China Submits Revised Offer for Joining Government Procurement Pact

· The procuring entities whose procurement processes will be open to foreign bidders

· The goods, services and construction services open to foreign competition

· The threshold values above which procurement activities will be open to foreign competition

At an informal meeting of the WTO’s Government Procurement Agreement (GPA) Committee on 23 October 2019, China introduced to the parties to the Agreement its sixth revised market access offer in the context of its negotiations to join the GPA. The revised offer was circulated to GPA parties on 21 October. Chairman Carlos Vanderloo of Canada called this “a very significant development” and the parties also welcomed China’s revised offer while saying they needed more time to review it.

The GPA is a plurilateral agreement — potentially open to all WTO members but binding only the parties to the Agreement. Each applicant's terms of participation are negotiated with GPA parties and set out in its respective schedule, which contains several annexes defining the party’s commitments with respect to:

1. the procuring entities whose procurement processes will be open to foreign bidders

2. the goods, services and construction services open to foreign competition

3. the threshold values above which procurement activities will be open to foreign competition

4. exceptions to the coverage.

A senior capital-based delegation from China detailed its sixth revised market access offer. China told the Committee that its revised market offer is improved and ambitious and responds to comments received on its prior revised offer from 2014.

China identified the following improvements, among other things: the revised offer covers additional government entities and their subordinated entities, both at the central and provincial levels. It also covers additional state-owned enterprises operating in the areas of railways, highways, ports, airports, urban transportation, water supply, etc. China has further included additional services sectors and all construction services are now covered by the offer.

China also proposed that after a transition period, it would apply standard GPA threshold values for the proposed goods and services covered. China reiterated its commitment to joining the GPA as soon as possible and its support for the multilateral trading system. China applied for accession to the GPA in 2007.

Currently, 48 WTO members (including the EU and its 28 member states) are bound by the Agreement. Australia is the latest member to have acceded to the Agreement earlier in 2019. The GPA aims to open up, in a reciprocal manner and to the extent agreed between WTO members, government procurement markets to foreign competition, and make government procurement more transparent. It provides legal guarantees of non-discrimination for the products, services and suppliers of GPA parties in covered procurement activities, which are currently worth an estimated US$ 1.7 trillion annually.

Also under discussion at the meeting were other ongoing negotiations on accession to the GPA, including those by North Macedonia, the Kyrgyz Republic, Tajikistan and the Russian Federation. The GPA parties reiterated their interest in seeing these countries' accession processes move forward. The Chairman encouraged the acceding members to submit revised market access offers as soon as possible and also encouraged GPA parties to engage with the acceding countries.