WORLD TRADE
ORGANIZATIONGPA/47
15 March 2001
(01-1281)
Committee on Government Procurement Original:  English
REVIEW OF NATIONAL IMPLEMENTING LEGISLATION
KOREA
The present document reproduces the questions put to the delegation of the Republic of Korea
and the responses given and comments made during the review of national implementing legislation
at the Committee's meetings of October 1998 to September 2000.1  Korea's notification of its national
implementing legislation in accordance with the Committee's Decision in GPA/1/Add.1 has been
circulated in document GPA/12/Rev.1, dated 9 June 1997.
_______________
REPLIES TO THE QUESTIONS FROM CANADA, THE EUROPEAN COMMUNITY,
SWITZERLAND AND THE UNITED STATES
I. THE ACT RELATING TO CONTRACTS TO WHICH THE STATE IS A PARTY
(ARCSP)
A. SCOPE OF THE GOVERNMENT PROCUREMENT CONTRACT
Question from Canada
1. In the section on scope, Korea refers to contracts "according to the international norm and
the GPA which exceed the amount determined and p ublicly announced by the Minister of Finance and
Economy".  What are the international norms that are referred to and does the Minister have the
authority to change the amounts from what is in the Agreement on Government Procurement?
"International norm" is international trade practices that do not deviate from the GPA in their
content and purpose.  The Minister of Finance and Economy holds no authority to change the amounts
of the threshold value, but notifies biannually the corresponding amount of the Won to the SDR.
B. COVERAGE
Question from the United States
2. Which government entities must follow the requirements of the Act Relating to Contracts to
which the State is a Party (ARCSP)?  Paragraph  I.1 of the summary of Domestic Legislations
(GPA/12/Rev.1) indicates that "[u]nless provided for in other laws, government procurement is
conducted under the [ARCSP]".  Please explain instances in which other laws provide that the
ARCSP does not apply.  In addition, when a governmen t entity is required to follow the ARCSP, are
all of the entity’s subordinate units (including its subordinate linear organizations, special local
                                                     
1 The minutes of these meetings have been circulated in documents GPA/M/10-14.GPA/47
Page 2
administrative organs, and attached organs) also re quired to follow the ARCSP?  Do government
entities that are not bound by the requirements of the ARCSP and/or its associated enforcement
decrees and regulations follow procurement practices based on international contracting principles,
including those contained in the WTO Agreement on Government Procurement?  Please explain.
The ARCSP applies to contracts to which a state is a party, such as government contracts
through international tendering subject to the GPA or contracts between state and a citizen of the
Republic of Korea.
The term "state" covers central government agencies established under the Constitution and
the Government Organization Act of the Republic of Korea, the National Assembly Secretariat, the
Ministry of Court Administration, the Constituti onal Court Secretariat, and the Central Election
Management Committee Secretariat.  Among the agencies covered by the ARCSP, the central
government agencies listed in Annex 1 of th e Korean Appendix I shall conduct government
procurement through international tendering pursuant to the provisions of the GPA.
With respect to the extent of the applicability of ARCSP there are a limited number of
provisions under the Korean laws which allow procurement procedures differing from the ARCSP.
For example, the acquisition, management and disposal of government properties are subject to the
Government Property Law while the procurement of goods for national defence is subject to theSpecial Law for National Defense Industry.
When a government agency is required to follow the ARCSP, the subordinate units of the
agency are also required to follow the ARCSP if the units are government agencies.  This is because
the central government agencies may establish subordinate units such as subordinate linear
organizations, special local administrative organs, and attached organs pursuant to the GovernmentOrganization Act of the Republic of Korea.  Therefore, subordinate units can comprise central
government agencies.
It is not clear what is meant by "government entities that are not bound by the ARCSP and/or
its associated enforcement decrees and regulations".  The ARCSP basically applies to all central
government agencies mentioned above.  The entities of Annex 1 of Korean Appendix I are required tofollow the international contracting principles pursua nt to the GPA.  Annex 2 and Annex 3 entities are
required to follow the principles under the Local Financing Act, and the Government Invested
Enterprise Accounting Regulations.  Entities not covered by the GPA are expected to operate
procedures of procurement pursuant to general international trade practice when international
tendering is necessary.
Small and Medium Enterprise Products Promotion Act
Question from Canada
3. Could Korea please describe the purpose and content of the provisions in the Small and
Medium Enterprise Products Promotion Act rela ted to procurement from small and medium-sized
businesses and their relationship to the Act Relating to Contracts to which the State is a Party and its
Presidential Decree?  What is the meaning of the expression "international tendering"?
The purpose and content of the Small and Medium Enterprise Products Promotion Act related
to procurement is to contribute to the balanced development of the national economy by promoting
sales and outlets of the products made by small and medium enterprises.  Korea's basic act relating to
the government procurement is the Act Relating to Contracts to which the State is a Party (ARCSP)
and its Presidential Decree.  ARCSP is based on general competition, and private contracts arerecognized as exceptional cases, including the private group contracts, as specified in the Small and
Medium Enterprise Products Promotion Act.GPA/47
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"International tendering" means giving bidding opportunities to all GPA Parties for
procurements with values greater than the threshold value.
Question from the European Community
4. According to Note 3 to Annexes 1 and 2 and Note 2 to Annex 3 of the Korean Appendix I,
Korea may exclude "the single tendering procurement including set-asides for small and
medium-sized businesses" according to the Budget and Account Law, the Local Finance Law, the
Government Invested Enterprise Management Act and the various Presidential Decrees and
Accounting Regulations.
This exception relates to Small and Medium-siz ed Enterprises (SMEs).  Could Korea please
specify if the single tendering procedure exception is applied to anything else?  How does Korea
decide that a contract is set aside for SMEs?  How is an SME defined in terms of size?  Does Korea
have any figures concerning purchases from SMEs (percentage of total procurement, etc.) ?
The instances when the central government can enter into a procurement contract by a single
tendering are described in detail in Article 26 of the Enforcement Decree of the ARCSP.  Accordingto Note 3 to Annexes 1 and 2, and Note 2 to Annex 3, Korea may exclude single tendering
procurement from the GPA.  The following are the cases in which single tendering can be applied:
(a) when an act of God or national security is concerned;
(b) when a former construction contractor is re-contracted in order to ensure
responsibility for any possible defects in the future;
(c) when a contract to procure goods is related to patents, or there is only one supplier;
(d) when the contract is for construction work whose estimated value is under
W 100 million, or for goods and services whose estimated value is under
W 30 million;
(e) when goods are being procured from small and medium-sized enterprises under the
Act regarding Small and Medium Enterprise Promotion and Products Purchase
Promotion;
(f) when goods are being procured from agencies for the disabled;
(g) when no bidder or successful tenderer can be found, even after a tendering
re-notification.
The cases when local governments and government-invested enterprises can enter into a
procurement contract by single tendering are prescribed in the Local Financing Law andGovernment-Invested Enterprise Accounting Regulations, in which the main content of the provisions
of the Enforcement Decree are quoted.
In Korea, the term small and medium enterprises (SMEs) is defined as a company which
employs less than 300 persons and whose assets amount to le ss than W 80 billion.
Each year, the Small and Medium Business Administration (SMBA) publishes a list of
products to be procured only from SMEs.  For the products listed, qualified suppliers may enter into a
procurement contract with SAROK (formerly OSROK) as prescribed in provisions 9 and 9.2 of the
Act regarding Small and Medium Enterprise Promotion and Products Purchase Promotion.GPA/47
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C. PRINCIPLES OF GENERAL COMPETITION
Question from Canada
5. What is the extent and purpose of the discretion provided to contract officers to nominate
participants or restrict qualifications of the participants, as provided for in the section on principlesof general competition?
The procurement entities may conduct reviews for qualification of suppliers participating in
the tendering to increase efficiency of the procurement process.  However, procurement entities have
objective criteria for the qualification reviews, and subjective judgments by the contract officers are
excluded.
D. 
RESTRICTIONS ON TENDERING PARTICIPATION ELIGIBILITY FOR IMPROPER BUSINESS PERSONS
Question from the United States
6. In Section I.6 of the summary of domestic legislation, Korea states that a person who is
"deemed unqualified" may be denied the opportunity to participate in a tender.  Under what
circumstances or conditions may a person be "deemed  unqualified"?  In view of GPA Article VIII(b),
are all of these conditions essential to ensure the person’s capability to fulfil the contract or contracts
in question?
In Section I.6 of the Summary of Domestic  Legislation (GPA/12/Rev.1), Korea states
restrictions on participation eligibility for tendering.  These restrictions apply to suppliers who impede
or deviate from fair competition or proper fulfilment of a government contract, or suppliers who aredeemed unqualified.  Grounds for the restrictions are prescribed specifically in the Enforcement
Decree of the ARCSP and Enforcement Regulation of the ARCSP in order to prevent procuring
entities from making arbitrary decisions.  The term "deemed unqualified" does not directly relate to
the capabilities of suppliers.  Rather, it means suppliers are "considered as unqualified" to participate
in tendering because of activities which are viewed by the entity as detrimental to fair competition orto proper fulfilment of a government contract.
Question from the European Community
7. The Korean Fair Trade Commission may intervene against cartels of suppliers which limit
competition in public procurement.  How does Korea intend to ensure that suppliers behave in a
competitive manner?  Can Korea give details on the activity of the Fair Trade Commission with
respect to this issue?  In particular, can Korea indicate whether it has already taken any concreteaction on bid-rigging and the like;  and whether in doing so it made a distinction between foreign
suppliers and domestic ones?
Korea takes strong action against bid-rigging by implementing the ARCSP, and the Fair
Trade Commission also plays a role to ensure fair competition in the procurement market.  If a
supplier is found to have committed improper activities detrimental to fair competition includingbid-rigging, the procuring entities must bar suppliers' eligibility for tendering for no less than one
month but for no more than two years.  The circumstances and periods of restrictions are described in
detail in Article 76 of the Enforcement Decree of the ARCSP and Article 76 of the Enforcement
Regulation of the ARCSP.  The provisions are quoted by the Local Financing Law and the
Government-Invested Enterprise Accounting Regulations.  The pro curing entity concerned mustpublish the restriction in an official gazette (Kwan-Bo).  Other procuring entities may also disqualify
the supplier from participating in tendering during the period of restriction.GPA/47
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Question from Switzerland
8. Please  provide additional information on the criteria used to judge a business person as
"improper" and on the length of the specified period this person may be deemed unqualified to
participate in the tendering.  Can this decision also be challenged?
Restrictions on participation eligibility for tendering apply to suppliers who impede or deviate
from fair competition or proper fulfilment of a government contract, and to suppliers who are deemed
unqualified.  Article 76 of the Enforcement De cree of the ARCSP and Appendix 2 related to
Article 76 of the Enforcement Regulation of the ARCSP prescribe specifically the grounds for
restrictions and the lengths of the period of restrictions in order to prevent procuring entities from
making arbitrary decisions.  When the restrictions apply, a hearing must be given for the supplier
concerned, according to the Act on Administrative Procedure.  The supplier concerned can challengea restriction under the Law for Administrative Review.
II. ENFORCEMENT DECREE OF THE ARCSP
A. S
INGLE TENDERING
Question from Switzerland
9. The single tendering procedure can be applied "… in case where the supplier is only one
person".  How can this exception from open or limited tendering be explained?
As stated in the answer to the question from the European Community on small and
medium-sized enterprises, the cases of a single tendering are prescribed specifically in Article 26 of
the Enforcement Decree of the ARCSP.  According to Note 3 to Annexes 1 and 2, and Note 2 toAnnex 3, Korea may exclude single tendering proc urement from applying the GPA.  When there is
only one supplier of the concerned goods and the purpose of procurement can not be achieved with
other suppliers, the procuring entity has to enter into a contract with the concerned supplier through
single tendering because there is an absence of competition.  This case is in line with Article XV:1(b),
which states that one of the cases for limited tendering is "when, …, in the absence of competition fortechnical reasons, the products or services can be supplied only by a particular supplier and no
reasonable alternative or substitute exists".
Question from Canada
10. In the case of  "single tendering" what is meant by act of God?
"Act of God" means natural disasters which cannot be prevented by the power of man.
Question from Canada
11. In response to question above, it was stated that "Act of God means natural disasters which
cannot be prevented by the power of man".  For this case and for each of the cases listed in
Section 2.6 - Single Tendering, of GPA/12/Rev.1, please provide the corresponding conditionprovided for in Article XV - Limited Tendering, parts (a) through (j) of the Agreement on Government
Procurement that provides for each case.
Article 26 of Korea's Presidential Decree of the Act Relating to the Contract to which the
State is a Party (ARCSP) specifies in detail the conditions for single tendering, including "Act of
God".  In accordance with Korea's Annexes to the WTO Agreement on Government Procurement(Annex 1, Note 3, Annex 2, Note 3 and Annex 3, Note 2), the Agreement on Government
Procurement does not apply to the single tendering procurement in Korea.GPA/47
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Question from Japan
12. In June 1998, the Enforcement Decree of the ARCSP was amended by adding a new provision
that stipulates that the central government is empow ered to use single tendering procedures in cases
where goods are procured from domestic small and medium size enterprises with a "good quality
mark" that has been certified by the relevant nat ional authority.  When did this amendment take
effect?  Does the amendment only apply to proc urement by the central government or does it also
apply to procurement by sub-central entities and na tional enterprises?  Is this amendment consistent
with Korea's obligations under the GPA, specifical ly, Articles III and VI:3 of the GPA or with the
derogation clause in Note 3 to Korea's Annex 1 of Appendix I?
The enforcement Decree of the ARCSP was amended in September 1999.  The amendment
applies to central government procurement and also applies to procurement by sub-central entities and
Annex 3 entities.  Korea believes that the amendment is consistent with its current GPA obligations.
Korea specified a single tendering procedure exception in its Appendix which is applied to small and
medium size businesses.  The amendment to the ARCSP enforcement decree allows the use of single
tendering procedures in cases where goods with a "good quality mark" are supplied by small andmedium-sized enterprises in accordance with the Small and Medium Enterprises Product Promotion
Act and law relating to the development of environmental technologies.
B. I
NTERNATIONAL CONTRACT DISPUTE MEDIATION COMMITTEE
Question from the United States
13. In Section I.1.7 of GPA/12/Rev.1, Korea states that: "Those who claim to have been
disadvantaged in the implementation of the provis ions on the scope of the government procurement
contract, eligibility for participation, public notice or the decision on the successful tenderer may
make an objection to the central agency concerned." Is a supplier claiming to have beendisadvantaged in one of the ways described above permitted to seek immediate redress with the
International Contract Dispute Mediation Committee, or must the supplier first make its objection to
the specific central agency concerned?
The International Contract Dispute Mediation Committee (ICDMC) is established to mediate
disputes which may occur in international tendering .  Any supplier who claims to have been a victim
of a breach of the GPA and discriminated against by a procuring entity must seek resolution from the
entity concerned first.  When the supplier is dissatisfied with the response or resolution offered by theprocuring entity, the supplier may request a review from the International Contract Dispute Mediation
Committee.
Question from the United States
14. Do the procedures of the International Contract Dispute Mediation Committee apply to
government entities that are not bound by the re quirements of the ARCSP and/or its associated
enforcement decrees and regulations?  If not, plea se provide information about the bid protest and
challenge system available to such entities to which the International Contract Dispute Mediation
Committee procedures do not apply.
The ICDMC is established pursuant to Article XX of the GPA in order to mediate disputes in
international tendering covered by the GPA.  Therefore, the procedures of the ICDMC apply to the
cases involving procuring entities covered by the GPA.  In addition, the Construction Dispute
Mediation Committee is established by the Ministry of Construction and Transportation in order to
deal with disputes between procuring entities (including both government and private entities) and
suppliers in the course of fulfilling their construction contracts.GPA/47
Page 7
Question from Switzerland
15. If a claim is first addressed to the procurement entity (Point 3.7 of GPA/12/Rev.1) and does
not lead to a satisfactory solution for the suppliers claiming a breach of the GPA, can he still address
this claim to the Committee?
Please refer to the answers to the above questions from the United States.
III. OTHER GENERAL REGULATIONS RELATED TO GOVERNMENT
PROCUREMENT
A. THE ACT ON GOVERNMENT PROCUREMENT BUSINESS AND THE OFFICE OF SUPPLY (OSROK )
Question from the United States
16. Section 4.1 of GPA/12/Rev.1 relating to the Ac t on Government Procurement Business states
that, "Basically, each government authority is responsible for procuring goods, services and
construction services for its own use".  It also states that central and local government agencies are
"required to purchase their needed goods and works above a given threshold value through OSROK".
Please explain how these seemingly contrasting statements can be reconciled.
Korea maintains a centralized supply system for government procurement of goods and
services exceeding a given threshold value.  For example, any central government contract for
construction services valued over W 3 billion must be conducted through the SAROK.  The main
roles of the SAROK are to publish tendering notices, to decide the award of contract, to enter into a
contract by a request from a procuring entity, and to assume relevant responsibilities.  Each procuring
entity must prepare an annual plan and a budget for its procurement.  Each entity is also responsiblefor matters related to the fulfilment of contracts such as supervision of construction works, inspection
of work completion and payment.
Question from the European Community
17. One of the prevalent features of the Kore an procurement system is the large amount of
procurement made by OSROK on behalf of differ ent public entities.  In practice, centralized
procurement favours the use of selective or restricted procedures and indeed OSROK requires all
potential suppliers to be registered with it before submitting a bid.  While this is not in contradiction
to the letter of the GPA, it does not facilitate ac cess from GPA countries who should be registered
before having the possibility to tender.  In practice, this can act as a barrier for foreign suppliers.
How is Korea ensuring that Article VIII of the GPA is complied with (with particular reference to
subparagraphs (b), (c) and (d))?  Would Korea please specify if the financial, commercial andtechnical capacity of suppliers from GPA countries is judged on the basis of that supplier's global
business activity?
In Korea, pursuant to the GPA, the Special Regulation of the Enforcement Decree of the
ARCSP for Specific Procurement (hereafter "Special Regulation") prescribes that procuring entities
may maintain lists of suppliers in order to conduct procurement efficiently.  On the list, suppliersregister general information such as address of location, name of representative, business entity
registration and ownership of factories or stores.  A supplier may apply at different times of the year
to be put on a list, by submitting forms issued by ag encies in the applicant's country.  The information
on a list will not be reviewed again in the process of qualifying suppliers for a specific tendering.
Procuring entities, if necessary, may determine qualification for participation in tendering
based on a supplier's previous experience in fulfilling contracts similar to the contract concerned,
construction capacity, level of technology, and financial statement.  It is prescribed in the SpecialGPA/47
Page 8
Regulation that when a supplier who is not on the list wishes to participate in tendering, the procuring
entity should begin to review the supplier's qualifica tions as soon as possible.  If it is determined that
there is enough time for the supplier to comple te the qualifying process by the day preceding the
deadline for submitting tenders, the procuring entity must allow the supplier to submit a tender.
These provisions are in line with Article VIII of the GPA.  The purpose of qualifying suppliers is toenhance the efficiency of the procurement process by reviewing the ability of suppliers to fulfil their
previous contracts.  Suppliers are judged on the basis of their activities as suppliers in both domestic
and foreign areas.
Question from Switzerland
18. Please explain in more detail how procurement is organized in Korea.  Are State and Local
government entities required to commit the procurement of goods, services and construction worksabove a certain threshold to OSROK or is it up to them to decide whether they procure themselves or
commit the job to OSROK?  If procurement is done  by OSROK, who is the procuring entity, OSROK
or the obligatory or voluntary end-users?
As stated above in the answer to question from the United States, Korea basically maintains a
centralized supply system for procurements of goods and construction services.  Under the system,procurement exceeding a given threshold value set by central and local government entities (which
are obligatory end-users) must be contracted by  SAROK (formerly OSROK).  That is, for any central
government procurement of construction work valued over W 3 billion, or for a local government
procurement of construction work valued over W 10 billion where suppliers must be pre-qualified or
must submit design drawings for the construction wo rk together with a tender document, as provided
in Article 15 of the Enforcement Decree of the Act on Government Procurement Business, or for
goods valued over W 50 million, SAROK will publish an invitation to tender, award the contract, and
enter into a contract on behalf of the end-users.  The obligatory end-users are, however, allowed to
procure goods if procurement is urgently necessitated by an act of God, or is for military supplies for
national defence, etc.  For the responsibilities of SAROK and end-users, please refer to the answer toquestion 7 from the United States.
B. 
LOCAL FINANCING ACT
Question from Switzerland
19. Although the provisions of the Local Financing Act and its Presidential Decree regulate
specialities for the local government procurement,  we understand that the requirements of the GPA
for local entities covered by the Agreement are met.  Is this understanding correct?  How do thespecialities mentioned affect the requirements of the GPA?
Korea does not believe that the provisions are incompatible with any requirements of the
GPA at this time, as the main contents of ARCSP ar e quoted by the provisions of the Local Financing
Act.  We have never implemented nor have intention to implement the provisions concerned in a way
that would violate any binding international agreement.GPA/47
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Question from the United States
20. Have copies of the Government-Invested Enterprise Management Law and Administrative
Regulations, the Act on Government Procurement Business, the Local Financing Act (and its
Enforcement Decree), the Act for the Civil Suit, and the Government Organization Act of the Republicof Korea been submitted to the WTO Secretariat?  If so, are they available in an official WTO
language?
The ARCSP and the relevant subordinate regulations have already been submitted in English
to the WTO Secretariat.
IV. INFORMATION ON PROCUREMENT OPPORTUNITIES
Question from the European Community
21. Korea is running a database system offering information on tendering opportunities.  Has this
database on-line access?  If so, where is it access ible from?  Can foreign-based suppliers connect to
this database from abroad?
All entities as indicated in the Korean Annexes 1, 2 and 3 are required to publish tendering
notices in an official gazette, the Kwan-Bo, but may additionally announce tendering opportunitiesthrough information technology.  Accordingly, each procuring entity may provide information on
international tendering opportunities through on-line services (Hitel, Unitel, Chollian) as well as in the
Kwan-Bo.  In the case that a procuring entity requests SAROK to enter into a contract, SAROK may
provide information on tendering opportunities on its Internet home page (http://www.sarok.go.kr).
Foreign suppliers can thus access the service from abroad.  However, it should be noted that providinginformation on tendering opportunities is not required for entities covered by the GPA.
Question from the United States
22. The response to the question on information technology in government procurement
(GPA/W/24/Add.3) noted that Korea was operating a database system offering information ontendering opportunities.  Please provide information regarding the extent to which Annex 3 entities
utilise information technology in offering inform ation on tendering opportunities, and whether these
entities publish summaries of opportunities in an official WTO language.
Annex 3 entities are required to publish summaries of tendering opportunities in official WTO
languages in an official gazette (Kwan-Bo) pursuant to the GPA.  However, although publishing
tendering opportunities through information technology is not a requirement, the procuring entities
may announce international tendering opportunities through local electronic media such as Hitel,Unitel, and Chollian.  In addition, Annex 3 entitie s may request the Supply Administration of the
Republic of Korea (SAROK, formerly OSROK) to ente r into a contract on their behalf.  In that case,
the SAROK may announce tendering opportunities on its Internet home page
(http://www.sarok.go.kr).
Question from the European Community
23. According to Article XVIII of the GPA, purc hasers shall inform suppliers of decisions on
contract awards (upon request in writing) and s hall publish Post-information or Contract Award
Notices.  Can Korea explain how this has been  implemented into its law and how it is done in
practice?
As to the openness of information on the award of a contract, the Special Regulation
prescribes that procuring entities publish a notice in an official gazette, the Kwan-Bo, no later thanGPA/47
Page 10
72 days after the award of a contract.  It is also prescribed that entities provide information on the
award of a contract upon request from suppliers.  The provisions are quoted by the Local Financing
Act and the Accounting Regulation on Government-Invested Enterprise.
V. TIME-LIMITS
Question from the European Community
24. Which measures have been taken to ensure that the minimum period of 40 days for
introducing bids in open procedures is respected in all cases?
Korea enacted the ARCSP in 1995 in line wi th the GPA.  In particular, the Special
Regulation, which was enacted by presidential decree in order to closely regulate procedures for
international tendering, entered into force on 1 January 1997.
The Special Regulation prescribes principles and procedures pursuant to the GPA.
Accordingly, Annex 1 entities of Korean Appendix I are required to observe the minimum period of
40 days for introducing bids in open competition.  For sub-central government entities and
government-invested enterprises, the provisions of the ARCSP and Special Regulation are quoted by
the Local Financing Act and the Accounting Regulation on Government-Invested Enterprises
respectively.
VI. INFORMATION ON SPECIFIC EXCEPTIONS
Question from the European Community
25. Note 4 to Annexes 1 and 2 and Note 3 to Annex 3 of Appendix I of the GPA exempts the
procurement of satellites pursuant to the Avia tion and Space Industry Development Promotion Law
for a duration of five years from entry into force of the Agreement.  Does Korea have any figures
concerning purchases under this exemption?  Has Korea foreseen in its legislation that from
1 January 2002 this kind of procurement should be open to competition?
Since 1997, there has been one instance of satellite procurement as shown below.  The
procurement was open to international competition.
THE KOREASAT III PROJECT
23 August 1996 Public Notice on Tendering
*Participants in Tendering:  Lockheed Martin (US), Hughes (US),
Aerospatiale (France)
5 December 1996 Award of Contract
*Successful Tenderer:  Lockheed Martin (US)
14 March 1997 Conclusion of Contract
Contract Amount:  US$10,825 million
With relation to the Korean Government's position on the expiration of the exception clause, a
decision has not been made on this matter.GPA/47
Page 11
Question from Canada
26. Pursuant to GPA Appendix I, Annex 1, Note 5 for Korea, could Korea please indicate which
piece of legislation it is using to implement its  commitments regarding Ministry of National Defence
purchases?  Also, could Korea please provide a summary of this legislation as it pertains to theprocurement of defence-related products?
Regarding Note 5 in Annex 1 for Korea, there are no special legislations for procurement of
defense-related products.  For such procurement, the Act Relating to Contracts to which the State is a
Party (ARCSP) and its Presidential Decree are applied.
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