RESTRICTED  
  
WT/BFA/208  
 
8 December 2022 
(22-9120) Page: 1/20 
Committee on Budget, Finance and Administration    
 
 
REPORT OF THE MEETING HELD ON 8 NOVEMBER  2022 
The Committee on Budget, Finance and Administration (CBFA) met on 8 November  2022. Her 
Excellency Ambassador  Dr. Bettina Waldmann, German Ambassador to the WTO , welcomed 
Members to the meeting.  
On behalf of the Interpreters, the Chair asked Members  to please abide by  the following  
recommendations:  when participating remotely, use an external USB tabletop microphone or a  lapel 
microphone ; and avoid using the computer's built -in microphone or cell -phone earbuds. She said 
following these recommendations will ensure that everyone can hear and understand the Speaker's  
message fully  and will also protect the Interpreters from possible harmful effects such as acoust ic 
shock.  
 
The Chair said if any delegation plans to read a statement, the Interpreters ask  the delegation  to 
kindly  send a copy to the Secretariat before taking the floor. She said the document will enable the 
Interpreters  to check against their delivery.  
 
1  ADOPTION OF THE AGENDA  
 
1.1.  The Chair said the agenda for th e meeting was released on 28 October , with the reference 
WTO/AIR/BFA/5 6, together with an annotated agenda bearing the reference JOB/BFA/6 5. She said 
the Committee will discuss the 2022-2023 Mid -Term Budget Review in informal mode , immediately 
after agenda item E regarding the Annual Report of the Office of Internal Oversight (OIO) . 
1.2.  The agenda as set out in document WTO/AIR/BFA/5 6 was adopted . 
2  ORAL REPORT FROM THE CHAIR ON ONGOING WORK  
2.1.  The Chair said she would like to first focus on the mid -term review  of the budget . She recall ed 
that a special session of the CBFA was held on 5 October exclusively for the presentation of the 
Director -General's proposal contained in document WT/BFA/W/607 . She noted that d elegations 
asked a number of important and well  thought  out questions. She pointed that the Secretariat has 
circulated document WT/BFA/INF/16 providing further helpful answers to the many questions asked 
by Members at the meeting. She adde d that, keeping in mind the solution -focused spirit of the 
process, DDG Ellard, the Secretariat Team, and she had met informally with delegations posing 
question s at the meeting on 5  October. She said there w ill be an opportunity for the Committee to 
continue its discussions in informal mode later  during the meeting , to ensure inclusiveness in the 
process for the benefit of all Members.  
2.2.  The Chair further noted the question of long -term liabilities, which has implications for the 
financial health of the Organization going forward. Referring to  document WT/BFA/W/607, she 
observed that the request  for a revised 2023 budget  states that it does not account for corrective 
measures needed to address  the actua rial gap in the WTO Pension  Plan to avoid prejudg ing the 
outcome of the process undertaken by the WTO Pension Plan  (WTOPP)  Management Board . She said 
the Committee will discuss at the meeting the draft proposal  of the Board circulated on 3 November 
after an  update by Mr. Jean-Marc van D ril, the Chair of the WTOPP Management Board . She informed 
the Committee that she had met with him recently to discuss possible steps going forward , and that 
there will be more discussion s once the Board has finalized its proposal.  WT/BFA/208  
 
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  3  COMPLETE SET OF REVISED FINANCIAL REGULATIONS OF THE WORLD TRADE 
ORGANIZATION  – WT/BFA/W/ 610 
3.1.  The Chair recall ed that the Committee has been reviewing the WTO Financial Regulations  for 
several years. She said the Committee previously agreed upon specific revisions to Financial 
Regulations 4, 17, 23, 26, 27, 29, 37, 38 and 42. She further recall ed the extensive discussions the 
Committee  had on revisions to Financial Regulation 19, and the additional  change to the Regulation 
proposed at the meeting of the CBFA held on 22 September. She said, because no objections were 
received, the proposed amendments to Financial  Regulation 19 have been included in the full set of 
revised Financial Regulations that is on the Committee's  agenda  for the current meeting . 
3.2.  The Chair propose d that the Committee endorse the full set of revised Financial Regulations of 
the WTO, as set out in document WT/BFA/W/610.  
3.3.  The Committee endorsed the  following  recommendation :  
The Committee recommends that the G eneral Council approve the Revised 
WTO Financial  Regulations annexed to document WT/BFA/W/610.  
3.4.  A Member said the Committee ought to congratulate itself and the Chair for concluding the 
revision of the Financial Regulations that started in 2019, adding that  her delegation appreciates the 
very good conversations, especially in the recent Committee meeting, on Financial Regulation 19. 
She emphasized that  the Financial Regulations are supposed to be reviewed every four years, 
however, it took the Committee four  years to complete this round of review.  
3.5.  She stressed that there should be a "no hijacking approach" . As a common understanding on 
such review exercise of Financial Regulations , if there is no consensus among Members  on specific 
regulation , the concerned Financial Regulation should be left as it is. 
3.6.  A Member thanked the  Chair and said that his delegation would like to include administrative 
measures  in the next review  because there are  many  Members in arrears. He said  it would be good 
to see if the  administrative measures are efficient enough to make Members in arrears  comply with  
their payment plan s. 
3.7.  A Member congratulate d all Members and the Chair on having passed the package of revisions 
to the Financial Regulations . Noting that  the Committee has  taken three years to conclude 
discussions on Financial Regulation 19, h e thanked everyone who contributed to this effort . He said  
the conclusion of th is discussion on the Financial Regulations shows that if Members  are all together , 
they can work constructively and even overcome some of the most complex issues  in this 
Organization . 
3.8.  The Chair thanked Members for their cooperation and flexibility.  
4  NOTIFICATION OF THE ESTABLISHMENT OF A FISHERIES FUNDING MEC HANISM TRUST 
FUND – WT/BFA/ INF/15   
4.1.  The Chair introduced the item and invited representatives of the Secretariat to provide further 
detail on the notification.  
4.2.  An Official of the Secretariat referred to the document WT/BFA/INF/15 and recalled that the 
Secretariat had been working with Members for over a year on the development of a fisheries funding 
mechanism , including several rounds of consultations with Members on the concept culminating in 
the concept note found in Annex 2 of the document. He then said his role was to r eport on the 
assessment of AGSD regarding the conditions described in Financial Regulation 19 , and in particular 
whether the proposed voluntary contributions would create additional financial liability for the WTO.  
4.3.  Noting that the creation of the funding m echanism is included in Article 7 of the WTO 
Agreement on Fisheries Subsidies , and that the proposed funding mechanism will be exclusively 
funded by voluntary contributions without additional financial obligations for the Organization, the 
Official  of the Secretariat concluded that the creation of the new fisheries trust fund  require s a 
notification to the Committee. He said that this notification  requirement  was fulfilled by the WT/BFA/208  
 
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  circulation of document WT/BFA/INF/15. He further observed that he was not awa re of any 
comments from Members since the circulation of the document and that the agenda item for the 
meeting was intended to provide further opportunity for any Member to express its views.  He then 
turned the floor over to another Secretariat official to highlight the key aspects of the funding 
mechanism, the nature of its governing structure, and how members will be kept apprised of its 
activities.  
4.4.  An official of the Secretariat provided an overview  contained in JOB/BFA/ 69 as follo ws: 
4.5.  Good morning. I am very pleased to be here to provide an overview of the main elements of 
the Fisheries Funding Mechanism Trust Fund, which is intended to assist developing and LDC 
Members that have capacity constraints to efficiently and effectively i mplement their new obligations 
under the new Agreement on Fisheries Subsidies. This funding mechanism is provided for in Article 
7 of this historic Agreement that was adopted by Ministers at MC12, and thus is a key component of 
that Agreement.  
4.6.  As the Offic ial of the Secretariat said, the documents related to the Fund that you have before 
you are the product of a lengthy process of discussion and consultation with Members, including 
three prior versions of the concept note that were circulated to the Trade N egotiations Committee. 
Along the way, we have received comments from numerous Members, and I want to thank those 
delegations for their feedback. Your comments have provided invaluable inputs for developing the 
details of the Fund's structure, governance, a nd operation, and how it will keep Members and other 
stakeholders informed about its activities.  
4.7.  This morning, I will give a brief presentation on those aspects in particular, and then will be 
happy to take any questions.  
4.8.  Before getting into the specifics,  let me start with why the Fund is needed. It was borne of 
longstanding demands for technical assistance and capacity building as reflected in many proposals 
tabled by developing country and LDC Members - in the lead up to MC11 in Buenos Aires and 
thereaft er - coupled with interest on the part of donors to support this sort of targeted assistance.  
4.9.  On the specifics of the proposals that Members made for technical assistance, I would note 
that there were different suggested modes of delivery for that technical assistance. One proposal 
included a dedicated voluntary funding mechanism like the Fund (RD/TN/RL/125 – LDC proposal of 
6 March 2020). In any event, the common thread through all of these proposals has been a demand 
for assurance that the agreed outcomes of the negotiations would integrate provisions for technical 
assistance and capacity building.  
4.10.  The reason for this specific call for assistance is that it has been clear since the outset that 
new WTO fisheries subsidies disciplines would create un ique demands on WTO Members, which could 
be difficult for developing and LDC Members to meet. In particular, these negotiations always have 
gone beyond the purely trade focus of the existing WTO Agreements, by placing sustainability at 
their core. As the d isciplines came into increasingly sharp focus during the negotiations, culminating 
in the new Agreement, developing and LDC Members have voiced the need for assistance to 
implement new transparency requirements, fisheries management measures such as stock 
assessments and data gathering and reporting, and establishment of internal mechanisms to prevent 
subsidies from flowing where they are prohibited. In short, because the new rules will require 
Members to integrate sustainable fishing policies into their in ternal decision -making on subsidies, 
the technical assistance to support this integration will need to draw on expertise in respect of both 
subsidies and fisheries – the latter being a subject where organizations other than the WTO have 
the expertise.  
4.11.  This is the main reason to establish the Fund as a multi -partner trust fund, with the FAO, the 
World Bank and IFAD as the WTO's co -founding partners. The WTO will bring the trade and subsidies 
expertise, while the other partners will bring the expertise on sus tainable fisheries. Our collaboration 
with these other institutions in jointly supporting implementation of the new disciplines is precisely 
aimed at ensuring that the needed technical assistance is provided effectively and efficiently, to 
address gaps in existing assistance while avoiding duplication.  WT/BFA/208  
 
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  4.12.  Let me now turn to a few points on the structure of the Fund. We received a number of 
questions and comments on this, which we've addressed through the amendments we  have made 
to the concept note, in Annex 2 to the notification to the CBFA. To recall, the Fund's structure is 
composed of two layers: the Steering Committee and the Fund Secretariat.  
4.13.  Regarding the first layer, the Steering Committee is the Fund's governing body. It will be 
composed of representati ves of the WTO Secretariat, the partner organizations, donors and 
beneficiaries. The concept note provides details on how the specific representatives of each of these 
groups will be selected. The representatives will bring a mix of senior policy perspecti ves and 
technical expertise, to equip the Steering Committee to evaluate and decide on the applications for 
assistance that are submitted, and on all issues related to the Fund's operation.  
4.14.  Also, in response to requests by Members for further details on ho w the Steering Committee 
will make decisions on funding applications and operational issues, we have included in the 
documentation a set of Guiding Principles for the Steering Committee, contained in Annex 3 to the 
notification to the CBFA. In addition to setting the basic composition and operation of the Steering 
Committee, the Guiding Principles specify the untied nature of donations to the Fund, such that all 
donations will be free of any restriction or designation as to how they will be used. The Guidin g 
Principles also set forth various elements for eligibility and prioritization of applications for funding, 
mainly to address the specific requirements of the Agreement for integrating fisheries sustainability 
into decision -making about subsidization, and  for fulfilling transparency requirements. In addition, 
the Guiding Principles describe the mechanisms for the Fund's accountability to all WTO Members.  
4.15.  Turning now to the second layer of the Fund's structure, namely the Fund Secretariat, initially 
this wi ll consist of two employees – one with substantive expertise in grant management and 
fisheries, and the other an administrative staff. At the beginning, the Fund Secretariat will assist 
Members with composing the Steering Committee, and helping with its se t-up. Thereafter, the Fund 
Secretariat will support the Steering Committee's work in running the Fund.  
4.16.  In terms of its operational aspects, the Fund will provide grants on the basis of applications 
from eligible Members or groups of Members for specific as pects of implementation of the disciplines, 
to complement any other assistance that may be provided. This is a key element of the Fund – it is 
intended to operate as a gap -filler. A large amount of assistance for sustainable fisheries already is 
being prov ided, both by the partner organizations and bilaterally. That said, because the Agreement 
is new, and has not yet entered into force, the existing assistance is not specifically focused on 
supporting implementation of the new fisheries subsidies discipline s. By providing targeted 
assistance to fill gaps, the Fund will complement and leverage, rather than seek to duplicate existing 
assistance.  
4.17.  Before moving on, I would like to say a word about eligibility to apply for support under the 
Fund. As set forth in the concept note, developing and LDC Members that have deposited their 
instruments of acceptance will be eligible. This condition is included at the request of some donors, 
and is intended to create an incentive for potential beneficiary Members to move qu ickly to deposit 
their acceptances. By way of reassurance to beneficiaries, let me add that this does not mean that 
no assistance will be available before then. To the contrary, as the concept note makes clear, before 
a Member has deposited its acceptance it will be able to obtain assistance through the ITTC under 
the Global Trust Fund, for understanding the Agreement and for supporting its acceptance process. 
In fact, the Secretariat is organizing, in cooperation with ITTC, a series of seven regional works hops 
between now and next June for precisely this purpose. So the new eligibility criterion will apply to 
the more focused, integrated implementation assistance to be provided under the Fund and not to 
the traditional WTO technical assistance.  
4.18.  On the gover nance of the Fund, in addition to questions about the Steering Committee, we 
received a number of questions and comments on the need to ensure that the Fund in general will 
be transparent and accountable to the full WTO Membership.  
4.19.  We have addressed this i ssue first through the Fund's regular mandatory reporting to the 
Committee on Budget, Finance and Administration, and to the Committee on Fisheries Subsidies.  
4.20.  In addition, the concept note and Guiding Principles suggest that Members establish a Working 
Party, initially perhaps as a subsidiary body of the Negotiating Group on Rules, and later as a WT/BFA/208  
 
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  subsidiary body of the Committee on Fisheries Subsidies, to serve as a liaison between the Fund and 
WTO Members as a whole. This Working Party would enable Members  that were not directly involved 
in the Fund's operations to regularly receive information and pose questions and provide feedback 
on the Fund's operations, thus ensuring ongoing multilateral oversight of the Fund, by the whole 
WTO Membership.  
4.21.  Let me close  with a few words on how the Fund will come into existence and put in place its 
various structures and mechanisms. This is outlined mainly in Annex 1 of the notification document, 
which contains the estimated budget.  
4.22.  In particular, for the Fund to begin an y activity, it needs to receive donations, as it will be 
entirely self -financing. As soon as funds are in hand, the first step will be to hire the two initial staff 
members. These staff then will carry out the initial work of helping with composition of th e Steering 
Committee and then supporting the Steering Committee in getting set up.  
4.23.  As indicated in Annex 1, we have provided in the estimated budget for a twelve -month start -
up period (once staff are hired). We expect, however, that this phase could be com pleted more 
quickly. As soon as the start -up phase is completed, the Fund will be ready to commence operations.  
4.24.  In the interest of time I will stop here. I hope that this summary has been helpful and I look 
forward to your questions and comments.  
4.25.  A Member thanked the Secretariat for the detailed report and noted that, consistent with 
Financial Regulations 1 and 19, the focus of the Committee is on financial regulation . She mentioned 
that the transparency requirements for trust funds, as just endorsed under the revised Financial 
Regulation 19, should not have a chilling effect on the willingness of Members to establish trust 
funds , especially in the first situation that no additional direct liabilities or costs occur. Noting that 
there are several implementin g partner s under the trust fund, she asked whether other interested 
organizations could join as well. Additionally, she noted that some of the partner organizations might 
contribute to the trust fund. She asked if this was just in -kind contributions of exp ertise, or if actual 
financial contributions were foreseen. The Member also asked if travel related to partner experts 
would be paid by the trust fund.  And whether the other international organizations also participate 
in the management of the trust fund.  
4.26.  The Member further asked whether the recruitment of L -post staff to support the new trust 
fund would give rise to long -term liabilities, such as pension and health insurance. She also asked if 
this is the first time the WTO refers to the OECD Development Assistance Committee (DAC) criteria 
in the management of a trust fund. She concluded by reiterating  that future conversations about 
trust funds will not convey chilling effect on the willingness of Members to establish trust funds.  
4.27.  A Member stated that his delegation  appreciate s the advanced work the Secretariat has 
undertaken to engage with Members in relation to the trust fund  and noted that his delegation had 
had a range of questions on the prior concept notes. He said t hese related to the duration of the 
fisheries funding mechanism and the role of trust funds in the Organization more generally, 
especially regarding questions about efficiency and impartiality. The Member acknowledged the 
improved transparency in the engag ement with Members leading to the set of documents presented 
to the Committee  and stated his delegation's belief that the final product greatly benefited from the 
open exchange. While acknowledging that the role of the CBFA is largely limited to process qu estions 
under F inancial Regulations, the Member expressed the expectation that the Organization would 
continue to engage Members more broadly with respect to the fisheries funding mechanism in an 
open and transparent manner, particularly through th e bodies  responsible for implementation of the 
Fisheries Subsidies Agreement.  
4.28.  A Member welcomed the notification of the trust fund  as an important tool to  implement  the 
disciplines of the Fisheries Subsidies Agreement, especially for developing countries and LDCs . The 
Member encouraged all Members to continue the work constructively to conclude  negotiations on 
topics not yet included in the treaty. He noted  that the trust fund  would s upport effective  
transformation of the obligations into legal regulations and proc edures , as well as the establishment 
of effective fishery control management structures. The Member indicated that his delegation stands 
ready to support the next steps.  WT/BFA/208  
 
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  4.29.  A Member took note of the remarks by the Secretariat that the proposal is in line with  the 
Financial Regulations, in particular Financial Regulation 19, and indicated that his delegation agrees 
with the analysis  made by AGSD . The Member expressed his delegation 's readiness  to join the 
deliberations on the further implementation of the trust fund. 
4.30.  A Member underline d that the trust fund is going to be a gap filler and expressed hope that 
other available assistance would be taken into consideration going  forward. The Member asked if 
during the initial period there would be an issue transferring funding from the first to the second 
year. Turning to Annex 3 , the Member noted that the guiding principles s pecify  that the decision -
making process would normally be by consensus . She asked if there might be extraordin ary 
circumstances where there would be other types of decision making. Finally, the Member noted that 
the steering committee should avoid micro -managing  the fund, for example with regard to travel , 
which she suggested should  be under the control of the Sec retariat.  
4.31.  A Member thank ed the Secretariat for its effort to include Members' comments and concerns 
and added that  her delegation  looks forward to the successful implementation of the trust fund . 
4.32.  A Member said that his delegation supports the agreement on fishing subsidies reached in 
June and, therefore, also supports th e trust fund. 
4.33.  The Representative of the EU delegation thanked the Members of the Committee for the 
flexibility they showed on the revised financial regulations.  
4.34.  Regarding the fish funding me chanism, he welcome d the  proposal and indicated  the EU's  
intention to contribute to the trust fund. He noted the perennial challenge of developing country 
Member s with respect to  capacity constraints . He said it is very coherent that Members have 
complemen ted the Agreement with the funding mechanism , which will help developing countries get 
up to speed with their obligations as soon as the agreement enter s into force.  Noting  that there will 
be no additional direct or indirect financial liability , he encouraged the Secretariat to keep costs of 
the trust fund low, while providing necessary service to beneficiaries in a transparent and effective 
manner. He drew  the Committee's  attention to a small technical issue related to constraints his 
delegation fa ces on the 13% overhead, but assured Members they always compensate in other ways. 
He called  on other Members  who contribute to other trust funds also to join and assist developing 
countries and LDCs to implement the Agreement.  
4.35.  A Member noted  that, in his view, it was the first time that the Committee was getting such 
a detailed briefing  on a trust fund . The Member said his delegation had repeatedly raised the issue 
of the linkage between the utilization of the benefits by the Members and the ratification o f the 
Agreement  on Fisheries Subsidies . He said that his delegation strongly believes that Members should 
not establish such a linkage between the two.  He observed that all WTO Members have signed this 
agreement in MC12 , and each o f them  is at a different stage of implementation or ratification . He 
said limiting eligibility to only those  Members  who ratify would  create mistrust.  He noted that the 
creation of the trust fund was one of the critical issues that led to the conclusion of t he Agreement  
on Fisheri es Subsidies. He requested that the two issues be decoupled so that all developing 
countries and LDCs who need technical support can immediately start benefiting as soon as the trust 
fund becomes operational.  
4.36.  A Member welcomed the conclusion of the Agreement on Fisheries  Subsidies, noting  its 
importance for the future sustainability of the world's oceans.  She indicated her delegation's 
readiness to contribute to the trust fund and called on the developing countri es to also implement 
the Agreement.  
4.37.  A Member signalled his delegation's support for the trust fund as a mechanism to provide 
technical assistance and capacity building to implement the Agreement  on Fisheries Subsidies . He 
said his delegation intends to support the mechanism and remains committed to working closely 
with the Secretariat to support th e establishment of the trust fund. 
4.38.  A Member  whose intervention is summarized in para graph  4.25 took the floor again to seek 
a clarification of how the  fund had been developed and whether only potential contributors , or also 
beneficiaries,  had been  involved . WT/BFA/208  
 
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  4.39.  With respect to finance -related  questions, an Official  of the Secretariat acknowledged a long -
standing arrangement for handling the constraints on overhead payments referred to in para graph 
4.34. Regarding the question reflected in para graph 4. 30 on tran sfer of funds between budget years, 
he clarified that voluntary contributions are not subject to the same budgetary restrictions on 
carrying forward of funds between budget years , noting that any limits would be governed by the 
agreements with Members rela ted to the specific contribution.  
4.40.   In response to the question in para graph 4. 26 about potential long -term liabilities linked to 
employment , the Official of the Secretariat clarified that a couple of years before , in response to 
concerns about the long -term liabilities, the WTO started revising the contracts of staff hired to work 
on trust funds to limit  the duration of employment to five years.  He explained  that these staff will 
not have met the minimum vesting period to become eligible for long -term benefit s under the 
pension or the medical plan.  
4.41.  Another Official of the Secretariat responded to other  questions.  In response to the question  
on the process for  the development of the trust fund reflected in para graph 4. 38, she explained that 
the idea of a trust fund originated in  the many proposals submitted by  Members to create a technical 
assistance provision in the Agreement, including a proposal to set up a trust fund. She said t hose 
discussions , which included beneficiary Members as well as some potential contributors, generated 
the very first concept note. She added that, o ver time , the idea was refined and that in June, the 
concept note, as it existed at t he time, was circulated to all Members in the Trade Negotiations 
Committee (TNC).  She explained that , subsequently, there were two revisions that went to the TNC , 
with the final one circulated in September whe n Members were specifically asked to provide 
comments  on the draft . She confirmed that the Secretariat had received a lot of comments as a 
result  and that  having those inputs from Members throughout the process  had been very helpful . 
4.42.  The Official of the Secretariat then addressed a question in para graph 4.25 by confirming that 
the funding mechanism is a partnership fund and the partners now involved were selected based on 
their expressed interest and willing ness to collaborate. She said that the question of eventually 
allowing other organizations to joi n as partners would be dealt with once the trust fund is up and 
running but that the intention is to keep the set up manageable and then see how it evolves. She 
also addressed the question on partner contributions confirming that the concept does foresee t he 
possibility of financial contributions and that these would be welcome.  
4.43.  Regarding costs of partner organization s' expert participation, the Official  of the Secretariat 
indicated that costs could be covered by the trust fund, as necessary.  
4.44.  Regarding the question in paragraph 4. 26, about the OECD DAC criteria, the Official  of the 
Secretariat stated that these are already considered in, for example, the STDF when they are doing 
project evaluation . She added that it was her understanding something similar is done  by the ITTC . 
4.45.  In response to the questions of the Member in para graph 4. 30 on decision making and how 
the steering committee would operate, the Official of the Secretariat explained that "normally by 
consensus" means consensus is the norm . She expressed the view that it was too early to say more 
on how the steering committee might work as it will be up to those involved to develop those 
guidelines f urther.  
4.46.  A Member thank ed the Secretariat for the presentation and noted that her delegation places 
great importance on the availability of technical assistance and capacity building , recognizing that it 
will be essential for the comprehensive and effective  implementation of the Agreement. She echoed 
the view expressed in paragraph 4. 35 that the eligibility described in the footnote 2 of the concept 
note should not be limited and that the trust fund should be available to help those Members who 
are in the pr ocess of ratification . 
4.47.  DDG Ellard thanked Members for their cooperation  throughout th e discussion s on the Fish 
Trust Fund and all the work done regarding the various revisions of the concept note and the 
supporting documentation to make it as thorough as p ossible. She thanked the staff as well. She 
said that thanks to the feedback from Members , the final product is genuinely better. She 
emphasized how important it is for the Agreement to enter into force as quickly as possible and 
indicated that the Secreta riat looks forward to helping Members at all levels of development with 
that process. She also reminded Members that until the trust fund is operational , the Secretariat can  WT/BFA/208  
 
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  provide technical assistance to Members  through regular technical assistance activities  to help them 
with the process of entry into force.  
4.48.  The Chair stated that the Committee take s note of the establishment of the WTO fisheries 
funding mechanism as a new trust fund and confirmed that the fund w ill be subject to regular 
external auditing and review and will report regularly on its activities to the Committee.  
5  ANNUAL REPORT ON THE ACTIVITIES OF THE OFFICE OF INTERNAL OVERSIGHT (OIO) 
2021 -2022  – WT/BFA/W/ 612  
5.1.  The Head of the Office of Internal Over sight (OIO), who took up office on 6 June 2022, 
introduced herself to the  Members as an experienced investigator, certified fraud examiner , and 
member of the Chartered Institute of Internal Auditors.  
5.2.  As required by the Institute of Internal Auditors, she c onfirmed the organizational 
independence of the OIO , emphasising the importance of  the OIO 's review  of and input in the 
recently approved Procedure for Administrative Investigations, pursuant to which investigations 
activities will be conducted going forwa rd. 
5.3.  The Head of the OIO provided an update on budget and staffing, noting that the OIO will lose 
its Assistant post and therefore plans , subject to budget approval , to recruit a technical  oversight 
specialist, in line with UN Joint Inspection Unit benchmar ks. She added that she has submitted a 
recommendation for the OIO's budget and staffing for the next five years to the Director -General.  
5.4.  The Head of the OIO provided a detailed account of the activities conducted by the OIO from 
June 2021 to October 2022. She said a key focus for the OIO was to  become more visible and 
accessible  through outreach activities , including inductions, trainings, and drop -in sessions . She 
said, as a result , the OIO saw an increase in the number of ethical queries, and the number of 
intakes more than doubled in the year 2021 (January -December 2021) to 2022 (as at 20 October 
2022). 
5.5.  The Head of the OIO informed the Committee that an important development and ke y highlight 
for the OIO has been  the review and issuance , on 3 November 2022, of a new Procedure for 
Administrative Investigations , which allows the OIO to receive anonymous reports and includes 
definitions of new matters that should be reported, including  fraud, theft, bribery, corruption, 
breaches of confidentiality, data security breaches, coercion, collusion, health and safety concerns, 
security concerns, and harm to the natural environment. She added that , on 4 November 2022 , the 
OIO also launched a new secure online reporting portal, the Integrity Line , available to staff and 
third parties . 
5.6.  The Head of OIO explained that d ue to resource limitations , including an 8 -month period 
without a Head, and the fact that investigations take precedence over the OI O's other duties, none 
of the audits proposed in the Internal Audit Plan for 2020 -2021 presented to the CBFA in October 
2020 were fully completed. She said t he OIO will submit its Internal Audit Plan for 2023 -2024 to the 
CBFA in early 2023. She also inform ed the Committee that t he OIO is revising the Internal Control 
Framework Policy . 
5.7.  She then detailed the priorities of the OIO for 2021 -2022, which include  to: (1) review the 
Internal Oversight Charter (Administrative Memorandum No.974 ), (2) d raft an Interna l Audit Plan 
for 2023 -2024, (3) m odernise the OIO’s systems and processes , and (4) continue to work holistically 
across  four interrelated pillars: prevention, detection, response, and assurance , in order to address 
root causes of misconduct . 
5.8.  A few Member s asked questions relating to the increase in reported concerns. The Head of the 
OIO explained that increased reporting meant greater visibility of issues to enable th em to be 
addressed, and that the majority of concerns had been reported late, after having  been occurring 
for some time.  
5.9.  A few Members asked questions relating to the role of the Risk Officer and in particular, how it 
overlaps with the function of the OIO. The Head of the OIO explained that t he Risk Officer role is a 
second line of defense funct ion (within the framework of the Three Lines of Defense Model , WT/BFA/208  
 
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  promulgated by the Institute of Internal Auditors ). She said the Risk Officer reports to senior 
management  and provid es advisory support  and brings risk management and compliance expertise 
into the design and management of internal controls. She added that t he OIO is an independent 
function that  assesses the effectiveness of internal controls and provides assurance that the control 
culture is robust in its design and operation.  With respect to risk, she said the OIO focuses on the 
top risks for the Organization.  
5.10.  In response to a Member's question about ownership of the Internal Control Framework Policy, 
the Head of the OIO explained that the OIO has t he responsibility for updating it and is reviewing 
the policy alongside the Risk Management policy that feeds into it.  
5.11.  In response to a Member's question, the Head of the OIO also confirmed that OIO policies 
apply to consultants and short -term staff.  
5.12.  The Head of the OIO thanked Members for their continued support  and invited them to get in 
touch with her directly for additional explanations . 
5.13.  The Committee took note of the report.  
6  ORAL UPDATE ON THE SECRETARIAT TRANSFORMATION EXER CISE  
6.1.  The Chair gave the floor to  DDG Ellard to provide a n updated on the transformation exercise.  
6.2.  DDG Ellard  delivered the statement  contained in  JOB/BFA/ 68, as follows:  
6.3.  I am pleased to provide you with an update on the Secretariat's transformation exercise and  
to hear your comments. As I have done before, I will provide my speaking notes to you in writing 
following this meeting.  
6.4.  I will continue to provide regular written updates on the status of transformation work. Since 
the written update that was circulated to you on 5 September as document WT/BFA/W/604, we have 
also shared with you detailed Information Notes setting out the outcomes in three specific areas of 
the transformation work: Rewards Outside Promotion, Procurement, and Mobility. These Notes are 
being  circulated every few weeks to staff, and I will continue to share them with you as they come 
out. Discussion of these updates and the transformation work will remain on the agenda for 
discussion at our meetings.  
6.5.  As indicated in my previous updates , the focus of the transformation work is now on 
implementing the outcomes approved  by the Transformation Steering Committee  so far.  To recall, 
the first two waves of work focused on seven specific subjects under the themes of Talent 
Management and Ways of  Working. Seven small implementation teams of volunteer staff are now 
working with the Transformation Office to take forward implementation  in these seven areas . 
6.6.  Progress is most advanced for Rewards Outside Promotion, Procurement, and Mobility. We are 
in the final stages of preparing the revised policies on Rewards Outside Promotion and Procurement. 
In accordance with our Staff Regulations, the new policy on Rewards Outside Promotion will be 
submitted to our Joint Advisory Committee, which will then provid e its advice to the Director -General 
before the policy is implemented. We are also at the final stage of reviewing our Procurement Policy 
to reflect new thresholds for low -value procurement, which is under the purview of Deputy Director -
General in charge o f Finance. We are also developing training programs for staff and Divisions 
involved in procurement.  
6.7.  Work on improving and updating the existing internal and external mobility policies is 
underway . We are also  exploring holding  an internal mobility exercis e for entry level staff who are 
already subject to mobility requirements under our  current mobility policy , and we are continuing to 
pursue external mobility arrangements with other international organizations.  
6.8.  As also explained in the WTO 2022 -2023 Mid -Term Budget Review (WT/BFA/W/607), the  
transformation exercise aims to improve staff motivation, engagement , and value  and, in turn, to 
enhance the services provided to Members . A key element in boosting sta ff morale  and retain ing 
talent in the Secretariat  will be to offer better career progression,  including improving the existing WT/BFA/208  
 
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  promotion process. The ongoing transformation work on improving our internal promotions 
framework is separate from but complemented by the request that we have made to Members for a 
modest budget increase to  enable us to raise  the number of promotions per year  from 30 in 2022 
to 60 in 2023 , at the average of grade 8.  
6.9.  As I reported at our September meeting, t he digital transformation work involves an additional 
step before we can pro ceed with implementation, namely, assessing the possible costs and content 
of the use cases  identified as priorities, and how they could fit in alongside other priority initiatives 
that are already being rolled out. This assessment is ongoing. As explained  in the Secretariat's 
Responses to Questions Raised by Members relating to the Mid-Term Budget (WT/BFA/INF/16), t o 
the extent possible the Secretariat is seeking to implement its transformation outcomes within 
existing budgetary constraints. To the extent costs are incurred, they are expected to be modest, 
with full disclosure to and consultation with Members.  
6.10.  Further work  on additional topics , and in particular , work focusing on strategy and vision, has 
yet to launch. As the DG and I mentioned before, we w ill consult Members once we reach this very 
important phase of work , and, as I described earlier today, as part of our budget request, we are 
asking for two posts for staff with expertise in strategic planning to lead this effort . 
6.11.  Thank you again for your constructive engagement with our transformation work. I look 
forward to any comments or questions that you would like to share.  
6.12.  A Member thanked DDG Ellard for the detailed information on the ongoing transformation 
exercise. The Member asked questions  regarding procurement and mobility. With respect to 
procurement, the Member said her delegation would like to know the details of the procurement 
policies because her delegation does not have a clear understanding on how decisions are made 
regarding procu rement . She also asked whether there is any public -bidding approach applied in the 
Organization. She said, given the large amount of purchases, public bidding ought to be used to 
ensure value for money and to find the best provider.  
6.13.  The Member  further  noted that, according to the information note on mobility, possible  
channels for external mobility include international organization s, national administration s, or 
regional bod ies. She said  these broad choices seem to refer to  outward  mobility and asked wheth er 
there is any consideration for inward  mobility . 
6.14.  The Member said DDG Ellard had mentioned the strategic unit again, saying that its purpose 
is to have a better management or assessment of the human resources in the Organization. She 
said her delegation s till believe this should be part of the responsibility of the HR division.  
6.15.  With respect to  procurement , DDG Ellard  referred to the information note summarizing the  
changes in procurement processes and threshold s for small procurement s that Division s can co nduct 
without having to go through the Procurement  Section. She  noted that the current threshold of  CHF 
4,000 will be increas ed to CHF 6,000 per vendor, per year, per Division , which is in keeping with the 
thresholds of other international organizations . She explained that this will  give Divisions more  
flexibility by simplifying the process  and that  there will be more training  on procurement  for Divisions  
so that t hey know how to use this option . DDG Ellard  further  said the range for when a request for 
quotation procedure is used will be increased from CHF 4,000 - 20,000 to CHF 6 ,000 - 50,000 . 
6.16.  DDG Ellard emphasize d that any large procurement , defined as valued  over CHF 50,000 , must 
still go to the Contracts Committee , and that any change to that threshold will have to be approved 
by the Committee as part of the Financial Regulations . 
6.17.  With respect to the bidding process , DDG Ellard said  the current procurement process is 
consistent with  what many other international organizations  do. She explained that the Secretariat 
posts request s for proposals on the UN website to share broadly the need for  a particular 
procurement . She said this approach has been very successful for the Organization . She added that 
the Secretariat also relies on other international organi zations because there is  better value for 
money if international organizations work  together to piggy-back of each other's procurement s. 
6.18.  With respect to external mobility , DDG Ellard responded that there is a big focus in the one -
pager on working with other international organizations to find opportunities for the Secretariat  staff WT/BFA/208  
 
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  to join those organizations temporarily to obtain new experience and then come back  to the WTO, 
as well as  for staff of other international orga nizations to come here . She said internal mobilit y is a 
very important part of this exercise  and that the four types of internal mobility that are being worked 
on are: a temporary move to fill a temporary vacancy , a permanent move to fill a vacant  position , 
a temporary move to enable staff to spend time in another Division or Section , and a permanent 
move without  vacant positions.  
6.19.  DDG Ellard said the question of mobility is something that the Secretariat  needs to consider 
carefully  because it wants to make sure that when staff  undertake mobility, whether it is internal or 
external, that  staff member still has an opportunity for a good career pathway  at the WTO . She said 
one of the concern s is that if a staff member  leaves his or her Division  and go es on a temporary 
assignment  to another Division , that staff member loses his or her  place in line when it comes to 
promotion and other opportunities within the original Division . She said the transformation exercise 
aims to make sure that there is more consistency across the house regarding this particular type of 
career pathway . 
6.20.  Regarding the  strateg ic unit and the need to map out the existing staff, DDG Ellard said that 
although the HR can provide some important insight s, this is an exercise that really goes beyond HR  
and capabilities and requires  extensive  expertise . She said it is very important that the Secretariat 
has someone to undertake this exercise who is trained with respect to staff mapping , and that this 
kind of work  is seen as independe nt and credible . Someone who is not deeply engaged within the 
Organization but has a more independent sen se and reports directly to management  might be 
engaged . She said  HR will be an essential part of th e exercise by  provid ing information to who mever 
is conducting this mapping, but it is a very highly specialized exercise calling for special skills . She 
said, for this reason , the Secretariat is  seeking two experts  as part of the eighteen new posts in the 
budget request . 
6.21.  The Committee took note of the comment s made and the replies given . 
7  ORAL UPDATE FROM THE CHAIR OF THE WTO PENSION PLAN MANAGEMENT BOARD   
7.1.  The Chair of the WTOPP Management Board (WTOPP Chair) , Mr. Je an-Marc Van Dril,  provide d 
the Committee with an update on the work of the WTOPP Management Board  (the Board)  to develop 
a proposal to address the actuarial  deficit in the WTOPP. The proposal was circulated through 
document WT/BFA/W/613.  
7.2.  The Chair informed  the Committee that she received a letter fr om the WTO Staff Council  in 
which the Staff Council expressed an interest to be present at the CBFA meeting on 8 November, 
when the actuarial deficit is discussed. The Chair recalled that Members were not able to  reach a 
consensus on two previous similar requests from the Staff Council - one in 2017 and the other in 
2019 - for the Staff Council be present at CBFA meetings when issues of interest to staff are on the 
agenda, and to listen to individual Members' view s. The Chair stated that several delegations had, 
at that time, expressed the view that Members should be able to discuss such issues freely. The 
Chair said she is operating on the presumption that the matter remains controversial, unless she is 
informed o therwise by Members.  
7.3.  The Chair said it is important to make sure that staff is informed separately about issues that 
are of concern to them, such as the pension plan liabilities. The Chair said, to this end, she and DDG 
Ellard had suggested, in the interes t of transparency, that the WTOPP Chair circulate the 
recommendations of the Board to staff. She said the WTOPP Chair did so in the same  week when 
the recommendations were sent to Members. The Chair added that  the WTOPP Chair had met with 
the Staff Council  and is planning to organize a Town Hall meeting with all staff, to provide an 
opportunity for them to express views and ask questions about the proposal. The Chair said she will 
also meet with the Staff Council to listen to their views, and report back to  the Committee.  
7.4.  The WTOPP Chair said the presentation to the Committee would be structured in two parts – 
first, the Lead Actuary of the WTOPP will introduce the context that led the Board to prepare the 
proposal for reform; and then the WTOPP Chair will p resent the draft reform proposal to address the 
WTOPP's funding gap.  WT/BFA/208  
 
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  7.5.  The Lead Actuary , Mr. Reto Leibuntgud , provided a short review of the financial situation of the 
WTOPP, from a long -term perspective. He  explained that, based on the  input parameters (the current 
population, pension rules and regulations, and some assumptions of the demographic and financial 
future ), an actuarial projection is made regarding the future of the population, salaries and benef its, 
and cash flows and assets , and a required contribution rate is calculated.  
7.6.  The Lead Actuary said, as at the end of 2020 , there was total amount of CHF  665 million of 
pension assets and that this will still increase in the future because the expenditur e (i.e., the benefits 
and administration costs) are lower than the revenues (i.e., the contributions and investment 
income). He stated that there is a certain time in the future where the benefits paid will surpass the 
cash inflows, resulting in shortage o f plan assets in the future.  
7.7.  He noted that the current gap in the contribution rate is 10.5%. He said this is due to changes 
in the financial assumptions (due to the low interest rate environment) and demographic 
assumptions (due to increased life expectan cy). 
7.8.  The Lead Actuary  said other pension funds , in Switzerland and other European countries, have 
similar problems. He said these problems have to be dealt with and the actuarial gap has to be  
closed. In this regard, h e noted that not only contributions ha ve to be increased , but there has to 
be a decrease in certain benefits. He said it is important to reflect how to share the burden.  
7.9.  Before commenting on the principles that the Board followed when elaborating the draft reform 
proposal , the WTOPP Chair reca lled the steps that it had followed. He said, with the support of the 
Lead Actuary , the Board elaborated a list of measures that could reduce the deficit. By doing so , the 
Board has also been looking at the conditions offered by pension funds of other inte rnational 
organizations and the measures some of them have implemented. He said the focus has mainly been 
on Geneva -based international organizations. He underlined that staff of international organizations 
based in Switzerland are not eligible for any Swi ss social security or social insurance benefits. Hence, 
he explained,  the pension scheme s provided by the international organizations are the sole 
retirement benefit  to which staff are entitled. The Chair said the Board has provided a costing for 
each of t he measures , i.e., an indication of the extent to which each measure could reduce the gap. 
He added that the Board has identified what it views as the best combination of measures, giving 
priority to the ones that have the largest impact and are predictable.  
7.10.  The WTOPP Chair  then stated the guiding principles that the Board had followed. He said that, 
considering the unprecedented size of the gap, the Board has retained equal burden sharing between 
plan participants and WTO Members. He said the draft proposal consists of a pa ckage where by 
roughly half of the gap reduction would be  borne by staff and retirees and the other half by WTO 
Members. He said the contribution rate is the element that contributes  the most to reducing the 
funding gap, while respecting the one -third to tw o-thirds allocation between plan participants and 
sponsors. He specified that  benchmarking with other international organizations' pension plans was 
done, where appropriate. He added that t he proposal reflects the desire to keep the WTO competitive 
in its ability to recruit the staff it needs to support Members. He said this does not imply strictly 
replicating other international organizations' provisions but is intended to make sure that the 
conditions offered by the reform of the  WTO pension fund do not d eviate substantially from the 
norms  of other international organizations . 
7.11.  Turning to the draft package , the WTOPP Chair started with the two measures proposed for  
Members to contribut e to the reform . Measure 1 is an increase in the contribution rate of 5.1 %, split 
into 3.4% borne by WTO Members and 1.7% borne by current staff, according to the two -thirds to 
one-third allocation of ratio. He said this represents an increase of CHF 4.2 million annually on the 
WTO budget. Measure 2 is a capital infusion of CHF  68.77 million. To explain how this amount was 
calculated, the WTOPP Chair drew the Committee's attention to the table showing the actuarial 
impact of each measure. He noted that the capital infusion equates to 1.9% impact on the actuarial 
gap, and the two  measure s taken together  amount  to 5.3% to be contributed by Members to 
reducing the actuarial gap.  
7.12.  The WTOPP Chair then turned to measures affecting staff. The first measure, which is an 
increase of 1.7% in the contribution rate for staff , represents a re duction of net salary between 2.1% 
and 2.5%, depending on the level of remuneration . The second measure , an increase in the 
retirement age from 65 years to 68 years , will impact future hires  - the early retirement possibility WT/BFA/208  
 
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  will remain the same , i.e., 5 years before the normal retirement age . The third measure  is a change 
in the rate of accumulation , i.e., the rate by which the staff is building up entitlements for retirement. 
The accumulation rate would be reduced during the first 10 years. As a conseque nce, this will have 
an alleviating effect of 1.2% on the actuarial gap. The fourth measure is a change in the vesting 
period. Currently participants with five years of contributory service have an entitlement to a lifelong 
retirement benefit. The proposal  is to align the WTOPP with the pension plans of some other 
international organizations where a ten-year vesting period  is the norm. This measure would apply 
only to future staff. The fifth measure  is a change in the early retirement reduction factor. He sa id 
the possibility exists for staff to retire up to 5 years before the normal retirement age. He said when 
this option is chosen , there is a reduction factor that is applied. This reduction factor is currently 3% 
for every year taken before the normal reti rement age , for staff with  less than 30 years of service. 
He said the measure foresees the increase in this reduction factor to 4.5%. He added that the current 
3% reduction factor creates a burden on the WTOPP in actuarial terms , i.e., someone choosing tha t 
option is creating a cost for the WTOPP. He said this measure would apply to staff who joined the 
Organization before 2016, noting that staff who joined after 2016 already have a different reduction 
factor. The WTOPP Chair said the sixth measure is a man ner through which  retirees will contribute 
to the reduction of the actuarial gap . He informed the Committee that retirees are currently entitled 
to a cost -of-living adjustment that fully compensates for the evolution of the cost -of-living. He said 
the prop osed measure is to limit indexation  by not index ing pensions up to 1.7% of the consumer 
price index. He said  the foreseen measure would be applied in chunks  of 0.3% of non -indexation , 
up to a maximum of 1.7% . By way of example, he said that if the inflatio n rate is 3%, the 
compensation for inflation would be 2.7%. He said this would be repeated until the accumulated 
non-indexation rate of 1.7% is reached. Once this rate is reached, the full indexation will start again.  
7.13.  The WTOPP Chair said the accumulation of the measures, as well as an aggregation effect of 
negative 0.3%, is bridging the entire actuarial gap of 10.5%.  
7.14.  The WTOPP Chair informed the Committee that the WTO Legal Counsel had been consulted 
regarding the aspect of acquired rights , in the context of cases which were brought to the ILO 
Administrative Tribunal challenging the reforms in the pension plans of some other international 
organizations. He said the ILO Administrative tribunal follows three steps in its reasoning: first is the 
nature of the right that is changed – is the regulation changed or is it rather a contract that is 
changed? He said c ases are more complicated when a contract is changed than when a change is 
made to a regulation in a manner that it affects all the beneficiaries . Second , the reason for the 
change  should be examined . He explained that  the reason for the proposed changes is clear, given 
the significant actuarial gap that, in the long run , threatens the sustainability and existence of the 
WTOPP. Third, the consequences of t he changes  should be considered, i.e., proportionality of the 
change and the extent to which it affects a specific individual, relative to other stakeholders, would 
come into play. He concluded by saying that  there is balance in the proposed burden -sharing  and 
that acquired rights apply to a benefit and not specifically to an entitlement for a specific value.  
7.15.  A Member said his delegation would assess  the proposal in more detail because something 
needs to be done to address the actuarial gap in the WT OPP. He said one issue which is particularly 
difficult for Members, in the current context, is the capital injection of quite a substantial amount. 
Another issue is the postponement of the retirement age to 68 years of age. He said his delegation 
had alway s had support for this measure in previous meetings of the Committee and, in principle, 
still supports it. He recalled that, another Member had called for a broad view of measures as a 
partial view could potentially complicate matters. He noted, in this re gard, that  the Committee has 
been asking for a strategic audit or review of human resources and that  its outcome is uncertain. 
He said it could be that the current Secretariat staff is fit for purpose , or it could be that this is not 
the case. He said that , in the latter case , the staffing would need to be adjuste d and posts would 
need to be made available . Therefore, while  extending the retirement age may aid the WTOPP , 
adding new posts would add a burden on the budget. He reiterated that, while in princip le, his 
delegation supports the extension of the retirement age, this should  await the outcome of the 
structural review of the staffing within the Secretariat.  
7.16.  A Member said his delegation welcomes the work that has gone into the proposal because the 
topic under discussion is very important and  is closely related to the discussion held earlier regarding 
the overall budget. The Member said his delegation welcome s the suggestion to push the retirement 
age forward to 6 8 years on the upper limit and 63 years on  the lower limit , which is similar to the 
current reform in his country. He said his country is also considering  going up to 70  years in a couple 
of years  and said Members could have this in mind as well.  WT/BFA/208  
 
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  7.17.  The Member noted that the  WTOPP Chair , during his presentation , sometimes mention ed WTO 
and sometimes mention ed WTO Members . He asked for clarification as to what is meant by WTO 
and what is meant by WTO Members. The Member asked the WTOPP Chair to confirm that WTO 
Members ' participation in the increased costs would be 5.3%, and that this  is equal to CHF 4.2 million 
on a yearly basis, to make sure that the numbers are clear  to the Committee . 
7.18.  A Member said his delegation share s the view that it is very important to address the 
challenges that the WTO PP is facing . He said his delegation is very committed to ensuring the 
stability  of the system and peace of mind of the WTO staff. He said his delegation is interested in 
hearing views of other Members . 
7.19.  Regarding the adjustment to the accumulation rate, the Member asked whether the 
percentages were intended to have any incentive role.  He said he would have expect ed the 
percentage at the beginning of the accumulation  phase  to be higher because staff have longer to 
generate returns. He asked if there is  anything that is intended to be incentivised by those specific 
percentages that go up  and down again.  
7.20.  The Member said there may be different views on whether the retirement age should increase, 
or contribution rates should increase, or  whether there should be a one -time payment, and so on. 
He asked whether the Board can share the model tha t it used, as this might prevent Members from 
coming up with unnecessary further  proposals for adjustments , and would help the conversation.  
7.21.  A Member said bringing the WTOPP back to a sustainable position is an issue of utmost 
importance, as this issue is a critical risk for all stakeholders. She said this is not an abstract problem 
and certainly not one that Members can kick down the road for future generations to deal with. She 
recalled that  the Lead Actuary ha d advised Members of the Board that the longe r it takes for 
Members to take action , the worse the gap will get. She  said the number under discussion is from 
the 2021 valuation and  added that the Lead Actuary mentioned that most likely the gap is bigger by 
now. She said , as a member of the Board , she can assure the Committee that the Board and the 
Secretariat have been working vigorously to analy se different ways to fund the actuarial gap and 
have been discussing their impact on different stakeholders.  She said this is a tremendous task 
becaus e there a re no easy solutions . She urged the Committee  to engage in these discussions with 
the aim of finding a solution in the shortest time possible.  
7.22.  A Member said t he continued financial he alth of the WTO PP is critical to all Members. He said 
his delegation  appreciate s the outreach from the WTOPP Chair and the opportunity to receive a 
briefing on the serious situation that is  facing the WTOPP. He said his delegation remain s willing to 
engage in a problem -solving  manner to work towards addressing and resolving the  difficulties that 
the WTOPP is facing. 
7.23.  Referring to point 2.1(a)  in document WTO/BFA/ W/613 , a Member asked what is implied by 
adding the phrase "while respecting acquired rights" . He said  not only rights , but also  responsibilities , 
should be discussed . He asked how the Board would qualify the responsibility of stakeholders to 
safeguard the continuation of the pension system. He said his delegation believes that if everyone 
is focusing on  what their rights are , there will never be a way to solve the problem. He said the focus 
should  shift a bit more towards responsibilities, and the definition of those responsibilities.  
7.24.   The Member said it is important  to look at the different stakeholder groups , i.e.,  what this 
means for younger staf f, for staff approaching the age of retirement, for the retirees , and what it 
mean s to WTO Members. He said it is important make sure that the burden is properly shared. He 
said his delegation would be interested to hear about this from the Board , perhaps at a later stage, 
as the staff themselves have been able to respond to the proposal. He said another aspect is 
solidarity between the different groups within the Organization.  
7.25.  The Member referred to paragraph 2.2 in document WTO/BFA/W/613 and said he recognizes 
that this  is the result of a careful process within the  Board , where possible options have been 
analysed and discussed. He said, without undermining the good work of the Board, Members have 
been presented with a proposal which is without options . He said it would be helpful for Members to 
get a bit more background on what the different  options have been in the discussions or could be 
for moving forward . WT/BFA/208  
 
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  7.26.  A Member said his delegation is pleased to hear about the approach for long -term 
sustainabilit y and recognizes that this is a very important issue  for staff . He said there is an ongoing 
conversation about budget increases  and that his delegation also want s to see all elements  and 
stands ready to play a role in the discussions . 
7.27.  A Member  asked for further clarification on how the current situation was arrived at. He asked 
whether the p roblem is largely relat ed to actuarial issues or whether it has already moved to being 
a liquidity or cash flow issue . He said he noted that the cashflow pro blem would come in 2033. He 
noted that  there is a need for reform  and added that the Committee has to come to a convergence 
on what kind of reforms are required to fix the problem. He said the L ead Actuary had mentioned 
that this problem is common  to many pension funds, be they of international organizations or 
different countrie s. He said countries , including his,  have moved  from defined benefit  to define d 
contribution pension systems , based on recommendations from international organizations , to 
overcome the burden that the government exchequer in developing countries is faced with . 
7.28.  The Member said the reform proposal is premised  on the existing practice of 1/3 to 2/3 
burden -sharing between staff and Members. He said the long -term share of the burden ought  to be 
more aggressive an d that  a 50:50  share  could be looked into. He said t he argument  that is always 
made is that the continuation of the defined benefit system helps attract better talent to the 
Organization . He said what is important to understand is that the decision of a candidate to choose 
an organization depends on a number of factors , and not just on the pension pay out . He said his 
delegation  agrees that reform is needed and said any proposed reform ought to move towards a 
defined contribution system.  
7.29.  The Member said his delegation would have liked to see how the proposed reforms compare 
with the pension plan reforms in similar international organizations. He asked why the reform 
proposal does not make any suggestion as to how to increase the return on the existing pension  
fund. He said this ought to be part of the proposed reforms. He said the proposal includes positive 
elements such  as increasing the retirement age  and added that the proposal  is a first step forward 
but that the reform s need to be a little bolder . 
7.30.  A Member asked w hether future staff could be moved to a defined contribution  pension rather 
than the current final salary -defined benefit accumulation  pension.  
7.31.  A Member said her delegation appreciates the fact that the Board t ried to review several 
parameters to come up with a solution that would call  on all stakeholders to contribute . She said the  
proposal will be studied b y her capital and that her delegation  is ready to take a constructive role in 
the discussion s. With reference to the aspect of  a capital injection by Members , the Member asked 
whether there has been recapitalisation of pension funds in other international organizations , and 
whether it was  taken  into account in the analysis . 
7.32.  A Member asked if there are reforms of a comparable magnitude  and substance  in other 
international organizations. He said this would aid the understanding  of his delegation  in considering 
the proposal . 
7.33.  A Member said that, given the technical nature and complexity of the topic, and as there 
would be a lot of questions, it may be useful to have a dedicated informal session  to answer questions 
and look at the details of the pro posal. 
7.34.  Regarding the comment s made in paragraph 7.23 pertaining  to the responsibilit ies of all 
stakeholders in ensuring the sustainability of the WTOPP, and regarding  acquired rights , the WTOPP 
Chair said the WTOPP had two previous reforms. He said the mea sures were fully borne by staff as 
they were considered as bein g bearable by staff. He said the current deficit is significant and thus , 
WTO Members are also requested to help  address it . He said  there is a moral responsibility for both 
WTO Members  and beneficiaries  to contribute to the WTOPP's  sustainability. He said the issue of 
acquired rights is settled by the ILO Administrative Tribun al jurisprudence . He explained that 
acquired rights are for a given benefit, but the amount is not set. He said  staff are  required to 
contribute up to a certain limit. He  further noted that a group that is not represented in the 
deliberations is future staff  and that the Board has been following a principle of not shifting too much 
of the burden to this group. He added that the B oard has been assessing what other international 
organizations have done in this regard , in order to benchmark . WT/BFA/208  
 
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  7.35.  Regarding the question s and comments in  paragraphs  7.27, 7.28 , and 7.30  about considering 
moving from a defined benefit to a defined contribution  pension scheme, the WTOPP Chair said such 
a move could be envisag ed only for future staff because current staff have acquir ed rights to a 
defined benefit scheme . He said even considering c hanging the design of the WTOPP , there is still a 
need to close the existing actuarial gap. He cautioned against comparing the pension schemes of  
national governments with those of international organizations  as people working in international 
organization s do not have the same benefits as those offered by national schemes. He noted that 
the B oard has mainly look ed at the UNJSPF and CERN as these cover Geneva -based international 
organizations . 
7.36.  The WTOPP Chair said  that if only the required contribution rate  were to be used to address 
the 10.5% actuarial gap, this would mean 7% for Member s and 3.5% increase  for staff  as this is in 
line with the current split in the contributions rate.  He said that this gap amounts to CHF 380 m illion, 
which could immediately close this gap.  
7.37.  On the accumu lation rate, he said th e proposed change  is close to the UNJSPF accumulat ion 
rates and that it would help  close the gap.  
7.38.  Regarding the question on capital injection in paragraph 7.31,  the WTOPP Chair sa id, in the 
case of CERN , the capital injection  was made by CERN Members to bring the pension plan back to a 
sustainable bas is. 
7.39.  Regarding the question s at para graph  7.32, the WTOPP Chair  referred Members to the table 
in the last page  of document WT/BFA/W/ 613 and  point 2.14, adding that 5.3%, a little more than 
50% of the actuarial gap,  refers to the  accumulation of the measures accruing to  Members . He said 
measure 1 , for the part that accrues to Members , and measure 7, as mentioned in the table in page 
5 of document WT/BFA/W/613,  would  close 5. 3% out of the actuarial gap of 10.5%.  He said the 
impact of the budget is highlighted in paragraph 2.4 on page 2 of document WT/BFA/W/613 , which  
shows an  increase of the contribution rate o f Members by 3. 4%, which re presents a CHF 4.4 million 
increase in the annual budget.   
7.40.   He said the increase in the normal retirement age would affect new staff. He noted that 
increa sing the ve sting period from 5 to 10 years would be up to the Organization and would require 
a revision of HR policies.  He said each time he refers to WTO Members or Members, he is referring 
to WTO Members.  
7.41.  The WTOPP Chair said he is open to the suggestion made by a  Member , at paragraph 7.33,  
to continue these excha nges in a different format.  
7.42.  In responding  to the question at paragraph 7.27 regarding whether this is a liquidity problem, 
the Lead Actuary in dicated that the projections  show that the cash flow and assets will last until 
2060 and thereafter the liquidity problem would arise.  
7.43.  Turning to the comment in para graph  7.39 that the proposal does not include any suggestions 
for increasing returns, the Lead Actuary said changing the strategic asset allocation to  increase risky 
assets  is not  the best solution and is not good governance. He said the B oard cannot just decide to 
invest in more risky assets and expect the market to take care of the problems.  He stated  that the 
issue is not on the assets side of the balance sheet , but rathe r on the liabilities  side. He added that 
the WTOPP has an expected rate of return that is reaso nable and a suitable asset allocation , which 
it can share with the Members.  
7.44.  The Chair thanked the WTOPP and the Lead Actuary. She also thanked Members for their 
active participation and questions. She said this is an ongoing discussion that started with a draft 
proposal by the B oard and said she would come back to Member s about how to continue discussions 
on this , and in what format.  
7.45.  The Committee took note of th e report from the WTOPP Management Board and the 
comments made.  
 WT/BFA/208  
 
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  8  WTO BUDGET AND FINANCE REPORT – 3RD QUARTER 2022 – WT/BFA/W/611  
8.1.   An Official of the Secretariat introduced the budget and finance report presented every 
quarter. She said the level of contributions received was close to 75%  and on track  and that 
contributions from Observers amounted to 55% of the total . She said there had been no change in 
the list of Members and Observers under administrative measur es since 30 September.  
8.2.  The Official of the Secretariat said some Members were not complying with the terms of their 
plans, which are typically spread over 30 years. She added that  the recorded expenditures amounted 
to 77% of the annual budget. She stated t hat some amounts , such as the allocation to the Building 
Renovation Fund and the Ministerial Conference Operating Fund, at CHF 600,000 each, had already 
been transferred in full. She further noted that the transfer to the ITC budget is done on a quarterly 
basis.  
8.3.  She said that the quarterly reports are ad -interim, and recalled that the Committee had 
reviewed the 2021 Audited Financial Statements during its meeting on 22 September. She noted 
that, in the budget document , the projected expenditures  until the e nd of 2022 are contained in 
Table 4 of document WT/BFA/W/607.  
8.4.  A Member  asked what steps the Secretariat is taking to address the  trade-off between the 
underspend in regular staff and overspend in temporary staff  highlighted in paragraph 4.3 . He 
highlighted that the overall category  – Staffing Resources  – shows a spend rate of 76%, which is in 
line with expectations at the end of the third quarter. He said it would seem logical that the 
under spend on regular staff would not see a  dramatic increase in the fourth quarter,  unless a large 
number of regular staf f suddenly departs. He added that it seems like the limits of savings in the 
line for regular staff have has been reached. He stated that the rate of growth in the temporary staff 
could well accelerate in the fourth quarter. He asked if steps have been tak en to ensure the balance 
in the expenditure on the overall Staff Costs budget.  He also asked what portion of the short -term 
staff costs is discretionary. He said if the rate of spend ing is higher than that which was anticipated 
and budgeted  for, Members should be made aware of the cuts and reductions that would have to be 
made to stay in line with the budget allocation.  He said if excessive use of Zoom and Interprefy is 
leading to these cost overruns , then all parties ought to collectively look into what is  essential and 
what is no t essential , evaluat e, and mak e choices now , as the alternative would be to accept a deficit 
at the end of the year.  
8.5.  The Member note d that the expenditure rate of general expenses is 96% of the total. He asked 
if these expenses are  evenly distributed throughout the year. If that is the case, he asked  whether  
Members should  expect an overspend of CHF 5 .6 million in this category and what steps are being 
taken to keep this budget line on track with the allocated amount.  
8.6.  Turning to cap ital expenditure, the Member asked if  the expenses  referenced  in para graph  4.7 
of document WT/BFA/W/608  are the primary drivers of the overspend or whether other expenses 
are expected to be incurred in the fourth quarter. He asked if travel and hospitality  expenses could 
be reduced further to offset the overruns in other areas. He said these items are subject to the most 
discretion. He said as the overruns in other parts are significant, then the Organization would  be 
able to work according to the current b udget allocations. He asked whether the Secretariat has 
issued any guidelines on reducing travel and hospitality in addition to the Covid-related reductions.  
He said the Secretariat ought to be taking all possible steps to reduce discretionary spending in the 
fourth quarter.  
8.7.  The Member stated that the Building Renovation Fund has received a contribution in previous 
years which is well over the CHF 600,000  norm ally budgeted. He asked whether there is a ny 
consideration to reduc e the current allocation and to  transfer the amount to cover other costs under 
the current extraordinary times , e.g., heating. He noted that the B uilding Renovation Fund is not 
discretionar y but that it can be considered under the current situation.  
8.8.  Referring to arrears in tables 2 and 3 of document WT/BFA/W/608 , a Member asked what st eps 
the Secretariat has taken in terms of outreach to the  Members  and Observers with arrears . He then  
inform ed the Committee that , as the Chair of the Accession Committee  of Somalia to the WTO, he 
always inform s the Somalia n officials  that they ought to address th e country's  arrears . He said the 
Somalia government is discussing a payment plan . WT/BFA/208  
 
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  8.9.  Referring to Table  6 of document WT/BFA/W/608 , the Member  said his delegation finds it 
encouraging that the expenditure for travel and hospitality is only 47% of the budget ed amount . He 
said this expenditure should  be kept low for the rest of the year and that new benchmark s should  
be established  for the coming years.  
8.10.  In response to the questions in paragraphs 8.5 and 8.6, an Official of the Secretariat said 
some expenses under the general expenses category, including cleaning services and some other 
outsourced services, are committed in full at the beginning of the year.  She said this is also the case 
for some items under capital expenditure , such as annual subscriptions for software.  
8.11.  Regarding the comments in paragraph 8.7 pertaining to the Building Renovation Fund, the 
Official of the Secretariat recalled that, based on the FIPOI guidelines and established practice in 
Switzerland, the WTO had recognized that it needed  to accumulate a total of CHF  25 million at the 
10th year after the renovation works that had b een completed  at the WTO in 2012. She said, at the 
time, Members had decided that they can only afford to contribute CHF  600,000 per year  into a 
Building Renovation Fund . She said this would have resulted in a significant shortfall at the end of 
the 10 yea rs, i.e., CHF  6 million vis -à-vis CHF  25 million. She explained that,  over the years , the 
Secretariat has transferred some of the savings in various budget lines to shore up the Building 
Renovation Fund  because it was concerned that when the time comes for  renovations , the 
Organization might fall short  of funds . She said the point made that the Building Renovation Fund  
has accumulated the targeted amount is a fair one. She said the Organization would have to start 
spending  the funds to renovate some areas o f the buildings , adding that it is important that Members 
continue contributing to the Building Renovation Fund as it requires replenishment because it is a 
necessary fund in the long -term. 
8.12.  In response to the question in paragraph 8.8 regarding arrears, th e Official of the Secretariat 
said the Secretariat sends letters to , and has frequent meetings with , the concerned delegations . 
She added that the Secretariat held a workshop with a regional group to which most of the concerned 
Members and Observers belong . She added that there is willingness to settle arrears and that the 
impediments to paying include the fact that some of the countries have come out of war and their 
priorities were to rebuild social and other infrastructure before  paying contributions to international 
organizations.  She said the Secretariat continues to engage the Members and Observers  and added 
that two Members have recently settled their arrears in full. She informed the Committee t hat the 
Accessions Division is requested to include the issue of settling arrears with concerned Observers 
during meetings with them . She added that the Director -General discusses this aspect with the 
concerned countries during her meetings with their seni or officials and encourages them to settle 
their arrears. The Official of the Secretariat said she agrees with the comment the Member had made 
at paragraph 3.6 regarding the need to include the review of the administrative measures in the 
next revision of the WTO Financial Regulations.  
8.13.  8.13. In response to the question on short -term staff in paragraph 8.4, DDG Ellard informed 
the Committee that the Secret ariat has set up a Short -Term Needs Committee  (STNC),  which 
consists of the four DDGs, the Chief of Staf f, the Director of Administration and General Services , 
and the Director of Human Resources (or the Division's representative as the position is currently 
vacan t). She explained that the STNC is focussing on addressing the explosion in the number of 
short-term staff and has been looking at each application for short -term staff, particularly those that 
are not to replace staff on sick leave or to temporarily fill vacant post s. She said that in July , a 
decision was made to not approve any new request s for short term staff for the rest of 2022. She 
noted that, if needed, exceptions could be made to hire short -term staff if there is an emergency or 
a particular situation. She added that , with the Director -General's support, rules that have been in 
place in the p ast are being re -evaluated to make sure that staff who go on sick leave, maternity 
leave, paternity leave , or special leave without pay are not automatically replaced  and that more 
rigour is applied . DDG Ellard informed the Committee that the STNC  has star ted looking at requests 
for 2023. She stressed that the process is enormously difficult because much of the Secretariat's  
work that is based on particular needs do es not match up with the vacant posts , and that is why the 
Secretariat needs to  have a more strategic approach to staffing.  
8.14.  In response to the questions on travel raised in paragraph 8.6, DDG Ellard said more discipline 
is being imposed  on approving travel . She said that this has been discussed in a meeting with 
Directors. She expres sed gratitude for the comments made by a Member at paragraph 8.9 , regarding 
the low rate of expenditure of the travel budget.  She noted that the rate of expenditure, though 
relative ly low , relates to fewer  trips taken, further explaining that the cost of t ravel has gone up WT/BFA/208  
 
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  between 40% and 60%.  She said  travel is returning to normal and that many types of meetings are 
difficult to do remotely , e.g., Trade Policy Review s and some work in technical assistance and 
capacity building. She sai d she cannot promise that the travel rate will continue to be low. She  
added, however, that the Secretariat will continue to apply rigour in assessing travel and  determine  
what can continue to be done remotely.  
8.15.  The Committee took note of report and the comments made.  
9  QUARTER 3  2022 EXTRA BUDGETARY FUNDS REPORT – WT/BFA/W/608   
9.1.  An Official of the Secretariat noted that the lifting of sanitary conditions and travel  restrictions  
has allowed the gradual resum ption of  face-to-face technical assistance  activities. He noted that the 
ITTC incorporated remote learning opportunities in its program of offerings even before the 
pandemic, but that for certain types of courses , in-person learning remains preferred and more 
effective. He also noted that t he gradual  start of this year 's activi ties mean s that the Global Trust 
Fund remains in a quite stable financial position for the remainder of th e year and probably 
through out next year . Nonetheless , he encouraged Members to begin planning to resume 
contributions (or become a new contributor) , as the current trend of expenditure s going up  and 
contributions going down will not be sustainable.  
9.2.  He observed that o ther trust funds are generally in good shape  but reminded Members that 
the balance in the STDF includes advance payments by some Members f or future years , stating that 
more contributions will be required to meet the level of demand already identified in the coming 
year. 
9.3.  A Member reported that his delegation has  completed its pledge to the GTF after the end of 
Q3. He noted that funds allocate d for advisory support on legal issues  have been underutilized  and 
wondered why Members are not taking advantage of these resources . He suggested that w ork could 
be done to examine and improve the utility of the support. He also asked a question about  a specific 
expenditure of CHF 78,000 not included in the budget  and requested additional information . 
9.4.  The Member also questioned the need for so many small trust funds that constitute a fraction 
of overall trust fund expenditure but carry significant administr ative and overhead c osts. He 
suggested that the Organization achieve efficiencies by consolidating separate trust funds in to a 
larger  centrally -managed trust fund in the context of broader trust fund reform efforts.  
9.5.  The Member noted that 51% of expenditure from all sources fall s into the category of 
implementation of WTO agreements . He said, g iven the capacity struggles that many Members point 
to regarding overdue or incomplete notification s, this appear s to be an area  where work should be 
undertaken to assess the actual results from these expenditures  so as to improve delivery of this 
assistance and better ensure that  transparency obligations are fully implemented.  
9.6.  The Member underscored  that barely 7% of capacity buil ding resources are  dedicated to 
improving engagement with non -governmental stakeholders and that the Organization is here to 
provide a framework for private sector entities to understand and comply with government policies . 
He noted, however, that  14% of r esources are going to  academic  entities , which neither use nor 
benefit from a system of multilateral rules . The Member expressed the hope that  the Organization's  
reform efforts can lead towards a  more inclusive approach that  more deeply engages with the ri ght 
range of stakeholders impacted by global trade.  
9.7.  A Member suggested that it would be useful if, in addition to historic data, the trust fund 
quarterly reports included a column for the following year. He said t his is relevant as several 
contributors hav e begun making advance payment for future years.  He added that combining current 
and future amounts makes the reports harder to understand and has resulted in a proliferation of 
footnotes.  He proposed that at least in the second half of the year the report s begin to separately 
show information related to future years.  
9.8.  A Member voiced support for the value of non -earmarked funding in the GTF to benefit 
developing countries and observed the downward trend in non -earmarked support for the GTF.  He 
asked if this  had been compensated by increasing contributions to other funds.  WT/BFA/208  
 
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  9.9.  An Official of the Secretariat thanked Members for their comments and questions.  He noted 
that he could not provide all the details about the expenditure of CHF 78,000 raised by a Member at 
paragraph 9.3, adding that he had previously reviewed this and felt comfortable assuring the 
Member that there was nothing major  there.  Nonetheless, he offered to follow up with the Member 
on the specifics of the line item.  
9.10.  Regarding the suggestion  at paragraph 9.7 to include some information on future years in the 
quarterly reports , the Official  of the Secretariat said t he suggestion is timely , as the Secretariat 
undertakes a review of the report format at the end of each year to be ready to introduce 
improvements in the subsequent year.  He promised to include the suggestion in the review process.  
9.11.  Regarding the question in paragraph 9.8 about declining contributions , the Official of the 
Secretariat said that such a pattern had been observed a few years a go, prior to the pandemic, but 
that the reduced contributions recently seemed to be strictly a pandemic phenomenon , with  
Members delaying contributions to the GTF due to the fact that expenditures were not as forecast. 
He said  additional funding was not im mediately necessary. He noted that most Members had 
signalled a willingness to contribute again when the need became evident.  He said  the Secretariat 
would be following the situation as it evolves and will keep Members informed.  
9.12.  The Chair thanked the Secre tariat for the report and additional explanation s. 
9.13.  The Committee took note of the report and the comments made.  
10  AMENDMENT TO STAFF RULES 106.14 (B) AND 106.15 (H)  
10.1.  An Official of the Secretariat introduced document WT/BFA/W/609, informing the Committee 
of amendments to Staff Rules 106.14 (b) and 106.15 (h).  He stated that t he amendments, set out 
in the document, replace the word "spouse" in both staff rules concerned with "in respect of the 
same child" and "other parent" respectively.  
10.2.  He said t he amendments do not change the basic principle behind the staff rules, which is to 
ensure that neither an allowance nor a grant can be paid twice for the same child , adding that the 
amendments are in line with what is already the practice  and do not have a financial impact.  
10.3.  A Member  commented that while his delegation agreed  with the amendments, the French and 
Spanish version s do not seem to correspond exactly to the English language version of the staff 
rules concerned  with respect to the reference in "parent" . 
10.4.  In response , the Official of t he Secretariat responded that the translated versions of the 
amended rules will be revi ewed and revised accordingly.  
10.5.  The Committee took note of the report and the comment s made.  
11  CLOSING REMARKS  
11.1.  The Chair  thank ed Members for their active participation and wish ed them  a pleasant evening.  
11.2.  She said the date of the next regular meeting will be co mmunicated in due course . 
11.3.  The meeting  was closed.  
__________