North Macedonia became the 49th WTO member to implement the plurilateral WTO Government Procurement Agreement (GPA) on October 30th, four years after the last accession (Australia in 2019). The accession fulfills a commitment made by North Macedonia (then the Former Yugoslav Republic of Macedonia)–to seek GPA membership–when it became a WTO member 20 years ago. This post examines the accession and procurement that the new party is opening under the GPA.
The WTO Government Procurement Committee approved North Macedonia as the agreement’s 22nd party in June 2023. North Macedonia completed its internal ratification process and submitted its instrument of accession to the WTO at the end of September. Its accession becomes effective 30 days later.
In negotiating its accession, North Macedonia tailored the procurement it is opening under the GPA to the coverage offered by the European Union (EU), as it is a candidate for EU membership. Once it joins the European bloc, which is not expected for several years, its coverage will have to reflect that of the EU member states. (The EU launched accession negotiations with it in July 2022.)
North Macedonia is opening the procurement of 103 central government entities to participation by the other parties. Its coverage of subcentral entities and other entities aligns with the EU approach of listing categories of entities and providing indicative, rather than definitive, lists of the covered entities.
The new GPA party's coverage commitments incorporate the reciprocal restrictions found in the EU schedules. However, the GPA parties have not permitted North Macedonia to apply those restrictions until it becomes an EU member state. In contrast, when Montenegro (also an EU accession candidate) became a GPA party in 2015, it was allowed to apply the reciprocal restrictions without waiting for EU membership.
When North Macedonia's reciprocal restrictions become effective, the United States will not have rights to participate in services procured by its subcentral entities and utilities, except electric utilities and ports (excluding dredging). These are the restrictions applied by current EU member states.
With respect to the services that it opens under the agreement, North Macedonia provides access to listed services based on reciprocity. It allows parties to participate in the procurement of a service, provided the party opens the same service. While the new party covers its construction services on a reciprocal basis, it limits access to its works concessions to the EU, Iceland, Liechtenstein, Norway, the Netherlands on behalf of Aruba (Aruba), Switzerland, Montenegro, and the United Kingdom (UK).
The EU, Montenegro, Switzerland, and the UK set out specific terms for North Macedonia’s access to certain of their GPA-covered procurement. For example, the EU gives it the same comprehensive access to its central government entities that it provided to its closest trading partners (Aruba, Iceland, Liechtenstein, Norway, Switzerland, and the UK), based on an indicative list. It also provides the same access to its works concessions contracts as it affords to certain parties. The UK echoes the EU in providing North Macedonia with access to its central government entities and works concessions.
The U.S. Trade Representative issued a waiver of discriminatory purchasing requirements with respect to goods and services from North Macedonia in October, in accordance with the Trade Agreements Act of 1979. With the waiver, the domestic purchasing requirements in the Buy American Act of 1933 and the Defense Department’s Balance of Payments Program will not apply to North Macedonia in the procurement that the US covers under the GPA. Based on the waiver, the Federal Acquisition Regulatory Council is amending the Federal Acquisition Regulation to add North Macedonia as a designated country.
In another accession development, Costa Rica applied for GPA membership on September 28th. It is only Central American country to seek accession since Panama withdrew its application in 2013.
Jean Heilman Grier
November 1, 2023
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