. /. RESTRICTED  WORLD TRADE  
ORGANIZATION  S/WPGR/W/53 
12 September 2005 
 (05-3956) 
Working Party on GATS Rules   
  
- DRAFT - 
 
ANNUAL REPORT OF THE WORKING PARTY ON GATS RULES  
TO THE COUNCIL FOR TRADE IN SERVICES (2005) 
 
 
1. Since its annual report for 2004, the Working Party on GATS Rules held three formal 
meetings: on 24 November 2004, on 7 February 2005, and on 20 June 2005.
1  The three negotiating 
mandates the Working Party is entr usted with were put on the age nda of each meeting: emergency 
safeguard measures (Article X), government procuremen t (Article XIII), and subsidies (Article XV).  
The Working Party also held one informal meeting.   
2. In the three areas, discussions referred to the need  to consider work priorities in the context of 
upcoming key timelines and the current state of discussions, including as mentioned by the 
Chairperson in the annotated agenda circulated as JOB(05)/115. 
I. NEGOTIATIONS ON EMERGENCY SAFEGUARD MEASURES UNDER GATS 
ARTICLE X 
3. At the meetings of November 2004 and Februa ry 2005, delegations continued their discussion 
on emergency safeguard measures on the basis of an informal communication from a group of 
ASEAN Members2 (JOB(04)/175), which presented answers to questions raised with respect to their 
proposal.  Issues touched upon in the discussion included:  situations justifying the use of a safeguard 
measure; the definition of domestic  industry; availability of appropr iate statistics; the relationship 
between safeguard measures and obligations in bila teral investment treaties; link to progressive 
liberalization; and the use of safeguard-type entries in schedules.   
 4. At the meeting of June 2005, a repr esentative from UNCTAD presented a paper on 
emergency safeguard measures that the organizati on had earlier circulated.  The ensuing discussion 
touched upon a number of issues, such as the pur pose and effects of a safeguard mechanism in 
services, relevant comparisons with rules in the area of goods, special and differential treatment, 
domestic industry, procedures and indicators, comp ensation, as well as possible approaches for a way 
forward.
3  Divergent views were expressed on the various  aspects raised in relation to emergency 
safeguard measures, including desirability and feasibility.    
II. NEGOTIATIONS ON GOVERNMENT PROCUREMENT UNDER GATS     
ARTICLE XIII.  
5. At the meetings of November 2004 and Februa ry 2005, delegations continued their discussion 
of an earlier proposal by the European Comm unities for a framework under GATS for government 
procurement in services (S/WPGR/W/48).  At the m eeting of June 2005, the European Communities 
                                                     
 
1 Reports of these meetings are contained in documents S/WPGR/M/50, S/WPGR/M/51, and 
S/WPGR/M/52.  They should be read in conjunction with this report.  
2  Brunei Darussalam, Indonesia, Malaysia, Myanmar, the Philippines and Thailand.   
3 Discussions on emergency safeguard measures are reflected in paragraphs 33-55 of S/WPGR/M/50, 
paragraphs 55-79 of S/WPGR/M/51, and paragraphs 4-37 of S/WPGR/M/52. S/WPGR/W/53 
Page 2  
 
presented a communication on the structure of an  annex to the GATS on procedural rules for 
government procurement (S/WPGR/W/52).  Issues raised in the discussion included the application of the MFN obligation, the relationship to the G overnment Procurement Ag reement (GPA), modal 
application, the possibility of distinguishing between goods and services, scheduling approaches, 
comparisons with approaches taken in regional tr ade agreements, thresholds, and elements of 
procedural rules.  As requested, the Secretariat prepared the following Note: Main Approaches to the 
Undertaking of Commitments on Government Proc urement in Economic Integration Agreements: 
Summary Observations  (S/WPGR/W/52).   
6. A number of delegations con tinued to reiterate that, in th eir view, the negotiating mandate 
under Article XIII did not entail market access issues, while others thought that these were covered.  
Some delegations drew attention to  the General Council's decision, in the July Package, that there be 
no negotiations on the Singapore issue of transparency in government procurement, while others pointed out that the July Package also called on Me mbers to intensify efforts to conclude the rule-
making negotiations, includi ng those on Article XIII.
4  
III. NEGOTIATIONS ON SUBSIDIES UNDER GATS ARTICLE XV 
7. At the meeting of November 2004, delegati ons pursued their discussion on issues relating to 
the information exchange, the definition of subsidy,  and trade distortion, including in the light of a 
previous communication from the delegation of Hong  Kong, China (JOB(04)/127).  At the meeting of 
February 2005, delegations discussed an informal  communication from the United States, which put 
forward some thoughts regarding the information exchange.  The delegation of Singapore also 
presented an informal communication which enumerated a number of relevant issues for the 
negotiations, in particular with respect to defin ition (JOB(04)/180).  At the meeting of June 2005, 
delegations discussed an informal communication fro m the delegations of Chile, Hong Kong, China, 
Mexico, Peru and Switzerland, which put forwar d suggestions regarding the development of a 
provisional definition of subsidy and suggested next  steps for the information exchange, including 
timelines (JOB(05)/96).   
8. During the three meetings, the issues raised , and on which various views were expressed, 
included the scope and depth of the information ex change provided for in Article XV:1, the selection 
of sectors and timelines for the provision of informa tion, the relevance of the ASCM concepts for a 
provisional definition in services, the treatment of public services, and flexibility for developing countries pursuant to Article XV:1.  As requested, the Secretariat prepared the following informal 
Note: Synthesis of Views Expressed on the Definition of Subsidy  (JOB(05)/4).
5 
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4 Discussions on government procurement are reflected in paragraphs 56-70 of S/WPGR/M/50, 
paragraphs 37-54 of S/WPGR/M/51, and paragraphs 38-58 of S/WPGR/M/52. 
5 Discussions on subsidies are reflected in paragraphs 4-32 of S/WPGR/M/50, paragraphs 2-36 of 
S/WPGR/M/51, and paragraphs 59-81 of S/WPGR/M/52.