RESTRICTED  
  
WT/BFA/185/Rev.1  
 
14 April 2020 
(20-2863) Page: 1/12 
Committee on Budget, Finance and Administration    
 
 
REPORT OF THE MEETIN G HELD ON 9 MARCH 20 20 
Revision  
The Committee on Budget, Finance and Administration (CBFA) met on 9 March 2 020. His Excellency 
Ambassador Dagfinn Sørli (Permanent Representative of Norway to the WTO and EFTA ), welcomed 
Members to the meeting.  
 
He welcomed the Director -General to the meeting, on behalf of the Committee.  
 
The Chairman introduced the agenda for the day, bearing the reference WTO/AIR/BFA/36 and the 
annotated agenda bearing the reference JOB/BFA/41. He informed t he Committee that, pursuant to 
the recent approval of t he Chairpersons of various standing bodies , by the General Council , he would 
be handing over the stewardship of the CBFA to the incoming Chairman, 
Ambassador  Manuel  Teehankee of Philippines, at the end  of the meeting . 
 
The agenda set out in WTO/AIR/BFA/3 6, with Agenda Item A deferred to the end,  was adopted.  
 
1  ADDRESS BY THE DIREC TOR-GENERAL  
 
1.1.  The chai rman invited the Director -General to address the Committee.  
1.2.  The Director -General started by informing the Committee that the Secretariat had set up a 
task force, under the Chairmanship of DDG Brauner, to coordinate the response to the coronavirus.  
1.3.  Noting that the next budgetary year will be the last one under his responsibility , and that the 
2020 budget was the tenth zero nominal growth budget, the Director -General provide d the 
Committee  with an overview of the key management  actions  that he had  implemented since taking 
office in 2013  and their implications for the WTO's finances  and the Secretariat's future.  He 
highlighted that Members had moved forward with new areas of work and had achieved key 
outcomes and that the number of Members had grown by 11.  
1.4.  The Director -General thanked the Committee for having resolved a difficult impasse regarding 
the budget , in late 2019 . He solicited Members to make every effort to avoid a repeat of th e 
experience  when they deliberat e on the budget for 2021 . 
1.5.  He informed the Committee that he had taken impact ful steps to adjust the grade structure of 
the organization in order to stay within the budgetary limits  without compromising on the quality of 
service the Secretariat provides to M embers.  This included the correction of the inverted pyramid.  
A case in point being the progressive reduction of Grade 10 staff from 118 to 75, with the final target 
being 63. This enabled the lifting of the freeze on promotions, and resuscitated staff mot ivation.  
1.6.  A second set of changes increased staff mobility across the Secretariat and optimized the 
allocation of resources. 290 moves across teams and Divisions have given staff members new  
challenges  and s hifting more than 30 posts to Divisions with prior ity tasks has enabled the 
Secretariat to better respond to Members' evolving needs, without increasing the total number of 
staff.  
1.7.  The Director -General recalled that the  Strategic Review of the Secretariat that he had  initiated 
in 2014  had led to a consult ative review of a number of policies  and the development of others within 
the Secretariat. He mentioned the  new policy on addressing harassment.  WT/BFA/185/Rev.1  
 
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  1.8.  The Director -General spoke about the Office of Internal Oversight  and how it  has enhanced 
internal audit and mo nitoring capabilities and introduced a dedicated facility for the investigation of 
staff concerns.  
1.9.  He further spoke of new information technology tools that are being implemented to strengthen 
the work of the Secretariat and enhance services to Members , with a focus on efficiency and cost 
effectiveness.   
1.10.   Turning to the Appellate Body Secretariat, the Director -General observed that u ntil a political 
agreement emerges as to the format of the future appeals process, 23 staff members of the 
Appellate Body Secretariat have been temporarily re -assigned  to other Divisions.  
1.11.   He informed the Committee that he had, in November 2019, asked the O ffice of Internal 
Oversight (OIO) to audit the internal control of expenditures relating to Appellate Body Members 
and Panellists. He emphasized that the scope of the audit was narrowly focused on this particular 
aspect of the dispute settlement system . 
1.12.   He said that the OIO is in the process of finalizing the report and would provide the detailed 
results at the April CBFA meeting. He added that the report does not cover  whether the current 
compensation system for A ppellate Body M embers or Panellists is adeq uate;  or whether the 
functioning of the dispute settlement system is appropriate in light of how it has evolved.  He said 
that i f Members find it necessary to evaluate these aspects of the system, the Secretariat could  find 
ways to assist.  
1.13.   The Director -General said that the current report finds that the overall internal cost control 
over the expenditures relating to AB members and pane llists has been adequate. He added that he 
will be  introducing an extra step of review for controlling cost claims  in order to improve the efficiency 
of controlling expenditures under the current system.  
1.14.   The Director -General said that his successor will need a reliable budget to continue offering 
Members the best support possible, working in an effective and efficient manner. H e said that his 
2021 b udget proposal had  already been presented to the Committee . He added that it would be  
adapt ed to respond to the changed circumstances in the Secretariat, notably the situation regarding 
the Appellate Body.  
1.15.   The Director -General invite d Members to  give careful consideration to  the proposed financial 
regulation for continuation of operations pending the approval of the budget.  
1.16.   In closing, the Director -General express ed gratitude to the host country and to all Members 
for the support they give to the work of the Secretariat.  
2  2020 DRAFT WORK PLAN FOR  THE COMMITTEE ON BU DGET, FINANCE AND 
ADMINISTRATION – WT/BFA/W/ 510 
2.1.  The Chairman introduced the 2020 draft work plan, noting that work plans have been tabled 
at the first CBFA meeting in  previous years , for consideration by the Committee.   
2.2.  The Chairman pointed out that the work plan would be modified with th e inclusion of the topic, 
"Enhancing Strategic Planning and Horizontal Coordination in the WTO" in the topics foreseen for 
the meeting that is scheduled to take place on 5 May 2020.  He said that, g iven the importance of 
this topic, it requires more than on e session for discussion.  He said that the revised work plan would 
be modified and circulated to Members.  
2.3.  A Member asked why some items were listed more than once in the draft workplan. She noted 
that the said subjects were responses to CBFA discussions at the end of 2019. She said that some 
were listed two times whilst others were listed three times. She said that some issues, such as those 
regarding h orizontal coordination or Strategic Planning of the WTO  seem  to go beyond the mandate 
of the CBFA . She add ed that the Secretariat staff members that deal with the CBFA are, g enerally 
speaking, experts on budget . She asked who, from the Secretariat, would be expected to come and 
discuss strategic and horizontal issues. She said that Members would need a person in the WTO 
Secretariat who is powerful enough to give explanation s or answer questions in this regard.  WT/BFA/185/Rev.1  
 
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  2.4.  The Member said that the regular review of the Financial Regulations had been undertaken in 
2019. She said that, according to the work plan, it seems that Financial R egulation s 19 and 23 are 
to be reopened . She asked for clarification as to the status of the report to the General Council on 
the Financial Regulations , that had been agreed by the Committee. She said while supporting the 
initiative to address pending budget approval situation, she questioned whether it was appropriate 
to reopen the revision of  Financial Regulation s which had a regular review, or the proposal should 
be a separate document.   
2.5.  A Member said that the work plan is well drafted and is very useful for the range of Committees 
that Members  are going to attend. He said the  highlight woul d be the 2021 budget proposal  and that  
there is sufficient time in t he workplan to discuss the budget. He suggested a qualitative discussion 
first on the outcome of MC12 , in June, and w hat the outcome mean s in terms of the workload for 
the Organization, wh at kind of existing work will continue  and what will be new. This would be  
followed by looking into a draft budget proposal in terms of figures in July.  
2.6.  An Official of the Secretariat said the number of times any given topic  is placed on the work 
plan is an estimate based on the expanse that the topic is deemed to have.  
2.7.  On the question  raised  regarding the revised Financial R egulations, the  Official of the 
Secretariat said that at the end of 2019, a number of Financial Regulations had already been agreed 
by the CBFA and there were two that were still outstanding,  Financial Regulations 19 and 23. She 
said that there ha d been an attempt to take the Financial Regulations that had received consensus 
from the Committee, to the General Council. This had not been  possible because two Members  said 
that the Financial R egulations have to be taken all together , in spite of the explanations to the 
contrary . She said that t he intention is that,  in the event that Financial Regulations 19 and 23 are 
not agreed upon sometime this year, they will be  remove d from the list and remain as is , whilst the 
Financial Regulations for which changes have been agreed will be submitted to the General Council 
for approval. She that a modality is required to advance Financial Regulation 10(b)  for approv al by 
the General Council , if the Committee  believe s that it should move forward.  
2.8.  The Chair man said that the Members have control of the agenda for every meeting and for 
decisions taken in meetings . He said that the wo rk plan is a tool which help s Members  to structure 
the work of t he Committee for th e year.  
2.9.  The Committee  took note of the proposed 20 20 Work Plan  and the planned revision . 
3  2020 WTO SALARY SURV EY – WT/BFA/W/ 509 
 
3.1.  The Chairman introduced the agenda item by recalling that the Director -General has a mandate 
to approve the salary scales for each year, in accordance with the staff regulations and staff rules.  
3.2.  An Official of the Secretariat  gave a brief introduction of the paper, highlighting that there is 
no adjustment of the salary scale nor for the dependency allowances for 2020 , relative to 2019 .  
3.3.  Referring to the two comparator  organizations for the salary survey , the United Nations Office 
in Geneva and the Coordinated Organizations  in Paris , he said that there was no increase in the 
combined elements of professional salaries  plus post adjustment  at UNOG , and a very minor increase 
in the salary scale for support staff. There was an increase of 2.6% in the salary scales of the 
Coordinated Organiz ations. However, given a reduction in the PPP/NER conversion factor, there was 
no increase to the WTO salary scale for 2020.  
3.4.  Turning to the dependency allowances, the Official of the Secretariat said that adjustment s in 
the salaries  in 2018, 2019 and 2020 together  were 0.6% and were thus below the 2% threshold  
that is required for the dependency allowances  to be adjusted. He noted that the next assessment 
of the dependency allowances will be i n 2023.  
3.5.  The Committee took note of the 2020 salary survey.  WT/BFA/185/Rev.1  
 
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  4  PROPOS ED FINANCIAL REGULAT ION FOR CONTINUATION  OF OPERATIONS PENDI NG 
THE APRROVAL OF THE BUDGET – WT/BFA/W/50 7 
4.1.  In his preliminary remarks, DDG Brauner mentioned the need for measures to prevent a 
situation where the legality of future expenditure may be in quest ion. DDG Brauner said that the 
proposed financial regulation is good housekeeping on how the Organization can operate  on a 
temporary basis , if the need arose.  
4.2.  An Official of the Secretariat said that the proposal was informed by the presupposition, in 
Financial Regulations 10 and 20, that the budget will always be approved and that the approv ed 
budget is the authority on which expenditure can be incurred.  
4.3.  The Official of the Secretariat stated that a gap exists  and that other international organizations 
have financial regulations or rules that permit expenditures whilst awaiting budget approval. She  
said that the  proposal is somewhat measured  and modest as expenditure and billing are suggested 
to be on a monthly basis. She added that the pro posed financial regulation does not indicate the 
length of the  interim period and that this could be a point of discussion . 
4.4.  The Official of the Secretariat said that prudence would be important and that expenses would 
have to be strictly controlled during the interim period . She highlighted that there would be no capital 
expenditure during th e interim period. She added that there are obligations that cannot be avoided 
whilst discussions  are still on going around the budget,  such as  heating, light ing an d that these are 
indispensable for Members to be able to discuss the budget  on the Secretariat premises.  She also 
said that the Organization has legal obligations to staff as pending discussion of the budget does  not 
negate the fact that there are contracts tha t have been entered into with staff. Having said that 
though, she indicated that there would be caution and restraint  around the extent of the expenditure  
and cited elements such as travel, recruitment and  spending money from the operating funds.  
4.5.  The Offic ial of the Secretariat added that, i n terms of placement, the best fitting place would 
be under Financial Regulation 10. Therefore, the suggestion is that the current Financial R egulation 
10 become 10(a) and the proposed Financial Regulation becomes 10(b).   
4.6.  Several Members welcomed the proposal and stated that this kind of provision is an essential 
best practice and an important signal for strengthening the functioning of the WTO . They invariably 
said that the proposal could be improved in terms of some details.  
4.7.  A Member suggested that the period of sending calls for contributions to Members should be 
quarterly, as monthly would be administratively complicated.  Several Members echoed this view.  
4.8.  A Member stated that as the WTO negotiate s rules to give pred ictability and certainty to the 
trading system , it was important to  have regulations that ensure predictability in the Secretariat . 
4.9.  A member said that many countrie s have domestic provisions in their national budget 
legislation , to ensure continuation of o perations pending approval of the budget . 
4.10.   A Member expressed support  for the interim authority for the D irector -General  to approve 
necessary expenditure. She added that there need to be c hecks and balance s for transparency 
purpose s. She suggested that this  could be in the form of a detailed list of expenditure being included 
in a notification from the Director -General to the G eneral Council, during the interim period . 
4.11.   A Member said that the proposed Financial Regulation c ould be a part of a larger solution  as 
there were a number of issues in 2019,  including the timing of the budget discussions . He added 
that other ways aimed at  avoid ing the calendar problem that had resulted in 2019 should be thought 
of as an  element  to add to the solution. The Member furthe r said that the proposed approach should 
ensure that the interim authority kicks in before 1 January of the concerned financial year.  
4.12.   A few Members cited their support for the proposal, noting that they had expressed the 
necessity  of some kind of contingency rule to prevent the discontinuation of the normal operations 
of the WTO Secretariat. The Member asked for examples of the types of expenditure that can be 
made during the interim basis . WT/BFA/185/Rev.1  
 
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  4.13.   While expressing his delegation's support fo r the approach, a Member said that the new 
Financial Regulation should not become some sort of fall back that could lead to complacenc y in 
relation to agreement on  the budget itself . 
4.14.   A Member said that the adoption of  two-year budget s should be reverted to .  
4.15.   A Member asked which International Organizations had been used for inspiration,  in crafting 
this proposal. He asked if the S ecretariat had considered relying on the surplus account  and/or the 
Working Capital Fund, as an interim basis to bridge the gap b efore receipt of Members ' contributions . 
He also said that  reference should be  made  to the  continued operations of the Organization, not just 
of the Secretariat.  
4.16.   A Member said that her delegation had h ighlighted  the need for this contingency issue in 
December 2019 and was, as such , supportive of such an initiative and  the need  for further discussion 
on the details. She said that her delegation had  also heard from the Secretariat that it seems other 
International Organization have something similar in place . Given this, she request ed the Secretariat 
to share the analysis of their research with Members .  
4.17.   An Official of the Secretariat put up slides showing similar provisions in the financial 
regulations of the examples ASEAN, the OECD  and WIPO.  
4.18.   A Member said t here should be a common understanding on why such kind of interim 
mechanism  is necessary . She said that this was  because Members may not have the budget 
approved as scheduled. She said that other Members had said that the reason s for the budget to be 
pending can be technical reasons and sometimes  political reasons. She said that the technical 
reasons for the budget approval pending usually could be addressed in the short -term but political 
issues could be more difficult. The proposed mechanism should be able to operate if pending budget 
approval exists for longer than expected .  
4.19.   A Memb er said that the proposal is a necessary exercise in filling a gap in the financial 
regulations  and he expressed hope that it is never  used. He further said that this proposal should 
not become the Committee's primary focus this year  as it can be agre ed relatively quickly given  the 
experience of other international organizations.  
4.20.   DDG Brauner thank ed Members for their support. He said that the Secretariat  will take on 
board Members ' preference for quarterly rather than  monthly authorization and billing. He noted the 
suggestion that more time be accorded to looking into the budget. He stated that the plan was for 
the budget to be presented in June, shortly after MC12 and several month s before  Jeûne Genevois.  
4.21.   With regards to comments that had been expressed by some Members about the political 
relative to technical reasons that could lead to approval of the budget to be pending, DDG Brauner 
said that the proposal  is purely technical, and not political . He said that Members may have political 
considerations and that such would be in the purview of Members. He said that a technical solution  
is necessary  in order to allow for the further operation of th e Organization.  
4.22.   An Official of the Se cretariat clarified that the Financial Regulations allow for temporary use 
of the Working Capital Fund to cover  expenses, whilst awaiting payment of contributions by some 
Members, with the proviso that the Working Capital Fund would be reimbursed  as soon a s 
contributions are received .  
4.23.   In response to an earlier question, an Official of the Secretariat stated that examples of the 
type of expenditure that can be covered during the interim period  would be salaries for staff, building 
utilities (electricity, he ating, telephones), IT licences and  the security contractor.  
4.24.   The Chairman closed this agenda item by saying that discussions of this proposal would 
continue during the next meeting of the Committee .  WT/BFA/185/Rev.1  
 
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  5  ORAL UPDATE FROM THE  CHAIR PERSON  OF THE WTO PENSION PLA N MANAGEMENT 
BOARD  
5.1.  The Chairman of the CBFA invited the Chairman of the WTO Pension Plan Management Board, 
Mr. Robert Prochazka, to take the floor.  
5.2.  The Chairman of the WTO Pension Plan Management Board provided the Committee with a 
brief oral update on the activities of the  WTO Pension Plan in 2019. He indicated that a  more 
exhaustive description w ould be in the WTOPP 2019 Annual Report , which will be published in mid -
2020.  
5.3.  The Chairman stated that i n the area of investments, 2019 was an unexpectedly strong year 
for financi al markets and the WTO  Pension Plan investments had a  real return of +12.3% for the 
year.  
5.4.  He emphasized that current economic circumstances remain challenging for investors, not only 
on account of the coronavirus  and added that s tructural economic challen ges such as historically 
unprecedent ed low interest rates are likely persist for some time. He added that, f ollowing several 
years of above average returns, it ought to be expected that markets will adjust and that the WTO 
Pension Plan will experience some  below average returns in the future.  
5.5.  The Chairman of the WTO Pension Plan Management Board  apprised the Committee that t he 
Management Board has launched the next full actuarial valuation of the Pension Plan based on the 
year end data for 2019.   
5.6.  The Chai rman of the WTO Pension Plan Management stated that, in 2019, the  Management 
Board had working groups focused on the process of reviewing the Environmental, Social and 
Governance (ESG) aspects of investment s; investment opportunities in a low yield environ ment; 
and the assumptions to be used in the upcoming long -term actuarial valuation.  
5.7.  In closing, the Chairman of the WTO Pension Plan Management Board announce d that the 
current 3 -year terms of the members of the Management Board selected by the General Co uncil will 
come to an end in July. He informed the Committee that, c onsistent with the agreed guidelines for 
the selection of new members by the General Council , a call for Expressions of Interest will shortly 
be circulated.  
5.8.  The Committee took note of the oral update .  
6  STATUS OF THE IMPLEM ENTATION OF EXTERNAL  AUDIT RECOMMENDATIO NS – 
WT/BFA/W/ 508 
6.1.  The update followed on from that provided in October 2019.  
6.2.  Of the 75 recommendations from the external auditors, 20 were newly issued  in June 2019. 
The Secretariat accepted all the recommendations and has been working hard to achieve results 
that could satisfy the auditors.  
6.3.  The external auditors check ed the status of pending recommendations in February 2020 and 
took stock of the steps that the Secretariat is taking to implement them.  
6.4.  In absolute terms, there are  17 pending recommendations. Among them, only 3 are related to 
audits older than 1 year. The remaining 14 pertain  to the last audit report , issued in June 2019 , and 
are primarily  related to the performance audit o n Human Resources .  
6.5.  As part of the steps t o address  the auditors ' recommendations, the Secretariat is currently in 
the process of acquiring a human resources software which will harmonize processes and data as 
required by  the audit report.  
6.6.  A Member welcome d the report , adding that it  is very important to follow up on the 
recommendations.  WT/BFA/185/Rev.1  
 
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  6.7.  A Member stated that to strengthen the Committee's oversight role, the Secretariat ought to 
add more specificity in the "Secretariat 's Respons e Column" . He said that writing "same as above" 
doesn't really indicate what is happening . He gave an example by saying that in Number 19, 
information on the revised text on Home leave, would be a  way to capture what is to address.  
6.8.  Referring to Number 45, the Member said  from an auditor standpoint , an action plan for running 
the WTO with ongoing outstanding contributions is fiscally responsible . Nonetheless, he said that it 
points to a more specific question and called on Memb ers to look at this problem and assess  what 
more can be done  to address the outstanding contributions  and to make the administrative measures 
more effective .  
6.9.  Referring to Number 49, the Member recognized that the recommendation relating to the Travel 
Policy has been closed . He said that Members had no clarity on what the revisions were  and said a 
little more description would be useful.   
6.10.   Turning to Number 55, he asked what was preventing the two concerned Divisions from 
implementing measures to address the recomm endation relating to Consultants. The Memb er made 
additional comments for Numbers 67, 68, 69, 70 and 75.  
6.11.   A Member commend ed the Secretariat for its openness and transparency regarding the 
external audit recommendations. He encouraged the Secretariat to follow up on the pending 
recommendations , with a clear time frame.  
6.12.   An Official of the Secretariat said that the Members' comments would be taken on board. He 
said that the external auditors would give a status update in their next report.  
6.13.   The Committee took  note of the report.  
7  REVIEW OF OUTSTANDING CONTRIBU TIONS FROM MEMBERS AN D OBSERVERS - 
WT/BFA/W/ 513 
7.1.  An Official of the Secretariat presented the  total annual receipts from Members from 2013 to 
2019. She pointed out that  the level of outstanding contributions from Members as at the end of 
2019 was slightly lower than in 2018, but on average at the level of previous years.  Highlighting 
that in  2019, the WTO received 92% of the assessed contributions v ersus 91% in 2018.  
7.2.  Turning to outstanding contributions from Observers, the Official of the Secretariat said that 
they are slightly higher than during the last six years . 48% of the assessed contributions  were paid  
in 2019 versus 61% in 2018 . 
7.3.  Turning to Members under administrati ve measures at the end of 2019, it was noted that 5 
were under Category I, 1 under the Category II and 6 under Category III . 
7.4.  2 Observers were under Category I  of administrative measures , 1 under  Category II and 2 
under Category III.  
7.5.  The Official of the Sec retariat sai d as at the date of the presentation, there were  20 Members 
under administrative measures. 7 Members under Category I, 5 Members under Category II and 
8 Members under Category III. She said that the Members can still make payments until the end  of 
the year so this situation is subject to  change.  
7.6.  As at the date of the presentation, 7 Observers were subject to Administrative Measures  – 
3 under Category I, 1 under Category II and 3 under Category III.  
7.7.  The Official of the Secretariat stated the measures in place to follow up on arrears in 
contribution. These include regularly following  up with Members  by sending out  reminder letters  
4 times per year . Once by the Director -General and three times by the Se cretariat. This also includes 
regular follow -up with Member focal points by phone and e -mail. WT/BFA/185/Rev.1  
 
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  7.8.  A Member suggested that, for future reports, a list of the status of payments for each of the 
Members and Observers of the Organization , their contribution to be paid and their outstanding 
contributions  should be included .  
7.9.  Referring to the different Categories of administrative measures, with specific focus on 
Category  III, a Member asked when last  inactive Members and Observers taking the floor in the 
General Cou ncil had been  identified as such. He said that he has noticed that this rule is not applied 
so and urged that the rule should be respected.  
7.10.   A Member asked for confirm ation that his understanding is correct that the full list of Members 
in arrears as 31 Dec ember 2019 can be determined by adding the list of Members on payment plans 
in paragraph 6.3 to the list of Members appearing in Table 3 . He asked if there was any reason for  
the information provided in paragraph 3.2b is not provided in a detailed breakdown similar to 
Table  3. 
7.11.   With respect to Section 6, paragraph 2, the Member asked what the implications of expiration 
of a payment plan are.  
7.12.   Reiterating an earlier observation,  the Member asked whether the list provided to the 
General  Council Chairman on 6 March  pertained to the Members under administrative measures as 
of 31 December 2019 or the latest at the time of the General Council.  
7.13.   The Chairman said that the list of Member s and Observers under Administrative measures 
that he had read out during the General Council was as of that date.  
7.14.   An Official of the Secretariat explained that payment plans which have expired  are those for 
Members  who had payment plans for 10 years and which are close to being fully paid .  
7.15.   An Official of the Secretariat said that the list of Members and Observers under administrative 
measures is circulated to other officials in the Secretariat . She said that, going forward, the 
colleagues would be request ed to remind the Chairman of the General Council to follow the procedure 
laid out for Members under Category III.  
7.16.   A Member said that some of the countries on the list of administrative measures are facing 
some challenge s. He said that the Secretariat shoul d redouble its engagement of Permanent 
Representatives of the countries as well as with capitals to  find appropriate solution s. He called for 
a process that is not coercive, whilst recognizing the moral obligations that Members have to pay 
contributions.  
7.17.   A Member said that Members and Observers should follow the rules of the organization and 
accordingly pay their dues.  
7.18.   The Chairman read out the following recommendation to be made to the General Council, 
which the Committee endorsed.  
7.19.   The Committee invites the General Council to urge Members and Observers under 
Administrative Measures to liquidate their arrears.  
8  COHERENCE IN THE EST ABLISHMENT AND MANAG EMENT OF WTO TRUST F UNDS - 
WT/BFA/W/514  
8.1.  The Chairman said that t his topic was of key interest in Committee meetings in 2019 . He 
referred to questions and answers that had been  circulated to Members under the reference 
WT/BFA/INF/6. He added that, g iven the focus on the budget discussions at the end of 2019, it was 
agreed that the Se cretariat would present some documents and suggestions to Members in 
early 2020.  
8.2.  An Official of the Secretariat said th e document that had been circulated to Members ahead of 
the meeting (WT/BFA/W514) was intended to help contextualize the various Trust Fu nds that are 
currently being managed by the Secretariat . He said that two princip al criteria for acceptance of 
voluntary contributions  are identified in Financial Regulation 19. First, that the purposes for which WT/BFA/185/Rev.1  
 
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  the contributions are made should be consis tent with the policies, aims and activities of the WTO 
and, second , that if such a contribution directly or indirectly involves additional financial liability for 
the WTO, the contribution should require the consent of the CBFA.  
8.3.  Another aspect is if there  is enough consistency in the implementation of Trust Funds, 
especially in relation to governance and transparency. The Official of the Secretariat added that 
discussions are ongoing within the Secretariat , with a first meeting organised by  DDG Brauner wit h 
WTO Staff responsible for the implementation of Trust Fund activities , to launch a process of review 
and refle ction. The objective is to develop greater coherence, and where appropriate, potentially 
more formalized guidelines for implementation , and ensure c lear and harmonized guidelines.  
8.4.  He said that Financial Regulation 19 and the recently implemented Guidelines for the Receipt 
and Notification of Voluntary Contributions are in place and have aided transparency and 
consistency.  
8.5.  The Official of the  Secretariat informed the Committee that the external auditors are conducting 
a performance audit of Trust Funds  and that they would issue recommendations as part of their first 
audit cycle in early 2020 . Recommendations from the performance audit will be  incorporate d in the 
papers to be submitted to the Committee, on Trust Funds .  
8.6.  A Member said that her delegation welcome s the document and its contribution to 
transparency. The Member said that  her country contributes to Trust Funds, and that it is importan t 
that they are well  govern ed and ought to be  connected to Committees so that all Members can be  
informed that they can take part in the work of the Trust Funds or the projects. She said that 
voluntary contributions should be big enough in size to ensure t hat good governance structure s are 
realizable. She added that there could be a future discussion on the number of Trust Funds that the 
organization should have.  
8.7.  A Member expressed appreciation for the follow up  on the questions his delegation had raised 
regarding Trust Fu nds. He said that the paper is a very helpful basis upon which to begin to clarify 
some of the issues. Referring to paragraph 2.3, the Member said that consolidation of funds was an 
important rationale for the creation of the Global Trust Fund. He said that Members would need 
information from the Secretariat regarding why the WTO Secretariat management no longer believes 
in that rationale or has moved away from it and supporting  the creation of extra budgetary Trust 
Funds outside of the framework  of the Global Trust Fund.  
8.8.  The Member cited the areas that the Global Trust Fund is geared towards , noting that the 
mandate and scope are broad and flexible. These include enhancing inst itutional and human capacity 
in beneficiary countries, addressing trade policy issues and concerns, facilitating fuller participation 
of beneficiaries in the Multilateral Trading System  and encourag ing effective participation in the 
negotiations.  
8.9.  The Memb er said t here is no consistency across the management of T rust Funds and that it is 
not clear how oversight is applied horizontally. He said it seems as if there are no boundaries in 
place that restrict the expansion of scope of activities over time , thus rendering the one -off 
notification to the Members insufficient. He asserted that the current approach to financial reporting 
may not be  sufficient and effective and may not be allowing for the kind of oversight that is needed 
for the range of issues and co ncerns that could arise.  
8.10.   The Member said that the appropriateness of using Trust Funds outside of ITTC needs to be 
carefully examined, so should the appropriateness of putting them within Divisions specifically 
responsible for Committees that oversee overlapping technical work.  
8.11.   The Member said that Table 1 could be revised to show the Unit or Division that is managing 
each T rust Fund. He said paragraph 12  shows that the China Development Co operation Research 
Fund is not actually a fund but rather a vehicle to move money from the South-South Cooperation 
Assistance Fund to specific Trust Funds. He added that it would be more accurate to list both the 
Investment Facilitation  for Development pro ject and the Asy cuda/Tiva project separately on Table 1 
so that Members can have a clearer picture of the 14 Trust Funds referenced. He recommend ed that  
Table 1 also include a separate entry for the China Development Cooperation Research Fund with a 
potent ial for up to USD 8 million of additional Trust Funds or whatever the residual amount is. The WT/BFA/185/Rev.1  
 
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  Member said if the China Development Cooperation Research Fund is reported at its full potential it 
would be the third in size after the Global Trust Fund and the STDF, representing around 30% of 
Trust Funds.  
8.12.   The Member asked for clarification as to whether the South -South Cooperation Assistance 
Fund is another WTO managed Trust Fund or something else. Referring to paragraph 12.4, he asked 
for additional information what constitutes the informal body referenced.  
8.13.   The Member expressed a ppreciat ion of  the summary provided in paragraph 6.7 regarding  the 
governance structure of the STDF and said it would  be useful to return to both the specific mandate 
of the STDF and its governance structure in future conversations. He highlight ed that the STDF was 
created with a specific Secretariat structure, that made clear that there is an administrative division 
between the Trust Fund and the work carried out in the Agriculture and SPS Committees.  
8.14.   The Member said paragraph 7.7 states that the T rade Facilitation Agreement Facility  reports 
regularly to the T rade Facilitation  Committee on its activities but he said that he does not  agree with 
that ass essment. He made reference to G/TFA/M/2 which are the minutes from the TF Committee 
meeting from July 2017 and for more detailed follow up in G/TFA/M/6 the minutes from                       
9-11 October  2018, specifically agenda item 2, paragraph 2.1 to 2 .13 where the Member requested 
an administrative separation between the Trade Facility Agreement Facility and the Committee on 
Trade Facilitation. He said that his delegation's c oncerns and questions remain unanswered.  
8.15.   A Member said that whilst his delega tion is pleased with the objectives, conditions and 
governance of the Trust F unds to which the Member is co ntributing , they are open to a discussion 
including a more cross -cutting view and improvements. He said that there is no need to 
micromanage the oper ation of the Trust F unds.  He said the Secretariat should manage the Trust 
Funds and provide transparen cy and accountab ility to the membership as a whole.  
8.16.   The Member asked for an explanation of the transfer of 10% from the Programme Support 
Fund to the regular budget and also asked if there are sunset clauses to Trust Funds.  
8.17.   In response , an Official of the Secretariat said 13% is applied across all the Trust Fund 
expenditures an d collected into the Programme Support Fund. He said that 10% of the amount 
collected into the Programme Support is transferred to the regular budget as an extra source of 
income.  
8.18.   A Member thanked Members that contribute  to Trust F unds and said the overrid ing objective 
of Trust Funds is to ensure a fairer multilateral trading system by facilitat ing the participation of 
developing countries and LDCs in the work of the WTO. He said that when governance is discussed,  
the beneficiaries of the Trust  Funds should  be involved .  
8.19.   A Member said that his country is a major donor to the G lobal Trust Fund, STDF and LDC 
Funds and that they  do not see necessity for the proliferation of more Trust F unds.  
8.20.   In response to a question whether the 2019 expenditure  as depicted in  Table 1 of the paper 
WT/BFA/W/514  is to be added to the year -end balance in 2019 in order to get the total funds , an 
Official of the Secretariat said the balance is what is available at the end of the year  whilst t he 
expenditure is what was disbursed from  the Trust F unds during the year.  
8.21.   A Member said that prior to acceding to the WTO, and in the early years after accession, her 
country had received a lot of help from other WTO Members, both bilaterally and through specific 
funds dedicated to capacity building in the multilateral trading s ystem and from the WTO. She said 
that, as a developing Member, they take heed of the different kinds of help required by LDCs and 
other countries to better integrate into this organization and always provide contributions 
commensurate with their capacity. She said any discussion on trust funds should encourage 
members to contribute more for different trust funds rather than the opposite. She suggested the 
priority of discussion on trust fund should be dialogues between contributing members and 
beneficiaries  to ensure trust fund could better serve its purpose.  
8.22.   DDG Brauner said that he found the input from Members to be useful and re alizes that  there 
are different views amongst  the membership . One Member is of the view that all the Trust Funds WT/BFA/185/Rev.1  
 
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  should be connec ted with a Committee whereas another Member is of the view that this is not a 
solution. He said that moving away from consolidated Trust Funds  was not a choice of the Secretariat 
but rather a result of Members making donations and ask ing that they be treat ed in a special and 
very often visible way.  
8.23.   A Member expressed support for the view that Technical Assistance would be better if it came 
to a Committees in a particular way. He said that Technical Assistance is good and that his country  
contributes to a n umber of very important technical assistance initiatives , including the STDF and 
the G lobal Trust Fund. He said the  issue is that the institution is moving beyond technical assistance 
into policy and hence  questions arising. He said at times Secretariat staff speak on behalf of a Trust 
Fund whilst also representing the Secretariat. He said that donations should be through existing 
funds. 
8.24.   A Member said that , as a developing nation, they do not want to be restricted by 
United Nations  definitions  of what a donor is . She said it is for this reason that her country does not 
deem it appropriate to contribute to  the G lobal Trust Fund. She sa id that they try to explore other 
ways to make contributions to th e Organization. She said that each country has its  own domestic 
financial rules, regulations or laws for certain kind s of donations.  
8.25.   The Chairman said that there had been a good discussion of the topic, with quite few issues 
highlighted which are a good basis for the next step of this process.  
8.26.   The Committee took note of the paper and the statements made and that the  Secretariat 
would  revert to the Committee with a follow -up paper by the  next meeting.  
9  UPDATE ON AFTER SERV ICE HEALTH INSURANCE  (ASHI) – WT/BFA/W/5 11 
9.1.  An Official of the Secretariat said that the report is based on  data from end of  2018 as the  full 
analysis of 2019  was not yet finalized . He pointed  out that the medical plan , including the ASHI part, 
operates a s a pay -as-you-go plan. That means  that both the staff and the WTO , through the budget , 
contribute to the costs of the plan as they arise . Therefore, there is not a systematic mechanism for 
financing the liabilities as they accrue.  
9.2.  The financing of the plan is managed on a cash flow basis but the whole concept of the ASHI 
liabilities arises out of IPSAS. Additionally, the risks of medical claims are not transferred to an 
insurance company.  
9.3.  The Official of the Secretariat showed the  relationship between premi a and reimbursements , 
indicating that they hardly match . He noted that after a period where reimbursements were less 
than premiums, th e situation has reversed for the past couple of years. He added that  this is typical 
as premiums are based on an estimate of future claims.  
9.4.  The Official of the Secretariat said t he cost of the medical insurance plan is split 60%/40% 
between the WTO budget  and members of the plan. Both stakeholders have an interest in controlling 
costs for the long -term viability of the plan.  
9.5.  The Official of the Secretariat said that is not surpris ing that the older participants tend to have 
higher health care costs than t he younger participants. Hence, th e principle of the plan  is solidarity. 
Younger participants help to subsidize older participants. Retired people contribute less but they 
have a higher percentage of the cost s that are paid out, that is a normal and expected part of the 
plan. The fact that the WTO has a growing population of retirees means th e population of people 
who are going to have above average cost is going to grow and that will drive the cost of the plan . 
9.6.  The ASHI liability for  2018 was estimated to be a little below CHF 300 million  and has ranged  
between CHF 225 million and CH F 280 million, depending upon the estimation of various factors.  
9.7.  In 2017, a Special Reserve Account was established to "ring -fence" savings on the budgeted 
amount for the medical plan to help manage future ASHI costs. As of the end of 2019, the 
accumulated balance of this account was CHF 3.4 million, plus another CHF 0.9 million that c ame 
from the extra budgetary funded staff , bring ing the total to CHF 4.3 million.  WT/BFA/185/Rev.1  
 
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  9.8.  In response to a question regarding the significant drop in the contribution for 2017, an Official 
of the Secretariat said this reflects the fact that the WTO negotiated a new contract with a new 
provider for the services of claims management and they made a commercial gesture or an overly 
optimistic bid on what the cost would be and thus the WTO benefitted from that.  
9.9.  Regarding a question as to whether the turn in interest rates could be mitigated, an Official of 
the Secre tariat said interest rate s are  an input to calculate the long -term liability and that this 
fluctuate s. It is not feasible to control this  therefore, the organization has to take the market interest 
rate, which  goes up and down.  
9.10.   The Committee took note of t he report.  
10  STATUS REPORT ON THE  LDCS TRUST FUND FOR  PARTICIPANTS IN MIN ISTERIAL 
CONFERENCES – WT/BFA /W/512  
10.1.   Given  the brevity and clarity of the paper, the Chairman invited questions and comments from 
Members. He added that during the General Council in the previous week, the United Kingdom 
pledged that they will be contributing GBP 50,000 to support the participation of representatives of 
LDCs at MC12.  
10.2.   A Member pointed to a typographical error on the date in Table 2, "Funds  as at 
1 January  2019". The Secretariat took note of this.  
10.3.   The Committee took note of the report and also expresse d its gratitude to those Members 
who have made contributions to the Trust Fund.  
11  APPOINTMENT OF THE C HAIRPERSON  OF THE CBFA  
11.1.   Before handing over  the Chairmanship, Ambassador Dagfinn Sørli thanked Member for their 
participation in the meeting  and their professionalism, support and cooperation during his year as 
Chairman. He further reminded the Committee that the next meeting of the CBFA will take place on 
2 April at 3 pm.  
11.2.   Turning to agenda item A, appointment of the Chairperson of the CBFA, Ambassador Sørli 
propose d that the CBFA formally appoints the Permanent Representative of Philippines to the WTO, 
His Excellency Ambassador Manuel Teehankee , as chairperson of the Committee . 
11.3.   The Committee sealed the appointment, by acclamation.  
11.4.   Ambassador Teehankee thanked the outgoing Chairman.  
11.5.   DDG Brauner expressed gratitude to Ambassador Sørli for the stable manner  and gravitas he 
carried during the demanding period of budget discussions.  
11.6.   The Chairman thanked Ms. Phillips  and the  Secretariat for the ir support iveness during his 
tenure . He said t hat Members should be very happy to have such professional servants of the 
Membership in the Secretariat.  
11.7.   Ambassador Teehankee expressed his appreciation for the privilege that he has been accorded 
to Chair the CBFA and said that he is looking forward to working with the Secretariat and with all 
Delegates . 
11.8.   The meeting was adjoined.  
 
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