WORLD TRADE  
ORGANIZATION  GPA/89 
11 December 2006 
 
 (06-5928) 
  
  
 
REPORT OF THE COMMITTEE ON GOVERNMENT PROCUREMENT 
(NOVEMBER 2005 – DECEMBER 2006) 
 
 
I. GENERAL  
1. This Report covers the period since the Committee's previous Annual Report
1, that is 
November 2005 – December 2006.  It is issued pursu ant to Article XXIV:7(a) of the Agreement on 
Government Procurement. 
2. Since the last Annual Report, the Committe e has held three formal meetings:  
on 21 December 20052, 2 June 20063 and 8 December 2006.4  These meetings were chaired by 
Ambassador Tae-yul Cho (Korea).5 
3. The Committee has also held a series of in formal meetings, pursuing negotiations under 
Article XXIV:7 of the Agreement on Government  Procurement, in the weeks of 6 February, 
27 March, 29 May, 10 July, 16 Octobe r and 4 December 2006, respectively. 
4. The following WTO Members are covered by the Agreement:  Canada;  the European 
Communities, including its 25 member States;  Hong Kong, China;  Iceland;  Israel;  Japan;  Korea;  
Liechtenstein;  the Kingdom of the Netherlands with respect to Aruba;  Norway;  Singapore;  
Switzerland;  and the United States. 
5. Twenty WTO Members have observer status in the Committee on Government Procurement:  
Albania, Argentina, Armenia, Australia, Bulgar ia, Cameroon, Chile, China, Colombia, Croatia, 
Georgia, Jordan, the Kyrgyz Republic, Mo ldova, Mongolia, Oman, Panama, Sri Lanka, 
Chinese Taipei and Turkey.  Three intergovernment al organizations, IMF, OECD and UNCTAD, also 
have observer status. 
II. IMPLEMENTATION OF THE AGREEMENT 
A. THRESHOLDS  
6. In accordance with the Decision on Modalities for Notifying Threshold Figures in National 
Currencies6, the following Parties have provided informa tion on their threshold figures expressed in 
national currencies for 2006-2007:  Hong Kong, China;   Singapore;  the United States;  Canada;  the 
                                                      
1 GPA/85, dated 10 November 2005. 
2 GPA/M/29, dated 31 January 2006. 
3 GPA/M/30, dated 4 July 2006. 
4 GPA/M/31, to be circulated. 
5 At its meeting of 2 June 2006, the Committee re -elected Ambassador Tae-yul Cho (Korea) as its 
Chairman for 2006 (GPA/M/30, dated 4 July 2006, para. 8). 
6 GPA/1, dated 5 March 1996, Annex 3. GPA/89 
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  European Communities;  and Norway.
7  Japan and Israel have notified their threshold figures 
expressed in national currencies for 2006-2008.8 
B. NOTIFICATION AND REVIEW OF NAT IONAL IMPLEMENTING LEGISLATION  
7. In line with Article XXIV:5(b) of the Agreem ent on Government Procurement, Japan notified 
a change in its national implementing legislation.9 
C. STATISTICAL REPORTING  
8. Article XIX:5 of the Agreement on Government Procurement requires Parties to collect and 
provide, on an annual basis, statistics on their pr ocurements covered by the Agreement.  During the 
period under review, Korea ha s reported statistics for 200310 and 200411;  Japan has reported statistics 
for 200312;  and Hong Kong, China has reported statistics for 2005.13 
D. CONSULTATIONS AND DISPUTE SETTLEMENT  
9. There were no matters raised under Artic le XXII of the Agreement on Government 
Procurement during the reporting period. 
III. MODIFICATIONS TO THE APPENDICES TO THE AGREEMENT 
(a) Modification by Israel regarding Offsets 
10. In December 2005, Israel submitted a communication14 containing proposed modifications to 
its schedules pursuant to Article XXIV:6(a) of  the Agreement on Government Procurement.  
Following informal consultations between interested  delegations, a draft decision was presented for 
adoption by the Committee.  At its meeting of 21 December 2005, pursuant to Article XXIV:6(a) of 
the Agreement on Government Pr ocurement, the Committee adopted15 that Decision.16  The Decision 
modifies Israel's Note and Annex 4 to its Appendix I to the Agreem ent:  it establishes a regime under 
which the allowed level of offsets is reduced fro m 35 per cent to 30 per cent after five years, 
28 per cent after 10 years and 20 per cent after 13 years, beginning from the date of Israel's 
implementation of the Agreement.  In compensat ion, the Decision reduces Israel's construction 
services threshold to SDR 5 million and expands its coverage of services.17  Following the adoption of 
the Decision, the representative of Israel stated his delegation's intention to engage in further 
consultations with other Parties in the framework of the coverage  negotiations under Artcle XXIV:7 
                                                      
7 GPA/W/295, dated 5 December 2005, GPA/ W/295/Add.1-3, date d 8 December 2005, 
14 December 2005, and 4 January 2006, respectively, GPA/W/295/Ad d.5, dated 30 January 2006 and 
GPA/W/295/Add.7, dated 10 October 2006. 
8 GPA/W/295/Add.4, dated 24 January 2006 and GPA/W/295/Add.6, dated 7 April 2006. 
9 GPA/37/Add.3, dated 15 March 2006. 
10 GPA/80/Add.3, dated 20 January 2006. 
11 GPA/84/Add.1, dated 12 October 2006. 
12 GPA/80/Add.4, dated 6 September 2006. 
13 GPA/88, dated 16 October 2006. 
14 GPA/MOD/ISR/5, da ted 12 December 2005. 
15 GPA/M/29, dated 31 January 2006, para. 5. 
16 GPA/86, dated 22 December 2005. 
17 This modification of Israel's Note on Offsets to its Appendix I to the Agreement on Government 
Procurement took effect on 21 December 2005, and was certif ied in document WT/Let/507, dated 
17 January 2006.  GPA/89 
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  of the Agreement with a view to reaching agreemen t on a long-term solution to the issue of offsets.18  
Several other Parties made statements on the Decision.19 
 (b) Modification by the European Communities 
11. In November 2006, the European Co mmunities submitted a communication20 which proposed 
modifications to its schedules pursuant to Artic le XXIV:6(a) of the Agreement on Government 
Procurement.  Subsequently, a draft deci sion adopting the change was circulated.21  The draft decision 
was adopted with modifications proposed in the formal meeting on the afternoon of Friday, 
8 December 2006. 
(c) Other Modifications 
Modifications that have been certified since the meeting of 14 October 2005 
12. During the reporting period, the following modifica tions have been certified, given that no 
objections were made in the 30-day period set  out in Article XXIV:6 of the Agreement on 
Government Procurement or because the objections  that had been made have been withdrawn 
subsequently with regard to all or some specific entities listed in such modifications: 
 (i) modifications by Israel : 
 
  - GPA/MOD/ISR/222, effective as of 17 February 200623, given that the 
 objection by the United States24 has been withdrawn25; 
   - GPA/MOD/ISR/7
26, effective as of 31 May 200627, given that no objections 
 were made within 30 days; 
 
  - GPA/MOD/ISR/828, effective as of 26 September 200629, given that the 
 objection by the United States30 has been withdrawn31; 
  (ii) modifications by Japan
: 
 
- GPA/MOD/JPN/2332, effective as of 7 January 200633, given that no 
objections were made within 30 days; 
                                                      
18 GPA/M/29, dated 31 January 2006, para. 6. 
19 GPA/M/29, dated 31 January 2006, paras. 7-12. 
20 GPA/MOD/EEC/2, dated 17 November 2006 and GPA/MOD/EEC/2/Add.1, dated 
21 November 2006. 
21 Job No. 9099, dated 1 December 2006 and Job No. 9099/Rev.1(9264), dated 8 December 2006. 
22 Dated 7 October 2005. 
23 WT/Let/513, dated 28 February 2006. 
24 GPA/MOD/ISR/3, dated 28 October 2005. 
25 GPA/MOD/ISR/6, dated 14 February 2006. 
26 Dated 1 May 2006. 
27 WT/Let/545, dated 19 June 2006. 
28 Dated 8 May 2006. 
29 WT/Let/550, dated 6 October 2006. 
30 GPA/MOD/ISR/9, dated 7 June 2006. 
31 GPA/MOD/ISR/11, dated 29 September 2006. 
32 Dated 8 December 2005. 
33 WT/Let/509, dated 25 January 2006. GPA/89 
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  - GPA/MOD/JPN/24
34, effective as of 5 November 200635, given that no 
objections were made within 30 days; 
- GPA/W/9136, effective as of 8 December 200637, given that the final 
outstanding objection by the EC38 has been withdrawn at the formal meeting 
of the Committee on Government Procurement on 8 December 2006.39 
 (iii) modification by Korea40, effective as of 23 May 200641, given that the objection by 
the EC42 has been withdrawn to all proposed modifications except one – "Korea 
General Chemical Corporation"43;  and 
  (iv) modification by the United States
44, effective as of 22 March 200645, given that no 
objections were made within 30 days. 
 
Proposed modifications that remain outstanding 
13. As to outstanding proposed modifications, the following developments, if any, have taken 
place in the reporting period: 
(i) Notifications by Japan  concerning proposed modifications relating to: 
- East Japan Railway Company, Central Japan Railway Company and West 
Japan Railway Company46 
In November 2006, the United States withdrew its objection to this proposed 
modification.47 
- Railway Construction Public Corpor ation and Corporation for Advanced 
Transport and Technology48 
No developments in the reporting period. 
- National Aerospace Laboratory49 
No developments in the reporting period. 
                                                      
34 Dated 6 October 2006. 
35 WT/Let/551, dated 24 November 2006. 
36 Dated 6 September 1999. 
37 To be issued as a WT/Let/ document. 
38 GPA/W/96, dated 1 October 1999. 
39 GPA/M/31, to be issued. 
40 GPA/MOD/KOR/9, dated 31 January 2006. 
41 WT/Let/543, dated 14 June 2006. 
42 GPA/MOD/KOR/10, dated 1 March 2006. 
43 GPA/MOD/KOR/11, dated 29 May 2006. 
44 GPA/MOD/USA/4, dated 24 February 2006. 
45 WT/Let/537, dated 4 May 2006. 
46 GPA/W/144, 145 and 146, dated 29 August 2001 and GPA/W/152 and Corr.1, dated 20 September 
and 10 October 2001. 
47 GPA/MOD/JPN/25, dated 30 November 2006. 
48 GPA/W/272 and GPA/W/272/Rev.1, dated 23 September and 8 October 2003, respectively. 
49 GPA/W/275, dated 23 September 2003.  GPA/89 
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  - Proposed modification to Annex 3 of Japan's Appendix I50 
No developments in the reporting period. 
(ii) Notification by the United States  concerning proposed modifications to reflect 
changes in the administrative structure of the Federal Government51, as regards the 
Uranium Enrichment Corporation  
In November 2006, Japan withdrew its obj ection to this proposed modification.52 
IV. ACCESSIONS 
14. Eight WTO Members are in the process of acceding to the Agreement on Government 
Procurement:  Albania, Georgia, Jordan, th e Kyrgyz Republic, Moldova, Oman, Panama and 
Chinese Taipei.  Bulgaria withdrew its application for accession to the GPA in view of its accession to 
the European Communities as of 1 January 2007.53  A further six WTO Members have provisions in 
their respective Protocols of Accession to th e WTO regarding accession to the Agreement on 
Government Procurement:  Armenia, China, Cr oatia, the Former Yugoslav Republic of Macedonia, 
Mongolia and Saudi Arabia. 
15. During the reporting period, the following develo pments have taken place with regard to 
accessions.  At the meeting of the Committee on 2 J une 2006, Jordan made a statement reporting on 
developments in its accession process to the Agreement on Government Procurement.54  Jordan 
submitted its revised entity offer during the c ourse of the October 2006 informal meetings.55 
16. During the reporting period, no developments have  been reported in relation to the respective 
accessions (pending or prospective) of Albania, Armenia, China, Croatia, Georgia, the Kyrgyz Republic, the former Yugoslav Republic of Macedonia, Moldova, Mongolia, Oman, Panama, 
Saudi Arabia and Chinese Taipei. 
17. At the meeting of the Committee on 2 June  2006 a Decision was taken on Modalities of 
Accession to the Agreement on Government Procurement.
56 
V. NEGOTIATIONS 
18. Article XXIV:7(b) and (c) of the Agreement calls on the Parties, not later than the end of the 
third year from the date of its entry into force,  to undertake further negotiations, with a view to 
improving the Agreement and achieving the greatest possible extension of its coverage among all 
Parties and eliminating any remaining discriminat ory measures and practices.  During the reporting 
period, Parties pursued negotiations on these matters at  informal meetings in the weeks of 6 February, 
27 March, 29 May, 10 July, 16 October and 4 December 2006. 
19. The negotiations focused on the simp lification and improvement of the 
non-market-access-related provisions in the text of  the Agreement, based on proposals made by 
delegations.  Following each informal meeting, proposal s have been consolidated into a single revised 
draft text, which formed the basis of the drafting work at the subsequent meeting. 
                                                      
50 GPA/MOD/JPN/7, dated 26 July 2004. 
51 GPA/W/153, dated 25 September 2001. 
52 GPA/MOD/USA/5, dated 30 September 2006. 
53 GPA/42/Rev.1, dated 17 November 2006. 
54 GPA/M/30, dated 4 July 2006, para. 10. 
55 GPA/ACC/JOR/9, dated 31 October 2006. 
56 GPA/87, dated 2 June 2006. GPA/89 
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  20. At the formal meeting of the Committee on Fr iday, 8 December 2006, the Chairman reported 
that the negotiators had reached an understanding on  the revision of the text of the 1994 Agreement 
on Government Procurement as contained in Job No . 6259, dated 8 December 2006 (to be circulated 
to all WTO Members as GPA/W/297).  The negotiati ons were, of course, subject to the well-known 
WTO principle that "nothing is agreed until everything is agreed".  In particular, the agreement of the 
negotiators was provisional based on the following considerations: 
 - First, the provisions of the text remain s ubject to a final legal check.  In other words, 
rectifications of a purely formal character th at do not affect the substance or meaning 
of the text may be needed.  It will also  be necessary to draw up and ensure the 
linguistic consistency of the texts in the other two WTO languages. 
 
 - Secondly, it is subject to a mutually satisfactory outcome to the coverage 
negotiations.  In other words, some ne gotiators may continue discussions on the 
relationship between certain aspects of the aforementioned text, in particular in 
relation to Annexes 2 and 3, and the coverage negotiations. 
 
21. The Chairman also indicated that the nego tiators intended to c onduct the coverage 
negotiations on the basis of the above text.  In addi tion, it was intended that this text be used as the 
basis for consultations and other ongoing work  relating to the accession of new parties. 
22. In the course of the meeting, the Chairman also  reported that agreement had been reached on 
arrangements for conclusion of the market access asp ect of the negotiations under Article XXIV:7.  It 
had been decided that three meetings will be held in  the first half of 2007, starting in February.  In the 
course of each meeting week, substantial emphasi s would be placed on opportunities for bilateral 
discussions between Parties.  In addition, in the c ourse of each week, attention would be given to the 
development of the planned arbitration procedures a nd indicative criteria.  The process of the bilateral 
negotiations would be kept  under review in regular plurilateral m eetings in an informal mode.  The 
overall goal was to complete the market access negotiations (and therefore all aspects of the 
negotiations) in spring 2007. 
23. The Committee took note of the Chairman's st atement on the negotiations and agreed to 
proceed as he had suggested. 
24. As regards the work pertaining to elements 2 and 3 of the work programme, namely the 
extension of coverage and the elimination of discr iminatory measures and practices, it is recalled that, 
prior to the reporting period, the following Parties ha d submitted requests in this  regard:  Canada;  the 
European Communities;  Hong Kong, China;  Japan;  Korea;  Norway;  Singapore;  Switzerland;  and 
the United States.  During the reporting peri od Norway submitted an additional request. 
25. During the reporting period, the following Parties submitted initial offers for the expansion of 
coverage and the elimination of discriminatory meas ures:  Canada, the European Communities, Israel, 
Japan, Korea, Norway, Singapore, Switzerland and the United States.  In addition, Jordan and 
Chinese Taipei, which are participating in the ma rket access negotiations pursuant to Article XXIV:7 
of Agreement, confirmed in the course of the inform al meeting held in the week of 6 February 2006 
that the offers that they had circulated to delega tions in the course of their negotiations on accession to 
the current Agreement should also be considered as their initial offers in the coverage negotiations 
undertaken pursuant to Article XXIV:7 of Agreement. 
26. At the informal meeting held in the week of  27 March 2006, delegations agreed that revised 
offers in the market access negotiations should be ci rculated by mid-September 2006 or, in any event, 
not later than the end of September, in time for c onsideration at the meetings scheduled for the week 
of 16 October.  Since then, revised offers have b een submitted by Japan, Jordan and the United States.  GPA/89 
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  27. At the informal meetings held in the weeks of 6 February, 27 March, 29 May, 10 July, 
16 October 2006 and 4 December 2006 delegations al so conducted informal plurilateral discussions 
on horizontal coverage matters, including on market access-related provisions of the text. 
__________