Agreement on Government Procurement

What is the WTO GPA?

The Agreement on Government Procurement (GPA) is a World Trade Organization (WTO) plurilateral agreement (an agreement not all WTO Members are part of) that opens government procurement markets between members. The GPA's principles are transparency and non-discrimination, requiring Members to:

  • offer other Members’ suppliers conditions ‘no less favourable’ than domestic suppliers
  • provide review procedures for suppliers to raise complaints about tender processes.

Australia and the GPA

Australia wants to join the GPA to protect and promote Australian businesses bidding for government procurement contracts in the markets of its 47 current members.1 This market is valued at US$1.7 trillion2 annually and is expected to grow following the accession of China and Russia to the GPA.

In return, we agree overseas companies can bid for our government business.

Australia launched negotiations to accede to the GPA in 2015.

Benefits to Australian exporters

Legally binding market access

GPA membership would provide legally binding market access for Australian firms to the procurement markets of GPA members, most significantly the European Union and its 28 member states. This would provide safeguards against any future protectionist measures introduced by GPA parties while delivering the certainty of a multilateral rules-based system. While Australian firms are not currently automatically disqualified from participation in GPA members’ markets, there are no legal barriers to stop some GPA members from excluding Australian firms.

Access to future GPA market expansion

Nine additional parties are currently in GPA accession talks, including Russia and China. China’s accession to the GPA will, for the first time, secure for GPA member suppliers meaningful and legally binding market access to significant parts of Chinese procurement markets. China’s total procurement market is estimated at US$1.5 trillion or around 20 per cent of China’s GDP. China’s accession is a high priority for GPA members. China’s accession may also generate considerable further interest from other WTO Members who have not acceded to the GPA.

Review rights for firms

Aggrieved firms have the right to take a complaint to an independent review body in each jurisdiction.

Why now?

Improvements in the GPA

A revised GPA entered into force on 6 April 2014. For covered government procurements, the revised GPA improves and updates the agreement and is more in line with the principles underlying Australia’s government procurement regime and makes GPA accession more beneficial.

  • The revised GPA better reflects the needs and realities of modern procurement processes. Notably the revised GPA takes into account the expansion of electronic procurement and the often reduced timelines and increased efficiency of government procurement practices.
  • The revised GPA provides gains in market access. Existing GPA members have expanded coverage of government entities (ministries and agencies) and services.

Australia’s compliance

Australian Government procurement practices have evolved over the past decade, making us already substantially compliant with the GPA. Australia enjoys a world-class government procurement system based on principles of value for money, non-discrimination and competition. Our procurement market is already open to competition from foreign suppliers.

Other considerations

Safeguarding Australian interests

Australia safeguards specific policy and strategic interests in negotiating trade agreements. The Australian Government continues to work closely with state and territory governments and other stakeholders to fully reflect Australia’s broad commercial and government procurement policy interests in our GPA negotiating position.

Changes to government procurement procedures

Implementation of the GPA will require several modest changes to existing practices at the time of implementation, including to procedures for pre-qualification and limited tendering.

Australia would also be required to have in place appropriate review procedures. The Department of Finance is working on improving these procedures based on the recommendations of a Senate committee report into Commonwealth procurement practices. These changes, which also satisfy GPA obligations, would provide an accessible review mechanism for all suppliers, including Australian businesses, to raise concerns and seek remedies in a timely manner.

Timeline of Australian accession

2015: Australia launched negotiations to accede to the GPA.

2015: Australia submitted its first offer of accession to the WTO Committee on GPA.

2017: After feedback and questions, Australia presented its revised offer to the WTO Committee on GPA.

March 2018: Following further feedback and questions, Australia presented its final offer to the WTO Committee on GPA, with the offer discussed during the 12-14 March meeting of the GPA Committee. GPA parties will consider Australia's final offer further at the next GPA Committee meeting scheduled for June 2018.

Current procurement market access

Australia’s procurement market is integrated with New Zealand, and Australian suppliers already have legally-binding access to the procurement markets of the US, Singapore, Chile, the Republic of Korea and Japan through our bilateral free trade agreements. Australia has also negotiated procurement market access in the yet-to-be-ratified Trans-Pacific Partnership Agreement.

Consultation

DFAT held direct consultation with more than 45 peak bodies and industry stakeholders, and a public consultation process, to decide if there was a market access case for reviewing Australia’s position on GPA accession.

The call for public submissions is closed, but we welcome comments from stakeholders throughout accession negotiations.

Submissions received*

* Organisations listed: Some organisations/entities have provided permission to be listed publicly as having made a submission to DFAT. Where an organisation/entity has also agreed to have their submission made available, a link to the text of their submission appears next to their name.

Copyright and content: Copyright in submissions resides with the author(s), not with DFAT. The views expressed in these submissions are the views of the author(s) and should not be understood as reflecting the views of the DFAT.

Resources

Last Updated: 3 April 2018

Contacts

Email: gpa@dfat.gov.au

Phone: + 61 2 6261 1111

Mail:

Free Trade Agreement Policy and New Issues Section,
Office of Trade Negotiations,
R.G. Casey building,
John McEwen Crescent,
Barton ACT 0221