RESTRICTED  
  
S/WPGR/M/89  
 
2 June 2016  
(16-2975)  Page: 1/3  
Working Party on GATS Rules    
 
REPORT OF THE MEETING HELD ON 17 MARCH 2016 
NOTE BY THE SECRETARIAT1 
The Working Party on GATS Rules (WPGR) held a meeting on 17 March 2016, chaired by  
Mr Don McDougall of Canada. The proposed agenda  and the Chairman's annotated agenda for the 
meeting were circulated in documents WTO/AIR/WPGR/4 and JOB/SERV/227 respectively. Given that the consultations for the appointment of the chairpersons for the subsidiary bodies of the 
Council for Trade in Services had not been finalize d at the time of the meeting, the Working Party 
adopted the agenda without the proposed item  2.E "Appointment of the Chairperson for the 
Working Party". 
1  ITEM A – NEGOTIATIONS ON EMERGENCY SAFEGUARD MEASURES UNDER ARTICLE X 
OF THE GATS 
1.1.  The Chairman recalled that  the Working Party had started in early 2014 a dedicated 
discussion on Members' experiences with emergenc y safeguard provisions in their bilateral and 
regional trade agreements (RTAs). The dedicated discussion continued in two subsequent meetings 
in 2014. In 2015, the proponents had re-affirmed their interest in pursuing work on emergency safeguards, and invited Members to review again their 2007 proposal as contained in document 
JOB(07)/155. The Chairman opened the floor for Members' interventions. 
1.2.  The representative of the Philippines, on  behalf of the delegations of Brunei Darussalam, 
Cambodia, Indonesia, Lao People’s Democratic Republic, Malaysia, Myanmar, the Philippines, 
Thailand and Viet Nam, called for continued work on emergency safeguard measures (ESM) in 
conformity with the built-in mandate in GATS Ar ticle X, as confirmed by subsequent Ministerial 
Declarations. She further recalled the dedicated discussion on provisions relating to safeguard measures in RTAs, the proponents' 2007 proposal as contained in document JOB(07)/155 and the 
dedicated discussion on ESM-relevant statistics. In the run-up to the Nairobi Ministerial 
Conference, the 'Friends of ESM' had constructi vely engaged in all aspects of the services 
negotiations, including ESM, with the ultimate objective of achieving a development-oriented 
outcome in MC10 and post-Nairobi. While being di sappointed by the absence of an outcome on 
services in Nairobi, the proponents reaffirmed their commitment to resume the unfinished work in 
trade in services, including in respect of emergency safeguard measures. The proponents recognized that the period of reflection on the fu ture of the overall negotiations had an impact on 
progress in particular technical areas, including the work of this Working Party. Nonetheless, the 
proponents stood ready to continue their consultations with interested Members on possible next steps, including possible further dedicated discussions, for instance on relevant statistical 
developments. 
1.3.  The Chairman thanked the proponents for their statement. He suggested that the Working 
Party take note of the statement made and revert to this issue at its next meeting. 
1.4.  It was so agreed. 
                                               
1 This document has been prepared under the Secret ariat's own responsibility and is without prejudice 
to the positions of Members or to thei r rights and obligations under the WTO. S/WPGR/M/89 
 
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  2  ITEM B - NEGOTIATIONS ON GOVERNME NT PROCUREMENT UNDER ARTICLE XIII OF 
THE GATS 
2.1.  Turning to government procurement, th e Chairman reminded delegations that, at the 
Working Party's meeting in March 2015, the delegation of the European Union had proposed that 
Members start a discussion on the treatment of fo reign-owned or –controlled, established service 
suppliers in their government procurement procedur es, notably in respect of national treatment. 
Following another round of discussions in the Working Party in June 2015, the EU delegation had 
circulated its proposal in writing in September 2015 (document JOB/SERV/215), providing further 
details on possible questions for further information exchange. At the Working Party's last formal meeting, in October 2015, several Members had posed questions or made suggestions to the European Union on its proposal. A couple of delegations had expressed specific areas of concern, 
notably regarding the purpose of the proposed discussion. Several delegations had suggested 
expanding the information exchange to include al so modes 1 and 4. As agreed by Members in 
October 2015, open-ended informal consultations were convened on 26 February 2016. The 
Chairman reported on these consultations at th e meeting. He explained that the consultations 
were mainly aimed at: seeking clarification from the European Union on the objectives and some key features of its proposal; discussing specific questions and concerns that Members had raised; 
and examining the parameters for a possible discussion on these issues in the future. 
2.2.  The Chairman informed Members that, in th e informal consultations, the EU delegation had 
made it clear that its proposal, made in the cont ext of the Working Party's regular work, aimed at 
a voluntary exchange of information among Me mbers regarding their existing government 
procurement practices. The EU delegation had also clarified that the definition of "established"  
service suppliers designated a "juridical person",  that is, any legal entity duly constituted or 
otherwise organized under applicable law in th e host country in accordance with GATS  
Article XXVIII, lit. (l) – thus excluding forms of commercial presence without separate legal 
personality such as branches or representative of fices. The EU delegation had also explained that 
the definition of "foreign-owned or controlled"  service suppliers was in accordance with the 
definitions in GATS Article XXVIII, lit. (n). Furtherm ore, it had stated its openness, in principle, to 
covering all levels of governments – this would be left to the discretion of the Members participating in the information exchange. Finally, the EU delegation was also open to including other modes of supply, and invited those Member s who had made this suggestion to present 
specific proposals in this regard. 
2.3.  The Chairman noted that, in the informal  consultations conducted in February 2016, broad 
support had been expressed in favour of resuming  the Working Party's regular work. A number of 
Members had supported the EU proposal, while on e Member had expressed concerns regarding the 
purpose of an information exchan ge and the suggestion to develop 'good practices'. The point had 
also been made that more clarity on the potential interactions between the GPA and the GATS 
would be desirable. It was understood that such  an information exchange would not imply any 
change to the scope of the exemption contained in  GATS Article XIII:1. While being in principle 
supportive of a voluntary information exchange, several delegations saw value in better defining its scope. Some delegations had invited the EU to reflect the complexity of national government 
procurement regimes in its proposal. In particular , when awarding public contracts, authorities 
were employing a myriad of different public poli cy tools, which did not necessarily distinguish 
clearly between goods and services, or between "f oreign" and "national" suppliers. Furthermore, 
the GPA's non-discrimination obligations applied only with respect to measures regarding each 
party's "covered procurement". Sharing information about government procurement practices outside  these "covered procurement" categories might prove difficult. The EU delegation was 
invited to give further thought to these questions.  
2.4.  The Chairman reported that, in the informal  consultations, one delegation had shared more 
concrete information about its good practices regarding the treatment of foreign-owned or  –controlled service suppliers in government proc urement procedures. The delegation noted that 
foreign suppliers often had to establish local companies in order to benefit from advantages such 
as tax reimbursements or bank guarantees  in relation to public contracts.  
2.5.  Finally, the Chairman further stated that se veral delegations had expressed interest in further 
studying the developmental aspects of government procurement, as well as the impact of opening-
up government procurement markets on countries' growth and development.  S/WPGR/M/89 
 
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  2.6.  Having summarised the gist of the informal  consultations, the Chairman opened the floor for 
Members' comments. 
2.7.  The representative of the European Union stated that her delegation had felt encouraged by 
Members' feedback.  An exchange of informat ion by Members on their existing government 
procurement practices would bring concrete added value to the discussions. As a next step, her 
delegation intended to reach out to those Members that had expressed interest, or raised questions or concerns.  Her delegation was open to adapting some elements of the proposal, such 
as clarifying that GATS definitions would be used, or reconsidering the reference to good practices. 
She recalled her delegation's readiness to extend the information exchange to other modes of supply.  To conclude, she noted that, in the informal consultation, some Members had already shared elements of answers to the questions raised  in their proposal.  This was encouraging, and 
showed that the exercise was both useful and not burdensome. 
2.8.  The representative of Japan thanked the EU delegation for their explanations and flexibility. 
His delegation encouraged the European Union to further clarify the objectives of the proposed 
information exchange. He observed that the question s raised in the proposal were relevant for the 
procurement of both goods and services. He th erefore suggested to integrate the broad and 
specialised knowledge accumulated by the GPA Committee, and to better define those questions 
that were specific to services procurement. 
2.9.  Summarizing the interventions made, the Ch airman took note that the delegation of the 
European Union would continue to reflect on the feedback it had received. He suggested that the 
Working Party take note of the statements made so far. The Chairman would continue to consult 
informally with the European Union and other interested delegations on the way forward.  
2.10.  It was so agreed. 
3  ITEM C – NEGOTIATIONS ON SUBS IDIES UNDER ARTICLE XV OF THE GATS 
3.1.  Turning to subsidies, the Chairman observ ed that the Working Party had not had substantive 
discussions on this topic for some time. No new ideas on how to carry forward the work in this 
area had emerged in his informal outreach with delegations prior to the meeting. Following these 
introductory remarks, he opened th e floor for Members' observations. 
3.2.  Reminding Members of the negotiating mandate contained in Article XV of the GATS, the 
representative of Switzerland recalled his delegation 's submission concerning disciplines on export 
subsidies (document JOB/SERV/36 of 2 December 2010), as well as Members' past discussions 
about what constituted a subsidy, respectively an export subsidy. Various other delegations had 
made submissions on subsidy-related questions. His delegation held the view that there was sufficient material on the table for Members to pursue their discussions in this area. 
3.3.  The Chairman suggested that the Working Party take note of the statement made and revert 
to this item at its next meeting.  
3.4.  It was so agreed. 
4  ITEM D – OTHER BUSINESS 4.1.  No matter was raised under this agenda item. 4.2.  Thus the meeting was adjourned. 
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