The revision of the GPA has entered into force — nearly 15 years after negotiations began.
On April 6, 2014, the Parties to the WTO Government Procurement Agreement (GPA) reached a major milestone with implementation of the revision of the GPA. This achievement is welcomed after more than a decade of negotiations, followed by two years of waiting for the Parties to ratify the revision. Approval by two-thirds of the 15 GPA partners, or a total of 10, was needed before the revised agreement could enter into force.
Liechtenstein was the first to ratify the revision – in May 2013, followed by: Norway, Canada and Chinese Taipei (Taiwan) in November 2013; Hong Kong China, the United States and the European Union in December 2013; and Iceland and Singapore in February 2014. The 10th ratification came in March when Israel submitted its acceptance. The April 6 entry into force applies only to these 10 Parties. However, an 11th Party, Japan will implement it shortly — on April 16, 30 days after Japan accepted the revision.
The revised GPA will apply to the remaining four GPA Parties that have not yet ratified it — Armenia, Republic of Korea, the Netherlands with respect to Aruba and Switzerland – 30 days after they accept the Protocol Amending the Agreement. Until these Parties ratify the revised GPA, they will not be given access to the procurement added in the revision and they will continue to be subject to the unrevised GPA.
When the revised GPA is fully implemented, it will provide procurement opportunities valued at an estimated $80 billion to $100 billion. The new procurement opportunities were detailed in a recent posting. In addition to expanding the procurement covered under the GPA, the revision modernizes the GPA text, as described in an earlier posting.
The GPA revision will also benefit WTO members that are in negotiations to join the GPA, and perhaps encourage other WTO members to initiate accession to the GPA. In addition to facilitating their understanding of the GPA, the revised GPA expands on the transitional measures available for developing countries. Ten WTO Members, including China, Moldova, Montenegro, New Zealand and Ukraine, are in the process of negotiating accession to it.
Bringing the revised GPA entry into force also has implications for the WTO, even though the GPA is a plurilateral agreement that only applies to just over one-quarter of the 159 WTO Members. It demonstrates that WTO Members can conclude negotiations and implement agreements that expand and improve the international trading system. This has been an illusive goal of the WTO as a whole. It was only in December 2013 at the WTO Ministerial meeting in Bali, Indonesia that the WTO Members were able to reach agreement on several issues in the broader Doha Round negotiations, which began in the fall of 2001. The Director General of the WTO, Roberto Azevêdo, cited implementation of the revised GPA, along with the Bali package, as evidence “that the WTO is back in business.”
Having implemented the revised GPA, the Parties will now tackle issues that were not resolved during the negotiations on the revision. As described in an earlier posting, they will take up the unfinished business in work programs in five areas: Small and Medium-sized Enterprises; Collection and Reporting of Statistical Data; Sustainable Procurement; Exclusions and Restrictions in Parties’ Annexes; and Safety Standards in International Procurement. Another item on the Parties’ agenda will be the adoption of arbitration procedures and indicative criteria, as called for in the revised GPA, to facilitate resolution of objections relating to Parties’ proposed withdrawal of entities from GPA coverage. It will be explored in a subsequent posting.
Jean Heilman Grier
April 7, 2014