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31 July 1998 (98-3041) Working Party on GATS Rules

REPORT OF THE MEETING OF 23 JUNE 1998

Note by the Secretariat

The seventeenth meeting of the Working Party on GATS Rules was chaired by Mr.
It consisted of five items: negotiations on safeguards under Article X of the GATS; negotiations on subsidies under Article XV of the GATS; negotiations on government procurement under Article XIII of the GATS; date of the next meeting of the Working Party; and other business.
With respect to the use of threshold values in determining the coverage of a transparency agreement, the view had been expressed that in principle all contracts should be covered, but that certain provisions might be more flexibly applied to smaller contracts.
Second, delegations might wish to clarify their understanding of the precise scope of existing GATS disciplines applying to subsidies; that might help to identify circumstances of trade distortion, if any, which are not satisfactorily covered in the existing framework.
The delegation of Australia gave examples of subsidies maintained in her country at the federal level, including an air services subsidy scheme providing assistance for regular air deliveries of educational material, general freight and passengers to remote areas; a Regional Telecommunications Infrastructures Fund; and tax concessions to companies establishing regional headquarters in Australia.
Several delegations had responded that action could be taken on behalf of all domestically established suppliers, regardless of ownership and control; while others had felt that it could be designed to protect only nationally owned suppliers.
Other delegations felt that the rules of origin contained in Article XXVIII of the GATS were not relevant for determining what "national industry" meant; in their view, the Article provided a legal definition of "service supplier of other Member" which was not a suitable concept for the purpose of a safeguard mechanism.
In relation to the fourth question, relating to the measures to be taken under the emergency safeguard mechanism, some delegations suggested that some measures could be temporarily applied in relation to all modes of supply, at both the pre-establishment and post-establishment stages.
One delegation emphasized that in the case of post-establishment acquired rights would not be affected; foreign services suppliers already established might not, however, qualify for new benefits which could be granted to national suppliers.
For example, only national banks could be offered subsidies in such cases, and market access could be suspended for new foreign banks.

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17 March 1999 (99-1072) Working Party on GATS Rules

REPORT OF THE MEETING OF 19 FEBRUARY 1999

Note by the Secretariat


The twentieth meeting of the Working Party on GATS Rules was chaired by Mr. Harald Fries of Sweden. The agenda of the meeting was contained in WTO/AIR/1009. It consisted of five items: negotiations on safeguards under Article X of the GATS; negotiations on subsidies under Article XV of the GATS; negotiations on government procurement under Article XIII of the GATS; date of the next meeting of the Working Party; and other business.
The Chairman indicated that in order to assist delegations in their preparation for the meeting he had circulated a Note, Job. No. 772 dated 10 February 1999. The Note recapitulated where the Working Party stood on the three issues and proposed a certain structure for the discussion.
ITEM A: NEGOTIATIONS ON SAFEGUARDS UNDER ARTICLE X OF THE GATS

The Chairma

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13 December 1996
Organization
(96-5320)


Working Party on GATS Rules




REPORT OF THE MEETING OF 8 AND 14 OCTOBER 1996

Note by the Secretariat


The eighth meeting of the Working Party on GATS Rules was chaired by Mr. Stuart Carre of Canada. The agenda consisted of six items: negotiations on safeguards under Article X of the GATS; negotiations on subsidies under Article XV of the GATS; negotiations on government procurement under Articl

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It consisted of five items: negotiations on safeguards under Article X of the GATS; negotiations on subsidies under Article XV of the GATS; negotiations on government procurement under Article XIII of the GATS; date of the next meeting of the Working Party; and other business.
Since delegations were already familiar with each others basic positions, and these had been reflected in the Note, he suggested that the discussion should focus on possible solutions to problems and on how the Working Party's work should be structured over the period before the end-June 1999 deadline.
Such an outline could include: a) definition and scope of safeguards in services; b) situations justifying its application and the type of injury; c) temporary or provisional measures; d) applicable procedures and investigation of injury; e) applicable measures; f) periods of application or time-limits; g) transparency; h) notifications; i) special and differential treatment.
His delegation had already argued that focusing on what a safeguard mechanism would look like, without prejudice to the outcome of the discussion on whether such a mechanism was merited, would be the most efficient way of taking forward the discussion.
Such a draft should reflect all possible options for a safeguard mechanism including the approaches followed in Article V of the Agreement on Agriculture and Article VI of the Agreement on Textiles and Clothing.
In light of the various options that had been put forward as basis for a draft, namely, Article XIX of the GATT, the sector-specific approach, the safeguards provisions of the Agreements on Agriculture and the Agreement on Textiles and Clothing, Members needed to decide how to proceed.
In summing up the discussion, the Chairman indicated that the proposal of requesting the Secretariat to draft an outline of an emergency safeguard mechanism had attracted ample support; however, some delegations had not been in a position to agree.
However, it might need to be clarified whether it was also ensured that such subsidy schemes did not disadvantage foreign services imported under mode 1 or consumed abroad under mode 2.
For instance, in the absence of further responses to the questionnaire and submissions from Members, would it be preferable to set this agenda item aside and concentrate on safeguards and government procurement?
One approach would cover procurement at all levels of government, including entities governed by public law and under the influence of government, while the second approach was based on market structure rather than on public ownership or influence per se - every case would be examined on its own merits, the ultimate criterion being whether the entity was subject to competition.
For instance, the case of a concession granted for operating a motorway, where the government was not buying something for itself, but rather granting the right to operate a public service to a private operator, was a clear case of a service provided in the exercise of governmental authority.
She asked whether the case of a contract providing a license to a private sector contractor to distribute government procurement data on an electronic tendering service, generating revenues from the purchaser of the data, would be considered to be a transaction for the service itself.
He indicated that at the following meeting, the Working Party would revert to the question of how to proceed with the second step in the work programme, which concerned the application of the basic discipline of non-discrimination.

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27 October 2004 (04-4567) Working Party on GATS Rules


REPORT OF THE MEETING OF 20 SEPTEMBER 2004

Note by the Secretariat


The meeting of the Working Party on GATS Rules was chaired by Ms. Clare Kelly, from New Zealand. The agenda for the meeting, contained in WTO/AIR/2375, included the following items: government procurement, emergency safeguard measures, subsidies, date of the next meeting and other business. To assi

It consisted of five items: negotiations on safeguards under Article X of the GATS; negotiations on subsidies under Article XV of the GATS; negotiations on government procurement under Article XIII of the GATS; date of the next meeting of the Working Party; and other business.
It had been suggested that work on the formulation of disciplines, both general and operational, should proceed in parallel with an assessment of the desirability and feasibility of a safeguard mechanism for services.
on whose behalf emergency safeguard action would be taken, one delegation felt that the "national industry" could be protected; this was believed to be in line with the definition contained in Article XXVIII of the GATS.
One delegation suggested that it would be helpful to reach an understanding that would exclude the possibility of distinguishing between foreign and domestically owned suppliers with respect to commercial presence.
as individuals rather than as country representatives, to allow for a frank discussion unencumbered by the need to maintain national positions.
Some participants supported a discussion on definitional issues, but pointed out that such a discussion could not be conducted without more information on actual subsidy policies.
who is the procuring entity, some stated that the level of public control should be the main consideration and that all levels of government should be included.
in light of the suggestion made under "Other Business", and to avoid a clash with another meeting, the date of the meeting was subsequently changed to 23 June 1998.
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6 July 1999 (99-2785) Working Party on GATS Rules

REPORT OF THE MEETING OF 21 JUNE 1999

Note by the Secretariat


The twenty-third meeting of the Working Party of GATS Rules was chaired by Mr. Siva Somasundram of Singapore. The agenda of the meeting was contained in WTO/AIR/1110. It consisted of five items: negotiations on safeguards under Article X of the GATS, including the extension of the deadline for the negotiations; negotiations on subsidies under Article XV of the GATS; negotiations on government procurement under Article XIII of the GATS; date of the next meeting of the Working Party; and other business.
2. The Chairman indicated that he had circulated a Note, Job No. 3432 dated 14 June 1999, to assist delegations in their preparation for the meeting. The Note recapitulated where the Working Party stood on its three negotiating issues and proposed a certain structure for the discussion.


ITEM

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7 May 1999 (99-1882) Working Party on GATS Rules

REPORT OF THE MEETING OF 16 APRIL 1999

Note by the Secretariat

The twenty-first meeting of the Working Party on GATS Rules was chaired by Mr.
It consisted of six items: installation of new chairman; negotiations on safeguards under Article X of the GATS; negotiations on subsidies under Article XV of the GATS; negotiations on government procurement under Article XIII of the GATS; date of the next meeting of the Working Party; and other business.
He gave a brief summary of points raised during the informal discussion held on 24 March in the Working Party: First, it was generally agreed that work should continue on the basis of the "List of issues for future discussion" contained in a Secretariat Note of November 1998 (S/WPGR/W/27).

Second, the notions of temporariness and degressivity of safeguard actions appeared to be broadly accepted as well; Article 7 of the Agreement on Safeguards (AS) might provide a model.
the delegation of Japan had proposed at the previous meeting a distinction between three principal approaches for safeguards: (i) horizontal (available to all Members in standard format across all sectors); (ii) sector-specific (available to all Members in sector-specific format); and (iii) sector-specific/scheduled safeguards (available only if included in schedules).
The representative of the European Communities observed that ex-ante safeguards required reasonably precise information on the situation to be addressed, while an ex-post mechanism could be more general and, thus, cater for unforeseen circumstances.
(ii) Situations justifying the application of safeguards measures
The representative of Thailand, on behalf of ASEAN, mentioned a situation where, as a result of unforeseen developments and of GATS obligations, a Member's market was inundated by foreign services supplied via commercial presence and/or presence of natural persons.
Those terms suggested that the mechanism was meant to cope with situations that were unexpected when the commitments were made; there was no need to repeat this notion in the Safeguards Agreement.
rapid technological changes might permit developed countries to supply services electronically through mode 1 although such supplies had not been considered feasible at the time of scheduling.
The Agreement on Implementation of Article VI of GATT (Antidumping Agreement) thus provided for flexibility and allowed injury determinations to be based, for instance, on concepts such as constructed value, best information available, and even consultations with affected Members during an investigation.
The representative of Venezuela gave examples of indicators that could be used in establishing injury: losses experienced by domestic suppliers; decline in capacity utilisation; capacity reductions; decline in sales in a sector; reduction in productivity; reduction in prices or changes in the structure of prices; declining number of domestic suppliers; and decreasing employment in the sector concerned.
The representatives of Canada and the United States reiterated their delegations' basic position concerning the desirability of safeguards; however, the discussion of feasibility issues might provide helpful insights in this context.
The representative of Thailand, on behalf of ASEAN, noted that special and differential treatment for developing countries was consistent with the objectives of the GATS; Article 9 of the AS would be of relevance.
ITEM C: NEGOTIATIONS ON SUBSIDIES UNDER ARTICLE XV OF THE GATS
The Chairman recalled the two issues which had been raised in the preparatory Notes for previous meetings: the applicability of current GATS disciplines to either "import-substituting" or "export-enhancing" subsidies.
Without prejudging Japan's position, he noted the different forms that they might take: (a) a contract between a government agency and a private company for the purpose of developing natural resources; (b) a government contract with a private company for the purpose of constructing and managing industrial sites,
Examining the question of what constituted "governmental purposes" would help to clarify which concessions could be considered government procurement and which would be subject to normal GATS disciplines.
A footnote to the Guidelines stated that the terms property and services covered all goods and services, including: consultancies and professional services of all types; real property activities; construction and related services; financial and operating leases for equipment and real property; individual and collective training and educational programmes; services obtained from public utility suppliers; and outsourcing or contracting,
The representative of the European Communities mentioned a recent draft document on the treatment of concession under Community law which could be of interest to other delegations (Draft Interpretative Document on Treatment of Concessions under Community Law; Official Journal of the EC, C94, 7 April 1999).
The representative of the United States said that it was apparent from the Secretariat's Note that the existing precedents (negotiating history or dispute panels) did not provide sufficient guidance for the interpretation of the relevant terms in GATS.
He observed that there was no authoritative WTO interpretation of the term; the existing interpretations by various GATT/WTO bodies of Articles III:8 and XVII:2 of GATT were, however, useful.
The representative of the United States emphasised that, although the panel arrived at a questionable conclusion, its report illustrated some of the difficulties implied in defining government procurement of services, as in many cases government contracts combine the supply of goods and services.

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8 September 1999 (99-3731) Working Party on GATS Rules

REPORT OF THE MEETING OF 27 JULY 1999
Note by the Secretariat

The twenty-fourth meeting of the Working Party of GATS Rules was chaired by Mr.
It consisted of five items: negotiations on safeguards under Article X of the GATS; negotiations on subsidies under Article XV of the GATS; negotiations on government procurement under Article XIII of the GATS; date of the next meeting of the Working Party; and other business.
speaking on behalf of ASEAN, said that a safeguard measure should be applied only after an investigation looking into all relevant factors of an objective and quantifiable nature.
The representative of Japan expressed reservation about the emphasis that some other Members had placed on the need for flexibility; clear procedures and criteria were required to arrive at objective and transparent decisions.

The representative of the United States said that the Venezuelan paper was useful in identifying how a possible emergency safeguard mechanism could be structured; concepts like increased imports, injury and causality were essential.
For example, should it matter if macroeconomic problems had played a role or an industry's capacity to adjust had been affected by government regulation rather than own weaknesses?
The representative of the United States noted that, depending on the relevant causality standard, the responsibility to prove that injury had been caused by increased imports, rather than by a change in government regulation, might rest on the invoking party.
These included the requirement to give adequate advance notice before invocation; use safeguards only temporarily and with a specified maximum period of duration; limit access to a given safeguards-type provision – for example, once during the course of a specified period of time – and prevent re-invocation during the specified period; apply safeguards on a degressive basis; clearly specify the envisaged action by mode and sector or sub-sector; respect "established rights" (although a different term was used in the paper) if limits were imposed on mode 3; and waive compensation if the rules are respected.
He sought further clarification on the "hybrid" approach proposed by the United States delegation, in particular on the question whether general framework rules would apply across all sectors while the measures would be sector-specific.
Several elements listed in the United States' paper should be used, such as adequate advance notice; degressive and temporary application; maximum duration (with special treatment for developing countries); MFN application; and objective and identifiable criteria.
A safeguard mechanism would be in place to respond speedily to emergency cases, which could be addressed and solved within a relatively short period of time, whereas Article XXI modifications dealt with longer-term changes in competitive conditions of a systemic nature.
Their application might prove more transparent, more predictable and less distortive from a supplier's perspective than, for example, quotas, while quotas might be deemed less costly and more efficient from the invoking country's perspective.
While its Article 5 prescribed the level at which any quantitative restrictions should be set, Article 6 provided that provisional safeguard measures be price-based.
he added that, given that the main purpose was to remedy injury (or threat thereof) caused by increased imports, quota-type restrictions tended to have shorter implementation periods and produce immediate results.
ITEM B: NEGOTIATIONS ON SUBSIDIES UNDER ARTICLE XV OF THE GATS
The Chairman drew the Working Party's attention to a recent submission from Hong Kong, China under the information exchange programme pursuant to Article XV.
This could help to clarify the meaning of national treatment under modes 1 and 2 and, in turn, might enable Members to schedule more significant commitments for national treatment especially under these modes.
Government procurement was thus considered to include all three categories in the hierarchy Australia had originally suggested: first, government purchases of services for consumption by the government; second, government purchases of services for consumption by the public; and, third, contracts between the government and private companies for the commercial provision of services to the public or to industry.
At previous meetings, it had been said that, in principle, entities at all government level should be covered, and that government ownership and control were important criteria.

ITEM D: DATE OF THE NEXT MEETING
The next meeting is scheduled to take place in the vicinity of the October meetings of the Committee on Government Procurement and the Transparency Working Group, possibly on Friday, October 8, 1999.

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9 October 2000 (00-4148) Working Party on GATS Rules


REPORT OF THE MEETING OF 27 SEPTEMBER 2000

Note by the Secretariat


The Working Party on GATS Rules held is twenty-ninth meeting under the chairmanship of Mr. Tony Sims, from the United Kingdom. The agenda for the meeting was contained in WTO/AIR/1381. It consisted of five items: negotiations on safeguards under GATS Article X; negotiations on subsidies under GATS Article XV; negotiations on government procurement under GATS Article XIII; date of the next meeting; and other business. The agenda for the meeting was adopted.
The Chairperson drew attention to an informal Note (Job No. 5538, 15 September 2000) he had circulated to assist delegations in their preparation for the meeting.
negotiations on safeguards under article x of the gats
In the absence of new contributions from Members, the Chairperson proposed to revert to items 1 (definition of "d

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2 November 1999 (99-4741) Working Party on GATS Rules

REPORT OF THE MEETING OF 8 OCTOBER 1999

Note by the Secretariat

The Working Party on GATS Rules held its twenty-fifth meeting under the chairmanship of Mr.
It consisted of five items: negotiations on safeguards under Article X of the GATS; negotiations on subsidies under Article XV of the GATS; negotiations on government procurement under Article XIII of the GATS; date of the next meeting of the Working Party; and other business.
Concepts of injury and causality
The Chairman proposed to focus the discussion on potential injury and causality indicators which might be used in any sort of safeguard mechanism, irrespective of whether it was sector-specific or horizontal, or any other variant under consideration.
While the United States remained prepared to engage in a general discussion, he wished to reiterate that delegations should attempt to describe real-life situations, which could assist the Working Party in reaching some kind of common understanding on appropriate indicators or criteria.
Her authorities were asking for more concrete examples so as to better understand the desirability and scope of various criteria when applied to specific situations.
Although it was likely that, if there were such examples, they might already have been raised in the GATS Council under Article X.
In summing up the discussion, the Chairman noted that Members acknowledged the particular importance of trade and injury indicators, irrespective of what safeguard mechanism would be in place.
He noted that it might be difficult to arrive at an early consensus on indicators until the Working Party started examining their use in concrete - real-life or hypothetical - situations.
Horizontal versus sector-specific safeguards
The Chairman noted that the Working Party had agreed, at its last meeting, to focus on the criteria and principles which would need to govern any type of safeguard action, regardless of the basic mechanism (sector-specific, horizontal or other) which might ultimately be chosen.
Would foreign-owned suppliers, which were already established under mode 3, continue to have exactly the same rights as any other domestically established supplier – including the right to expand their market shares through take-overs, mergers, new investment, etc.
With respect to the proposed clear specification of the measure, the US paper was more specific than the Hong Kong, China paper; in ASEAN's view, rules in services might go a step further than those in the goods sector by specifying the particular safeguard measures that might be applied if the investigation established injury caused by increased consumption of foreign services.
The history in the goods area, predating the existence of the AS, showed that when governments were faced with requests from industries to provide relief, they would look at the various options available to them, including GATT Article XIX and Article XXVIII.
The representative of Hong Kong, China said that the objective of the paper previously presented by his delegation was to see whether a mechanism not open to abuse could be set up and be workable.
With respect to degressivity, there was a need to examine the relationship with the principle of temporary application: if a safeguard action was temporary and short, degressivity might not be relevant.
while many Members had expressed the view that it should be possible in safeguard cases to suspend commitments under Article XVIII, others had raised doubts as to whether this should include the suspension of regulatory principles (e.
He thought it would be useful to have more background information and suggested that the Secretariat look at other papers, for instance in the area of investment, where services subsidies might have been discussed.
Entities having some exclusive rights, without being directly controlled by the government, might be an obstacle to market access, but should not raise procurement-related issues, especially if there was no government ownership.
The representative of New Zealand recalled that the paper presented by his delegation was an attempt to explore possible areas of common understanding in the application of fundamental WTO principles to government procurement in services.
In this regard, New Zealand acknowledged that Members, whilst seeking the best price or the economically most advantageous tender, might wish to ensure that domestic suppliers were not overlooked and had a full and fair opportunity to compete.
The representative of Canada agreed that the Working Party should proceed on parallel tracks and, in doing so, examine the questions raised in the New Zealand paper as well as any other pertinent issues.
At this stage, the Working Party should be focusing on more general procurement disciplines rather than pursuing the type of sectoral approach adopted in the Understanding on Commitments in Financial Services.
Date of the next meeting
The Chairman proposed that, in view of the preparation of the Seattle Ministerial Conference, the Working Party should hold its next meeting early next year, at a date to be announced in due course.
other business
The Chairman said that the decision not to schedule an additional meeting this year had implications for the Annual Report which had to be submitted to the Council for Trade in Services.

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2 November 1999 (99-4741) Working Party on GATS Rules


REPORT OF THE MEETING OF 8 OCTOBER 1999

Note by the Secretariat


The Working Party on GATS Rules held its twenty-fifth meeting under the chairmanship of Mr. Siva Somasundram of Singapore. The agenda for the meeting was contained in WTO/AIR/1171. It consisted of five items: negotiations on safeguards under Article X of the GATS; negotiations on subsidies under Article XV of the GATS; negotiations on government procurement under Article XIII of the GATS; date of the next meeting of the Working Party; and other business.
The Chairman indicated that he would raise, under other business, the question of the Working Party's Annual Report to the Council for Trade in Services. The agenda for the meeting was adopted.
The Chairman drew attention to an informal Note (Job No. 5332) he had circulated on 16 September 1999, to assist delegations in their preparati

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15 June 1999 (99-2413) Working Party on GATS Rules


REPORT OF THE MEETING OF 19 MAY 1999

Note by the Secretariat


The twenty-second meeting of the Working Party on GATS Rules was chaired by Mr. Siva Somasundram of Singapore. The agenda of the meeting was contained in WTO/AIR/1086. It consisted of five items: negotiations on safeguards under Article X of the GATS; negotiations on subsidies under Article XV of the GATS; negotiations on government procurement under Article XIII of the GATS; date of the next meeting of the Working Party; and other business.
The Chairman indicated that in order to assist delegations in their preparation for the meeting he had circulated a Note, Job No. 2803 dated 11 May 1999. The Note recapitulated where the Working Party stood on the three issues and proposed a certain structure for the discussion.
ITEM A: NEGOTIATIONS ON SAFEGUARDS UNDER ARTICLE X OF THE GATS
The Chairma

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4 August 2000 (00-3240) Working Party on GATS Rules


REPORT OF THE MEETING OF 7 JULY 2000

Note by the Secretariat


The Working Party on GATS Rules held is twenty-eighth meeting under the chairmanship of Mr. Tony Sims, from the United Kingdom. The agenda for the meeting was contained in WTO/AIR/1343. It consisted of five items: negotiations on safeguards under GATS Article X; negotiation on subsidies under GATS Article XV; negotiations on government procurement under GATS Article XIII; date of the next meeting; and other business. The agenda for the meeting was adopted.
The Chairperson drew attention to an informal Note (Job No. 4058, 27 June 2000), he had circulated to assist delegations in their preparation for the meeting.
negotiations on safeguards under article x of the gats
The Chairperson said that good progress had been made since the beginning of this year on the question of an emergency safeg

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27 September 1999 (99-3986) Working Group on Transparency
in Government Procurement

documents of the working party on gats rules
relating to concessions

Note by the Secretariat

At its meeting of 28 June 1999, the Working Group on Transparency in Government Procurement addressed the subject of concessions under the item on "definition and scope of government procurement".
As was identified by this Group at the informal consultations, to the extent that Members share the desire to reach greater liberalisation on trade in services, and multilateral disciplines on procurement is seen as means to achieve that overall objective, discussions can and should take place in this Group.
OBJECTIVE
The aim of this paper is not to come up with clear or specific rules on procurement but rather to launch a discussion so that we can identify where services-specific elements in any procurement rules would add value to the existing disciplines under the relevant WTO Agreements.
In the EC, and as a matter of fact under the GPA, the procurement rules apply to procurement by any contractual means, including through such methods as purchase or as lease, rental or hire purchase, with or without an option to buy, including any combination of services, Is this definition broad enough/covering all possible transaction under which a service is being procured?
3 of the GATS stipulates that the Agreement applies to measures taken by "central, regional or local governments and authorities" and "non-governmental bodies in the exercise of powers delegated by central, regional or local governments and authorities".
Should criteria to determine influence/control of the government be set, such as: financed, in part, for the most part, by the state, regional or local authorities; subject to management supervision by State authorities; having administrative, managerial or supervisory board, more than half of the members being appointed by the State?
Services in the exercise of governmental authority, for example, are excluded (such as activities conducted by a central bank or monetary authority or any other public entity in pursuit of monetary or exchange rate policies; activities forming part of statutory social security schemes or activities conducted for the account of the financial resources of the Government - see para 1 of Annex on Financial Services).
As far as the definition used in the GATS or in the GPA is concerned, it seems not to address all the elements specific to the procurement of a service which is in most instance not purchased with the purpose to acquire something but rather to obtain a right to consume, exercise, supply or grant a service.
It had come to the view that there was need for work to improve the understanding of what disciplines could apply to services procurement and that the goal should be to develop such disciplines.
Concerning the definition of government procurement, it had been suggested that the Transparency Working Group should employ a sufficiently broad approach to accommodate differing meanings given to the term "government procurement" in national legislations.
In regard to the first question, it had been suggested that entities at all levels of government, as well as enterprises owned or influenced by the government, be covered by a transparency agreement.
One delegation noted that some discussion on concessions had taken place at the previous meeting and that a similar discussion was being conducted in the Working Group on Transparency in Government Procurement; it was thus important to avoid duplication and to coordinate work.
While one delegation felt that for practical reasons it would be appropriate to discuss MFN-related issues first, others were of the opinion that the two principles should be dealt with in parallel since they were closely intertwined.
One approach would cover procurement at all levels of government, including entities governed by public law and under the influence of government, while the second approach was based on market structure rather than on public ownership or influence per se - every case would be examined on its own merits, the ultimate criterion being whether the entity was subject to competition.
He indicated that at the following meeting, the Working Party would revert to the question of how to proceed with the second step in the work programme, which concerned the application of the basic discipline of nondiscrimination.
Would for example a contract providing a license to a private sector contractor to distribute government procurement data on an electronic tendering service and generate revenue from purchasers of the data, be considered to fit within the transaction for the service itself and, if so, on what basis would it not meet the definitions of a procurement in the AGP and GATS Article XIII?
In relation to concessions, she added that the relevant definition seemed to differ between national legislations; the EC was preparing a submission on this subject and looked forward to contributions from other delegations as well.
which referred to procurement in terms of services purchased "for governmental purposes and not with a view to commercial resale or with a view to use in the supply of services for commercial sale".
Another important issue was the definition of "governmental purposes" and, in this context, whether the focus should be on the government's use of a service – as in the case of maintenance and cleaning services – or its role in, and responsibility for, the provision of a service – as in the case of garbage collection.
The Secretariat indicated that any such note would essentially distinguish between three categories of services: those supplied in the exercise of governmental authority, which were outside the scope of the GATS; services procured by governments which fell under Article XIII; and all other services.
Several delegations, including Argentina, Venezuela and Malaysia, felt it would be useful to further discuss these issues in the Working Party, based on information provided by Members before the Secretariat was asked to prepare a background note.
Without prejudging Japan's position, he noted the different forms that they might take: (a) a contract between a government agency and a private company for the purpose of developing natural resources; (b) a government contract with a private company for the purpose of constructing and managing industrial sites, railways, public water supply systems, and others; and (c) government purchases of services which may be consumed by the government, e.
A footnote to the Guidelines stated that the terms property and services covered all goods and services, including: consultancies and professional services of all types; real property activities; construction and related services; financial and operating leases for equipment and real property; individual and collective training and educational programmes; services obtained from public utility suppliers; and outsourcing or contracting, including programme delivery and programme support.
The representative of the European Communities mentioned a recent draft document on the treatment of concessions under Community law which could be of interest to other delegations (Draft Interpretative Document on Treatment of Concessions under Community Law; Official Journal of the EC, C94, 7 April 1999).
The representative of the United States said that it was apparent from the Secretariat's Note that the existing precedents (negotiating history or dispute panels) did not provide sufficient guidance for the interpretation of the relevant terms in GATS.
Both legislations were applicable to federal, state and municipal governments, as well as to public enterprises, foundations and any form of institution with some level of control, directly or indirectly, by the government.
The representative of Hong Kong, China, would prefer a working definition of government procurement which would minimize the exclusion of transactions from GATS disciplines; however, his delegation's interpretation of the term government procurement, as used in Article XIII:1, covered purchases for government use as well as cases where the government procured, but did not consume the relevant goods and services itself.
Regarding contracts for exploitation of natural resources, he considered that the resources themselves were goods, but the exploitation activity was a service; for instance, energy services were included in the Services Sectoral Classification List (MTN.
The paper on concessions mentioned at the previous meeting had some factors that could be used in the work on definition, for example, level of exploitation, ownership, financial responsibility, etc.
For instance, activities could be ranked as follows: government purchases for consumption by the government; government purchases for consumption by the public; contracts with private companies for the purpose of constructing and managing industrial sites, railways, etc.
He suggested that, at the next meeting, the Working Party tried to further clarify this question, in addition to advancing the discussion on definitional issues.
Government procurement was thus considered to include all three categories in the hierarchy Australia had originally suggested: first, government purchases of services for consumption by the government; second, government purchases of services for consumption by the public; and, third, contracts between the government and private companies for the commercial provision of services to the public or to industry.
The Stores Regulations, supplemented by Financial Circulars issued by the Secretary for the Treasury, govern the government procurement process.
services as well as civil and engineering works, with the exception of the following for which separate procedures shall apply 

(i) Franchises, concessions, leases, licences, tenancies and other items procured by public auction or method laid down by statute and government regulations.
As mentioned, there are also special procedures for public works concessions, which may include additional specifications depending on each particular case.
520) also recognizes three alternative methods: public tendering, direct contracting with public entities or government-owned companies, and contracting with mixed-capital or private-sector companies.
If a more desirable bid than that of the person presenting the proposal is made, both may improve their respective proposals within a period not exceeding half of the original presentation period.
The time-period between the final publication of notices and the date of submission of bids must be at least 30 days and at most 90 days, except in carefully defined exceptional cases where the maximum time-period may be extended.
105/89 establishing its regulations amended the Law on Public Works Concessions, by stipulating as award criteria the economic/financial equation and the scope of the prior investments to be made in each case in order to obtain a real reduction in the tariff or charge to be paid by users.
This includes not only procurement of all types of goods and services, but also the construction of public works, concessions for government facilities, public services management concessions, public works concessions (governed by a special law) and the sale and leasing of government property.
… For public works concessions, there are specifications for foreign participating countries, which are required, before signing a contract, to submit a declaration sworn before a notary in which they irrevocably undertake to comply with the requirements of Article 8, paragraph 4 of Law No.
The company is asked to ensure that the social pact defines the social conditions and grants the necessary authority to conclude, perform and comply with the contract in all its details, and assume the legal and economic responsibilities attached thereto visà-vis the government and vis-à-vis third parties.

World Trade
Organization RESTRICTED S/WPGR/W/52
15 June 2005 (05-2502) Working Party on GATS Rules Original: English

Communication FROM the European communities


Government Procurement in Services


The following communication, dated 13 June 2005, from the delegation of the European Communities is being circulated to the Members of the Working Party on GATS Rules.

_______________


In its communications on government procurement in services of July 2002, May 2003 and May 2004, the European Communities (hereinafter the EC) submitted proposals for a framework that could be developed under the GATS, including an Annex to the GATS on procedural rules for government procurement and the possibility to make specific commitments in GATS Schedules to open up to international competition government procurement in services. These communications underlined the flexibility of such framework and the benefits that could be drawn from it. The underlying principle wou

World Trade
Organization RESTRICTED S/WPGR/M/34
10 October 2001 (01-4965) Working Party on GATS Rules

REPORT OF THE MEETING OF 3 OCTOBER 2001

Note by the Secretariat

The Working Party on GATS Rules held its thirty-fourth meeting under the chairmanship of Mr.
It consisted of six items: negotiations on safeguards under GATS Article X; negotiations on subsidies under GATS Article XV; negotiations on government procurement under GATS Article XIII; annual report on the activities of the Working Party to the Council for Trade in Services; date of the next meeting; and other business.
He recalled that, during the last informal meeting, on 25 September, Members had had an extensive exchange of views on these topics listed, and had addressed in a preliminary manner an informal Communication from Mauritius on Emergency Safeguard Measures (JOB(01)/143) as well as an informal Communication from Venezuela on Causality Link (JOB(01)/101/Add.
negotiations on government procurement under article xiii of the gats
The Chairperson proposed that delegations should continue their general exchange of views on any aspect of government procurement of services.
WPGR could go further and examine, for instance, the following questions: what limitations, if any, should there be to the criteria used?
Replying to Chile, the representative of the European Communities said that the idea was to examine what kind of additional rules would be necessary to assess the qualifications of bidders and what kind of limitations could be put in place.
The representative of the European Communities suggested that a sentence might be added to paragraph 5 which would indicate that several delegations had stressed the importance of pursuing work on the issue of government procurement.

World Trade
Organization RESTRICTED S/WPGR/M/19
21 January 1999 (99-0216) Working Party on GATS Rules

REPORT OF THE MEETING OF 1 DECEMBER 1998

Note by the Secretariat

The nineteenth meeting of the Working Party on GATS Rules was chaired by Mr.
It consisted of six items: negotiations on safeguards under Article X of the GATS; negotiations on subsidies under Article XV of the GATS; negotiations on government procurement under Article XIII of the GATS; report on the activities of the Working Party to the Council for Trade in Services; date of the next meeting of the Working Party; and other business.
The representative of Egypt indicated that any safeguard mechanism should combine elements contained in Article XIX of GATT 1994, Article 5 of the Agreement on Agriculture, and Article 6 of the Agreement on Textiles and Clothing.
The policy background was very different in agriculture and while there was no injury requirement, invocation of the Article relied on a considerable amount of empirical information which was lacking in the case of services.
The representative of Japan voiced concerns regarding the non-MFN basis of this mechanism but regarded as positive that the burden of proof was placed on the country imposing safeguards.
Definition and scope of safeguards in services
The representatives of Australia and the European Communities said that safeguard measures should be applied by the Members themselves, whether via government regulation or delegated powers.
The representative of Brazil felt that no distinction should be made between national and foreign own investment, and action should affect only new entrants.
While it could be argued that foreign suppliers might then focus on unrestricted modes, this possibility should not be overestimated, given the costs involved in switching between modes.
Type of injury
The representative of the European Communities noted that the Members arguing in favour of safeguards had failed so far to give compelling examples of situations calling for emergency protection.
The representative of Thailand, on behalf of ASEAN, pointed out that the Agreement on Textiles and Clothing contained provisions on the attribution of damage which should be taken into account; the burden of proof rested with the invoking Member.
The representative of Australia noted that while safeguard actions would involve the suspension of market access and national treatment commitments, it was doubtful whether they should affect additional commitments under Article XVIII.
Special and differential treatment
The representative of Australia, recognizing the importance of special and differential treatment, felt it premature to discuss details at that stage.
while the national treatment obligation does not impose any restraint on the level of subsidies that may be granted by Members, it is nevertheless a potentially powerful discipline with respect to the non-discriminatory use of subsidies.
The limitations scheduled with regard to subsidies compiled in document S/WPGR/W/13, suggested that other Members shared this interpretation; otherwise they would not have exempted subsidies from national treatment under Modes 1 and 2
Regarding import-substituting subsidies effects, it was useful to distinguish between services of national and of domestic origin.
In the context of the first question regarding what transactions constitute procurement, delegations had recognized that more information was needed on how concessions were defined and treated within national legislations.
The representative of Canada said that the EU paper suggested that the transaction for the service itself (as distinguished from the buying or hiring of the service) did not appear to be covered by the Agreement on Government Procurement.
On how to proceed with the work, he suggested requesting the Secretariat to prepare a note listing the types of policies that are applied to government procurement and may not be consistent with non-discrimination, both MFN and national treatment, with a brief explanation of each.
ITEM D: REPORT ON THE ACTIVITIES OF THE WORKING PARTY TO THE COUNCIL FOR TRADE IN SERVICES
The Chairman noted that the draft report of the Working Party to the Council for Trade in Services had been circulated as S/WPGR/W/28.

World Trade
Organization RESTRICTED S/WPGR/M/48
20 July 2004
(04-3131) Working Party on GATS Rules


Report of the meeting of 23 June 2004

Note by the Secretariat


The meeting of the Working Party on GATS Rules was chaired by Ms. Clare Kelly, from New Zealand. The agenda for the meeting, contained in WTO/AIR/2337, included the following items: subsidies, government procurement, emergency safeguard measures, date of the next meeting and other business. To assist delegations in the preparation of the meeting, the Chairperson had prepared an annotated agenda contained in JOB(04)/74.
The Chairperson noted that the order of the items on the agenda had been modified and indicated her intent to continue to do so, taking into account a variety of factors. She did not think that the order of the items should have any substantive bearing. Delegations needed to discipline themselves, including regarding the length of their interventions, so that all issues coul

S/WPGR/M/40

World Trade
Organization S/WPGR/11
30 June 2003 (03-3466) Working Party on GATS Rules


NEGOTIATIONS ON GOVERNMENT PROCUREMENT

Report by the Chairperson of the Working Party on GATS Rules


introduction
On 22 July 2002, the Working Party on GATS Rules adopted a work programme on government procurement with a view to structuring its work. Item (a) of the work programme provides for Members "
to continue discussion on government procurement on the basis of submissions f

S/WPGR/13

World Trade
Organization RESTRICTED S/WPGR/M/50
17 January 2005 (05-0194) Working Party on GATS Rules


REPORT OF THE MEETING OF 24 NOVEMBER 2004

Note by the Secretariat


The meeting of the Working Party on GATS Rules was chaired by Ms. Clare Kelly, from New Zealand. The agenda for the meeting, contained in WTO/AIR/2443, included the following items: adoption of the annual report to the Council for Trade in Services, subsidies, emergency safeguard measures, government procurement, date of the next meeting and other business. To assist delegations in the preparation of the meeting, the Chairperson had prepared an annotated agenda, contained in JOB(04)/167. The agenda was adopted.
ANNUAL REPORT OF THE WORKING PARTY ON GATS RULES TO THE COUNCIL FOR TRADE IN SERVICES (2004)
The Chairperson invited the Working Party to adopt the draft annual report contained in document S/WPGR/W/50 and transmit it to the Council for Trade in Services. It covered the meetings

World Trade
Organization RESTRICTED 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)


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. The three negotiating mandates the Working Party is entrusted with were put on the agenda of each meeting: emergency safeguard measures (Article X), government procurement (Article XIII), and subsidies (Article XV). The Working Party also held one informal meeting.
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.
NEGOTIATIONS ON EMERGENCY SAFEGUARD MEASURES UNDER GATS ARTICLE X
3. At the meeti

S/WPGR/11

S/WPGR/W/39

S/WPGR/W/35

World Trade
Organization S/WPGR/15
22 September 2005 (05-4190)

ANNUAL REPORT OF THE WORKING PARTY ON GATS Rules
TO THE COUNCIL FOR TRADE IN SERVICES (2005)

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.

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.
The ensuing discussion touched upon a number of issues, such as the purpose 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, compensation, as well as possible approaches for a way forward.
As requested, the Secretariat prepared the following informal Note: Synthesis of Views Expressed on the Definition of Subsidy (JOB(05)/4).

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.