World Trade Organization (WTO)

I. The WTO Working Group on Transparency in Government Procurement

At the December 1996 WTO Ministerial Conference in Singapore, WTO members agreed to ``establish a working group to conduct a study on transparency in government procurement practices, taking into account national policies, and, based on this study, to develop elements for inclusion in an appropriate agreement.'' Taking into account the significant progress that has been made to date in the study phase of the Working Group's mandate, the trade ministers of the United States, the European Union, Japan, and Canada have called for the conclusion of a WTO agreement on transparency in government by the time of the Third WTO Ministerial Conference, scheduled for late 1999 in the United States.

II. The WTO Government Procurement Agreement (GPA)

The GPA, which entered into force on January 1, 1996, is a ``plurilateral'' agreement included in Annex 4 to the WTO Agreement. As such, it is not part of the WTO ``single undertaking'' and its Membership is limited to WTO Members that specifically signed it in Marrakesh or that subsequently accede to it. The GPA's current Membership include the United States, the member states of the European Union (Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Liechtenstein, Luxembourg, Netherlands, Portugal, Spain, Sweden, United Kingdom), the Kingdom of the Netherlands with respect to Aruba, Canada, Hong Kong China, Israel, Japan, the Republic of Korea, Norway, Singapore, and Switzerland. Iceland,

Panama and Chinese Taipei are in the process of negotiating accession. Under their protocols of accession to the WTO, Bulgaria, Mongolia and Slovenia have committed to join the GPA. The GPA is the successor to the first international Agreement on Government Procurement, also known as the Government Procurement Code, which was negotiated during the 1975-1979 Tokyo Round and entered into effect on January 1, 1981. the GPA made important improvements to the Code, including prohibition on the use of offsets (unless specifically provided for in the GPA annex) and a requirement that each Party establish independent review bodies to rule on bid challenges. The GPA also provided significantly greater market access coverage, including the addition of commitments relating to a wide range of service sectors and the inclusion of sub-central (i.e., state) governments and government-owned enterprises. State procurement entities of 37 U.S. states are currently covered by the GPA. The WTO Secretariat estimates that the value of government procurement opportunities covered under the GPA exceeds $400 billion annually. The export opportunities for U.S. products and services are immense, ranging from basic agricultural and other commodities to sophisticated services and manufactured goods and technologies. To ensure that the rules of GPA remain up to date and to maintain progress in creating new trade opportunities in this area, Article XXIV.7 of the GPA specifically called for renewed negotiations within three years of the entry into force of the Agreement, i.e., by January 1, 1999. Many current GPA participants view these negotiations as an opportunity to simplify the Agreement in a way that will make it more accessible to a wider range of international participants.

A. Modalities for Negotiations

At its June 1998 meeting, the Committee of GPA Participants agreed to proceed with the negotiations called for under Article XXIV.7 on the following basis: (1) The Committee will aim to complete negotiations on the simplification and improvement of the Agreement by the third WTO Ministerial at the end of 1999, with a view, in particular, to increasing the attractiveness of the Agreement to new members; and (2) The Committee will, in parallel, continue work on the removal of discriminatory measures and practices incorporated in the individual members' annexes to the Agreement and on the expansion of the market access coverage. The Committee agreed that Participants' formal proposals on the simplification and improvement of the Agreement should be submitted to the Committee no later than April 1999.

B. Substantive Issues

Issues for the review process that have been highlighted to date by GPA participants, and on which public comment is solicited, include: (1) Whether the text of the GPA should be re-organized or simplified in order to make the Agreement more understandable to officials responsible for its implementation, while maintaining its effectiveness in ensuring open and competitive procurement procedures; (2) Whether the Agreement should be updated to accommodate electronic communications and other emerging technologies used in modern procurement systems, while ensuring equitable access for potential suppliers with different technological capabilities; (3) Whether the use of electronic communications and other emerging technologies allows for greater flexibility in the minimum time periods for submission of bids established under the Agreement, while ensuring that all international bidders have adequate time to participate; (4) Whether the GPA's statistical reporting requirements can be simplified, while preserving participants' ability to effectively monitor implementation of the Agreement; (5) Whether there should be greater flexibility for developing country participants in implementing GPA requirements and whether GPA participants' procuring entities should be more flexible in assessing developing country suppliers' bids on covered procurements; (6) Whether specific conditions and exceptions to GPA participants' current market access commitments (in Appendix 1 to the Agreement) should be removed in order to provide more uniform and understandable GPA market access coverage; and (7) Whether GPA participants' market access commitments should be expanded to cover additional goods and service sectors and additional central and sub-central government entities. In the context of the GPA review process, the TPSC also seeks public comments on: (1) Any specific GPA-participant procurement entities or markets not currently covered by the Agreement which, if covered, might be expected to offer significant new trade opportunities for U.S. suppliers and workers; and (2) Any policies or practices of GPA participants or covered procuring entities which unfairly restrict U.S. suppliers' ability to participate in procurements covered by the Agreement, including discriminatory technical requirements and offset measures such as those listed in the footnote to Article XVI of the GPA.

Public Comments Requested

The TPSC invites written comments on U.S. objectives with respect to the various categories of issues identified above, including the agenda, scope, content and timetables for work and negotiations. Comments submitted should clearly indicate the category or categories of issues outlined in the submission.

Submission of Written Comments

Those persons wishing to submit written comments should provide ten (10) copies (in English) no later than January 15, 1999, to Gloria Blue, Executive Secretary, Trade Policy Staff Committee, Office of the United States Trade Representative, Room 122, 600 17th Street Northwest, Washington, D.C., 20508. Comments should state clearly the position taken and should describe the specific information supporting that information. If the submission contains business confidential information, ten copies of a confidential version, and ten copies of a public version that does not contain confidential information, must be submitted. A justification as to why the information contained in the submission should be treated confidentially must be included in the submission. In addition, any submissions containing business confidential information must be clearly marked ``Confidential'' at the top and bottom of the cover page (or letter) and each succeeding page of the submission. The version that does not contain confidential information should also be clearly marked, at the top and bottom of each page, ``public version'' or ``non-confidential.'' Written comments submitted in connection with this request, except for information granted ``business confidential'' status pursuant to 15 CFR 2003.6, will be available for public inspection in the USTR Reading Room, Room 101, Office of the United States Trade Representative, 600 17th Street NW, Washington, DC. An appointment to review the file may be made by calling Brenda Webb at (202) 395-6186. The Reading Room is open to the public

from 9:30 a.m. to 12 noon, and from 1 p.m. to 4 p.m. Monday through Friday.

Frederick L. Montgomery, Chairman, Trade Policy Staff Committee. [FR Doc. 98-32862 Filed 12-9-98; 8:45 am] BILLING CODE 3190-01-M