RESTRICTED
WORLD TRADE S/WPGR/M/3
21December 1995
ORGANIZATION
(95-4151)
Working Party onGATS Rules
REPORT OFTHE MEETING OF8DECEMBER 1995
Note bytheSecretariat
1. Thethirdmeeting oftheWorking Party onGATS Rules waschaired byMr.Stuart Carre of
Canada.Theagendaconsistedoffouritems:negotiationsongovernmentprocurementunderArticleXIII
oftheGATS, negotiations onsafeguards under Article XoftheGATS, nextmeeting oftheWorking
Party, andother Business.
Negotiations onGovernment Procurement under Article XIIIoftheGATS
2. TheChairman drewtheattention ofMembers oftheWorking Party toanotebytheSecretariat
ongovernment procurement ofservices (S/WPGR/W/3). Several delegations saidtheyfound thenote
auseful introduction totheissues. Anumber ofdelegations observed thatthelackoffullymultilateral
rulesongovernment procurement represented asignificant gapinthemultilateral trading system. It
wasalsostated thatitwould bedesirable tohavecommon procurement rulescovering bothgoods and
services. Some delegations indicated their strong interest inexploring ways ofinducing greater
participation indisciplines onprocurement. Among theimportant disciplines identified bydelegations
forinclusion inrulesonprocurement weremost-favoured-nation treatment, national treatment, market
access andeffective enforcement. Delegations alsolaidparticular emphasis ontransparency, which
wasnotonlyabout publication ofrelevant rules, butalsodetails ofprocedure andcriteria fortaking
decisions. Onedelegation expressed theviewthatprocurement disciplines should becomprehensive,
covering suchmatters asthedevelopment oftender specifications onthebasis ofperformance rather
thandesign, reasonable qualification conditions forbidding, clear award procedures, andadequate
opportunity tochallenge contract award decisions.
3. Several delegations considered thatitwould beuseful formembers oftheWorking Party to
consider whymore governments hadnotsigned theGovernment Procurement Agreement (GPA).
While recognizing thatthiswasanimportant question, some delegations cautioned against assuming
toostrong orexplicit alinkbetween theGATS negotiating mandate andtheGPA. Thenature ofthe
relationship between thetwowould emerge fromthework oftheWorking Party, andalsoasexperience
wasacquired withtheGPA. Some delegations ofgovernments whoweresignatories oftheGPAsaid
thattheyattached importance toencouraging others tojoin. Onerepresentative saidherauthorities
haddetermined thatthepotential gains from signing theGPA were insufficient tooutweigh the
administrative costsofmembership. Moreover, thisassessment hadbeenmade against thebackground
ofaderegulated, non-preferential, andopen government procurement policy thatstressed value for
moneyundercompetitivemarketconditions.Severaldelegationsacknowledgedthatbalancewasrequired
--theattainment ofbroad-based commitments among governments onprocurement should notbe
compromised byoverly burdensome procedural andadministrative requirements. Ontheother hand,
thelatter requirements must bestrong enough toguarantee predictable market access.S/WPGR/M/3
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4. Many delegations expressed theview thatthenextsteptheWorking Party should takewas
toimprove theinformation baseonprocurement. Some delegations suggested thatinformation should
beexchanged onnational procurement requirements andprocedures, aswellasonlawsandregulations.
While some considered thataquestionnaire might bedesigned forthispurpose, others wereinfavour
ofavoluntary exchange ofinformation along somewhat lessstructured lines, andstillothers thought
asurvey might beuseful. Onedelegation saidthatitmaybehelpful toreview existing procurement
disciplines under theWTO. Inview oftheimportance attached bydelegations totheinformation-
gathering aspect oftheWorking Party’sactivities atthisearly stage, theChairman suggested thatthe
secretariat would prepare abriefnoteondifferent approaches tothecollection ofinformation. The
notewould beaninput intodiscussions ofthese issues atthenextmeeting oftheWorking Party.
Delegations were agreeable tothechairman ’ssuggestion.
5. Insumming upthediscussion, theChairman saidthattheWorking Party hadheldauseful
preliminary exchange ofviews ontheissues thatwould havetobeaddressed infuture meetings. He
referred tothecritical roleofinformation gathering forfuture work. Healsonoted theinverse
relationship thatmight existbetween burdensome procedures andabroad commitment toprocurement
disciplines. Aquestion thathadbeenraised andwould seemtowarrant further consideration waswhy
more governments hadnotjoined theGPA. Helooked forward tofurther reflection ontheseandother
matters insubsequent meetings, andurged delegations tobring forward information andviews that
would contribute tothework. TheChairman alsoindicated thathewould consult withtheChairman
oftheCommittee onGovernment Procurement inorder toidentify areasofcommon interest, andwould
report backtotheWorking Party onthese consultations.
Negotiations onSafeguards under Article XoftheGATS
6. TheChairmandrewtheattentionoftheWorkingPartytoasubmissiononsafeguardsbyAustralia
(S/WPGR/W/5).TheChairmanalsonotedthattheSecretariathadproducedafurthernoteonprocedures
forsafeguards invarious trade agreements (S/WPGR/W/5). Inintroducing theAustralian paper, the
representative ofAustralia pointed outthatthepaper wasbasically non-judgemental, seeking toset
outsome oftheissues thatwould havetobeaddressed bytheWorking Party inconsidering the
development ofanemergency safeguard mechanism inservices. Among these were thefashion in
which different modes ofsupply should betreated, thenature ofmeasures available, therelationship
between trade liberalization andasafeguard mechanism, andthequestion ofcompensation.
7. Therepresentative ofThailand presented apaper explaining why, inThailand ’sview, itwas
desirable todevelop emergency safeguards inGATS. Anemergency safeguard wasrequired because
existing mechanisms didnotoffer anadequate safety valve todealwithadverse circumstances that
might ariseasaconsequence ofaMember ’sspecific commitments. More workwasrequired, however,
ontheprecise nature ofasuitable mechanism. Thailand intended tocirculate itspaper asaworking
paper oftheWorking Party. Several delegations expressed support forThailand ’sview, andagreed
there wasaneedtoexplore theissue further. Onedelegate referred toanideahehadraised before
--thatArticle XXI(modification ofschedules) might beusedasavehicle forintroducing thenecessary
flexibility when emergency safeguard action wasrequired. Other delegations repeated views expressed
inprevious meetings, totheeffect thatthedesign ofanysafeguard instrument inthefieldofservices
wasahighly complex matter, fraught withpractical difficulties. Several ofthese delegations also
expressed doubt about theneedforsuchaninstrument, butexpressed willingness tocontinue exploring
thematter.
8. Insummarizing thediscussion, theChairman noted thatdiffering views wereemerging inregard
tothecaseforanemergency safeguard provisions inGATS. These views needed tobedeveloped
further, andheurged delegations todoso.Healsourged delegations toprovide information tothe
Working Party onanysafeguard provisions theymight haveinnational legislation.S/WPGR/M/3
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Next Meeting oftheWorking Party
9. Itwasagreed thatthenextmeeting oftheWorking Party would beheldinFebruary 1996,
onadatetobedetermined .
Other Business
10. Nomatters were raised under Other Business.