. /.WORLD TRADE
ORGANIZATIONS/WPGR/13
3 December 2003
(03-6420)
Working Party on GATS Rules
ANNUAL REPORT1 OF THE WORKING PARTY ON GATS RULES
TO THE COUNCIL FOR TRADE IN SERVICES (2003)
1. Since its last update to the annual report, the Working Party on GATS Rules held two formal
meetings: on 2-3 July 2003 and 1 October 2003.  Reports of these meetings are contained in
documents S/WPGR/M/43 and S/WPGR/M/44.  They should be read in conjunction with this update.
The three negotiating mandates the Working Party is entrusted with were put on the agenda of the two
meetings: emergency safeguard measures (Article X), government procurement (Article XIII) and
subsidies (Article XV).  At its meeting of 2 and 3 July, the Working Party also took stock of progressmade in the negotiations, as reflected in the report of that meeting, and subsequently reported by the
Chairman in his personal capacity to the Specia l Session of the Council for Trade in Services.
2
I. NEGOTIATIONS ON EMERGENCY SAFEGUARD MEASURES UNDER GATS
ARTICLE X
2. At the meeting of July 2003, the question of emergency safeguard measures was not
addressed.  At the meeting of 1 October 2003, delegations continued their examination of issues
related to the question of ESM, including desirability and feasibility.  Also, a delegation drew
attention to the usefulness of examining examples of safeguard-type provisions contained in economic
integration agreements and in Members' schedules.  As an answer to a Chairman's suggestion that
Members should examine the hypothetical example presented by ASEAN Members under the
different approaches considered by the Working Party, the Swiss delegation submitted a non-paper
which goes through the example under approach (e) (i.e. no explicit ESM).  Various points of views,as well as preliminary reactions were expressed.  The delegation of Thailand, speaking for a number
of other delegations, responded to questions previously asked regarding how an ESM model might
apply to a hypothetical example it presented.  These discussions are reflected in paragraphs 2-22 of
S/WPGR/M/44.
II. NEGOTIATIONS ON GOVERNMENT PROCUREMENT UNDER GATS
ARTICLE XIII
3. The issue of government procurement was not addressed at the meeting of July 2003.  At the
meeting of 1 October 2003, the European Communities explained its proposal to negotiate an annex
to the GATS that would lay down the conditions under which a number of GATS provisions would
apply to government procurement.
3  The EC argued that this proposal showed that an agreement was
feasible and could easily be put in place, enabling negotiations of commitments for government
procurement within the framework of the GATS.  A number of delegations commented and asked
questions, while others reserved their position for the time being.  Some delegations recalled their
views on the negotiating mandate under Article XIII, questioning the negotiations on market access                                                     
1 This report, together with the update in document S/WPGR/12, complete the reporting requirement
for 2003.
2 TN/S/M/8.
3 S/WPGR/W/42.S/WPGR/13
Page 2
issues, and pointed out the uncertainty arising from work undertaken in other fora.  These discussions
are reflected in paragraphs 23-38 of S/WPGR/M/ 44.  Also, the Secretariat had prepared a note on
government procurement disciplines in economic integration agreements.4
III. NEGOTIATIONS ON SUBSIDIES UNDER GATS ARTICLE XV
4. The issue of subsidies was discussed at both the meetings of July and October 2003.
Discussions focused on the issue of definition and on ways to obtain more information on subsidies in
services sectors.  Regarding the latter point, a proposal by the delegation of Chile, supported by
various other delegations, was put forward and several Members referred to UNCTAD's work on a
study on subsidies in services sectors.  In addition, Members mandated the Secretariat to update its
previous Note on subsidy disciplines in economic integration agreements notified under Article V and
to put together a list of studies pertaining to subsidies in services sectors that have been done by other
international organizations.  These discussions are reflected in paragraphs 44-69 of S/WPGR/M/43and paragraphs 39-83 of S/WPGR/M/44.
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4 S/WPGR/W/44.