RESTRICTED
GENERAL AGREEMENT GPA/IC/W/12
7December 1994
ONTARIFFS AND TRADE
(94-2693)
Interim Committee onGovernment Procurement
Working Group onStatistical Reporting
NOTE ONTHE DISCUSSION ATTHE MEETING
OFTHE WORKING GROUP HELD ON15NOVEMBER 1994
Note from theSecretariat
I. INTRODUCTION
TheWorking Group onStatistical Reporting, which wasestablished bytheInterim Committee
onGovernmentProcurementatitsmeetingon29June1994,helditsfirstmeetingon15November1994.
Thediscussionconcentratedontwomainissues:uniformclassificationsystemsforpurposesofstatistical
reporting andcountry oforigin ofproducts andservices.
II. UNIFORM CLASSIFICATION SYSTEM
Some delegations expressed theview thatitwasperhaps premature totalkabout specific
classification systems atthisstageandthatitwould bemoreuseful tofocus thediscussion atthismeeting
onthegeneral characteristics thattheclassification system orsystem tobeusedforpurposes ofstatistical
reportingtotheCommitteeonGovernmentProcurementshouldpossess.Anotherdelegationwasalready
inaposition toputforward some specific suggestions forconsideration bytheGroup. Some delegations
indicated thattheyneeded more timeforstudy andthattheirremarks werepreliminary atthisstage.
Severalcharacteristicsorprincipleswereidentifiedbyoneormoredelegationsasbeingnecessary
foranyclassification system under theAgreement.
- Universality/Uniformity. Theview wasexpressed thatitwould bedesirable that
statistical information would besupplied byeachParty onthebasis ofthesame
(uniform) system orsystems. Onedelegation stressed thedesirability ofemploying
universally recognized systems, which werenotlinked toaspecific geographical area.
Thiswould helpaccommodate future Parties totheAgreement. Indrawing aparallel
withtheprovisions onrules oforigin inArticle IVoftheAgreement, classification
systems should bethose used inthenormal course oftrade. Another delegation
questioned theexistence ofauniversal classification system which wasusedaround
theworld. Thepoint wasmade thatthesupply ofstatistical information tothe
Committee onacommon basiswould notpreclude theuseofdifferent national systems
provided theywere capable ofbeing putonacommon basis through concordances
between thenational systems andtheone(s) under theAgreement. Theviewwasalso
expressed thattheuseofdifferent systems bydifferent Signatories forpurposes of
reporting totheCommittee should notapriori beexcluded.
- Comparability ofstatistics fortheentities ineachoftheSignatories, withaviewto
allowing ameaningful comparison ofwhatSignatories arereporting. Onedelegation
viewed thisinthecontext ofthedesirability ofhaving more thanonesystem.GPA/IC/W/12
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- Coverage. Onedelegation expressed apreference fortheadoption ofasingle system
covering goods, services andconstruction services. Other delegations wereoftheview
thatthere wasacaseforseparate systems forgoods andforservices, albeit thatthese
should bethesame forAnnexes 1,2and3.
- Anappropriate levelofdetail. Several points were made inthisrespect. Thelevel
ofdetail should besufficient toprovide meaningful information about thetypesofgoods
andservices thatwerenormally being procured bygovernments, which wereidentified
asdifferent groups which weresometimes bound andsometimes notbound within the
Agreement, butonlytotheextent thatthesystems remained workable andthatthe
amount ofinformation provided wasnecessary anduseful forthepurpose tobeachieved
bycollecting statistical data. Thelevel ofdetail should furthermore allow for
concordances between national classification systems andtheAgreement 'ssystem or
systems. Thepoint wasalsomade thatthelevelofdetail inthesystem(s) should take
intoaccount theneedforadequate information regarding thederogations andexclusions
intheAgreement. Itwasalsosuggested thatananalysis could bemade ofthevarious
derogations andexclusions intheAgreement withaviewtoidentifying categories of
products which should orshould notbeseparately identified from thepoint ofview
ofstatistical reporting.
Delegations alsodiscussed theadvantages anddisadvantages ofseveral specific classification
systems.
- Harmonized System. Onedelegation suggested thattheHarmonized System (HS)would be
asuitable candidate forthereporting ofstatistics ongoods. Itwasauniversal system andwas
commonly used. Incommenting onthissuggestion, thepoint wasmade that,while theHS
wasincreasingly thestandard forcustoms authorities, theHarmonized System wasnotsuitable
forpurposes ofstatistical reporting under theAgreement onGovernment Procurement because
itwastoocomprehensive. Onedelegation added thattheHSwasnotacommonly usedsystem
torecord procurement statistics andthathisauthorities would finditalmost impossible to
establishanyreliableconcordancebetweentheHSandtheirnationalsystem.Anotherdelegation,
recalling astudy hisdelegation hadundertaken earlier inadifferent framework, noted that
theHSsystem required reporting either by21sections, which didnotprovide enough detail,
orby98chapters, providing toomuch detail. HSwasoriented towards commercial items,
butdidnotprovideenoughdetailsoncategoriesofproductstypicallypurchasedbygovernments.
Furthermore, implementing HSforprocurement purposes would create great difficulties
administratively.
- UNCPC. Onedelegation suggested thattheUNCPC would beasuitable candidate forthe
reporting ofstatistics onservices, since itwasauniversal system andcommonly used. One
delegation noted thattheUNCPC would perhaps beappropriate forreporting services butit
would bewholly inadequate forgoods.
- Thepoint wasmade thatthesystem of26product categories usedunder thecurrent Agreement
sometimes lacked anecessary levelofdetail toprovide meaningful information.
Itwasnoted thattheUSFederal Classification System might havesome merit forreporting
statistics ongoods butthatitwasprobably notadequate forservices. Therepresentative oftheEuropean
CommunitiesmentionedthattheCPA,theclassificationsystemhisauthoritieshaddevelopedforinternal
useandonwhich theirownprocurement information wasbased, hadstrong linkswiththeUNCPC.
Itallowed comparison ofpublic sector procurement withother statistics suchasonproduction andGPA/IC/W/12
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onmarkets inindividual countries andcould beorganized inawaytomatch other systems. He
recognized however thattheCPA wasaEuropean system andbynomeans universal.
TheWorking Group requested theSecretariat toprepare apaper onprevious discussions held
intheCommittee onGovernment Procurement under theAgreement presently inforce, summarizing
thearguments advanced ontheadvantages anddisadvantages ofthevarious classification systems.
Inaddition, inorder todetermine where detail ofproduct andservice categories would berequired
intheclassification system orsystems, theChairman suggested thatdelegations, prior tothenext
meeting, study intheircapitals inwhat categories ofgoods andservices theirprocurements were
concentrated. Itwassuggested thatthiscould, forexample, bedonebytaking arepresentative sample
drawn from statistical reports submitted inthelastfewyears.
III. COUNTRY OFORIGIN OFPRODUCTS AND SERVICES
Theviewofsome delegations wasthatthere wasmerit inusing thesame rules oforigin for
purposes ofstatistical reporting under Article XIXasthose applied under Article IV.Thiswasso
because rules oforigin usedforpurposes ofstatistical reporting should bethose usedinthenormal
course oftrade. Moreover, since Article IVtriggered therights andobligations oftheAgreement,
itseemed sensible thatthose same rules oforigin beusedinthereporting ofstatistics under the
Agreement. However, onedelegation saidthatitmight benecessary, forreasons ofpracticability
andcollectibility, fortherules oforigin forthepurpose ofstatistical reporting tobedifferent from
theonesusedtodetermine whatgoods andservices benefit fromtheAgreement. Thepractical aspects
ofcollecting statistical information required simplifying therules oforigin inorder thataprovider
ofinformation could understand themandwould beinaposition toprovide theinformation required.
Placing anexcessive burden onreporting officers might mean thatno,orveryunreliable, information
wasprovided. Onedelegation noted these concerns andwasopentosuggestions. Hewould welcome
anyproposal tothateffect.
TheGroup considered howtheorigin ofaservice should bedefined forthepurposes ofstatistical
reporting. There seemed tobeawidely-held viewthatthenationality oftheservice supplier should
beemployed asthebasisfordefining theorigin ofaservice. However, itwasalsonoted thattheuse
ofnationality asabasiswasnotwithout difficulty. Forinstance, howwould onedefine thenationality
ofalocally-established subsidiary incountry Aofacompany incountry Bwhich itself waswholly
owned byacompany incountry C?Onedelegation noted thatthepractice ofitsowngovernment
wasthatifacontract wasawarded toalocalsubsidiary ofaforeign company, thecontract would be
considered local; if,however, itwasawarded totheforeign company itself, thecontract would be
considered foreign. Another delegation explained thatitsauthorities weretrying tocollect statistics
ontheorigin ofservices onthebasis oftheaddress ofthewinning tenderer, butadmitted thatthis
wasnotatotally satisfactory method fordetermining therealorigin oftheservice. Inthiscontext,
delegations recognized therelevance oftheprovisions intheGATS asregards theorigin ofservices
andagreed thatfurther reflection onthiswasdesirable.
TheWorking Group requested theSecretariat toprepare ashort paper onthewaynationality
wasdefined inthevarious WTO Agreements and,totheextent possible, inotherinternational economic
agreements. TheChairman invited delegations tobring experts along intheareaofrules oforigin
ofgoods andintheareaofservices atthenextmeeting.GPA/IC/W/12
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IV. DATE OFTHE NEXT MEETING
Itwasagreed thattheChairman would setthenextmeeting inconsultation withdelegations,
which would most likely coincide withafuture meeting oftheInterim Committee onGovernment
Procurement. TheChairman furthermore invited delegations tosubmit proposals inwriting onany
ofthematters discussed.