- Revisions to WTO Agreement on Government Procurement Enter into Force
- April 11, 2014 | Authors: Timothy J. Keeler; Marcia G. Madsen
- Law Firm: Mayer Brown LLP - Washington Office
The revised World Trade Organization (WTO) Agreement on Government Procurement (GPA) entered into force on April 6, 2014. The overarching principles of the GPA continue to be nondiscrimination and transparency, and many of the Agreement’s procedures and requirements closely resemble those used in the United States. The Agreement requires that foreign products, services and suppliers be accorded treatment no less favorable than that accorded to domestic products, services and suppliers. The Agreement also requires parties to ensure that tendering procedures are applied in a nondiscriminatory manner, and it establishes procedures to challenge a procurement decision.
The changes to the GPA expand the scope of its coverage to more government entities, services and other procurement activities—including local governments and sub-central entities. The WTO estimates that the parties to the revised Agreement will see annual gains ranging from $80 - $100 billion in market access for their businesses.
The GPA is a plurilateral agreement, meaning it only applies to those WTO members that have agreed to be bound by it. Two-thirds of the signatories were required to accept the Protocol of Amendment before the revised GPA could enter into force. This condition was met on March 7, 2014, when Israel approved the Protocol. The revised Agreement is now in force for the first 10 parties to have accepted the Protocol of Amendment: the United States, the European Union, Canada, Norway, Taiwan, Hong Kong, Singapore, Iceland, Liechtenstein and Israel. The revision will come into force for Japan on April 16, 2014. South Korea, Switzerland, Armenia and the Dutch territory of Aruba will continue to operate under the original 1994 GPA until they submit their instruments of acceptance.
The parties to the revised GPA hail it as a “streamlined and modernized” agreement on government procurement. The GPA now includes standards related to the use of electronic procurement tools, as well as a new provision relating to the prevention of corrupt practices in the parties’ procurement systems. The revised Agreement also incorporates improved transitional measures to facilitate accession by developing and least-developed countries.