 
4. At the meeting held on 18 June 2003, th e Working Group continued its discussion of 
transparency-related provisions in existing intern ational instruments on government procurement and 
national procedures and practices, and technical assistance and capacity building. 
                                                      
1 M/17, para. 4. WT/WGTGP/7 
Page 2  
 
II. ISSUES DISCUSSED IN THE WORKING GROUP 
5. This section of the Report provides an overview of the substantive work done in the Working 
Group in 2003, pursuant to the mandate given in pa ragraph 26 of the Doha Ministerial Declaration 
(WT/MIN(01)/DEC/1).  By its very nature, such an overview cannot reflect everything that was said 
and capture all nuances of the discussion such as can be found in the detailed records of the Working 
Group's meetings during the year (WT/WGTCP/M/17 and WT/WGTGP/M/18) and in the written 
contributions of Members. 
A. 
TRANSPARENCY -RELATED PROVISIONS IN EXISTING INTERNATIONAL INSTRUMENTS ON 
GOVERNMENT PROCUREMENT AND NATI ONAL PROCEDURES AND PRACTICES  
6. This matter was discussed by the Working Gr oup at its meetings of 7 February and 
18 June 2003.  Written submissions  on this item were provided by the representatives of the United 
States  (entitled "Considerations related to Enforc ement of an Agreement on Transparency in 
Government Procurement");  the European Communities  (entitled "Domestic Review Mechanisms 
Related to Transparency in Government Procurement");  Korea  (entitled "Work Ahead up to the 
Cancun Ministerial");  and the European Communities  (entitled "Positive Effects of Transparency in 
Government Procurement and It s Implementation").  They were circulated in documents 
WT/WGTGP/W/38, 39, 40 and 41 respectively.2  The representatives of Australia ;  Brazil ;  Canada ;  
Chile ;  China ;  Chinese Taipei ;  Colombia ;  Cuba ;  Dominican Republic ;  Egypt ;  European 
Communities ;  Hong Kong, China ;  Hungary ;  India ;  Japan ;  Korea ;  Malaysia ;  Morocco ;  Pakistan ;  
Peru;  Philippines ;  Poland ;  Nigeria ;  Sri Lanka ;  Switzerland ;  Thailand ;  United States ;  and 
Venezuela  made oral statements or posed questions. 
7. At both meetings, the Working Group took up the items on the Chairman's "List of Issues 
Raised and Points Made" (JOB(99)6782 of Nove mber 1999).  Discussions focused on Items I 
(Definition and Scope of Governme nt Procurement), VIII (Domestic Review Procedures), XI (WTO 
Dispute Settlement Procedures) and XII (Techni cal Cooperation and Special and Differential 
Treatment for Developing Countries).  Set out below is a summary of the Working Groups' 
discussions on these matters. 
8. In addition to the above-mentioned issues, th e Working Group touched on a number of more 
general issues.  With respect to the issue of the importance of transparency in government  
procurement for international trade , it was noted that all Member governments purchased goods and 
services both domestically and abroad.  The view was expressed that, consequently, there was a 
significant amount of international trade generated by  public entities when, in the exercise of their 
sovereign powers, they decided to purchase internati onally.  Given the impact on international trade, 
rules ensuring transparency should be negotiated in the WTO.3 
9. Some of the benefits considered to be associ ated with a future multilateral agreement on 
transparency in government procurement that would accrue to procuring entities as well as to 
participating bidders were identified.  First, it was suggested that transparency would result in 
enhanced efficiency and increased innovation.  Specifically, public procurement applied in a 
transparent environment with a clear set of rules de fined in advance and respected by all parties might 
allow tendering companies from both developed a nd developing countries to foster enhanced 
competition, which would, in turn, stimulate innovation amongst bidders.  Second, a multilateral 
agreement would result in better value-for-money.  In  particular, transparent tendering should lead to 
effective competition between bidders (in some case s from foreign bidders), reduce the level of bids, 
and this would reduce the amount of public expenditu re.  Third, transparency rules would encourage 
domestic and foreign investment a nd partnerships between local and foreign suppliers.  This benefit 
                                                      
2 Hereinafter in the Report, documents issued in the series WT/WGTGP/W/- series are referred to as 
"W/…";  documents issued in the WT/WGTGP /M/- series are referred to as "M/…". 
3 M/18, para. 5.  WT/WGTGP/7 
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was considered to be of particular importance fo r developing countries that were trying to develop 
their markets.  Fourth, a transparen cy agreement would have the effect of reducing corruption.  It was 
suggested that this was a welcome side-effect for all countries.4  Fifth, ensuring transparency in 
government procurement was a core element of good governance and that this, in turn, was essential 
to economic development.5  Finally, an agreement on transparency in government procurement would 
result in the establishment of a minimum set of rules applicable world-wide that would have the effect 
of introducing legal certainty to  existing procurement procedures.6  Reference was also made to a 
number of Members' experience with transparent procurement regimes.  In this regard, it was noted that the enhancement of transparency in government  procurement attracted more international bidders 
and foreign investment.
7  The view was expressed that tran sparency in government procurement 
should not be perceived as politically controversial given the numerous benefits that flowed from 
transparency in government procurement and give n that the issue of market access did not arise.8 
10. The view was expressed that, despite the theore tical and actual benefits associated with 
transparency in government procurement, this was not necessarily a sufficient basis upon which to 
create multilateral rules in the area.9  Reservations regarding bindi ng obligations in the area were 
expressed, particularly because the issue at  stake was only one of transparency.10  The point was made 
that, while the benefits of transparency could not be denied by any Member, it was necessary to 
demonstrate and understand how an agreement on tr ansparency in government procurement would 
enhance relations among WTO Members and how one Member applying enhanced transparency in 
government procurement affected and bene fited its trading partners in the WTO.11 
11. With regard to the nature of a multilateral agreemen t on transparency in government 
procurement , the suggestion was made that a multilateral  agreement on transparency in government 
procurement did not need to be a complex undertak ing.  It was noted that the Doha Ministerial 
Declaration had narrowed the scope of a possibl e agreement on transparency in government 
procurement by limiting the parameters to transparen cy aspects and by providing explicitly that such 
an agreement should neither restrict domestic preferences nor require market access commitments.12  
Recognizing difficulties for developing countries to im plement a future agreem ent on transparency in 
government procurement, it was suggested that su ch an agreement be si mple, focusing on core 
principles such as transparency in procurement oppor tunities and other elements as illustrated in the 
items in the Chairman's "List of Issues Raised and Points Made" (JOB(99) 6782 of November 1999).13  
An agreement should encompass a robust principles-b ased approach both with respect to transparency 
and due process aspects but which, at the same time , was not prescriptive and which did not confer a 
right to challenge tender outcomes.  Such an agre ement could be the first step towards a genuine 
multilateral instrument designed to facilitate comp anies' access to information about procurement 
opportunities, processes and practices and, at the same time, could provide the benefit of a more competitive procurement market.
14 
12. It was questioned whether the elements that we re the subject of discussion within the context 
of the Working Group related exclusively to issue of transparency.  The point was made that even 
with respect to those elements that were purely re lated to issues of transparency, clarification was 
needed as to whether they pertained to procuremen t procedures or, rather, to procurement activity in 
                                                      
4 M/18, paras. 6 and 23. 
5 M/18, para. 41. 
6 M/18, para. 17. 
7 M/18, para. 19. 
8 M/18, para. 5.  See also M/18, paras. 24, 30 and 31. 
9 M/18, paras. 20 and 22. 
10 M/18, para. 21. 
11 M/18, para. 10. 
12 M/17, para. 3. 
13 M/18, para. 16. 
14 M/18, paras. 17 and 21. WT/WGTGP/7 
Page 4  
 
general.
15  A related point was made that a transp arency agreement should not interfere with 
substantive decisions made by procuring entities, such as the evaluation of offers, decision-making 
processes, provision of relief to unsuccessful tendere rs, and review of procuring entities' decisions, 
etc.16 
13. It was noted that, while foreign access might be granted to procurement markets in some 
cases, the Working Group's mandate did not enta il a market access component.  Clarification was 
sought as to whether progression from a transparency  agreement to one aimed at securing market 
access in the future would be sought.  Clarifica tion was also sought about whether it was proposed 
that a future agreement on transparency would be applied without distincti on between tenders open to 
international bids and those that were not.17  In response, it was noted that, while the future agreement 
on transparency in government procurement should be  applicable without distinction between bids 
open to foreigners and those that were not, this would not impinge upon the right of governments to 
decide what ultimately would remain ex clusively reserved for national bidders.18 
14. With regard to the issue of the relationship between transparency in government and the 
reduction of corruption, the view was expressed that corruption existed in all countries, even 
notwithstanding the application of transparency rules.   Nevertheless, transparency rules enhanced the 
ability of countries to combat this problem.19  In response, the point w as made that, while reducing 
corruption was a laudable objective for all natio nal governments, it should not be a principal 
objective, nor should it be built into any possibl e agreement on transparency in government 
procurement.  This was a moral issue, and that mora l, social and similar kinds of issues were not the 
domain of the WTO.  Rather, such issues should be  addressed by each Member in accordance with its 
own respective legislation.  It was also questi oned how a multilateral agreement could assist Members 
in combating such practices.20  In response, it was noted that the rationale underlying a future 
agreement on transparency in government procuremen t would not be to reduce corruption.  Nor would 
a future multilateral agreement contain specific pr ovisions on corruption.  Rather, the reduction of 
corruption would be a side-effect of the agreement.21 
Definition and Scope of an  Agreement on Transparency in Government Procurement 
15. In taking up the items in the informal note by the Chairman "List of Issues Raised and Points 
Made" contained in JOB(99)6782 of  November 1999, comments were made in relation to item I, 
being the definition and scope of government procurement .  On the one hand, the point was made that 
the substance of the Working Group's discussion w as transparency in the procurement process, 
irrespective of whether this related to contract s for goods, services or a combination of both.  The 
view was expressed that, accordingly, since a fu ture agreement would not have a market access 
component, it should have a broad coverage exte nding to goods, services and construction services.  
Additionally, given the difficulty associated with distinguishing between procurement that should or should not be subject to transparency rules and that  procurement regimes in most countries applied the 
same rules to procurement of both goods and services, it was important that the whole system, 
including goods and services, be transparent.
22 
16. Another view was that any eventual agreemen t on transparency in government procurement 
should be limited in scope to procurement of goods only and should not include procurement of 
services or any combination of goods and services.  In  this regard, transparency in procurement of 
services went beyond the Working Group's mandate.  Re-opening the issue of transparency in 
                                                      
15 M/17, para. 9. 
16 M/18, para. 48. 
17 M/18, para. 25. 
18 M/18, paras. 7, 26 and 30. 
19 M/18, para. 38. 
20 M/18, para. 39. 
21 M/18, paras. 38 and 40. 
22 M/17, para. 10.  WT/WGTGP/7 
 Page 5 
 
 
procurement of services might be counter-productive and that the Group should instead seek to build 
on the progress made in discussions relating to tr ansparency in relation to goods procurement.23  
However, it was recognized that procurement of goods often entailed procurement of services and 
there was a need to take account of this possibility.24  It was further suggested that there might be a 
need to provide flexibility for developing countri es with respect to the procurement of services25 given 
that smaller developing countries did not procure significant quantities of services.26 
17. With respect to the issue of the application of thresholds  in the context of a possible 
agreement on transparency in government procur ement, the view was expressed that thresholds 
should be included in an agreement on transparency in government procurement.  The point was made 
that a transparency agreement would become to o onerous without the inclusion of thresholds, 
particularly for developing countries.  In the ab sence of thresholds, the agreement would apply even 
to the smallest of procurements.27  Higher thresholds might apply for developing countries or, at least, 
for the least-developed countries, if that was c onsidered the way to acco mmodate such countries' 
concerns in the future.28  However, there was also a view questioning the relevance of thresholds in 
the context of transparency in government pr ocurement.  There should be a commitment to 
transparency and openness even for small tenders.29  In response, the view was expressed that while it 
might theoretically be the case that transparency sh ould be applied irrespective of the magnitude of 
the procurement in question, thresholds might be a way to provide fl exibility to accommodate 
developing countries' needs.30 
18. As regards the level of government  that might be covered by a transparency agreement, in 
response to a statement that a tran sparency agreement should be appli cable at the federal level as well 
as the sub-federal and municipal levels, the view  was expressed that a multilateral agreement on 
transparency in government procurement should be  limited to procurement by federal entities and 
should not extend to procurement by ent ities at the sub-federal level because, inter alia , local entities 
encountered capacity problems.31 
Domestic Review Procedures and WTO Dispute Settlement Procedures 
19. Comments were also made on items VIII and XI of the Chairman's "List of Issues Raised and 
Points Made"32, concerning domestic review procedures and WTO dispute settlement procedures 
respectively.  Some general comments were made in  relation to both domestic review procedures and 
the application of WTO dispute settlement procedur es.  In addition, separate and specific comments 
were made in relation to the two compliance mechan isms.  In relation to domestic review procedures, 
discussions touched, inter alia , on the pros and cons associated with domestic review procedures;  the 
degree of precision of provisions on domestic review  procedures, if any, in a WTO transparency 
agreement;  and the scope of application of dom estic review procedures under a WTO transparency 
agreement.  In relation to WTO disputes settleme nt procedures, the issues discussed included the 
question of whether such procedures should apply to  a transparency agreement and the circumstances 
in which the DSU might apply.  Comments were al so made about the interaction between domestic 
review procedures and the application of the WTO Dispute Settlement Understanding. 
                                                      
23 M/17, paras. 8, 9 and 11. 
24 M/17, paras. 6 and 7. 
25 M/17, para. 6. 
26 M/17, para. 6. 
27 M/18, para. 11. 
28 M/17, paras. 5 and 6;  M/18, para. 8. 
29 M/18, para. 28. 
30 M/18, para. 29. 
31 M/18, para. 27. 
32 JOB(99)6782, November 1999. WT/WGTGP/7 
Page 6  
 
20. Some general comments were made covering both domestic review procedures and the 
application of WTO dispute settlement procedures .  Referring to submissions that had been made in 
relation to this item
33, the view was expressed that a strong case had been made for ensuring adequate 
enforcement mechanisms.34  The existence of provisions on domestic review in other WTO 
agreements clearly highlighted the widespread a pplicability of that concept to trade matters.  
Procurement involved dom estic implementation of trade-rela ted matters and, in that sense, 
procurement rules were similar to the ru les contained in other WTO agreements.35  Accordingly, 
domestic review procedures and th e DSU should be among the core elem ents of a future transparency 
agreement in government procurement.36 
21. Another view was that domestic review pro cedures and the application of the DSU had 
nothing to do with transparency.  They were out side the scope of an agreement that dealt with 
transparency.  As long as those two elements were on the negotiating table, there would be no 
consensus at the Cancun Ministerial Conference to negotiate an agreement in this area.  It was 
stressed that any eventual agreem ent on transparency in government procurement should be limited in 
scope, should not be prescriptive, and should not c ontain provisions on domestic procurement review 
that could be used to question the decisions of Members' governments, administrations and procuring 
entities.37 
22. In response, the point was made that the provisions on domestic review procedures and 
dispute settlement would be determin ed by the rules that might emerge from the negotiations.  It was 
acknowledged that such rules had to be consiste nt with Members' governance objectives.  It was 
difficult to delve into domestic review and dispute settlement issues except in a rather general way 
until Members knew the content, coverage a nd elements of a transparency agreement.38 
23. It was noted that there was perhaps an unnecessa ry fear that the Working Group would try to 
develop a one-size-fits-all model in relation to enforcement mechanisms.39  Members should work 
towards identifying the models of enforcement mechanisms that coul d be appropriately applied to a 
transparency agreement40 and that worked best for them b ased on their legal traditions, experiences 
and background.41  Many countries had used the UNCITRAL Model Law as a guide  for development 
of their respective procurement systems.  Others  had used the World Bank Guidelines while others 
had developed their laws in other ways.42 
24. With respect to the pros and cons associated with domestic review procedures , the view was 
expressed that such procedures were important for the proper functioning of a procurement system, 
not only for foreign suppliers but also for domestic constituencies.43  The establishment and 
maintenance of a transparent procurement system pr ovided confidence to potential suppliers that they 
would be treated fairly in the procurement pr ocess.  When procurement processes became clouded 
and decisions were perceived not to follow a logi cal outcome, suppliers could lose confidence in the 
system.44  Based on the experience of countries that al ready had domestic review procedures, it was 
suggested that such  procedures provided credibility.  They also  assured suppliers that, if they had a 
complaint against a decision of a procuring entity, they would have the means for having that decision 
reviewed by an impartial body.  Most Members al ready had domestic review procedures in place, not 
                                                      
33 WT/WGTGP/W/38 and 39. 
34 M/17, para. 26. 
35 M/17, para. 17. 
36 M/17, paras. 18 and 19. 
37 M/17, para. 23. 
38 M/17, paras. 18 and 35. 
39 M/17, para. 65. 
40 M/17, para. 17. 
41 M/17, para. 65. 
42 M/17, para. 65. 
43 M/17, para. 18. 
44 M/17, para. 20.  WT/WGTGP/7 
 Page 7 
 
 
because the WTO had imposed an obligation requiri ng them but, rather because such Members had 
determined that it was in their best interest.  On  the basis of the foregoi ng, it was suggested that 
domestic review procedures should be part of a transparency agreement.45 
25. Another view was that domestic review pro cedures had nothing to do with transparency.  
Therefore, they were outside the scope of an agreement that dealt with transparency.46  Further, 
domestic review procedures might be susceptible to abusive challenges that were aimed at delaying 
the procurement process and could result in the re-commencement of the procurement process if, as a result of such a challenge, the original process was de clared null and void.  With this perspective, the 
view was expressed that suppliers' rights had to be balanced against the interest of governments to 
conduct efficient procurement processes and the need  to guarantee an efficient allocation of public 
resources.
47  Another view was that suppliers did not normally use domestic review procedures very 
often – possibly because they wished to avoid prob lems arising with procuring entities in future 
tenders.  In response, the view was expressed that s uppliers were perfectly aware of their legislative 
rights and they exercised them to the extent possi ble without fear of being sidelined in future 
procurements.48 
26. In relation to the degree of specificity that provisions , if any, on domestic review procedures 
should have in a WTO transparency agreement , the view was expressed that domestic review 
obligations should be strong but non-prescriptive.49  An agreement on transparency in government 
procurement could include simple and flexible prov isions on domestic review procedures that took 
into account and accommodated independent admini strative or judicial tribunals and review 
procedures that currently existe d in various Member countries.50  Adequate domestic administrative, 
audit and judicial mechanisms were already in place in  many countries to ensure that all participants 
in the procurement process acted in conformity wi th the applicable rules and procedures.  It was 
suggested that the need for the establishment of a domestic re view mechanism would arise only if a 
Member's pre-existing system did not guarantee the overall transparency of government procurement.
51 
27. In response, the question was raised as to whether an agreement on transparency in 
government procurement should impose common oblig ations with respect to domestic review 
procedures or whether Members should be left to establish their own procedures.  Opposition was 
voiced to common obligations, common procedur es and common mechanisms with respect to 
domestic review commitments.  It was noted in this regard that domestic review provisions contained 
in existing WTO Agreements did not require that a ll Members have or apply common rules but, rather 
that the rules were consistent w ith their commitments in the WTO.52 
28. In counter-response, it was stressed that the ag reement should set out ge neral obligations or 
principles and each Member would then have to impl ement them in the way th at worked best within 
its domestic system.53  This approach would be an effec tive way of ensuring that the general 
principles were applied while simultaneously acco mmodating disciplines contained in pre-existing 
domestic procedures.54  Responding to this view, it was noted that most WTO Members had 
reasonable and adequate administrative, arbitral a nd/or judicial mechanisms to suit their domestic 
needs and level of development, which ensured that  all players in the procurement process acted in 
conformity with the relevant rules and procedures.   Accordingly, the stipulation of any mandatory 
                                                      
45 M/17, paras. 20, 21, 25 and 36. 
46 M/17, para. 23. 
47 M/17, para. 36. 
48 M/17, para. 37. 
49 M/17, para. 33. 
50 M/17, paras. 33, 56 and 64. 
51 M/17, para. 34. 
52 M/17, paras. 59 and 61. 
53 M/17, paras. 57 and 64. 
54 M/17, para. 57. WT/WGTGP/7 
Page 8  
 
rules or prescriptive guidelines in a transparency ag reement would not be acceptable.  The primacy of 
domestic laws and procedures had to be preserved and there should be no requirement to change 
them.
55 
29. As to what would be the scope of application of  domestic review procedures under a WTO 
transparency agreement , the view was expressed that such pro cedures should ensure that all suppliers 
participating in a procurement had the legal right to  challenge that process, independently of whether 
that procurement was covered by the agreement.  Fo r example, even if a procurement was subject to a 
national preference and even if only a Member's nati onal suppliers had the right to have recourse to 
domestic review, the limitation of the scope of the agreement to transparency should not affect the 
ability of a national supplier to challenge procurement decisions in such cases.56 
30. In response, the view was expressed that  Members should be allowed to limit the 
implementation of transparency rules, including the domestic review procedures.  It was questioned why all suppliers should be provided with the oppor tunity to challenge procurement processes given 
that the work of the Working Group had nothing to do with market access.
57  Consistent with the 
Doha mandate, which explicitly excluded domestic pr eference schemes, enforcement mechanisms in a 
transparency agreement could not be  used to challenge such schemes.58  More specifically, if a 
national procurement system allowed governments to  maintain domestic preferences, the right to 
challenge a procurement procedure s hould be limited to national suppliers.59  Even if the domestic 
rules provided that suppliers had a right to challe nge a procurement decision, a foreigner should not 
be able to invoke a WTO transparency agreemen t in cases where the tender did not fall under the 
scope of the agreement.60 
31. In counter-response, the point was made that , although the transparency agreement would 
exclude market access, government authorities in WTO Members did not meet their procurement needs only through domestic suppliers but also th rough foreign suppliers.  Therefore, foreign 
suppliers' interests should also be protected.  It w as suggested that the transparency agreement should 
require Members to make available domestic re view procedures for both domestic and foreign 
suppliers who were concerned that a particular procurement had not been in compliance with the 
transparency provisions of the agreement.
61 
32. The view was expressed that in the absence of reassurance that domestic review procedures 
would not question the decisions of domestic authorities, the inclusion of such procedures in a transparency agreement could not be accepted.
62  Further, while domestic review provisions existed in 
a number of WTO agreements, those agreements were  not related to transparency.  A transparency 
agreement would essentially require making available cer tain information on Members' relevant rules, 
regulations and procedures.  Acco rdingly, domestic challenge procedures did not have their place in a 
transparency agreement.63 
33. The point was made that the establishment of domestic review mechanisms was an area 
where developing countries might be able to seek technical assistance for capacity building .64 
                                                      
55 M/17, para. 58. 
56 M/17, para. 74. 
57 M/17, para. 54. 
58 M/17, para. 49. 
59 M/17, para. 51. 
60 M/17, para. 75. 
61 M/17, para. 52. 
62 M/17, para. 23. 
63 M/17, para. 27. 
64 M/17, para. 48.  WT/WGTGP/7 
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34. In relation to the application of WTO dispute settlement procedures  in the area of 
transparency in government procurement, the view was expressed that an agreement on transparency 
in government procurement would be an important addition to the rules-based international trading 
system and its obligations should be subject to th e same types of enforcement procedures as existing 
commitments in other WTO agreements.65  Without a link to the DSU,  a transparency agreement 
would not be effective.  Members would simply  ignore the requirements of the agreement knowing 
that they would suffer no detriment for having done so.66 
35. Another view was that the dispute settlement mech anism in whole or in part should not apply 
to a transparency agreement.67  Members had to abide by the mandate given to the Working Group, 
namely to clarify and define transparency rather than identifying what w ould transpire in cases where 
Members did not abide by transparency rules.68  Further, the nature of an agreement on transparency 
in government procurement would be inherently different from any existing WTO agreement.  Unlike 
other WTO agreements, an agreement on transparency  in government procurement, which – in terms 
of the Doha mandate – would allow Members to continue to discriminate in favour of national 
suppliers, would not seek to address trade relati ons among Members.  The WTO dispute settlement 
mechanism was based on the presumption that a violati on of an obligation would have an effect on the 
trade of Members whereas, in the context of  an agreement on transparency in government 
procurement, there could be no such presumption.  In addition, under the DSU, the way to correct 
non-compliance was through  compensation or retaliation.  It would be difficult to base any dispute 
settlement mechanism applying to transparency in government procurement on that premise because 
there would be no violation of trade rights.69  Similarly, existing enforcement mechanisms had been 
devised to ensure fair trade and to avoid the creation of unnecessary obstacles to trade, which were 
market access issues.  Without obligations on ma rket access, an agreem ent on transparency in 
government procurement should not be treated like other WTO agreements.70 
36. In response, the view was expressed that, simi lar to other WTO agreements, a transparency 
agreement would contain obligations  and requirements and an enforcement mechanism was needed in 
order to make those obligations  and requirements meaningful.71  Further, it was suggested that as well 
as having market access as their principal focus,  many WTO agreements included transparency 
elements.  The agreement on transparency in gove rnment procurement would be similar to other 
WTO agreements in this respect.  The WTO agreemen ts that had transparency elements did not carve 
out the transparency elements to provide that such elements were not subject to WTO dispute 
settlement procedures.  Any Member could challe nge another Member's implementation of such 
transparency provisions.  Further, while accepting th at the agreement was about transparency, and not 
about market access, the point was made that if a Member did not implement any of the provisions of the transparency agreement, Members would not be seeking concessions or retaliation, but 
compliance.
72 
37. It was suggested that while there was a need fo r enforcement measures, that did not mean that 
they had to be identical to the existing rules in  the DSU.  There could be specific provisions on 
implementation of the DSU tailored to th e scope of the transparency agreement.73  There were already 
a number of WTO agreements with specific provisi ons relating to the application of the DSU, for 
instance, Article XXII:4 of the plurilateral Agre ement on Government Procurement dealing with 
consultations and dispute settlement with regard to cross-retaliation.74  It was suggested that the 
                                                      
65 M/17, paras. 14 and 19. 
66 M/17, para. 66. 
67 M/17, paras. 30 and 31;  M/18, para. 43. 
68 M/17, para. 30. 
69 M/17, para. 16. 
70 M/17, para. 25. 
71 M/17, para. 26. 
72 M/17, para. 32. 
73 M/17, paras. 66, 71 and 74. 
74 M/17, para. 71. WT/WGTGP/7 
Page 10  
 
Working Group consider the flexibilities provided in the provisions of the DSU and in other agreements, for instance Article 17 of the Anti-dumping Agreement.
75  It was also suggested that 
there may not be a need for sanctions or suspension  of concessions or cross-retaliation to ensure that 
the agreement was enforced.76  Members should identify provisions that might be more difficult for 
Members to implement and, perhaps, such provi sions could be subject to transition periods.77 
38. It was suggested that certain provisions of a transparency agreement could be phased in for 
developing countries and that, consequently, the application of the DSU for such countries would also be phased-in.
78  It was suggested that the Working Gr oup should assess which provisions could be 
problematic to implement for some countries and th at a flexible approach should be adopted to 
phasing-in those provisions.79 
39. As to the circumstances in which the DSU mi ght apply under a transparency agreement , the 
view was expressed that the DSU would be available for systemic failures to comply with or a high 
level of disregard to the agreement, for instance, if there were refusals to ever publish a notice, or 
refusals to ever make information available about procurement methods.80  Nevertheless, based on 
Members' experience with transparency provisions in other WTO Agreements, it was suggested that 
the likelihood of a transparency provision being challenged in the DSU was very low.81 
40. In response, while it was acknowledged that in  all probability a case under the agreement on 
transparency in government procurement would not  be raised under the DSU, if Members included 
any provisions relating to application of the DSU in th e agreement, they had to be absolutely clear as 
to what could potentially happen in the event that non-compliance was established.  For example, a 
Member could be found by a panel and the Appellate  Body to be in systematic violation of a 
commitment in the transparency ag reement.  However, it might not be in a position to comply with 
the recommendation of the DSB to bring its legislati on into conformity with the agreement because of 
the refusal of its congress to adopt the relevant legislation.82  Responding to this scenario, it was 
suggested that if there were a case where a Member reported to the WTO that it could not change its 
laws, other Members would not rush to take that Member to dispute settlement as that was not going 
to be in any Member's interest.  Members would be more likely to determine how they could work 
together in an attempt to address the problem at issue.  The overall goal was not to retaliate and penalise Members;  it was to develop a common set of transparency obligations that would apply 
across the membership of the WTO.
83 
41. As regards the interaction between the domestic review procedures and the application of the 
WTO Dispute Settlement Understanding , the view was expressed that the respective roles of the two 
mechanisms that served different purposes should be made explicit in the future agreement.84  
Domestic review procedures and the application of  the DSU were two distinct phases in a dispute 
resolution process and there was not much scope for their interaction.85  Further, domestic review 
procedures and WTO dispute settlement procedures ser ved different purposes, and there could be no 
overlap between the two.86  The transparency agreement should contain provisions allowing a supplier 
to challenge, through domestic procedures, a proc urement in breach of the provisions related to 
transparency of the procurement process.  At the WTO level, the DSU would only apply to the 
                                                      
75 M/17, para. 72. 
76 M/17, para. 71. 
77 M/17, paras. 32 and 71. 
78 M/17, para. 45. 
79 M/17, paras. 32, 45 and 71. 
80 M/17, paras. 29 and 66. 
81 M/17, para. 66. 
82 M/17, para. 67. 
83 M/17, para. 68. 
84 M/17, para. 38. 
85 M/17, para. 39. 
86 M/17, para. 41.  WT/WGTGP/7 
 Page 11 
 
 
implementation of the transparency provisions in the agreement.87  It was also suggested that the 
transparency agreement could explicitly provide that  resort to the DSU would not be available to 
challenge how a procurement authority had handled a specific procurement or to overturn a contract 
decision.88  The DSU would not be available to WTO Members to question national authorities' 
procurement decisions.  Members could invoke WTO dispute settlement procedures only for repeated 
failures to comply with the rules in the agreement or  to implement its basic obligations.  If there was a 
question about how a procurement was being conducte d, it would be up to the relevant supplier to 
take that issue up under the domestic review mechanism.89 
42. Clarification was sought as to whether a transp arency agreement would require the exhaustion 
of domestic review procedures before any rec ourse could be made to WTO dispute settlement 
procedures.90  The point was made that, until the full contours of an agreement had been determined, 
the issue of the link between domestic review proc edures and application of the DSU could not be 
fully examined.91 
Special and Differential Treatment, Tec hnical Assistance and Capacity Building 
43. With respect to the issue of special and differential treatment , the view was expressed that 
exceptions from transparency ob ligations should apply in certa in circumstances and longer 
implementation periods should be provided.92  However, it was pointed out that transitional periods or 
other types of flexibilities contained in the Urugua y Round agreements had pr oven to be inadequate 
for effectively addressing complex and multi-dimensional issues facing developing countries.93  
Traditional ways of ensuring special and differentia l treatment that had been proposed in this area 
were inadequate as they did not allow deve loping countries the needed policy flexibility.94  T h e r e  
were still a number of Uruguay Round agreements th at Members had not been able to implement due 
to lack of technical assistance, and, in fact, some Members had still not understood the commitments which they had signed up to.  Therefore, the Workin g Group had to give serious attention to the issue 
of technical assistance, developing new ways of a ddressing the concerns of developing countries as 
well increasing efforts to try to make the process move forward beyond Cancun.
95  It was suggested 
that a more holistic approach to the issue of spec ial and differential treatment  for developing countries 
was needed.96 
44. The need for technical assistance during and after the negotiations – as was agreed in the 
Doha Declaration – was emphasized.  It was an im portant element in ensuring that such countries 
would be in a position to implement a multilatera l agreement of transparency in government 
procurement.97  Commitment was also expressed to provi ding support through the WTO and other 
institutions.98 
45. While the commitment to provide technical as sistance and capacity building was welcomed99, 
it was suggested that the provision of technical assistance by some proponents might be tied to an 
eventual agreement on transparency in government  procurement or to the demonstration of a 
readiness to negotiate.  The point was made that, if  donors of technical assistance were genuine about 
                                                      
87 M/17, paras. 47 and 74. 
88 M/17, para. 41. 
89 M/17, para. 43. 
90 M/17, para. 40. 
91 M/17, para. 44. 
92 M/18, para. 43. 
93 M/17, paras. 79 and 82. 
94 M/17, para. 80. 
95 M/17, paras. 79 and 83. 
96 M/17, para. 81. 
97 M/18, para. 9. 
98 M/18, paras. 32 and 33. 
99 M/18, para. 35. WT/WGTGP/7 
Page 12  
 
helping the developing countries, transition ec onomies and LDCs to im prove their government 
procurement regimes through making them more tran sparent and more efficient, then technical 
assistance should be provided even in  the absence of an agreement or  in the absence of an agreement 
to negotiate.  In this regard, technical assistan ce should not be aimed at helping countries to 
understand the elements of a transparency agreemen t, what it would mean and its implications.  
Rather, it should be aimed at assisting with the establishment of a more efficient government 
procurement regime though the adoption of procur ement rules that would enhance transparency.
100  In 
response, the point was made that technical a ssistance was already being provided through 
multilateral and bilateral channels  when genuine requests for tec hnical assistance were made.  
Technical assistance had been provided to various  developing countries to help them develop and 
modernise their procurement systems for a long peri od of time independently of the work undertaken 
in the Working Group to develop a transparency agreement.101 
Status of the Working Group's Work and the Way Forward 
46. Reflecting on the work undertaken by the Working Group during the past six years and on the 
way forward, the view was expressed that the st udy phase had been valuable and fruitful.  In 
particular, it had enabled Members to identify adva ntages of a transparency agreement as well as 
some difficulties, which confronted me mbers in the lead-up to negotiations.102  The study phase had 
been completed because the elements were clear an d the differences of positions were clear.  What 
remained was for work to commence on negotiations .  It was necessary in this respect to make 
"bridges" during the negotiation phase.103 
47. In response, the point was made that the iden tification of elements by the Working Group as 
reflected in the informal note by the Chairman 's "List of Issues Made and Points Raised" 
(JOB(99)6782 of November 1999) did not imply any form of agreement, or tacit understanding, or 
consensus to include those elem ents in a future agreement.104  While some level of consensus had 
emerged in relation to several of the elements in  the informal note by the Chairman containing the 
"List of Issues Raised and Points Made"105, the work of clarifying the issues had not yet been 
completed.106  The Working Group was not in a pre-negotia tion stage but still in an educational and 
clarification stage.107  In order to have a mandate in Cancun to  negotiate, there needed to be agreement 
in the Working Group on the elements of a fu ture transparency agreement and, pursuant to 
paragraph 26 of the Doha Ministerial Declaration, ther e had to be an explicit co nsensus to move on to 
negotiations.108 
48. However, the point was also made that divergence of views existed in relation to most issues.  
It was suggested that these issues, which were system ic in nature, could have serious implications in 
terms of the costs associated with implementation, th e effect on national policy,  and flexibility.  Such 
issues included the scope and coverage of an agre ement on transparency in government procurement 
(that is, inter alia whether the agreement should be limited to goods or include services and 
concessions), the meaning of "transparency", the re lationship between transparency and particular 
procurement methods, the application of domestic  review procedures and the DSU mechanism and 
the form that special and differential treatment would take.  It was suggested that some elements were not concerned with transparency and should not be  a part of an agreement on transparency in 
government procurement.
109  Before entering into a negotiating phase, there needed to be a clear 
                                                      
100 M/18, para. 36. 
101 M/18, para. 37. 
102 M/18, para. 3. 
103 M/18, paras. 15, 16, 18 and 46. 
104 M/17, para. 94. 
105 JOB(99)6782 of November 1999. 
106 M/18, paras. 12, 19, 48 and 49. 
107 M/17, paras. 3, 77, 78, 86, 90 and 92. 
108 M/17, paras. 77, 78 and 85. 
109 M/18, paras. 12, 19, 48 and 49.  WT/WGTGP/7 
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conception of what would be involved if there w as to be any discussion to launch negotiations on a 
future agreement on transparency.110 
49. The view was expressed that it was not necessarily the case that negotiations could not 
proceed before convergence on all elements had been achieved.  It was suggested that achieving such 
convergence was the purpose of negotiations and not of the study phase.111  The view was also 
expressed that the existence of divergence of views on some issues should not be, in itself, an 
impediment to moving forward.  Rather, a cer tain consistency in approach was required.112  A similar 
view was that all that was necessary before Member s moved to negotiations was the identification of 
the core issues at stake.  Agreement co uld then be reached through negotiations.113 
50. The view was expressed that the Doha Declaration clearly stated that negotiations on 
transparency in government procurement would take place after the Cancun Ministerial Conference 
on the basis of Ministers' decisions on modalities of  negotiations, and that the negotiation would be 
treated as part of the single undertaking.114  It was suggested that this view was supported by the Doha 
Ministerial Declaration, the relevant secti on of which read "…a decision on modalities of 
negotiations…"115 rather than "…a decision on negotiations…".  Further, the view was expressed that 
the Doha Ministerial Declaration clearly stated th at a decision on modalities would be taken at the 
Fifth Ministerial Conference and not after that.116 
51. In order to ensure that a multilateral agreem ent on transparency in government that was 
acceptable to all could be negotiated, it was suggest ed that it was crucial to adjust the level of 
ambition and to address the interests of developing  countries in an effective and balanced manner.117  
In order to take full account of the concerns, burde ns and obligations of de veloping and LDCs, S&D, 
TA and support for capacity building should be  fully reflected in the negotiations process.118 
52. It was suggested that the following steps were necessary in the context of the Working Group 
in the lead-up to the Cancun Ministerial Conference .  First, it was necessary to reiterate that an 
agreement on transparency in government procur ement would only be limited to transparency;  it 
would exclude market access commitments and would have no impact on Members' rights to use 
government procurement to support domestic ente rprises and purchasing natio nal goods.  Secondly, 
the elements of the agreement need ed to be identified.  Thirdly, the Working Group should establish a 
timetable for an agreement on transparency in government procurement, which did not specify a 
deadline for the conclusion of the agreement.  Finally, S&D treatment should be ensured for 
developing countries, given that the respective leve ls of development of government administrations 
amongst Members differed.  In particular, exceptions  from transparency obligations should apply in 
certain circumstances and longer impl ementation periods should be provided.119 
53. The point was made that developing countries wanted to be able to properly participate in the 
negotiation process.  However, they lacked sufficient skills to negotiate at the current point in time.  
Before an agreement on transparency in governme nt procurement was considered, such countries 
wanted to be clear about what would be entailed.  The agreement had to be a win-win agreement that 
was beneficial to all and was truly balanced.120 
                                                      
110 M/18, para. 13. 
111 M/18, para. 18. 
112 M/18, para. 50. 
113 M/17, paras. 84 and 94. 
114 M/17, para. 91;  M/18, paras. 41 and 46. 
115 (WT/MIN(01)/DEC/1), para. 26. 
116 M/17, para. 91. 
117 M/18, para. 41. 
118 M/18, para. 41. 
119 M/18, paras. 43 and 45. 
120 M/18, para. 47. WT/WGTGP/7 
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54. With respect to the future implemen tation of a transparency agreement , it was noted that 
many countries, including developing countries, al ready had transparency rules in place.  It was 
suggested that, accordingly, the implementation of any future multilateral agreement should not be a 
major difficulty for those countries.  It was further suggested that for those countries that did not have 
a procurement system in place, the costs that mi ght be associated with the introduction of such a 
system would be far outweighed by the resulting benefits.
121  Another view was that the cost of 
implementation of any agreement on transparency in government procurement might be extremely 
high.  The point was made that as long as Members did not know exactly how the future agreement 
would look like and, in particular, what the scope  and coverage would be, it was difficult to have a 
precise idea of the costs in volved in the setting up of transparency system.122 
55. The view has been expressed, on the one hand, that the four Singapore issues, including 
transparency in government procurement, were part of the Single Undertaking.123  The contrary view 
has also been expressed that the Singapore issues were not part of the Si ngle Undertaking and, 
therefore, required a negotiating mandate.124  Yet another view expressed was that the debate as to 
whether the Singapore issues were part of the Singl e Undertaking was not productive for the work of 
the Working Group125 and was beside the point.  In this rega rd, the point was made that Ministers had 
agreed to a work programme that included these issues which had given rise to expectations amongst delegations that their concerns woul d be addressed irrespective of whether or not they were part of the 
Single Undertaking.
126 
B. TECHNICAL ASSISTANCE AND CAPACITY BUILDING  
56. The WTO Secretariat informed the Working Group at each of its meetings of the technical 
assistance and capacity building activities undertaken by it as well as those activ ities foreseen in the 
period leading up to the Cancun Ministerial Conference.   The main focus of the Secretariat's activities 
was on regional events organized in cooperation with the multilateral development banks.  In 
addition, a number of broader technical co-opera tion activities organised by the Secretariat had a 
government procurement component, and a limited num ber of national seminars had been held.  An 
Information Session was held in Geneva on the mo rning of 19 June 2003 on technical co-operation 
and capacity building activities of inter-government al organisations in the area of government 
procurement at which a number of inter-governmental  organisations shared information on activities 
undertaken by them.  That Information Session was followed on the afternoon of 19 June 2003 by a workshop on capacity-building in government pr ocurement at which a number of developing 
countries shared information on thei r respective experiences and needs.
127  Further information on the 
Secretariat's technical assistance activities can be found in Section B of the minutes of the Working 
Groups Meetings (WT/WGTCP/M/17 and WT/WGTGP/M/18). 
57. The point was made that a number of countries lacked capacity in this area.  Some did not 
even have procurement laws.  The view was expre ssed that, accordingly, the provision of technical 
assistance through seminars and conferences was insu fficient.  A concerted effort was needed to 
provide technical assistance on a case-by-case basis rather than making it general or adopting a one-
size-fit-all approach.  Such an approach would ensu re that such assistance would really build capacity, 
it would help countries to participate in the curre nt and possibly future process at the WTO on this 
issue.128 
                                                      
121 M/18, paras. 5, 7 and 32. 
122 M/18, para. 33. 
123 M/17, para. 91. 
124 M/17, para. 87. 
125 M/17, para. 89. 
126 M/17, para. 88. 
127 M/17, paras. 96 and 98;  M/18, para. 51. 
128 M/18, para. 52.  WT/WGTGP/7 
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C. OBSERVER STATUS OF INTERNATI ONAL INTERGOVERNMENTAL ORGANIZATIONS  
58. The Working Group considered requests for observer status from three international 
intergovernmental organizations (OECD, SELA and the Organization of the Islamic Conference) and 
agreed to revert to these requests in the light of the ongoing consu ltations in the framework of the 
General Council.129 
__________  
                                                      
129 M/17, para. 100.