Revised WTO Govt Procurement Agreement Enters into Force

10 April 2014

The WTO's revised Government Procurement Agreement (GPA) entered into force on 6 April, with the resulting changes expected to liberalise an additional US$80-100 billion in public contracts. The news comes just over two years after parties completed their negotiations to update the previous version of the pact.

The GPA commits parties to a series of disciplines regarding transparency, competition, and good governance with regard to the procurement of goods, services, and capital infrastructure by public authorities. The agreement is one of the WTO's plurilateral pacts, covering only those members who sign onto it. The deal's participants - counting the 28-nation EU as one - currently number at fifteen.

Negotiations to update the original agreement - which has been in force since 1996 - took over a decade and were finally completed in 2011, just minutes before the start of the WTO's Eighth Ministerial Conference in Geneva. (See Bridges Daily Update, 16 December 2011) While parties had hoped to ratify the deal in time for the WTO's following ministerial in Bali, Indonesia last December, they later confirmed that the ratification process would need to continue through the first quarter of this year.

The changes agreed in 2011 include the coverage of various new entities, such as government ministries and agencies, as well as more services and goods. Other additions include new standards involving the use of electronic procurement tools and the improved prevention of corrupt practices, along with measures aimed at promoting environmental protections and the conservation of natural resources.

The revised pact also includes provisions aimed at facilitating the accession of new developing country parties to the Agreement. How this may affect the efforts of China, for instance, which has been negotiating entry for several years and has a massive government procurement sector, is one question on trade observers' minds.

Including Beijing, there are 10 WTO members - both developed and developing - currently in talks to join the agreement, with at least five others expected to begin accession talks.

"This is a plurilateral success story in the WTO, and we should continue to build on it by expanding participation of developed and developing economies," said US Trade Representative Michael Froman in response to the GPA's entry into force.

The revised GPA is in now force for those ten parties that have ratified it - Liechtenstein, Norway, Canada, Chinese Taipei, the US, Hong Kong, the EU, Iceland, Singapore and Israel. Japan is expected to follow on 16 April.

ICTSD reporting.

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