RESTRICTED  
  
GPA/M/56  
 
4 September 2014  
(14-5026)  Page: 1/5  
Committee on Government Procurement   
 
 MINUTES OF THE FORMAL MEETING OF 25 JUNE 2014 
CHAIRMAN: MR BRUCE CHRISTIE (CANADA) 
The Chairman said that, in preparation for the meeting, delegations had received an Airgram 
(WTO/AIR/4320 of 10 June 2014) setting out the proposed agenda. The proposed agenda, as set 
out in the Airgram, was as follows:  
1. Request for observer status: Tajikistan; 
2. Domestic Legislation – Recent Developments; and 
3. Other business, if any. 
The Chairman said that, under the heading of othe r business, he would make a brief statement, on 
behalf of the Committee, regarding the status of the Committee's decisions listed in Annexes A 
through G of Appendix 2 to the Committee's decision of 30 March 2012 regarding the Outcomes of the Negotiations Under the 1994 Agreement. These Annexes concerned the Committee's decisions 
on its new Work Programmes and its decision  of 30 March 2012 regarding Notification 
Requirements under Articles XIX and XXII of the Agreement.  
No other items had been proposed under the heading of other business. 
 The Committee adopted the agenda as proposed. 
1  REQUEST FOR OBSERVER STATUS: TAJIKISTAN 
1.1.  The Chairman said that Tajikistan's requ est for observer status had been circulated on 
5 June 2014 (GPA/W/329). This request had been made in fulfilment of a commitment made by Tajikistan in its WTO accession Protocol. 
1.2.  The Committee agreed to grant observer status to Tajikistan. 
1.3.  On behalf of the Committee, the Chairman extended a warm welcome to Tajikistan in its new 
capacity as an observer to the GPA. 1.4.  The representative of Tajikistan expressed his appreciation to the Committee for according 
his government observer status under the Agreement. He thanked the Secretariat and relevant 
donor organizations for their support and assistance in securing Tajikistan's observer status in the shortest time possible. 
1.5.  Continuing, he said that the GPA had become an important feature of international trade and 
a significant tool in ensuring transparent and fair practices in the field of government procurement. This was evidenced by the growing interest in  GPA accession and observer status among WTO 
Members. In the Republic of Tajikistan, reforms in the field of the government procurement had 
begun with the adoption of a new "Law on Government Procurement of Goods, Works and 
Services" in 2006. This Law had abolished and replaced the previous (1997) law. The new Law 
fully took account of the UNCITRAL Model Law on Public Procurement. A key objective of the Law 
was to enhance participation by - and competition among - both domestic and foreign suppliers. In this regard the new Law had removed previously existing restrictions on the participation of GPA/M/56 
 
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  foreign suppliers and stipulated equal opportunities for domestic and foreign suppliers to 
participate in the government procurement market in Tajikistan. 
1.6.  In recognition of the importance of the GPA as a tool for reforms in the field of government 
procurement and of Tajikistan's GPA accession obli gation in this respect, the Government of the 
Republic of Tajikistan had decided, in the first instance, to obtain observer status in the 
Committee. Subsequently, it would seek to negotiate its accession to the Agreement. Tajikistan believed this would be a part of the ongoing refo rms of the trade regime of the country. In this 
regard, observer status, together with the help of the Secretariat and GPA Parties, would provide 
Tajikistan with the opportunity to further learn about the operation of the GPA with a view to helping it draw on the benefits that the GPA offers. 
1.7.  The representatives of the United States, Japan, the European Union, Switzerland, Canada, 
Chinese Taipei, Norway, Singapore and Korea warmly welcomed Tajikistan as an observer on the 
Committee. They looked forward to Tajikistan init iating its accession to the Agreement, pursuant 
to its commitments in its WTO accession Protocol, in the foreseeable future and stood ready to 
assist and work with Tajikistan in this regard. 
1.8.  Continuing, the representative of the United States said that his delegation supported 
Tajikistan's effort to understand not only the operation of the GPA but also other countries' 
procurement practices. Tajikistan's participation in the EBRD Capacity Building Session workshop 
in the course of the week was helpful in this resp ect. The United States also wished to note that 
Tajikistan had sent a delegation to Washington to learn more about electronic procurement. 
1.9.  The representative of the European Union said that his delegation stood ready to provide 
assistance to and cooperate with Tajikistan in regard to the initiation of its accession process 
within a reasonable timeframe. 
1.10.  The representative of Switzerland said that his delegation stood ready to cooperate with, 
offer support and share experiences with Tajikistan  where Switzerland could add value - notably in 
the area of electronic procurement. 
1.11.  On behalf of all of the Parties, the Chairm an warmly welcomed the delegation of Tajikistan 
to the Committee in its newly acquired status of  observer. On his own behalf and that of the 
Parties and the Secretariat, he expressed support  for Tajikistan's eventual accession to the 
Agreement as a Party. He invited Tajikistan to co ntact himself, the Secretariat and/or the Parties 
individually with any questions it might have or to seek any advice that it might need as regards 
facilitating related work. Tajikistan could look forward to appropriate support in this regard.  
2  DOMESTIC LEGISLATION – RECENT DEVELOPMENTS 
2.1.  The Chairman recalled that this agenda it em had been requested by Canada. Accordingly, he 
invited the delegation of Canada to make a statement. 
2.2.  The representative of Canada said that in recent months, Canada had taken note of a number 
of legislative initiatives in the United States which increased domestic content requirements in 
procurement conducted by federal, state and municipal-level entities. Canada wished to register its 
concern with these new forced localization requirements. These concerns had been repeatedly expressed by Canadian stakeholders, who regularly competed with United States companies in the 
Canadian market. As a general point, Canada sought clarification from the United States on the 
specific steps it had taken to comply with paragraph 6 of Article XXII of the amended Agreement 
on Government Procurement, which provided that "[e]ach Party shall seek to avoid introducing or continuing discriminatory measures that distort open procurement". 
2.3.  Continuing, and referring to "Canada's conc erns related to three separate categories of 
initiatives", he said that, on 10 June 2014, the Pres ident of the United States had signed into law 
the Water Resources Reform and Development Act (WRRDA). This Act contained a programme 
that would provide financial assistance to large water infrastructure projects. The legislation 
imposed new Buy America restrictions on all iron and steel used in such projects. The WRRDA also imposed new and permanent Buy America restrictions on procurements funded by the Environmental Protection Agency's (EPA) Clean Water infrastructure fund – the Clean Water State-GPA/M/56 
 
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  Revolving Fund (CWSRF). While the WRRDA included a provision requiring that the new Buy 
America restrictions be applied consistently with the United States' international trade obligations, it was the understanding of Canada that the EPA – which was a covered federal entity – did not actually conduct the procurement under this prog ram. Canada further understood that the actual 
procurement under the CWSRF was conducted by local government entities, which were not 
covered by the United States in the GPA. With this in mind, Canada requested, pursuant to 
Article IV:1(b) of the Agreement, that the United  States provide an explanation of the practical 
effect of the provision requiring consistency with its international obligations. In addition, in light 
of paragraph 6 of Article XXII of the revised GPA, Canada sought clarification from the United States as to what, if any, specific actions it had taken to "seek to avoid introducing" these new "discriminatory measures that distort open procurement". 
2.4.  Second, the United States federal government had tabled in Congress a new law that sought 
to expand domestic content requirements attached to federal funding for urban transportation – the Generating Renewal, Opportunity, and Work  with Accelerated Mobility, Efficiency and 
Rebuilding of Infrastructure and Communities throughout America Act – or the "GROW AMERICA 
ACT". Section 3006 provided for an increase in the Buy America domestic content provisions for so-called "rolling stock" – buses, urban rail cars – from the current 60 percent to 100 percent by 
2019. If passed, this bill would force GPA suppliers to localize production in the United States in 
order to participate in these procurements. In light of paragraph 6 of Article XXII, Canada again sought clarification from the United States as to what, if any, specific actions it had taken - or planned to take - to "seek to avoid introducing" these new "discriminatory measures that distort 
open procurement" – particularly, given the fact that the GROW America Act was an 
Administration initiative. 
2.5.  Third, he said that Canada was concerned with the growing list of "Buy America" legislative 
initiatives at the state government level. Since November 2013 alone, there had been seven state 
initiatives that had been brought to Canada's attention, of which a few were as follows: 
 With respect to Minnesota, in May 2014, the Minnesota State Legislature had passed a 
$1 billion Capital Investment Bill. This legislation contained a Buy America provision 
requiring any public entity that received  funds under the Bill to use American-made 
steel. The bill made no reference to compliance with the international obligations the United States had assumed on behalf Minnesota. In the GPA, the United States covered 
procurement by all Minnesota's "executive branch agencies". Canada requested 
confirmation from the United States that Minnesota would apply those new forced localization requirements consistently with the United States' international obligations – 
in particular, obligations that the United States had assumed on behalf of Minnesota 
after 2008 – when the state legislature had passed a statute requiring that it, in addition to the governor, give approval before the state committed to any procurement 
provisions in new international trade agreement's (2008 chapter 300 s 3). This was 
important for complying not only with new obligations the United States had assumed at the sub-national level in relation to Canada as a result of revisions to the WTO GPA, but also any future accessions to the Agreement. 
 Concerning New York, in early May 2014, Bill A09521 had been introduced in the State 
legislature. The bill sought to impose Buy America restrictions on a broad range of New York state procurement activities that mirrored the restrictions imposed by the federal 
government for federally funded transpor tation infrastructure. In the GPA, the 
United States covered procurement by all New York's state agencies, state university system and public authorities and public benefit corporations. While the bill included a 
provision that these restrictions must be applied consistently with the United States' 
international obligations, New York had an explicit exclusion for "construction-grade steel". Canada requested that the United States provide an explanation of the scope of "construction grade steel", as the scope of this exclusion could greatly affect market 
access for Canadian suppliers. 
 Regarding Massachusetts, State Senate bill S2904 had been introduced in April 2014 and 
was at the present time with the State Senate Ways and Means Committee for study. 
The bill proposed a preference for domestic products purchased by State Agencies – a 
clear offset requirement. In the GPA, the Un ited States covered procurement by a range 
of Massachusetts Executive offices. The proposed bill did not contain any explicit GPA/M/56 
 
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  requirement to ensure consistency with the United States international obligations. 
Canada sought assurances from the United St ates that this bill, if adopted, would be 
applied consistently with the United States' international obligations. 
2.6.  Continuing further, he said that these state initiatives raised several systemic issues of 
concern to Canada. Uncertainty regarding consistency with international obligations and the lack of 
clarity regarding the scope and application of these measures inherently favoured domestic suppliers at the expense of GPA competitors. A ccounts by Canadian suppliers indicated that the 
complexity of these new Buy America restrictions and the harsh penalties imposed for their 
violation caused US distributors and general contractors to err on the side of caution and avoid using Canadian goods, even where international obligations should protect them. This amplified the distortive effect of such discriminatory measures. 
2.7.  Furthermore, even though many of thes e new initiatives might not pass, the reoccurring 
threat of new forced localization requirements discouraged foreign suppliers from investing the time and energy needed to develop new opportunities in foreign public procurement markets. This 
inhibited suppliers from taking advantage of the market access commitments that had been 
negotiated. Uncertainty – in and of itself – had the potential to undermine market access. 
2.8.  Lastly, turning again to Article XXII:6 – "Each Party shall seek to avoid introducing or 
continuing discriminatory measures that distort open procurement" - Canada's question to the 
United States remained as follows: what specific steps had the United States taken to fulfil this 
commitment in relation to these new measures? 
2.9.  The representative of the United States said that his delegation had not received any 
indication from Canada of its interest in or concerns with regard to the policies under reference 
prior to the day before its departure for Geneva. As such, his delegation was in the unfortunate position of being unable to respond substantively. The United States took its international 
obligations very seriously, including with regard to Article XXII:6 of the revised GPA. In this 
regard, the Administration worked closely with Congress to review pending legislation in the context of the United States' WTO obligations. Hi s delegation would take the specific questions 
back to Washington and obtain information on how these policies affected the United States' 
commitments under the GPA. 
2.10.  The representative of Japan said that hi s delegation shared the concerns expressed by 
Canada on the recent trend towards domestic cont ent requirements in the United States. Japan's 
concerns centred particularly on the GROW AMERICA Act. His delegation accordingly sought to 
share the concerns of Japan's stakeholders in th is respect. According to his understanding, the 
United States Department of Transportation had tabled to Congress in May 2014 the "GROW 
AMERICA" Act. As noted by Canada, section 3006 of the Act stipulated an increase in Buy America 
domestic content provisions for manufactured rolling stock components and subcomponents to 100% from the current 60% by 2019.  
2.11.  Continuing, he said that Japan understood that the United States effectively excluded some 
types of procurement from its GPA coverage comm itments even in some covered States. As noted 
also by Canada, he recalled that Article XXII:6 of the revised GPA stipulated that "each Party shall seek to avoid introducing or continuing discriminatory measures that distort open procurement". 
Japanese stakeholders had repeatedly expresse d their concern that existing discriminatory 
domestic content requirements in the area of go vernment procurement, especially the provisions 
of the Surface Transportation Assistant Act" of 1982, acted as a high barrier for Japanese business 
interests in the United States' government procurement market. The Government of Japan and 
Japanese enterprises were closely monitoring how the Grow America Act that would strengthen Buy American provisions on top of the Surface Tran sportation Assistance Act would be dealt with in 
both the administrative and legislative branches. 
2.12.  Further, Japan shared Canada's concer ns regarding the Water Resources Reform and 
Development Act, HL23080, which contained Buy American restrictions on iron and steel products. In any case, Japan requested that the US respect th e spirit of the Article XXII:6 of the revised GPA 
and refrain from introducing new discriminatory measures or strengthening the existing 
discriminatory measures as well as to take new steps to eliminate existing discriminatory measures as early as possible. GPA/M/56 
 
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  2.13.  The representative of the European Union said that his delegation shared the concerns that 
had been expressed by Canada regarding the variou s US legislative initiatives containing domestic 
restrictions - or so called Buy America provisions - regarding government procurement. It had been a long standing policy of the European Union to advocate against the introduction and 
persistence of domestic content requirements in GPA Parties' domestic legislation. The 
European Union was particularly concerned abou t the trend of proliferation of Buy America 
provisions in new policy proposals at various levels. It was already equally witnessing similar 
policies being developed in other parts of the worl d. In the view of the European Union, such 
policies sent the wrong signal at the time of economic crisis when open markets were an essential element in growth strategies. 
2.14.  Continuing, he said that the restrictions on government procurement provided for in recent 
legislative initiatives introduced by the United States had the potential to affect the right of 
European Union suppliers to access government procurement opportunities in the United States. The European Union trusted the United States to be in a position to provide GPA Parties rapidly 
with sufficient assurances that it would ensure full compliance with its GPA commitments and in 
particular Article XXII:6. The European Union intended to continue monitoring these developments and looked forward to receiving updates from the de legation of the United States on the status of 
those legislative measures. The European Union also attached great importance to the role of the 
Committee in bringing transparency to the legal obligations of Parties under the Agreement and in raising awareness on any potential issues arising in this regard. 
2.15.  The representative of Switzerland said that the Committee had had previous occasions to 
discuss the Buy American Act and its implementation at the local level. Switzerland looked forward 
to hearing from the United States as to how the United States Government implemented the Buy American Act at that level. In light of relevant provisions that excluded GPA Parties from 
restrictions arising from the Buy American Act and related legislation, it was important to know 
how this information was communicated down to local entities in charge of the implementation of the United States international commitments in this regard.  
2.16.  Regarding the issues related to coverage of urban transport raised by both Canada and 
Japan, Switzerland had adopted a functional definition approach to its coverage in this area. As such, suppliers from the United States had equal access to Switzerland's market in this area. In this connection, Switzerland sought clarification from the United States as regards the potential 
effects of the new restrictions for access to the United States related covered procurement 
markets by suppliers from Switzerland.  
2.17.  The representative of Hong Kong, China said that his delegation shared the concerns raised 
by Canada regarding the consistency of the measures reflected in the United States' Buy American 
legislative initiatives with the GPA. In this regard, Hong Kong, China sought confirmation from the United States that the interests of GPA Parties would not be affected by these measures. 
2.18.  The Committee took note of the various statements that had been made. 
3  OTHER BUSINESS 
3.1.  On behalf of the Committee, the Chairman no ted for the record that pursuant to the language 
set out in paragraph 2 of the Decision on the Outcomes of the Negotiations that had been adopted 
on 30 March 2012 and to related language contained in the decisions set out in Annexes C, D, E, F 
and G of Appendix 2 of that decision, the Deci sions set out in Appendix 2 of the Committee's 
Decision of 30 March 2012 on the Outcome of  the Negotiations had been adopted on 
30 March 2012 and were in effect as of the date of entry into force of the amended Agreement, 
that is to say, 6 April 2014. Furthermore, the work programmes set out in Annexes C, D, E, F and G of Appendix 2 of the referenced decision on the Outcomes of the Negotiations were hereby 
initiated. 
3.2.  The Committee took note of the Chairman's statement. 
 
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