RESTRICTED  WORLD TRADE  
ORGANIZATION  S/WPGR/M/58 
17 July 2007 
 
 (07-3019) 
Working Party on GATS Rules  
  
 
REPORT OF THE MEETING OF 4 JULY 2007 
 
Note by the Secretariat
1 
  
1. The meeting was chaired by Ms. Shaista Sohail, from Pakistan.  The agenda for the meeting, 
contained in WTO/AIR/3038, included the follo wing items: emergency safeguard measures, 
government procurement, subsidies, date of the ne xt meeting, and other business.  The agenda was 
adopted
. 
I. NEGOTIATIONS ON SUBSIDIES (ARTICLE XV) 
2. The Chairperson  invited delegations to take up the discussion on the basis of the questions 
that had been enumerated in paragraph 6 of the communication from Hong Kong, China and Mexico 
on non-actionable subsidies (JOB(07)/27).   
3. The representative of Hong Kong, China  wished to share some preliminary thoughts on the 
first six questions in JOB(07)/27.  She hoped to pur sue informal exchanges wi th delegations in the 
coming months. 
4. Discussions continued in informal mode.   
5. The representative of Switzerland  wished to share some elements  of answers to the questions 
raised in paragraph 6 of JOB(07)/27.  Policies in  pursuit of public, social and environmental goals 
normally served domestic interests and should aim at  enhancing the prosperity of an economy as a 
whole.  In that sense, subsidies for objectives such as provision of infrastructures and public services, 
aid for regional development, and, to a certain ex tent, funding for research should not be regarded as 
trade distortive given the national and social dimensions involved.  These could therefore be 
considered as permissible or non-actionable subsidie s.   Obviously, criteria to grant subsidies should 
be objective, transparent and non-discriminatory.  In  his view, nationality should not be a condition to 
achieve these goals.  The representative also wi shed to recall his delegation's views on export 
subsidies.  Such measures distorted competition and put in question market a ccess commitments.  His 
priority was to focus on subsidies that had distortiv e effects on trade, principally export subsidies, 
which did not help to enhance the welfare of a country as a whole nor to avoid social exclusion.  Subsidies were an important topic for his delegation and he hoped that the efforts of the sponsors of 
JOB(07)/27 would help Members to fulfil the oblig ation of information ex change and to develop 
disciplines in the area of subsidies.  He wish ed to continue work on both these aspects.   
6. The representative of China
 drew attention to the Secretariat Note entitled Subsidies in 
Services Sectors: Information Cont ained in WTO Trade Policy Reviews  (S/WPGR/W/25/Add.5), 
which was presented at the last meeting.  She be lieved that some of the government activities 
mentioned in the Note might not be considered as subsidies.  Furthermore, there was no definition yet 
                                                      
1 This document has been prepared under the Secret ariat's own responsibility and without prejudice to 
the positions of Members and to their rights and obligations under the WTO.  S/WPGR/M/58 
Page 2  
 
  of what constituted a subsidy in the context of servic es.  The word 'subsidies' in the title of the Note 
should therefore be qualified by quotation marks.  Th is would better reflect the purpose of the type of 
information gathered.   
7. The Chairperson
 underscored the different aspects of tr ade distortion raised in the discussion 
and noted that a delegation wished to focus more on export subsidies.  Some  delegations had also 
emphasized the importance of development aspects in  the discussion of any disciplines.  She asked 
delegations to further reflect on the questions raised  in paragraph 6 of JOB(07)/27 in preparation for 
the next meeting and invited the Working Party to take note  of the comments made.   
II. NEGOTIATIONS ON GOVERNMENT PROCUREMENT (ARTICLE XIII) 
8. The Chairperson  remarked that at the last meeting the European Communities had recalled 
what it saw as the benefits of disciplines on govern ment procurement.  This came against the 
background of the EC's latest proposal, containe d S/WPGR/W/54, which proposed the text of an 
annex to the GATS on government procurement in services.   
9. The representative of Canada  considered that the EC propo sal for an annex to the GATS on 
government procurement provided a good starting point for further discussions.  The annex to 
S/WPGR/W/54 set out a range of issues that would n eed to be considered in formulating the rules and 
transparency requirements for government pr ocurement commitments in the GATS.  The 
development of procedural rules was a necessary firs t step.  The Working Party needed to address the 
substantive rules and transparency requirement s for any commitments to open procurement to 
international competition.  Her delegation would be prepared to participate in a discussion of the 
various proposals contained in the annex in the course of future meetings.   
10. The representative of the European Communities  noted that the merits of his delegation's 
proposal had been explained several times.  From a political point of view, rules on procurement were 
good for domestic policy reasons because liberalization provided better value for money.  Such rules 
also offered domestic companies better access to foreign markets.  It was important to have a set of procedural rules, which his delegation's propo sal had developed, to accompany market access 
commitments.  Members were already aware of such  rules given their use in domestic frameworks as 
well as in free trade agreements.  His delegation was looking forward to a discussion of the proposal 
so as to fulfil the mandate in Article XIII.  Such  discussion was without prejudice to the outcome of 
the negotiations.   
11. The Chairperson
 encouraged delegations to share their domestic experiences on how they 
ensured transparency in this area, as well as their views on how to move forward on this agenda item.  
She invited the Working Party to take note  of the comments made.   
III. NEGOTIATIONS ON EMERGENCY SAFEGUARD MEASURES (ARTICLE X) 
12. The Chairperson  recalled that at the last meeting the delegations of Brunei Darussalam, 
Cambodia, Indonesia, Malaysia, Myanmar, the Ph ilippines, Thailand and Vietnam had introduced a 
room document that proposed rules regarding th e use of an emergency safeguard measures in 
services.   Some delegations had welcomed the ef forts of proponents, and a number of others had 
reiterated their general concerns ove r this more recent proposal.  As the previous Chairperson had 
noted, significant divergences on issues of importance re mained on this topic, relating for example to 
the link to market access.  She in dicated that the group of proponents had been planning to present 
today a revised version of the room document, but that had not proved possible.   
13. The representative of Thailand , speaking on behalf of Brunei Darussalam, Cambodia, 
Indonesia, Malaysia, Myanmar, the Philippines, a nd Vietnam, said that his group of delegations had  S/WPGR/M/58 
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  held additional informal exchang es since the last formal meeting.   These exchanges had allowed to 
explore new ideas and levels of ambition.  He al so recalled that at the informal consultations 
organized by the Chair of the Special Session of  the Council for Trade in Services, the group's 
ambassadors had reiterated the importa nce of emergency safeguard measures as an integral part of an 
ambitious outcome in services.  His group had been working on a revised room document.  It sought 
to accommodate ideas and suggestions from other Members on such topics as causal link, the market 
conditions constituting evidence of injury, and reco gnition of the need for the domestic industry to 
adjust.  Unfortunately, final clearance could not be obtained in time for the document to be presented 
today, and he indicated that it would be taken up at the next meeting.  His group remained open to any 
further questions or comments with respect to the room document of 6 March 2007.   
14. The Chairperson  said that she remained willing to offe r her services to facilitate informal 
discussions, should delegations so desire.  Sh e invited the Working Party to take note  of the 
comments made.   
IV. DATE OF NEXT MEETING 
15. The Chairperson  suggested that the next formal meeting be held during the next cluster of 
services meetings, subject to the usual consultations.    
V. OTHER BUSINESS 
16. No items were raised under this agenda item.   
 
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