The bid challenge procedures under the WTO Government Procurement Agreement: a critical study of the Hong Kong experience

Abstract

As one of the original contracting parties to the Government Procurement Agreement (GPA) since the Tokyo Round, Hong Kong also participated actively in the negotiations to improve the GPA during the Uruguay Round and joined the new GPA shortly after it entered into force in 1996. In order to ensure effective enforcement of the obligations, the new GPA explicitly requires Members to establish a challenge procedure and this has been praised as “arguably the most innovative aspect” of the GPA.1 As explained by Arrowsmith: “[i]n providing for a detailed system of supplier remedies the GPA marks a departure from the approach of most other WTO agreements. In general, these do not require affected private parties to be given a right to enforce WTO rules, but rely mainly on inter-governmental enforcement. Private challenge procedures are required under some of these provisions, but *P.P.L.R. 212 none go as far as the GPA. In particular, their procedural requirements and obligations on remedies are not as detailed or stringent as those of the GPA and they generally give greater deference to states' own national traditions of review in the particular area concerned.”2 While there has been an extensive literature on the challenge procedure of the GPA in general,3 as well as excellent country studies on the operation of the national challenge procedures of several key GPA Members,4 no such study has been conducted for Hong Kong yet. In the view of the author, even though Hong Kong has a relatively small procurement market, it combines the features of a clean and effective government and a highly internationalised procurement market, and thus makes an interesting subject of study. In this article, the author examines the efforts made by the Hong Kong Government to implement its obligation under the GPA to provide challenge procedures. The article starts by reviewing Hong Kong's participation in the government procurement agreements under the GATT and WTO, and then sets out the general background to the Review Body for Bid Challenges of Hong Kong. In the next section, the article discusses in detail the bid challenge procedures and how such procedural rules have been applied and elaborated through the cases that came before the Review Body. The article concludes by noting that the bid challenge system in Hong Kong generally conforms to its GPA obligations.