This report by the Law Library of Congress discusses the implementation of government procurement agreements, including the World Trade Organization Plurilateral Agreement on Government Procurement (WTO-GPA), and the domestic laws that regulate government procurement in Brazil, Canada, China, the European Union, India, Japan, and the Russian Federation. It includes a comparative summary.
Full Report, (PDF, 480KB)
Article 37 of the Brazilian Constitution of 1988 provides that public works, services, purchases, and transfers of ownership must be contracted through a process of public tender that assures equal conditions for all bidders. To participate in the bidding process, foreign companies must be legally established or represented in the country. Brazil is not a party to the World Trade Organization Plurilateral Agreement on Government Procurement.
Canada has implemented the provisions of NAFTA and the WTO agreement on government procurement at the federal but not the provincial or municipal level. Therefore, Canadian suppliers can be excluded from bidding on state and local contracts that are subject to the “Buy American” provisions of the American Recovery and Reinvestment Act. Most government contracts that are open for bidding by US suppliers are listed by Public Works and Government Services Canada on the Government Electronic Tendering Service through MERX. This governmental department buys goods and services through contracts, standing offers, and supply arrangements.
Under China’s Government Procurement Law, “government procurement” refers to the use of government funds by government authorities, institutions, and social organizations to procure goods, projects and services that fall within the centralized procurement catalogue, or that are above purchase thresholds. Under the Law, government procurements must come from domestic sources, with some exemptions. The Law may not apply to procurements relating to the military, emergency and national security, international loans, and mechanical and electronic products.
Government procurement is governed by two EU Directives and the WTO Government Procurement Agreement, to which the EU and the twenty-seven Member Countries of the EU are parties. Within the single market of the EU, where the principles of nondiscrimination, equal treatment, and transparency apply, a preference for domestic sourcing is not required. Public contracts are awarded on the basis of only two criteria: (a) “the most economically advantageous tender” and (b) the lowest price.
The legal framework for government procurement of goods and services is derived from provisions of the Constitution of India. As India is a union of states, some states have established their own procurement rules. Overall, the objective of the various procurement policies of the states under the framework rules is to provide equal opportunity, fairness, and transparency to all domestic and foreign companies that compete for procurement contracts and award the contract to the bidder with the lowest bid.
Under the Accounts Law, each government agency in Japan is responsible for its own procurement. While open tendering is the standard method under the law that is used for awarding procurement contracts to suppliers, in practice restricted tendering is more common. Japan is a party to the WTO Agreement on Government Procurement, which was implemented through the passage of domestic regulations. Japan has taken measures to open procurement from foreign suppliers to a greater extent than is required by the WTO Agreement.
The Russian government procurement system has been in place since 2006, and has undergone constant changes in order to enhance its efficiency and transparency. Contracts are generally awarded to the winners of anonymous online auctions. Other methods of government procurement can be used depending on the price of the contract and the scope of work. The law does not provide for exemptions other than for reasons of state secrecy, and protectionist measures are minimal.
Last Updated: 09/16/2014