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GPA/M/79

18 September 2020

(20-6319) Page: 1/6

Committee on Government Procurement

MINUTES OF THE FORMAL MEETING OF 21 JULY 2020 (VIRTUAL MEETING)

CHAIR MR CARLOS VANDERLOO (CANADA)

The Chair opened the meeting by noting that, in preparation for the meeting, delegations had received an Airgram1 setting out the proposed agenda, which was as follows:

1. Participation in the Committee on Government Procurement as Observer – Written Notice from Côte d'Ivoire (GPA/153, dated 10 July 2020); 2. Application for Accession to the Agreement on Government Procurement (GPA): Brazil (GPA/152, GPA/ACC/BRA/1, dated 19 May 2020); and 3. Other Business, if any.

In regard to Other Business, the Chair recalled that the Republic of Moldova had informed the Secretariat of its intention to make a brief statement to update the Committee on legislative developments in the country. The Committee adopted the agenda.

1 PARTICIPATION IN THE COMMITTEE ON GOVERNMENT PROCUREMENT AS OBSERVER – WRITTEN NOTICE FROM CÔTE D'IVOIRE

1.1. The Chair said that the written notice regarding its participation in the Committee on Government Procurement as observer had been circulated by Côte d'Ivoire on 10 July 2020.2 Pursuant to Article XXI:4 of the revised GPA, "any WTO Member that is not a Party to this Agreement shall be entitled to participate in the Committee as an observer by submitting a written notice to the Committee".

1.2. The Committee took note of the written notice submitted by Côte d'Ivoire. It also expressed its sincere condolences for the passing of the Prime Minister of Côte d'Ivoire, His Excellency Amadou Gon Coulibaly.

1.3. The representative of Côte d'Ivoire said that his delegation would like to take this opportunity to convey to the GPA Parties its wish to become an observer to the Committee on Government Procurement. Côte d'Ivoire attached great importance to transparency and competition in the award and execution of government procurement contracts. Government procurements in the development of activities in all areas of economic life within the central government and public bodies were subject to the Government Procurement Code as soon as they were in the form of a contract. To strengthen and improve all aspects of transparency and competition, Côte d'Ivoire had adopted a new government procurement instrument, Ordinance No. 2019-679 of 24 July 2019 on the Government Procurement Code. The new Code repealed and replaced previous incompatible provisions, such as those from Decree No. 2009-259 of 6 August 2009 on the Public Procurement Code, as amended by Decree No. 2014-306 of 27 May 2014 and Decree No. 2015-525 of 15 July 2015. Nonetheless, the most recent existing legislation remained applicable to government procurement procedures that had been under way on the date of entry into force of the new Ordinance, except with regard to planning.

1 WTO/AIR/GPA/21, dated 10 July 2020. 2 GPA/153, dated 10 July 2020. GPA/M/79

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1.4. The new Government Procurement Code was part of the process to transpose the community directives of the West African Economic and Monetary Union (WAEMU) relating to the organization of government procurement in that region and contained a number of new institutional developments and government procurement procedures. It aimed to permanently remedy shortcomings and gaps identified during a review of the government procurement system of Côte d'Ivoire and to increase transparency and attract investment. It was the result of consultations between stakeholders in the government procurement system, including the main technical and financial partners. Compliance with the regulation "on environmental, social and labour matters, protection of persons with disabilities and gender" was established as a fundamental principle alongside equal treatment of candidates and bidders, transparency of procedures and free competition, which had already governed government procurement in Côte d'Ivoire. More importance had been attached to sustainable development, with relevant provisions included in the new instrument. Government procurement subject to this new Ordinance was clearly defined. It covered not only conventional procurement contracts (works, supply and service contracts and mixed contracts) but also particular types of contract (cost-plus contract, service-level management and maintenance contract, turnkey contract, design contract - construction, operation or maintenance, innovation contract and framework agreement).

1.5. In terms of institution, the Administrative Commission for Conciliation, which had been responsible for settling disputes likely to arise in the context of the award or execution, or even the regulation and control, of contracts, had been replaced by the National Government Procurement Regulatory Authority (ANRMP).

1.6. Moreover, the Ordinance further promoted paperless procedures. In the event of a dispute, a preliminary appeal could be lodged by any appropriate means, including by electronic communication, within seven working days (previously ten working days). The new Government Procurement Code also provided the contract holder with a new form of judicial remedy, namely the ability to file an appeal for reversal or for misuse of authority against a decision of the government procurement regulatory body. Appeals did not have a suspensory effect, except if a request for a stay of execution was made before the competent court. Disputes arising from the execution or regulation of government procurement could be referred either to the courts competent in administrative matters or to an arbitral tribunal. The obligation for disputes to be subject to the rules of the Uniform Act of the Organization for the Harmonization of Business Law in Africa (OHADA) relating to arbitration was no longer binding, and the parties could agree among themselves to choose any other arbitration court.

1.7. Côte d'Ivoire's application for observer status in the Committee was therefore a reflection of the Government's willingness to ensure its practices in this area were in line with international standards. Concluding, he thanked the WTO Secretariat for the GPA national workshop it had organised in Abidjan on 30 and 31 October 2019. This workshop, as well as the support provided by the WTO Secretariat, had contributed to and facilitated the procedure for Côte d'Ivoire to obtain observer status in the Committee.

1.8. The representatives of the European Union, the United States, the Republic of Korea, Canada, Switzerland, the Republic of Moldova, Brazil and Tajikistan welcomed Côte d'Ivoire's participation in the Committee on Government Procurement as an observer.

1.9. The representative of the European Union said that opening up the accession process would pave the way for sharing views and experiences on the benefits of complying with the rules and principles of the GPA. The European Union noted that recent accessions had demonstrated that becoming a fully-fledged Party to the GPA on mutually satisfactory terms could be achieved quickly and effectively.

1.10. The representative of the United States thanked Côte d'Ivoire for providing an overview of the new domestic procurement provisions that would help to bring transparency to procurement practices in Côte d'Ivoire. She said that obtaining observer status provided an opportunity for Côte d'Ivoire to learn more about the GPA and international procurement standards. Her delegation looked forward to working with Côte d'Ivoire.

1.11. The representative of the Republic of Korea expressed support for Côte d'Ivoire's efforts for greater liberalization of government procurement.

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1.12. The representative of Canada expressed the hope that Côte d'Ivoire's observer status would inspire other African countries to follow the same path. She encouraged Côte d'Ivoire to take advantage of the government procurement related training and technical cooperation activities offered by the WTO Secretariat and said that Canada remained available for informal exchanges on these matters and looked forward to working with Côte d'Ivoire.

1.13. The representative of Brazil referred to Brazil's very positive experience as observer in the Committee and expressed hope that Côte d'Ivoire's experience as observer would be similarly positive.

1.14. The representative of Switzerland said that his delegation was ready to share its experience as a GPA Party. Switzerland considered the GPA as an important tool not only to promote open and transparent rules for trade in government procurement but also to achieve sustainable economic growth.

1.15. The representative of Côte d'Ivoire thanked all delegations that had spoken for their kind words welcoming Côte d'Ivoire and their readiness to share their experiences and good practices with his delegation. He reiterated that Côte d'Ivoire stood ready to make progress and to have a government procurement system that was responsive to international standards.

1.16. In summary, the Chair congratulated Côte d'Ivoire on all the reforms it had undertaken as well as those under way to ensure its government procurement system to be in line with international best practices. The Committee would closely follow future developments in the country. Côte d'Ivoire was the third observer from Africa after Cameroon and Seychelles. He hoped that more African countries would follow Côte d'Ivoire's example. He strongly encouraged the delegation to participate in the Committee's work. Given the particular circumstances in the lead-up to the current meeting, he would give Côte d'Ivoire's capital-based delegation one more opportunity to make a statement at the Committee's next meeting.

2 APPLICATION FOR ACCESSION TO THE GPA: BRAZIL

2.1. The Chair recalled that in keeping with earlier statements made at the highest level in this regard, Brazil had submitted its application for accession to the GPA in document GPA/152 and GPA/ACC/BRA/1 on 19 May 2020. He said that Brazil's decision to apply for accession was a most positive development and sent a very powerful and encouraging signal in exceptionally challenging times, not just for Brazil's economy, but for the whole of Latin America and international government procurement markets beyond. He informed the Committee that Brazil was represented on this special occasion by a high-level delegation, led by Ambassador Norberto Moretti, Secretary for Foreign Trade and Economic Affairs, Ministry of Foreign Affairs.

2.2. The representative of Brazil said that he was honoured to address the Committee at this historical opportunity for Brazil although he regretted not being able to be in Geneva. He referred to Brazil's communication of 18 May to the Committee stating Brazil's intention to accede to the GPA according to its Article XXII. He said that Brazil's application to become a Party to the GPA was fully in line with Brazil's national objectives of deeper and wider integration into the international economy and improved public governance. Becoming a GPA Party implies accepting more international binding commitments, and Brazil did not shy away from them. Brazil had recently concluded negotiations of two major free trade agreements, with the European Union and the European Free Trade Association, respectively. In addition, it was negotiating another three equally ambitious bilateral agreements with Canada, the Republic of Korea and Singapore. It had also negotiated binding commitments in government procurement with some of its regional partners, including Chile, Peru and the MERCOSUR countries that were not GPA Parties yet, but in a few cases were observers to the Committee, as Brazil had been since October 2017.

2.3. Continuing, he said that acceding to the GPA also meant taking part in the relevant discussions held by the Committee. Brazil would maintain and deepen its involvement in these activities and make a positive contribution to this Committee, honouring a tradition of constructive engagement with the WTO as a whole. He recalled that Brazil was an active participant of the talks on WTO reform, individually and as a member of the Ottawa Group. Brazil was also engaged in a thorough review of its legislation and practices, including through the adoption of international benchmarks, as a prospective member of the OECD.

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2.4. With regard to government procurement, he said that Brazil had an advanced and evolving procurement system. Its procurement legislation followed the constitutional principle of equal treatment among competitors, and, as a rule, prohibited discrimination against foreign companies. A recent update in the regulation governing its Supplier Registration System at the federal level had allowed foreign suppliers to register directly, without the need to establish a local legal representative. In force since May 2019, this change enabled foreign competitors to tender in the procurement of common goods and services carried out through electronic auctions, and public works under a specific contracting regime. This new regulation applied to 99% of all procurements from the Executive Branch at the federal level. In recent years, Brazil had also strongly promoted the digitalization of procurement processes. Electronic auctions represented more than 90% of open tendering procurement in the federal government. In addition, under the legislation enacted in 2019, this modality was now compulsory for all state-level and municipal-level agencies when procuring with federal resources.

2.5. Ambassador Moretti also said that transparency had been a key component not only of Brazil's government procurement system, but also of its entire bureaucracy. For almost a decade, Brazil's Transparency Law had significantly improved the degree of openness of government data and had secured any interested person the right to obtain information relevant to procurement processes and government contracts. More broadly, Brazil had strong institutions that ensured the rule of law. It had modern and very active agencies, both in the executive and legislative branches, responsible for auditing public expenditure and fighting corruption. Brazil's judicial system was comprised of an autonomous and equally active Prosecution Service and a Judiciary that abided by the principle of mandatory jurisdiction.

2.6. He said that all the above helped to understand why Brazil was the first country in Latin America to seek GPA membership. This was a very significant and positive step that was likely to draw considerable attention to and generate interest in the negotiation of Brazil's accession. Brazil would enter this process with the confidence that its procurement system was both solid and advanced. Previous and current negotiations with specific partners had shown to Brazil the sensitivities it would need to address in its GPA accession.

2.7. Regarding next practical steps, he explained that Brazil was working on the Replies to the Checklist of Issues, which would provide a description of its government procurement regime and facilitate consultations relating to Brazil's accession. He expected to share this document with the Committee within a short time from the meeting. In addition, Brazil was also giving careful consideration to its market access offer that would be presented in the coming months.

2.8. The representatives of the European Union, the United States, Australia, the Republic of Korea, Chinese Taipei, Ukraine, Canada, Singapore, Switzerland, the Republic of Moldova and Tajikistan welcomed Brazil's application for accession to the GPA.

2.9. The representative of the European Union said that the application from the largest economy in Latin America was an excellent signal underlining the mutual benefits of reciprocal market opening and showed the continued relevance of the GPA. Coming at a time of unprecedented societal and economic challenges caused by the COVID-19 pandemic, Brazil's application highlighted the importance of open, transparent and non-discriminatory public procurement regimes to support the recovery and provide high-quality services to its citizens.

2.10. He said that on 28 June 2019, the European Union and the MERCOSUR member countries - Brazil, Argentina, Paraguay and Uruguay – had reached a political agreement for an ambitious, balanced and comprehensive trade agreement. It was the first international agreement to provide for the opening of MERCOSUR's government procurement markets. The government procurement chapter of the European Union/MERCOSUR trade deal would open markets on both sides according to their market access commitments. In terms of disciplines, the European Union and MERCOSUR had agreed to apply modern disciplines based on the principles of non-discrimination, transparency and fairness and on the detailed rules of the revised GPA. Brazil's public procurement commitments in the EU-MERCOSUR trade agreement would provide a good basis for further mutual market opening.

2.11. Furthermore, the European Union maintained a dynamic and fruitful regulatory dialogue with Brazil on public procurement policy. Building upon that dialogue, the European Union welcomed

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2.12. The representative of the United States acknowledged that Brazil was a large and very important market for GPA suppliers around the world. She said that the United States looked forward to Brazil's initial market access offer and its Replies to the Checklist of Issues, so as to learn more about the procurement procedures in Brazil. The United States took note of recent changes in the Brazilian procurement system which had allowed greater access for international goods, services and suppliers. It was encouraged to see that Brazil had in place an advanced procurement system and looked forward to working with Brazil on its GPA accession.

2.13. The representative of Australia said that his delegation was looking forward to receiving an ambitious initial market access offer and the Replies to the Checklist of Issues from Brazil. Australia stood ready to engage constructively with Brazil towards its timely accession.

2.14. The representative of the Republic of Korea expressed appreciation for Brazil's statement and active engagement. He said that his delegation looked forward to receiving Brazil's offer in the near future.

2.15. The representative of Chinese Taipei said that his delegation was looking forward to actively engaging with Brazil.

2.16. The representative of Ukraine said that her delegation was looking forward to receiving Brazil's initial market access offer and its Replies to the Checklist of Issues. Ukraine was hoping to work closely with Brazil in its accession process.

2.17. The representative of Canada said that it was noteworthy that Brazil was the first country in South America to initiate its accession to the GPA. Her delegation hoped that this trend would continue. Canada was looking forward to receiving Brazil's initial market access offer and its Replies to the Checklist of Issues and to working closely with Brazil in its accession process.

2.18. The representative of Singapore noted that no WTO Member from the Latin American region currently was a GPA Party. Brazil's request was a step in the right direction, which would contribute greatly to the diversity of GPA membership. Singapore was looking forward to working with Brazil and other GPA Parties for a smooth and successful accession for Brazil.

2.19. The representative of Switzerland acknowledged the progress Brazil had made so far in reforming its government procurement system and welcomed Brazil's ambition towards achieving internationally recognized standards in the area of government procurement. He said that his delegation had already had a privileged opportunity to exchange views and experiences about the benefits of adhering to GPA rules and principles in the context of the negotiation of an EFTA-Mercosur free trade agreement. Switzerland was looking forward to deepening its cooperation with Brazil in the context of the latter's GPA accession process.

2.20. The representative of Brazil thanked all delegations for their encouraging statements. He confirmed that Brazil was working on the Replies to the Checklist of Issues and its initial market access offer. He said that the specification of Brazil's current government procurement system would be satisfactory for GPA accession. There would be sensitive issues to be addressed with negotiation partners during the accession process, as true for all negotiations. Nonetheless, he was sure that Brazil expected to conclude its GPA accession process as soon as possible. Brazil's GPA membership would strengthen the GPA and demonstrate the benefits of integration to the world economy. It would also demonstrate that the GPA was truly open to all WTO Members.

2.21. The Chair joined Parties in warmly welcoming Brazil's application to the GPA as the first application from a Latin American economy. He said that he was certain that Brazil's accession process would be followed in Latin America with great interest, and for that reason alone, it was systemically important. The GPA, with its foundational principles of market access on the basis of mutual reciprocity, non-discrimination, transparency and integrity, undoubtedly had the potential to

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3 OTHER BUSINESS

3.1. The representative of the Republic of Moldova presented to the Committee a short overview of recent developments in the public procurement system of the Republic of Moldova. She said that on 26 June 2020, the Republic of Moldova had published Law No. 74 on Procurement by Entities Operating in the Water, Energy, Transport and Postal Services Sectors to transpose the EU Directive 2014/25 and to keep in line with the GPA standards. The Law offered a better instrument at the national level for some of the Annex 3 entities in implementing the GPA provisions. Previously, in some cases, the entities had had to apply the GPA provisions directly without a primary national legislation, except some secondary legislation, in this regard. The adoption of this law would increase the efficiency of public procurement in water, energy, transport and postal services sectors in the country.

3.2. In addition, the Government of the Republic of Moldova had implemented the e-Procurement system and M-Tender one year ago. With the support of the IFIs, the EBRD and the European Union, it continued to develop and expand the use of the e-Procurement system in small value procurement. This increased the efficiency of public spending. An updated open contracting portal for public procurement in the Republic of Moldova had also been launched at the end of 2019. This portal collected and published data about all public contracts signed during the period of 2012-2019.

3.3. The Chair thanked the representative of the Republic of Moldova for the statement.

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