RESTRICTED  
  
GPA/ACC/AUS/32  
 
19 June 2017  
(17-3261) Page: 1/3 
Committee on Government Procurement  Original: English  
 
ACCESSION OF AUSTRAL IA TO THE AGREEMENT ON GOVERNMENT PROCUR EMENT  
COMMUNICATION FROM A USTRALIA  
The following communication, dated 16 June 2017, is being circulated a t the request of the 
Delegation  of Australia.  
 
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AUSTRALIA'S RESPONSE  TO COMMENTS FROM ICELAN D, LIECHTENSTEIN, NO RWAY AND 
SWITZERLAND (GPA/ACC /AUS/27) ON AUSTRALI A'S REVISED OFFER  
Australia thanks Iceland, Liechtenstein, Norway and Switzerland (Members of the European Free 
Trade Association (EFTA)) for the submission of comment s (GPA/ACC/AUS/27) on Australia's 
revised offer (GPA/ACC/AUS/17). Australia provides the following responses to the questions 
circulated by the EFTA States.  
 
Annex 1 - Central government entities  
 
1. The EFTA States cover all central government entities in An nex 1 and request 
Australia to include additional entities, aligned with the obligations taken so far by 
Australia in other international trade agreements such as TPP, KAFTA and JAEPA.  
In Australia 's second revised offer (GPA/ACC/AUS/29) , we have included two further entities (the 
Australian Transport Safety Bureau in Annex 1 and Old Parliament House in Annex 3). As a result, 
Australia 's coverage of central government entities is now consistent with our most recent trade 
agreements.  
 
Annex 2 - Sub-Central G overnment Entities  
 
2. The EFTA States reiterate their request that Australia lowers its thresholds for 
goods and services coverage in Annex 2 to SDR 200,000 in order to assure consistency 
with the thresholds applied by most of the Members of the GPA, includi ng the EFTA 
States.  
The current threshold is similar to that of other GPA members, including the United States and 
Canada. The threshold is consistent with state and territory commitments in Australia's recent 
trade agreements.  
 
3. The EFTA States cover all s ub-central government entities operating at the 
regional or local level in Annex 2, as well as all bodies governed by public law. The EFTA 
States request Australia to ensure further coverage in Annex 2 by:  
i. including additional entities at State and Territo ry level, including entities 
operating in the utilities sectors;  
Australia has gone through 30 years of divestment and/or privatisation of public 
assets, including most utility assets. Generally, utilities have been privatised (or on 
long-term leases to t he private sector) or are government corporations operating on GPA/ACC/AUS/32  
 
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  a commercial basis. This means that state and territory governments do not directly 
control the procurement decisions of such utilities, with their procurement decisions 
undertaken in accordanc e with commercial considerations, and outside government 
procurement frameworks.  
 
ii. including entities at the local government level such as major cities.  
While we are not able to offer local government, our market access offer is still very 
comprehensive and ambitious with around 90% of government procurement 
undertaken at the Commonwealth and state and territory levels. The exclusion of 
city-level procurement is consistent with Australia 's existing trade commitments. 
Australia has never made commitments a t the local government level, given the 
large number, small size and nature of local councils in Australia.  
 
Annex 3 - Other Entities  
 
4. The EFTA States request Australia to expand its Annex 3 coverage by including 
GBEs at central level, in particular those  operating in the utilities sectors.  
As with utilities (above), Australian Government Business Enterprises (GBEs) are required to 
operate on a commercial basis. This means that governments do not directly control the 
procurement decisions of such utilities , with their procurement decisions undertaken in accordance 
with commercial considerations, and outside the Australian Government 's procurement framework.  
 
5. Where the Australian Government does not control the procurement decisions of 
GBEs, could Australia please provide specific examples, e.g. directives and/or corporate 
laws governing the operations of such GBEs?  
Information regarding the directives and/or corporate laws governing the operation of Australian 
Government Business Enterprises can be found in  the Commonwealth Department of Finance's 
Resource Management Guide No. 126: Commonwealth Government Enterprise Governance and 
Oversight Guidelines. The guide can be accessed here:  
 
http://www.finance.gov.au/sites/default/files/RMG -126%20GBE%20Guidelines.pdf . 
 
6. The EFTA States request Australia to move all non -corporate Commonwealth 
entities from Annex 3 to Annex 1.  
Australia notes that the current listings in Annex  1 and Annex 3 are consistent with existing trade 
agreements.  
 
Annex 5 - Services  
 
7. The EFTA States welcome the use of a negative list approac h for the coverage of 
services.  
Annex 7 - General Notes  
 
8. The EFTA States consider that any set asides or preferences generate conflicts with 
the commitments of non -discrimination of Article IV of the revised GPA. Other measures 
designed to accommodate national SMEs and SMEs located in other GPA States alike are 
not discriminatory. The EFTA States estimate tha t this is for example the case for 
measures such as the division of contracts into lots, etc. The EFTA States request 
Australi a to delete its Note 1, lit. a.  
The inclusion of the SME N ote is essential for all Australian governments, which recognise the 
important contribution small and medium enterprises (SMEs) make to the economy and 
employment in particular. For this reason, Australian governments seek to ensure that Australian 
SMEs have the same opportunities to participate in procurement processes as lar ge companies and 
international businesses. SME participation schemes aim to assist competitive Australian SMEs to 
participate in projects by encouraging innovation, expansion of capability and investment 
opportunities.  GPA/ACC/AUS/32  
 
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  The N ote does not stop foreign compa nies from winni ng contracts in Australia. The N ote on SMEs 
is consistent with Australia's existing trade agreements and is in keeping with similar Notes of 
other GPA members.  
 
9. The EFTA States request Australia to delete its Note 2, lit. e.  
Unsolicited inno vative proposals are offers to the Government to purchase goods or services made 
under exceptionally advantageous conditions that arise only in the very short term and are not 
routine procurement from regular suppliers. These products and services are not typically 
commercially available.  
 
This Note is for greater certainty because Australia considers that innovative proposals fall within 
the scope of Article XIII. New Zealand has a similar exception (for "unsolicited unique proposals ") 
referencing Article XIII. 
 
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