RESTRICTED  
  
WT/BFA/W/478  
 
18 April 2019 
(19-2594) Page: 1/5 
Committee on Budget, Finance and Administration    
 
REVIEW OF SELECTED FINANCIAL REGULATION S OF THE WORLD TRADE  ORGANIZATION   
 
1  BACKGROUND  
1.1.  Financial regulation 4 stipulates that the financial regulations of the World Trade Organization 
shall be reviewed by the Committee on Budget, Finance and Administration (CBFA) at least every 
four years.  
1.2.  Financial regulation 4 further  states that only the General Council has the authority to amend 
the financi al regulations , on recommendation by the CBFA . 
1.3.  The Financial Regulations of the World Trade Organization that are currently in force are 
contained in document WT/L/156/Rev.3, dated 27 February 2015.  Therefore, a revi ew is due.  
2  FINANCIAL REGULATION S THAT ARE PROPOSED FOR REVIEW 
2.1.  Table 1 contains the proposed reformulation of selected financial regulations.  
 
 
  
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- 2 - TABLE 1 – FINANCIAL REGULATION S PROPOSED FOR REFORM ULATION  
FINANCIAL 
REGULATION  PROPOSED REFORMULATION OF SELECTED REGULATIONS  
4 These regulations shall not be amended except by the General Council acting upon the advice of the Committee on Budget, 
Finance and Administration (the Committee). The Committee shall review these regulations at least every  five years.  
17 A Provision for contrib utions in arrears shall be maintained.  
19 Voluntary contributions, gifts or donations from WTO Members and Observers may be accepted by the Director -General provided 
that the purposes for which the contributions are made are consistent with the policies, aims and activities of the WTO, and 
provide d that the acceptance of such contributions which directly or indirectly involve additional financial liability for the WTO 
shall require the consent of the Committee. The CBFA will be notified of all voluntary contributions that lead to the establishment 
of a new trust fund.  
 
Voluntary contributions, gifts or donations from Non -Governmental Donors are subject to the additional guidelines laid out in 
Annex C.  
 
Monies a ccepted for purposes specified by the donor shall be treated as trust funds. A standard overhead fee of up to 13% may 
be charged on direct expenditure incurred by trust funds to reflect supporting services provided by the Secretariat. The stan dard 
overhead  rate can be reduced when implementing partners are being used and when defined in the agreement signed with the 
donor. The Programme Support Fund collects the overhead fees from all trust funds and pays expenditure incurred to support 
the trust fund 's activities. The Programme Support Fund also releases a fee representing 10% of its expenditure to the WTO 
Secretariat , that will record it as miscellaneous income.  
 
Monies accepted in respect of which no purpose is specified shall be treated as miscellaneous  income and reported as "gifts" in 
the accounts of the financial period.  
 
Monies received by a staff Member as honoria in his/her official capacity shall be remitted to the Organization and be credit ed to 
the WTO Staff Assistance Fund.  
 
Unless otherwise provided, such voluntary contributions, gifts or donations shall be administered in accordance with the present 
financial regulations.   
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- 3 - FINANCIAL 
REGULATION  PROPOSED REFORMULATION OF SELECTED REGULATIONS  
23 The budgetary result is defined as the difference between assessed contributions plus projected miscellaneous income, and, th e 
actual expenditure plus actual miscellaneous income.  
 
The actual expenditure does not take into account the variations in the ac tuarial provisions for the long -term liabilities associated 
with staff pensions and after service health insurance if they have not been included in the approved budget.  
 
The annual budgetary result shall be reported in the WTO financial performance repor t. The Director -General shall make specific 
recommendations for its redistribution to a specific part of the WTO's equity.  
The sum between the budgetary result for the period and IPSAS adjustments, including the actuarial provisions for pension and  
after service health insurance, determine the WTO year -end financial result.  
 
If at the end of a financial period the financial result shows a positive  balance, the Director -General shall make proposals to the 
Committee with regard to its use which may be:  
  
a) application as income against the budget for the next applicable  financial period following that in which the surplus occurs, 
thereby reducing Members' contributions;  
b) transfer to the Working Capital Fund;  
c) transfer to the Surplus/Deficit Account;  or  
d) use for any other purpose decided upon by the General Council.  
 
If at the end of a financial period the financial result shows a negative balance, it shall be transferred to the Surplus/Deficit 
Account.  
27 
 Sums advanced under financial regulation  26(a) above shall be reimbursed to the Working Capital Fund as soon as receipts from 
contributions are available for the purpose.  
 
Sums to be advanced by the Director -General as per  financial r egulation 26(b) shall be considered by the CBFA, which will make 
a recommendation to the General Council for its prior authorization.  
The replenishment of sums advanced in accordance with financial regulation 26(b) will require a decision by the General Counci l, 
on recommendation  by the CBFA.  
28 
 The General Council may only liberate all or part of the sums constituting the Working Capital Fund if the WTO equity has a 
positive balance. Sums so liberated, in so far as they are derived from monies placed in the Working Capital Fund under financial 
regulation 24(a), shall be returned to the Members which have contributed to the Working Capital Fund in proportion to their 
respective shares in the Working Capital Fund.   
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REGULATION  PROPOSED REFORMULATION OF SELECTED REGULATIONS  
29 Subject to a decision by the General Council, and only if the  WTO equity has a pos itive balance, countries or separate customs 
territories which for any reason cease to be Members of the WTO shall be entitled to the reimbursement of the total amount of  
their shares in the Working Capital Fund under financial r egulation 24(a)  and, shall honour any liabilities attributable to them . 
37 The Director -General shall also provide to the Committee:  
 
a) Reports  on the financial position and performance of the Organization, for the first 6 months and year -end. The year-end 
report shall include information on the financial performance of the Organi zation by activity (for example, technical assistance 
or dispute settlement).  
b) Annual reports on human resources , with details on the evolution of the grade structure, salary ad justments , employee 
benefits, diversity of staff, internal mobility of staff , external recruitment activities and learning and development.  
38 The Director -General shall:  
a) establish an effective system of risk management to identify and address internal and external risks to the Secretariat;  
 
b) establish detailed financial rules and procedures in order to ensure effective financial administration and the exercise o f 
economy;  
 
c) cause all payments to be made on the basis of appropriate supportin g documents and other documents which ensure that the 
services or goods have been received and that payments have not previously been made;  
 
d) designate the officers who may receive monies, incur obligations and make payments on behalf of the WTO. All pay ments 
shall require a minimum of two signatories;  
 
e) maintain an internal control system  which shall ascertain the accomplishment of established operational objectives; 
compliance with policies, procedures, rules and regulations; and safeguarding of assets. The internal control system shall also 
provide for an effective current examination an d/or review of financial transactions in order to ensure:  
 
• the regularity of the receipt, custody and disposal of all funds and other financial resources of the WTO;  
• the conformity of obligations and expenditures with the appropriations or other financial  provisions approved  by the General 
Council, or with the purposes and rules relating to trust funds and special accounts;  
• the economic use of the resources of the WTO ;  
• the reliability and integrity of the information on which such use is based ;  
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- 5 - FINANCIAL 
REGULATION  PROPOSED REFORMULATION OF SELECTED REGULATIONS  
f) maintai n an internal oversight function, which shall be responsible for providing independent and objective assessments of 
the adequacy and effectiveness of the Organization's internal control system, management practices, budgetary control and 
allegations of mis conduct , in all its forms , at the WTO. For this purpose, the internal oversight function shall have unrestricted 
access to all functions, activities, operations, processes and information within the Organization.  
42 The Director -General shall establish rules for the procurement function. The procurement function includes all actions necessary 
for the acquisition, by purchase or lease, of property, including products and real property, and of services, including work s. The 
following general prin ciples shall be given due consideration when exercising the procurement function of the WTO:  
  
• Efficient and effective use of the Organization's resources ;  
• Non-discriminatory, fair, open competition and equal opportunity for vendors ;  
• Transparency ; 
• Best value for the money in terms of quality and price ; and  
• Accountability .  
Tenders for property and services shall be invited by a recognized method of solicitation, except where the Director -General 
deems that, in the interest of the WTO, a departure from this financial r egulation is desirable.  In such cases, a statement 
specifying the precise amount, the payee and the rationale for the departure from this financial regulation , shall be disclosed in 
the Financial Performance Report of the c oncerned year.  
 
3  RECOMMENDATION  
3.1 The Committee invites the General Council to approve the revised Financial Regulations of the World Trade Organization, to be 
contained in document WT/L/156/Rev.4, with specific revisions to financial regulations 4, 17,  19, 23, 27, 28, 29, 37, 38 and 42 . 
 
 
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