WORLD TRADE
ORGANIZATIONGPA/50
15 June 2001
(01-2999)
Committee on Government Procurement Original:  English
REVIEW OF NATIONAL IMPLEMENTING LEGISLATION
UNITED STATES
The present document reproduces the questions put to the delegation of the United States and
the responses given and comments made during the review of national implementing legislation at the
Committee's meetings of 23 February 1999 and 29 September 2000.1  The United States' notification
of its national implementing legislation in accordance with the Committee's Decision in GPA/1/Add.1
has been circulated in document GPA/23, dated 15 July 1998.
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REPLIES TO THE QUESTIONS FROM CANADA AND
THE EUROPEAN COMMUNITY
I. GENERAL
Question from Canada
Would the United States please explain how its legislation and regulations ensure
non-discriminatory treatment and the elimination of  offsets for covered procurement, including the
elimination of all Buy America requirements  and any provisions for sub-contracting or
sub-contracting plans from domestic suppliers?
FAR Section 25.402(a) implements the waiver  of most Buy America requirements for
suppliers and products of GPA participants and other designated countries.  This waiver does not
apply to programmes and requirements specifically excluded from GPA coverage, including General
Note 1 to Appendix I, relating to small business and minority set-asides, and the notes to Annexes 2and 3 referred to in the response to Question 1, above.
Question from Canada
In its response to Canada's question conc erning non-discriminatory treatment, the
United States does not address the elimination of the provisions for subcontracting or subcontracting
plans for United States small business.  It is noted that United States legislation and regulations
require the provision of subcontracting plans for United States small business in GPA-covered
contracts.  Would the United States explain how these provisions are consistent with Article III of the
GATT;  and with Article III of the WTO GPA - Non-discrimination and Article XVI of the WTO GPA -Offsets?  Please address this issue both in respect of foreign suppliers who are providing goods and
services that are not of United States origin and foreign suppliers providing goods and services that
are partially of United States origin.
                                                     
1 The minutes of these meetings have been circulated in documents GPA/M/11 and 14.GPA/50
Page 2
Small and minority business set-asides are excluded from the coverage of the Agreement on
Government Procurement under General Note 1 to the United States' Appendix I.  We also note that,
under the Federal Acquisition Regulation (FAR 19.702(a)), subcontracting plans are requirements that
apply only to "apparently successful offerors" and "bid ders selected for award";  they are not factors
that influence the initial competitive selec tion of the "apparently successful offeror".
Question from the European Community
What steps has the United States Government taken to ensure implementation of
Article XXIV:7(c) of the GPA, in particular in relation to resisting new restrictions and seeking to
eliminate existing ones which (a) Congress, or (b) subfederal authorities covered under Annexes 2
and 3 have imposed, or seek to impose?
In the context of the United States commitmen t to promoting full and open competition, the
Administration consults with the Congress on legislative proposals relating to United States
procurement policies and practices.  During the negotiations leading to the conclusion of the
Government Procurement Agreement and subsequently, the Administration has consulted regularly
with relevant state-level agencies and associations and with individual states, as appropriate, on issues
related to the implementation of the Agreement.
At a federal level, there are inter-agency procedures which allow the collection of
Administration comments on proposed legislation.  This is the primary way in which consultation
with Congress proceeds on these types of issues.  To facilitate implementation by the covered states,
the Administration (particularly through the Office of the United States Trade Representative), has
established regular consultative procedures with a number of national associations of staterepresentatives.  Specifically, it has coordinated with the National Association of State Procurement
Officials (NASPO) in producing and disseminatin g a "Guide for State Procurement Officials
Application of the WTO Agreement on Government  Procurement".  NASPO is also consulted in
relation to issues raised by the Committee and issues that arise in relation to the implementation of the
GPA.  Also, there are fairly frequent communications with individual states on an ad hoc basis oneither proposed state level legislation or questions relating to other governments' coverage under the
GPA.
II. TENDERING PROCEDURES
Question from the European Community
Article VI states that technical specifications prescribed by procuring entities shall, where
appropriate, be based on international standards, where such exist.  To what extent, if possibleexpressed as a proportion of all contract awards, do contracting entities refer to international
standards, where such standards exist?
There is no way to statistically determine to what extent technical specifications contained in
procurement notices or involved in tendering procedures rely on international standards.  However,
recently, the United States has taken steps to reduce to a minimum procurement and regulatoryagencies' reliance on government-unique standards.  The National Technology Transfer and
Advancement Act of 1995 (PL 104-113) provides that "all Federal agencies and departments shall use
technical standards that are developed or adopted by voluntary consensus bodies ...".  Such standards
include those developed by both domestic and international voluntary consensus standards-setting
bodies.GPA/50
Page 3
This policy is implemented through Office of Management and Budget (OMB) Circular
A-119, dated 10 February 1998, which adds that:  "in the interests of promoting trade and
implementing the provisions of international treaty agreements ... [agencies] should consider
international standards in procurement and regulatory applications" (Section 6.h).  Agencies which do
not use available voluntary consensus standards must submit to OMB written explanations of thereasons for using government-unique standards (Section 6.b).  Circular A-119 also requires that
Federal agencies give preference to performance standards when such standards may reasonably be
used in lieu of proscriptive standards.
Question from the European Community
To what extent do United States contracting entities resort to limited tendering procedures as
provided for in Article XV?  How is correct and full application of Article XV monitored?
United States regulations provide that:  "with certain limited exceptions ... contracting officers
shall promote and provide for full and open competit ion in soliciting offers and awarding Government
contracts".  In particular, Part 6 of the Federal Acquisition Regulation (FAR) prescribes policies and
procedures to promote full and open competition in the procurement process and to set out the
conditions under which limited tendering is permitted.  FAR Part 6 provides that, when procurement
officers depart from full and open competition procedures, they must justify their use of this authority.Each justification must contain sufficient facts and rationale to justify the use of the specific authority
cited.  As a minimum, each justification must include at least twelve elements of specific information
about the contracting opportunity and the justification.
Complete statistics on the use of limited tendering procedures for contracts covered by the
GPA are not currently available.  In recent years, however, available statistics show that contractsawarded under limited tendering procedures have accounted for about 10 per cent of all Federal
procurement contracts exceeding US$50,000.
III. PUBLICATION
Question from the European Community
According to Article IX of the GPA, invitations  to participate regarding intended procurement
shall be published in the appropriate publication listed in Appendix II.  We note that only one of at
least 37 relevant information sources relating to Annex 2 entities is indicated.  The United States is
therefore requested to comment on its implementation of the transparency requirements of Article IX.
To what extent have efforts been made to bring together in one location on the Internet (for example,
through links) all relevant information sources at the federal and subfederal level?
All federal procurement offices, with some exceptions provided for under the GPA, are
required to announce proposed procurement actions over US$25,000 in the Commerce Business Daily
(CBD).  These notices are accessible to all domestic and foreign suppliers either through the printed
version of the CBD, or through the CBDNet , a free of charge Internet-based system
(www.CBDNet.gpo.gov).  In addition, detailed info rmation on procurement policies, practices and
procedures and opportunities for all federal entities is available on the National Air and Space
Administration's federal procurement "jump-sta tion" (http://nais.nasa.gov/fedproc/home.html).
In terms of sub-central publications, the Internet home page of the National Association of
State Purchasing Officers (NASPO) contains hyperlinks to the central procurement entities of each of
the states covered by the GPA (http://www.naspo.org/state/stateweb.html) .  Those links provide
information on state procurement rules and procedures, current procurement opportunities and
contract awards.GPA/50
Page 4
Question from the European Community
How does the United States Government ensure in its procurement notices, as well as those of
covered subfederal entities, that foreign supp liers are made aware that contracts fall under the
Agreement and are not subject to restrictio ns such as Buy America or set-asides?
Section 5.207(e) of the United States Federal Acquisition Regulation (FAR) provides that, for
each announcement of proposed procurement action published in the  Commerce Business Daily , one
or more standardized "numbered notes" may apply to the proposed contract action.  Each numbered
note represents specific conditions or information that applies to the proposed contract action.  The
purpose of the numbered notes is to eliminate the unnecessary duplication of information that appears
in various announcements.  When a note applies to an announcement, the contracting official
references the note at the end of item 17 in the synopsis.
For contracts covered under the GPA, federal procurement offices indicate whether one or
more of the items under the acquisition is covered by indicating that Note 12 applies to the
procurement.
For all acquisitions covered by the WTO GPA, federal government agencies evaluate offers
for an eligible product without regard to the restrictions of the Buy American Act.  With regard to set
asides, General Note 1 of Appendix I of the United States provides that the GPA will not apply to setasides on behalf of small and minority businesses.  For additional information on set asides, please
refer to the response to question 7, below.
Question from Canada
Would the United States please explain how its legislation and regulations provide for its
notices of proposed procurement to meet each of the requirements of Article IX? Would the United
States please explain where the information on coverage of individual procurements by the
Agreement, as provided for in paragraph 11 of Article IX, may be located?
Part 5 (Publicizing Contract Actions) of the United States Federal Acquisition Regulation
(FAR) implements the requirements of Article IX .  FAR Section 5.207(e) provides that, for each
announcement of proposed procurement action published in the  Commerce Business Daily , one or
more standardized "numbered notes" may apply to the proposed contract action.  Each numbered note
represents specific conditions or information that applies to the proposed contract action.  The purpose
of the numbered notes is to eliminate the unnecessary duplication of information that appears in
various announcements.  When a note applies to an announcement, the contracting official references
the note at the end of item 17 in the synopsis.
For contracts covered under the GPA, federal procurement offices indicate whether one or
more of the items under the acquisition is covered by indicating that Note 12 applies to the
procurement.
IV. COVERAGE
Question from the European Community
The GPA applies to purchases of a number of FSC categories "subject to the United States
Government determinations under the provisions of Article XXIII, paragraph 1" (see Annex 1):
• How does the United States Government make such a determination?  For example, do
guidelines exist in relation to the invocation of national security?GPA/50
Page 5
• More specifically, are studies carried out each time Article XXIII, paragraph 1 is invoked
to determine whether this is justified?
• Are studies carried out to justify the continuation of such restrictions each time they are
renewed?
• When Congress imposes Buy American restrict ions in the annual appropriations bills,
does DOD/the Administration comment on such provisions before the President signs the
bills?
Detailed guidelines for invoking national security exceptions for acquisitions normally
subject to the provisions of the GPA are set forth in regulation.  For example, Defense Federal
Acquisition Regulation Supplement (DFARS) subpart 225.403(c)(1)(A) states "If a department oragency considers an individual acquisition of a product to be indispensable for national security or
national defense purposes and appropriate for exclusion from the provisions of Federal Acquisition
Regulations (FAR) subpart 25.4 (FAR Chapter 25 implements United States international trade
commitments), it may submit a request with supporting rationale to the Director of Defense
Procurement (USD(A&T)/DP)".  The Director of  Defense Procurement is the Department of
Defense's senior procurement official.  Her staff carefully evaluates requests for exemptions from the
requirements of FAR 25.4 to ensure that it thoroughly demonstrates national security or nationaldefense considerations are justified. In addition, the request may be reviewed by other agencies as
necessary. There are administrative procedures within the federal Administration that provide for co-
ordination in such cases.
In the absence of appropriate documentation, requests for exceptions to the requirements of
FAR 25.4 are not approved.  As pa rt of normal administrative review procedures, appropriate
personnel from the responsible executive agencies may review such exceptions and make appropriate
recommendations.
As indicated in the response to question 5 above, the Administration has the opportunity to
comment on proposals before the Congress at various points in the legislative cycle.
Question from the European Community
According to General Note 1 to the Appendix I of the United States, the GPA does not apply
to set-asides on behalf of small and minority businesses.  Please explain how in practice a contract is
set aside.  How does the United States define a small business?  How does the United States define a
minority business?  Can the United States provide an y statistics in relation to purchases from small
and minority businesses (for example, what percentage of total above-threshold procurement is setaside for such businesses)?
The regulatory procedures for small business and minority set-asides are set out in FAR
Part 19.502-2.  Procurements are set aside when there is a reasonable expectation that offers at fair
market value will be received from at least two responsible small business concerns.  In the absence
of that reasonable expectation, the contracts are not to be set aside.  That is, if it is impossible to
identify small or minority businesses that are interested in bidding on those type of contracts, a
contract will not be set aside.
FAR Part 19.001 defines a "small business" as a business, including its affiliates, that is
independently owned and operated, not dominant in the field of operation in which it is bidding on
government contracts, and qualified as a small business under the size standards and other criteria that
are established on a sector-by-sector basis by the Small Business Administration.  The size standards
are listed in FAR Part 19.002.GPA/50
Page 6
The Code of Federal Regulations defines minority businesses as businesses of "disadvantaged
individuals" that have been subjected to racial or ethnic prejudice or cultural bias because of their
identities as members of groups and without regard to their individual qualities.  The social
disadvantage must stem from circumstances that are beyond such individuals' control.
Statistics on how the use  of set-asides relates to GPA coverage are not yet available.  Efforts
are being made to develop such statistics.  The initial indication is that the amount of set-asides
affecting GPA coverage is likely to be small - that is probably in the range of 5 per cent.  However,
this is currently being verified.
Question from the European Community
Does the Federal Administration, or any other body, monitor or in any other way verify
(whether on a routine or an ad hoc basis) that entities covered under Appendix I carry out
procurements in accordance with GPA requirements?
Implementation of the GPA is done directly through regulation which has legal effect. All
entities that are covered by those regulations must comply. All Federal procurement entities are
required to comply with the Federal Acquisition Regulation (FAR), Defense Federal Acquisition
Regulation Supplement (DFARS) and other applicab le laws and regulations which implement United
States commitments under the GPA and other international agreements.
The Administration is not aware of any compliance problems.  If complaints are raised, the
Administration will vigorously investigate them.  As described in the "Notification of National
Implementing Legislation" (GPA/23), any departures from regulatory requirements can be addressed
through established review procedures.  In addition to performing its bid challenge functions, the
United States General Accounting Office (GAO) conducts ad hoc investigations of Federalprocurement agencies' implementation of United States law and regulations, including the Federal
Acquisition Regulation (FAR).
Question from the European Community
For each of the 37 States fully or partially covered in Annex 2, please indicate whether the
Federal Administration has taken steps to verify that the procurement regime(s) of that State is inconformity with GPA requirements.
The United States has a regular consultative procedure. As part of the process of preparing the
United States "Notification of National Implementing Legislation" (GPA/23), the Administration
conducted a survey of the 37 states covered by the GPA in order to assess their implementation of
GPA requirements.  In addition, the Administration has consulted closely with the National
Association of State Procurement Officials (NASPO) and the indivi dual NASPO 37 state
representatives on issues related to GPA implementation.  This consultation indicated that all37 States are fully compliant with the requirements of the Agreement.
Detailed information on each of the states is available through the NASPO website.  That
website provides links to each of the state procurement agencies and each has on their websites,
notification of opportunities and also expl anation of procurement practices, laws etc.GPA/50
Page 7
Question from the European Community
For each of the 37 States fully or partially covered in Annex 2, were any statutory
amendments to laws or regulations required  to implement the obligations of the GPA?
The Administration is not aware of any legislative changes that were necessary to comply
with GPA requirements.  Some states have issued policy and administrative guidance to ensureconformance with specific GPA provisions, such as those relating to time-limits in Article XI.
Question from the European Community
In the checklist of issues – questions 6-14 – information with regard to implementation at
State level is provided only in the form of a gene ral statement.  However, it is our understanding that
individual States have autonomy in determining their procurement policies and practices and that
considerable variations between them may exist.  Please therefore provide responses to
questions 6-14 for each of the 37 States covered under Annex 2.
As noted in the response to question 2, such information can be obtained on the individual
states' web-sites, which are listed on the NASPO home page
(http://www.naspo.org/state/stateweb.html)  or through the list of NASPO State Directors
(http://www.naspo.org/stdirect.html).
Question from Canada
Regarding section 1.2 on page 2 of its Notification of National Implementing Legislation, can
the United States provide more detail on the circumstances in which federal procurement laws and
regulations are applicable to state government, under what authority, and what are the statutory
requirements that state governments must meet?
As noted in Section 1.2 of GPA/23, Federal procurement laws and regulations generally do
not pertain to state government procurements.  Howe ver, Federal statutory requirements apply to state
government procurements when those procurements involve the expenditure of certain Federal grants
or other financial allocations.  Those requirements are addressed in Note 1 and Note 5 to Annex 2,
and Note 1 to Annex 3.
Question from the European Community
According to note 1 to Annex 2, subfederal entities can apply restrictions that promote
general environment quality in that State.  The United States is requested to provide examples of such
restrictions.
Many US states have established purchasing practices that are intended to promote general
environmental quality.  A widely utilized example of such a practice is the adoption of procurement
laws and regulations that encourage the use of recycled products, or products made with recycledmaterial.  Such laws often grant a specific percent price preference for recycled products or products
containing recycled materials.
Question from the European Community
Can the United States Government confirm that, while contracts for R&D services are
excluded from its offer in Annex 4, the purchase of supplies or the execution of construction serviceswhich are necessary for those R&D services to be supplied, are covered by the Agreement?  Are there
any conditions that have to be met for foreign-owne d firms to participate in the award of such supply
or construction services contracts?GPA/50
Page 8
When the procurement of such supplies or construction services is a component of an R&D
contract or a contract for procurement of one of the other services listed in Annex 4, General Note 4
to Appendix I is applicable.
Question from the European Community
Can the United States Government confirm that the United States coverage of contracts for
construction services includes supplies which can be considered an intrinsic part of a construction
contract and without which the construction could not be completed?
In general, coverage of contracts for construction services includes supplies which can be
considered an intrinsic part of a construction contract. However, the United States Appendix I sets out
several potential exceptions to this rule which may apply to procurements by Annex 2 and Annex 3
entities, specifically Note 1 and Note 5 to Annex 2 and Note 1 to Annex 3.  These relate to the use of
funds by sub-central entities.
Question from Canada
Can the United States explain how its legislation and regulations provide for the procurement
of architectural services and for the procurement of engineering services to be carried out in
accordance with the Agreement on Government Procurement?
United States regulations for the procurement of architectural and engineering services are
contained in FAR Subpart 36.6.  These regulations require that entities publish a notice of all
requirements for architectural or engineering services (36.601-1) and that those services be procured
through competitive procedures (36.601-2).  Other re levant requirements include provisions to ensure
that the evaluation process is objective and based on the technical merits of each proposal, and to
ensure that appropriate records of award decisions are maintained.
Questions from Canada
(a) In its response concerning the procurement of architect-engineer services, the United States
references FAR 36.602 - Selection of Firms for Architect-Engineer Contracts, subpart 36.602
- 1 (Selection Criteria) makes reference in subpart (a)(5) to "location in the generalgeographic area of the project and knowledge of the locality of the project...".  Would the
United States please explain whether it considers this provision to be consistent with the GPA
and specifically with GPA Articles III - Non-discrimination and XVI - Offsets, and if so, how?
Sub-part 36.602-1 addresses the unique nature and the particular requirements of
architect-engineer service contracts by setting out a number of factors that procuring entities should
consider in evaluating the capability of potential s uppliers to fulfill such contracts.  Decisions are
based on an evaluation, on a case-by-case basis, of a range of factors relevant to particular
architect-engineering contracts, and do not discriminate among firms which are capable of fulfilling
each specific procurement need.
(b) We note FAR subpart 36.104 refers to procurement being carried out under the Brooks
Architect-Engineers Act as being outside the scope of FAR 36.  Is the Brooks
Architect-Engineers Act used for GPA-covered procurement and, if so, would the United
States please explain whether it considers the procurement carried out in accordance with the
Act to be consistent with the GPA?
The Brooks Architect-Engineers Act requires full and open competition for contracts subject
to the Act.  The procurements carried out in acco rdance with this Act are therefore consistent with
domestic legal requirements and the requirements of the Agreement on Government Procurement.GPA/50
Page 9
V. BID CHALLENGE
Question from Canada
Would the United States explain whether it considers its legislation in 41 U.S.C.
section 253 j(d) (1994) to be consistent with the GPA.  The section restricts the scope of bid challenge
concerning delivery orders under IDIQ's (indefinite delivery indefinite quantity) to instances where
there is an increase in "the scope, period, or maximum value of the contract under which the order is
issued".
As the United States has explained in consultations relating to the use of IDIQ contracts and
similar procurement instruments (see, for example,  paragraph 8 of Job No. 2795), task or delivery
orders occur after the awarding of an IDIQ contr act and are not subject to the tendering, award and
challenge procedures of the Agreement on Government Procurement.  Of course, the procedures for
tendering and the awarding of IDIQ contracts are subject to the relevant Agreement on Government
Procurement provisions, including the bid challenge procedures, provided the contract itself is
covered.
Although we do not consider individual transa ctions that follow the award of an IDIQ
contract to be subject to the Agreement on Government Procurement provisions for tendering and
contract award, we nevertheless provide, as Canada's question notes, challenge procedures relating to
changes in the scope, period or maximum value of an IDIQ contract.  We believe this is necessary,given the unique nature of IDIQ contracts, in order to strike a balance between ensuring that contract
terms are honoured and preserving the efficiency that these types of contracts are intended to provide.
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