WORLD TRADE  
ORGANIZATION  GPA/99 
2 June 2009 
 (09-2646) 
Committee on Government Procurement Original: English 
  
 
NOTIFICATION OF NATIONAL LEGISLATION 
 
Communication from Japan Pursuant to Article XXIV:5(b)
1 of the  
Agreement on Government Procurement  
 
 
 The following communication, dated 28 May 2009, is being circulated at the request of the Delegation of Japan.  
_______________ 
 
  Pursuant to Article XXIV , paragraph 5(b) of the WT O Agreement on Government 
Procurement, the Government of Japan wishes to  inform the Committee on Government Procurement 
of the following change in its regulatio ns concerning the government procurement.
2 
 
_______________ 
 
 
NOTIFICATION OF THE "LAW CONCERNING THE PROMOTION OF CONTRACTS 
CONSIDERING REDUCTION OF EMISSIONS OF GREENHOUSE GASES AND  
OTHERS BY THE STATE AND OTHER ENTITIES" AND "BASIC POLICY 
CONCERNING THE PROMOTION OF CONTRACTS CONSIDERING  
REDUCTION OF EMISSIONS OF GREENHOUSE GASES AND  
OTHERS BY THE STATE AND OTHER ENTITIES" 
 
 1. Agency responsible 
 Ministry of the Environment. 
 
2. Description of the law 
 Based on the "Law concerning the Promoti on of Contracts Considering Reduction of 
Emissions of Greenhouse Gases and Others by the Stat e and Other Entities" (hereinafter referred to as 
Law), which entered into force in 22 Novemb er 2007, and the "Basic Policy concerning the 
Promotion of Contracts Considering Reduction of Emissions of Greenhouse Gases and Others by the 
State and Other Entities" based on the Law (hereinaft er referred to as Basic Policy) adopted by the 
cabinet decision, central government entities and other entities shall endeavour to award contracts 
                                                     
 
1 Article XXIV:5(b) reads as follows:  National Legislation "(b) Each Party shall inform the Committee 
of any changes in its laws and regulations relevant to th is Agreement and in the administration of such laws and 
regulations." 
2 Previous notifications of Japan's national legislation can be found in documents:  GPA/37, dated 
20 June 2000;  GPA/67, dated 15 April 2002;  GPA/37/Add.1, dated 7 April 2004, GPA/37/Add.2, dated 
21 March 2005;  GPA/37/Add.3, dated 15 March 2006;  GPA/37/Add.4, dated 13 March 2007;  and 
GPA/37/Add.5, dated 1 April 2008. GPA/99 
Page 2  
 
with preference given to contracts which contribut e to the reduction of emission of greenhouse gases 
and others substances and publish the summary of the procurement track record after every fiscal 
year-end since 7 December 2007.  
3. Entities which shall procure based on the Basic Policy 
(1) State (all central government entities): 
  House of Representatives, House of Councillors , Supreme Court, Board of Audit, Cabinet 
(National Personnel Authority), Cabinet Office (Imperial Household Agency, National Public 
Safety Commission (National Police Agency), Financial Services Agency), Ministry of 
Internal Affairs and Communications, Ministry of Justice, Ministry of Foreign Affairs, 
Ministry of Finance, Ministry of Education, Culture, Sports, Science and Technology, Ministry of Health, Labour and Welfare, Ministry of Agriculture, Forestry and Fisheries, Ministry of Economy, Trade and Industry, Ministry of Land, Infrastructure, Transport and Tourism, Ministry of the Environment and Mini stry of Defence (including all their internal 
sub-organs, attached organizations and othe r organizations and local branch offices). 
 (2) Other entities (98 independent administrative institutions and four special legal entities): 
  The entities listed in the government ordinance determining the legal entities stipulated under 
Article 2, paragraph 3 of the Law as subsequently  amended (cf. attached list of the entities as 
of 1 October 2008).
3 
 
4. Contents of the said procurement policy 
(1) To consider the efforts to reduce the emissi ons of greenhouse gases and others in bidding for 
concluding the following contracts: 
 
 (a) contracts related to the supply of electricity;  and   (b) contracts related to  the purchase of vehicles.  (2) To promote the introduction of "energy con servation improvement (ESCO) projects", through 
concluding the contracts related to ESCO projects. 
 (3) To require technical proposals including the reduction of emissions of greenhouse gases and others in bidding for concluding the contracts related to the design service pertaining to the construction or large scale refurbis hment of government facilities. 
 
5. Starting date of procurement based on the revised Basic Policy 
 As soon as each entity is ready to start after the entry into force of the Law and the Basic 
Policy on 7 December 2007.  
6. Responsibility of local governments and loca l independent administrative institutions 
 Local Governments and local independent ad ministrative institutions shall endeavour to 
formulate a policy for the promotion of contracts that  give consideration to the reduction of emissions 
of greenhouse gases and others and, to take me asures necessary for such promotion in accordance 
with the relevant policy.  
                                                     
 
3 In English only.  GPA/99 
 Page 3 
 
 
7. Compliance with the WTO Agreemen t on Government Procurement 
 The Basic Policy includes the following paragraph: 
 
Each entity is "required to ensure accordan ce with other administrative purpose, with 
due consideration to compliance with  the WTO Agreement on Government 
Procurement, lest an unnecessary impediment be posed on international trade". 
8. Legal texts 
 The Japanese texts of the Law and the Basic Policy are available on the Ministry of the 
Environment website below:  
 http://www.env.go.jp/policy/ga/index.html. 
  Provisional English translations of the La w and the Basic Policy are attached hereto.
4 
 
9. Enquiry point 
 Environment and Economy Division, 
 Integrated Environmental Policy Bureau,  Ministry of the Environment  Telephone:  +(81 3) 5521-8229  Fax:  +(81 3) 3580-9568  
                                                     
 
4 In English only. GPA/99 
Page 4  
 
The list of the entities listed in the governme nt ordinance determining the legal entities 
 
stipulated under Article 2, Paragraph 3 of the Law concerning the  Promotion of  
Procurement of Contracts Considering Reduction of GHG Emissions by the   
State and Other Entities, as subsequently amended  
(as of 1 October 2008) 
 
 
 (Independent administrative institutions)  
1. National Agency for Vehicle Inspection, Fund  for the Promotion and Development of the 
Amami Islands, National Institute of Biom edical Innovation, Pharmaceuticals and 
Medical Devices Agency, Japan Aerospace Expl oration Agency, Okinawa Institute of 
Science and Technology, Marine Technical  Education Agency, Japan Agency for 
Maritime-Earth Science and Technology, National Maritime Research Institute, Japan Science and Technology Agency, National Livestock Breeding Center, Environmental Restoration and Conservation Agency, Nati onal Center for Teacher’s Development, 
Organization for Environment Improvement around International Airport, Research 
Institute of Economy, Trade and Industry, Japan Nuclear Energy Safety Organization, 
Building Research Institute,  National Institute for Sea Training,  National Center for Industrial Property Information and Training,  Civil Aviation College, National Traffic 
Safety and Environment Laboratory, Japan Organization for Employment of the Elderly and Persons with Disabilities, Port and Ai rport Research Institute, Japan National 
Tourism Organization, Japan International Cooperation Agency, Japan Foundation, Japan 
International Research Center for Agricultura l Science, National Cons umer Affairs Center 
of Japan, National Printing Bureau, Nationa l Science Museum, National Institute for 
Environmental Studies, National Institute of Health and Nutrition, Institute of National 
Colleges of Technology, National Archives of  Japan, The National In stitute for Japanese 
Language, National Center for Persons with Severe Intellectual Disabilities, 
Nozominosono, National Woman’s Education Center, National Institution for Youth 
Education, Center for National University Fi nance and Management, National Institute of 
Special Needs Education, National Museum of Art, National Hospital Organization, 
National Institute of Cultural Heritage, Em ployment and Human Resources Development 
Organization of Japan, National Institute of Advanced Indus trial Science and Technology, 
National Agency for Automotive Safety an d Victims’ Aid, Japan Housing Finance 
Agency, National Center for Seeds and S eedlings, National Research Institute of 
Brewing, Information-Technology Promotion Agency, Japan, National Institute of Information and Communications Technolog y, New Energy and Industrial Technology 
Development organization, Forestry and For est Products Research Institute, Fisheries 
Research Agency, National Fisheries Univer sity, National Institute of Technology and 
Evaluation, Japan Oil, Gas and Metals Nationa l Corporation, Japan Mint, National Center 
for University Entrance Examination, Na tional Institute for Academic Degrees and 
University Evaluation, Organization for Small & Medium Ente rprises and Regional 
Innovation, JAPAN, Labor Management Or ganization for USFJ Employees, Japan 
Railway Construction, Transport and Technology Agency, Public Corporation, Electronic 
Navigation Research Institute, National Sta tistic Center, Urban Renaissance Agency, 
Public Works Research Institu te, Japan Society for the Promotion of Science, Japan 
Student Services OrganizationJapan Art Counc il, Japan Atomic Energy Agency, Japan 
Expressway Holding and Debt Repayment Agency, National Agency for the Advancement of Sports and Health, Comme morative Organization for the Japan World 
Exposition ’70, Japan External Trade Orga nization, Nippon Export and Investment 
Insurance, Readjustment of Facilities fo r Insured Pensions and Beneficiaries 
Organization, National Institute for Agro-E nvironmental Sciences, Farmers’ Pension 
Fund, National Agriculture and Food Resear ch Organization, National Institute of  GPA/99 
 Page 5 
 
 
Agrobiological Sciences, Agriculture and Li vestock Industries Corporation, Agriculture, 
Agriculture, Forestry and Fisheries Credit Foundations, Food and Agricultural Materials 
Inspection Center, Welfare and Medical Servi ce Agency, National Institute for Materials 
Science, The Public Foundation for Peace a nd Consolation, Incorporated Administrative 
Agency, National Research Institute for Eart h Science and Disaster Prevention, National 
Institute of Radiological Sciences, Northern  Territories Issue Association, Japan Water 
Agency, National Institute of Multimedia Education, Management Organization for 
Postal Savings and postal Life Insurance, RIKEN, National Institute of Occupational 
Safety and Health, Japan, Japan Labour Hea lth and Welfare Organization, The Japan 
Institute for Labour Policy and Training 
 
 (Special legal entities)  
2. The promotion and Mutual Aid Corporation for Private Schools of Japan 
3. Okinawa Development Finance Corporation 
4. Japan Finance Corporation 
5. Japan Racing Association 
 GPA/99 
Page 6  
 
 
(Provisional Translation) 
 
THE LAW CONCERNING THE PROMOTION OF CONTRACTS CONSIDERING 
REDUCTION OF EMISSIONS OF GREENHOUSE GASES AND OTHERS  
BY THE STATE AND OTHER ENTITIES 
  
Article 1 (Purpose) 
  The purpose of this Law is to encourage a reduction of emissions of greenhouse gases and 
others by the State and other entities, thereby contributing to the creation of a society that enjoys environmentally sustainable development, by clarifying the responsibilities of the State and other 
entities and stipulating the formulation of a basic po licy and other necessary matters with regard to the 
preferment of government contracts which addr ess and promote the reduction of emissions of 
greenhouse gases and others of the State and other entities. 
 
Article 2 (Definitions) 
 
1. For the purpose of this Law, “greenhouse gases and others” means greenhouse gases and 
other substances that have an environmental load, as  provided in Article 2, paragraph 1 of the Basic 
Environment Law (Law No.91 of 1993); the same shall apply hereinafter. 
2. For the purpose of this Law, “the State and ot her entities” shall mean the State, independent 
administrative institutions, etc. local governments and local independent administrative institutions. 
3. For the purpose of this Law, “independent ad ministrative institution(s), etc.” means legal 
entities, being independent administrative institutio ns, as provided in Article 2, paragraph 1 of the 
Law on General Rules on Independent Administrative Institutions (Law No. 103 of 1999) or special 
organizations (legal entities that are establishe d by law or established for special purposes in 
accordance with special legislation, and that are subject to the provisions of Article 4, 
subparagraph (15) of the Law for Establishmen t of the Ministry of Internal Affairs and 
Communications (Law No. 91 of 1999); the same sha ll apply hereinafter), whose capitals are funded 
mostly or entirely by the State or whose main s ources of operational revenue are grants or subsidies 
provided by the State, limited to those specified by Cabinet Order. 
4. For the purpose of this Law, “local independe nt administrative institutions” shall have the 
meaning provided in Article 2, paragraph 1 of  the Law on Local Independent Administrative 
Institutions (Law No. 118 of 2003). 
5. For the purpose of this Law, “the head of each  ministry or agency” shall have the meaning 
provided in Article 20, paragraph 2 of the Public Finance Law (Law No.34 of 1947). 
Article 3 (Responsibility of the State and independent administrative institutions, etc.) 
 
 The State and independent administrative ins titutions, etc. shall endeavour to ensure the 
appropriate and reasonable use of energy in orde r to reduce emissions of their greenhouse gases and 
others, and to award contracts in consideration of various factors other than cost, with preference 
given to contracts which contribute to the reducti on of emissions of greenhouse gases and others by 
the State or relevant independent administrative institution and are also economically efficient. 
  GPA/99 
 Page 7 
 
 
Article 4 (Responsibility of local governme nts and local independent administrative 
institutions) 
  Local governments and local independent admi nistrative institutions shall endeavour to 
ensure the appropriate and reasonable use of energy  in order to reduce emissions of their greenhouse 
gases and others, and to award contracts in consider ation of various factors other than cost, with 
preference given to contracts which contribute to  the reduction of emissions of greenhouse gases and 
others by the local governments or local indepe ndent administrative institutions and are also 
economically efficient, in accordan ce with local environmental and social conditions in the case of a 
local government, and in accordance with its admi nistrative and business activities in the case of a 
local independent administrative institution. 
 
Article 5 (Basic policy) 
 1. The State shall formulate a basic policy for th e preferment of contracts that address the 
reduction of emissions of greenhouse gases and others  by the State and independent administrative 
institutions, etc. (hereinafter the “Basic Policy”). 
2. The Basic Policy shall stipulate the following: 
 (1) The basic direction to be followed for th e preferment of contracts that address the 
reduction of emissions greenhouse gases and others. 
 
 (2) Basic matters related to the reduction of  emissions of greenhouse gases and others for 
the following categories of contracts, with overriding priority on the reduction of 
emissions of greenhouse gases and others: 
 
  (i) contracts related to the supply of electricity;  and 
   (ii) contracts related to the purc hase of products emitting greenhouse gases and 
 others. 
  (3) Basic matters related to contracts for energy conservation improvement projects 
‒projects for which the expected reduction in th e cost of electricity, fuel, etc. related 
to the use of a government building exceeds the cost of design, construction, 
maintenance and so forth incurred in the im provement of structures, facilities, etc. 
(hereinafter “design, etc.”) of said buildi ng; the same shall apply under Article 7. 
 
 (4) Basic matters related to the reduction of  emissions of greenhouse gases and others  
under contracts other than those listed in the preceding two subparagraphs, that fall 
into the categories of contracts related to buildings or other contracts awarded by the 
State and independent administrative institutions, etc. 
  (5) Other important matters related to th e preferment of contracts that address the 
reduction of emissions of greenhouse gases and others. 
 3. The Basic Policy shall be formulated in su ch a way as to contribute to the effective 
implementation of the Action Plan on the central G overnment’s Business provided in Article 20-2, 
paragraph 1 of the Law concerning the Promotion of the Measures to Cope with Global Warming 
(Law No. 117 of 1998), with due c onsideration given to the need to secure a stable supply of energy. GPA/99 
Page 8  
 
4. The Minister of the Environment shall consult with  the head of each ministry or agency, etc. 
(the head of each ministry or agency in the case of the State, the competent minister in the case of 
independent administrative institutions, etc.; the same  shall apply hereinafter) in advance of drafting 
the Basic Policy and shall obtain  an approval of the Cabinet. 
5. Consultation with the head of each ministry or agency, etc. under the preceding paragraph 
shall be conducted based on a proposal drafted by the Minister of the Environment in cooperation 
with the competent minister in charge of the releva nt project under a contract stipulated in the Basic 
Policy. 
6. The Minister of the Environment shall, upon obtaining the approval of the Cabinet stipulated 
in paragraph 4 of this Article, pub lish the Basic Policy without delay. 
7. The provisions of the preceding three paragra phs shall be applied mutatis mutandis to 
revisions made to the Basic Policy. 
Article 6 (Promotion of contracts that add ress the reduction of emissions of greenhouse 
gases and others in accordan ce with the Basic Policy) 
 
 The head of each ministry or agency and th e heads of independent administrative institutions, 
etc. (or its representative, if the relevant indepe ndent administrative institution, etc. is a special 
organization; the same shall apply hereinafter) sh all strive to take measures necessary for the 
preferment of contracts that address the reducti on of emissions of greenhouse gases and others in 
accordance with the stipulations of the Basic Policy. 
 
Article 7 (Financial obligation of the State) 
  In cases where the costs of an energy conservati on improvement project are to be defrayed by 
the State out of the national treasury, such defrayment shall be limited to a period of 10 fiscal years 
starting from the fiscal year of the initial defrayment. 
 
Article 8 (Publication of a summary of contracts concluded, etc.) 
 
1. The head of each ministry or agency and the heads of independent administrative institutions, 
etc. upon the closing of each fiscal year or each business year shall compile and publish a summary of 
concluded contracts that address the reduction of emissions of greenhouse gases and others, and shall 
notify the Minister of the Environment without delay of such publication. 
2. The heads of independent administrative institu tions, etc. shall notify the Minister of the 
Environment as stipulated in the preceding paragraph via the competent minister in charge of the 
relevant independent administrative institutions, etc. 
Article 9 (Request of the Minister of the Environment) 
 
 The Minister of the Environment may request the head of each ministry or agency, etc. to take 
other special measures deemed necessary for the preferment of contracts that address the reduction of 
emissions of greenhouse gases and others. 
 
Article 10 Compilation, etc. of information by the State) 
 
 To contribute to the preferment of contracts that address the reduction of emissions of 
greenhouse gases and others the State shall compile and analyze the data relating to the concluded 
contracts and other data, and shall make the results  of such compilation and analysis extensively 
available.  GPA/99 
 Page 9 
 
 
 
Article 11 (Preferment of contracts that address the reduction of emissions of greenhouse 
gases and others by local governments a nd local independent administrative 
institutions) 
 
1. Local governments and local independent administ rative institutions shall strive to formulate 
a policy for the preferment of contracts that a ddress the reduction of emissions of greenhouse gases 
and others by local governments and local independent administrative institutions. 
2. Policies formulated under the preceding paragra ph shall, in the case of a local government, 
have regard to the environmental and social conditi ons of the local area, and, in the case of a local 
independent administrative institution, to its administrative affairs and business activities. 
3. Local governments and local independent admini strative institutions, having formulated a 
policy under paragraph 1 of this ar ticle, shall strive to take measures necessary for the preferment of 
contracts that address the reduction of emissions of greenhouse gases and others in accordance with 
the relevant policy. 
4. Local governments and local independent admi nistrative institutions shall compile and 
publish a summary of concluded contracts that addr ess the reduction of emissions of greenhouse gases 
and others. 
Article 12 (Fair competition) 
  The State and other entities, when formulating and implementing measures concerning the 
preferment of contracts that address the reduction of emissions of greenhouse gases and others by the 
State and other entities, shall ensure fair competit ion with due consideration, by taking measures 
necessary to ensure SMEs are not unfairly disadvantaged. 
 Article 13 (Harmonization with other measures) 
 
1. The State and other entities, when formulating and implementing measures concerning the 
preferment of contracts that address the reduction of emissions of greenhouse gases and others by the 
State and other entities, shall ensure accordance  with other measures concerning the award of 
contracts by the State and other entities. 
2. The State and other entities shall, when form ulating and implementing measures concerning 
the preferment of contracts that address the reduc tion of emissions of greenhouse gases and others by 
the State and other entities, ensure  accordance with measures describ ed in the Basic Energy Plan 
provided in Article 12, paragraph 1 of the Basi c Law on Energy Policy (Law No.71 of 2002) and 
other measures related to the reduction of emissions  of greenhouse gases and others by the State and 
other entities. GPA/99 
Page 10  
 
(Provisional Translation) 
 
BASIC POLICY CONCERNING THE PROMOTION OF CONTRACTS CONSIDERING 
REDUCTION OF EMISSIONS OF GREENHOUSE GASES AND OTHERS  
BY THE STATE AND OTHER ENTITIES 
(Approved by the Cabinet on 7 December 2007) 
  
1. The basic direction for the promotion of contracts that consider reductions of emissions 
of greenhouse gases and others 
(1) Background and significance of the promotion of green contracts 
  In light of the scale and severity of its antic ipated impacts, global warming is the most 
significant environmental issue threatening the foun dations of human survival. According to a report 
by the Intergovernmental Panel on Climate Change (IPCC), there is no room for doubt that global 
warming is occurring. 
  As a consequence, global warming will likely cast negative impacts on our economic and social activities in multiple respects, not only cau sing frequent weather anomalies and drastically 
changing climates, but negatively impacting farm ing and agriculture and leading to increased 
incidents of infection, devastating disasters and so forth. We have already witnessed how global 
warming has affected water res ources and vulnerable ecosystems. It is projected that as the 
temperature continues to rise, more serious impacts will ensue.   It is not only harmful greenhouse gases that humanity emits into the environment. While 
socio-economic activities characterized by mass pr oduction, mass consumption and mass waste have 
benefited us greatly, such activities have wasted  the Earth’s limited resources and hampered the 
natural cyclical change of materials, impos ing a heavy load on the global environment. 
  Against this background, we must ensure th e development and prosperity of humankind by 
seeking solutions to these challenges. To this end,  it is essential to reduce emissions of greenhouse 
gases and other substances that negatively impact the environment (hereinafter, “greenhouse gases 
and others”) across all sectors. In particular, it will be an overridingly important approach to strive to 
reduce emissions of greenhouse gases and others by  addressing the reduction of environmental loads 
in connection with the award of contracts.   The emissions of Greenhouse gases and othe rs related to power supply, automobiles 
purchases, energy conservation improvement, refurbis hment and construction, for which details on 
the award of contracts to address reductions of  emissions of greenhouse gases and others are 
stipulated by this Basic Policy, account for about  60% of the total greenhouse gas emissions sourced 
from the Government. In promoting contracts that take account of the re duction of emissions of 
greenhouse gases and others, it is essential to ensure th e achievement of the related targets (using the 
2001 level as the benchmark, the average of emi ssions of greenhouse gas emissions directly and 
indirectly emitted in connection w ith affairs and projects of each governmental administrative organ 
from 2010 to 2012 should be cut by 8%) set in a program to be formulated concerning measures to be implemented with the view of curbing the Govern ment’s greenhouse gas emissions in its affairs and 
projects pursuant to Article 20-2, paragraph 1 of the Law concerning the Promotion of Measures to 
Tackle Global Warming (Law No.107 of 1998) (approved by the Cabinet on March 30, 2007; 
hereinafter, “the Action Plan on the Central Government’s Business”) and strive for further 
reductions.   GPA/99 
 Page 11 
 
 
 Through these measures, we aim to build a soci ety wherein people in every country can enjoy 
wellbeing in a sound, fertile environment conserve d in all dimensions, from a global level to the 
community level—one that can be inherited by fu ture generations. In other words … a sustainable 
society.  
 It is expected that when concluding contract s that takes account of the reduction of emissions 
of greenhouse gases and others, in view of various factors other than price while bearing in mind 
economical efficiency and paying due regard to the inherent wisdom and effo rts of industry, we can 
effectively improve environmental efficiency (i n terms of environmental load related to the 
production of goods or the provision of services per unit) and ensure any increase in the 
environmental burden can be contained, even as our economy becomes more affluent and “value 
added.” Moreover, it is also expected that this will give rise to new economic activities by taking the 
lead in creating higher-performing green technologies and products that contribute to environmental 
conservation.  
 The State, independent administrative institutions, etc. (referring to independent 
administrative institution(s), etc. defined in Ar ticle 2, paragraph 3 of the Law concerning the 
Promotion of Contracts considering Reduction of Emissions of Greenhouse Gases and others by the 
State and Other Entities [Law No. 56 of 2007; here inafter, “the Law”]; the same shall apply 
hereunder), local governments and lo cal independent administrative institutions (hereinafter, “the 
State, etc.”) occupy a significant place in the na tional economy as a central player engaged in daily 
economic activities. In addition, the modality of concl uding contracts by the State, etc. is of great 
importance, influencing those concluded by othe r entities. Therefore, it would bring significant 
benefits to markets if the State, etc. establish th e practice of concluding contracts that take into 
account the reduction of emissions of greenhouse gases and others.  
 Along with the purport of Article 24 of the Basic Environmental Law (Law No., 91 of 1993) 
and Article 3, paragraph 3 of the Law concerning the Promotion of Measures to Tackle Global Warming, it is called upon the State, etc. to take the initiative in promoting contracts that take into 
account the reduction of emissions of greenhouse g ases and others, which can be expanded by the 
private sector, thereby encouraging a nationwide shift to the promotion of contracts that take account of the reduction of emissions of greenhouse gases and others. 
 
(2) Basic concept concerning the promotion of c ontracts considering reduction of emissions of 
greenhouse gases and others 
  The head of each ministry or agency, etc. (refe rring to “the head of each ministry or agency, 
etc.” set forth in Article 2, paragraph 5 of the Law;  the same shall apply hereinafter) and the heads of 
independent administrative institutions, etc. shall stri ve to, pursuant to the provisions of Article 6 of 
the Law, as stipulated in this Basic Policy, ta ke necessary measures for the promotion of contracts 
considering reduction of emissions  of greenhouse gases and others. 
  In practice, the following approaches shall be  taken toward the conclusion of contracts: 
 
 (i) When entering into contracts that take  into account the reduction of emissions of 
greenhouse gases and others, the reduction of emissions of greenhouse gases and others should be considered in as wide range  of fields as possible, in recognition that 
it is expected to be an effective approach  toward the spread of eco-friendly goods and 
services (hereinafter, “goods, etc.”) in markets to take into account various factors 
other than price while bearing in mind economical efficiency. 
  (ii) It is essential to keep in mind the concern that unless a contract considers the 
reduction of emissions of greenhouse gases and others, larger volumes of greenhouse 
gases and others are likely to be emitted in  connection with the production, use, etc. GPA/99 
Page 12  
 
of goods, etc. under the relevant contract, as a consequence of which the State, etc. might incur higher costs for environmental conservation. 
  (iii) It is essential to promote the Action Plan on the Central Government’s Business 
effectively through contracts that consider the reduction of emissions of greenhouse 
gases and others. In particular, for indepe ndent administrative institutions, etc. to 
promote contracts that consider the reduction of emissions of greenhouse gases and others, it is preferable to take a well-pla nned approach, comparable to the Action Plan 
on the Central Government’s Business, wh ile respecting the characteristics of an 
individual institution. 
 
 (iv) When specifying requisite performance s for procurement, these specifications should 
be necessary, sufficient and clear, in lin e with administrative purposes, etc., and 
contract-related information should be pub licized. When setting forth requirements, 
the evaluation methodology, procedures for th e award of contracts, etc., and when 
implementing contracts, it is essential to ensure fair competition with due 
consideration, by taking necessary measures to prevent small and medium-sized enterprises from unfair disadvantage. 
  (v) When implementing measures concerning the promotion of contracts that consider 
the reduction of emissions of greenhouse g ases and others, it is essential to ensure 
accordance with other measures concerning the award of contracts by the States, etc. 
  (vi) When implementing measures concerning the promotion of contracts that consider 
the reduction of emissions of greenhouse g ases and others, it is essential to ensure 
consistency with measures described in the Basic Energy Plan stipulated in Article 
12, paragraph 1 of the Basic Law on Energy Policy (Law No. 71 of 2002) and other 
measures related to the reduction of emissions of greenhouse gases and others by the States, etc. 
  (vii) It is required to ensure accordance with other administrative purpose, with due 
consideration to compliance with the WTO Agreement on Government Procurement, 
lest an unnecessary impediment be posed on international trade. 
 
2. Basic matters related to the reduction of greenhouse gas emissions for contracts with 
overriding priority on the reduction of greenhouse gas emissions. 
(1) Contracts related to the supply of electricity 
 
 Basic matters related to the reduction of emissions of greenhouse gases and others for contracts related to the supply of electricity are stipulated as follows: 
  For contracts to be concluded by bidding relate d to the supply of electricity, it is essential to 
select the successful bidder on the basis of price from among those qualified bidders who have met 
the requisite standard of greenhouse gas emission f actors and effort of reduction of environmental 
loads (the status of introduction of new energy, the status of use of unutilized energy, etc.), which is 
prescribed in advance (hereinafter, “the  bottom-cut method”), for the present. 
  - When considering details of bidding pr ocedures under the bottom-cut method, it is 
essential to ensure accordance with actions  for secured supplies while taking the 
actual situation of the said region into account as well as fair competition. 
  - When concluding a contract related to the supply of electricity, it is essential to enter 
into contract with a power operator acknowledged as capable of supplying electricity  GPA/99 
 Page 13 
 
 
to meet the required power demand, the estimated power consumption, etc. as 
described in specifications throughout the term of contract reliably and stably. 
  - The State and independent administrative institutions, etc. shall endeavour to ensure 
the appropriate and reasonable use of energy and, when implementing contracts 
related to the supply of electricity, to ensu re fair competition with due consideration, 
by taking measures necessary to prevent small and medium-sized enterprises from unfair disadvantage, and at the same time,  to ensure consistency with measures 
concerning the conclusion of contracts by other States, etc., measures described in the Basic Energy Plan stipulated in Article 12,  paragraph 1 of the Basic Law on Energy 
Policy (Law No. 71 of 2002) and other measu res related to the reduction of emissions 
of greenhouse gases and others by the States, etc. 
 (2) Contracts related to the purch ase of greenhouse gas-emitting products 
 
 Basic matters related to the reduction of em issions of greenhouse gases and others  for 
contracts related to the purchase of automobiles are stipulated as follows: 
  - For contracts to be concl uded by bidding related to the purchase of automobiles, it is 
essential to enter into contract with a part y whose proposal is rated the best when 
comprehensively evaluated in terms of purchase price and environmental 
performance. 
  - With regard to requisite performance at  the time of ordering, it is essential to 
prescribe requirements by properly taking administrative purposes into account, giving due consideration not to restrict biddings unnecessarily. 
 
 - Bidding requirements shall be set fo rth by type of fuel, for the present. 
  - With regard to specific requirements for a particular bid, the procuring party shall set 
forth details, based on data on the use of automobiles. 
 3. Basic matters related to contracts for energy conservation improvement projects 
 Basic matters related to contracts for energy  conservation improvement projects (referring to 
“energy conservation improvement pr ojects” described in Article 5, paragraph 2, item 3 of the Law; 
hereinafter, “ESCO project”) are stipulated as follows:  
 - It is essential to conduct a feasibility study for the introduction of ESCO projects, and 
introduce ESCO projects as widely as possible. 
  - When planning an ESCO project, it is essential to grasp in advance the conditions of 
existing facilities accordingly, and draw up a plan for a program by making use of means for implementing an ESCO project appropriately and smoothly, such as 
feasibility studies, etc. 
  - When planning an ESCO project, it is essential to properly formulate a long-term in-
service program and to realize thorough di scussion, lest terms and conditions of a 
contract be subject to change within the term of contract. 
 
 - When deciding the ESCO operator, it is essential to comprehensively evaluate 
proposals not only by comparing prices but also by determining which proposed technical solution with other factors is the most suitable for the equipment and systems of the relevant facility, with innovations fully incorporated. GPA/99 
Page 14  
 
  - In concluding a contract for an ESCO project, it is essential to consult thoroughly 
with the implementing operator in advance concerning the sharing of potential risks 
to arise during the period of the project. 
 
 - When implementing an ESCO project, it is essential to formulate guidelines on 
maintenance and measurement/verification, acco rding to the contract  to be concluded. 
  - Before the completion of an ESCO project, with regard to area(s) pertaining to the 
technical scope employed as an ESCO project, it is essential to require the 
implementing operator to create guidelines on proper maintenance and administration 
following the termination of the project. 
 
4. Basic matters related to the reduction of emissions of greenhouse gases and others under 
contracts other than those listed in the preced ing 2 and 3 that fall into the categories of 
contracts related to buildings or other cont racts awarded by the State and independent 
administrative institutions, etc. 
 Basic matters for contracts related to buildings are stipulated as follows: 
  - When contracting for the design service pertaining to the construction or large-scale 
refurbishment of a building, it is essential, as  a rule, to employ the procedure to select 
a party who has proposed the most excelle nt technical solution when evaluated 
comprehensively in light of the specified technical requisite standards, including 
features addressing the reduction of emissions of greenhouse gases and others (including affirmative use of natural en ergy) (hereinafter, “the green proposal 
procedure”). However, the same rule does not  necessarily apply to such projects with 
overriding priority on other factors than the reduction of emissions of greenhouse 
gases and others, or such projects where there is little room for such design innovations. 
  - When contracting for the design service pertaining to the construction or large-scale 
refurbishment of a building, it is essential,  as a rule, to describe the environmental 
conservation performance required for the design output clearly in contract 
documents. 
  - If the green proposal procedure is employed, and when features addressing the 
reduction of emissions of greenhouse gases a nd others contained in the technical 
solution proposed by the selected party are judged appropriate in terms of economical 
efficiency as well, it is essential to ensure  the relevant features of the technical 
solution are reflected in the design output , by clearly describing the appropriate 
features in contract documents. 
  - If the green proposal procedure is employed, it is essential to conclude a contract with 
the selected party and to require the other pa rty (the designer) of the contract to assess 
life-cycle CO
2 emissions (LCCO 2), in addition to comprehensive environmental 
conservation performance, with regard to the design output. 
  - When ordering through the green proposal procedure, it is essential to announce to 
that effect officially with an outline of th e order in advance, and when the outline has 
been modified, to publicize the outline as modified. 
  GPA/99 
 Page 15 
 
 
 - When ordering through the green proposal  procedure, it is essential to provide 
necessary information for those who are inv ited to propose technical solutions, and to 
ensure those parties are allowed reasonable time for preparation. 
  - When ordering through th e green proposal procedure, it is essential to ensure 
impartiality, transparency, and objectivity. 
 
5. Other important matters related to the pr omotion of contracts that address the 
reduction of emissions of greenhouse gases and others 
(1) Promotion of contracts that address the reduc tion of emissions of greenhouse gases and others 
in all contract categories 
  For all of the contract categories listed in the preceding 2 through 4 as well as others, including associated contracts permitting the installati on of equipment in govern ment buildings, it is 
preferable to ensure features under contract are s ubstantial to make use of goods, etc. under contract 
and to conduct affairs related to the award of cont racts in such a way as to contribute to the reduction 
of emissions of greenhouse gases and others in co nnection with the implementation of projects under 
contract and affairs to award contracts. Also, due consideration should be given lest the reduction of 
emissions of greenhouse gases and others in the ad ministrative field cause increased emissions of 
greenhouse gases and others in non-administrative sectors.  
(2) Establishment of structure to promote contracts 
  The head of each ministry or agency and th e heads of independent administrative institutions, 
etc. shall establish a structure to promote cont racts that address the reduction of emissions of 
greenhouse gases and others. As a rule, it is required th at the head of the structure shall be a person 
who is competent in supervising contracts that address reductions of emis sions of greenhouse gases 
and others entirely for the internal organization (i n the case of each ministry or agency, a person who 
holds the office of or equivalent to Director Gene ral [Chief Secretary] or higher) and also that all 
internal organizations shall be involved in the struct ure. In particular, departments/divisions in charge 
of environmental affairs and departments/divisions in charge of accounting/procurement shall engage 
in the structure on their own initiative. 
 
(3) Publication of a summary of contracts concluded, etc.   When publishing a summary of c oncluded contracts that address the reduction of emissions of 
greenhouse gases and others, the head of each mini stry or agency and the heads of independent 
administrative institutions, etc. shall publish su ch a summary in a form as plain as possible. 
 (4) Implementation of programs to enhance pers onnel's understanding for further promotion of 
contracts that address the reduction of emissions of greenhouse gases and others 
  The head of each ministry or agency and th e heads of independent administrative institutions, 
etc. shall seek to provide the personnel, including of ficials in charge of business practice relating to 
contracts, opportunities to enhance their understand ing of contracts that address the reduction of 
emissions of greenhouse gases and others and to ac quire technical knowledge useful for concluding 
such contracts.  
(5) Compilation, etc. of information 
  The State, with the view of contributing to the promotion of contracts that address the reduction of emissions of greenhouse gases and othe rs by the State, independent administrative 
institutions, etc., local governments , local independent administrative institutions, and other citizen of GPA/99 
Page 16  
 
the State, shall compile and analyze the data re lating to the concluded contracts that address the 
reduction of emissions of greenhouse gases and others and other data, and shall make the results of 
such compilation and analysis extensively availabl e in an easily understandable form. The head of 
each ministry or agency and the heads of independe nt administrative institutions, etc. shall seek to 
conclude contracts that contribute to the reducti on of environmental loads as much as possible by 
making sufficient use of existing information including the relevant information. 
 (6) Harmonization with other measures   The State shall engage reasonably and effectiv ely in the publication and compilation, etc. of 
information in coordination with the system estab lished for the enforcement of the Law concerning 
the Promotion of Procurement of Environment-Friendly Products by the State, etc. (Law No. 100 of 2000), which stands for a pioneering initiative addressing the environment.  (7) Review of the Basic Policy 
 
 With the view of contributing to further prom otion of contracts that address the reduction of 
emissions of greenhouse gases and others, the State sh all review this Basic Policy whenever deemed 
necessary in reference to available informa tion/data described in (5) and so forth. 
 
__________