MAIN ARGUMENTS ADVANCED IN PREVIOUS DISCUSSIONS HELD IN THE COMMITTEE ON GOVERNMENT PROCUREMENT ON A UNIFORM CLASSIFICATION SYSTEM FOR STATISTICAL REPORTING

                                                          Note by the Secretariat

1)     At its meeting on 15 November 1994, the Working Group on Statistical Reporting of the Interim Committee on Government Procurement requested the Secretariat to prepare a paper on previous discussions held in the Committee on Government Procurement under the Agreement presently in force, summarizing the arguments advanced on the advantages and disadvantages of the various classification systems.  This note has been prepared by the Secretariat in an attempt to respond to the above.

2)     Article VI:10(b) of the present Agreement calls for statistics to be reported under a "uniform classification system to be determined by the Committee".  Currently, statistics are being reported by 11 of the 12 Parties to the Agreement presently in force in accordance with a Committee decision, taken when that Agreement was implemented, to use 26 categories flowing from the Customs Cooperation Council Nomenclature (CCCN) (GPR/M/1, Annex III).  From 1987 to 1990,  inconclusive discussions took place in the Committee on Government Procurement with a view to determining a uniform classification system.  Out of these discussions, three major classifications came forward as possible bases for a uniform classification system:  (1) the UN Central Product Classification (UNCPC);  (2) the Harmonized Commodity Description and Coding System of the Customs Cooperation Council (HS);  and (3) an adaptation of the existing 26 product categories agreed upon by the Committee in January 1981.  However, none of these was capable of giving a global answer to all concerns expressed by delegations.  These concerns related to the functionality of the systems, details required, inclusion of services, simplicity, comparability and transparency, and a minimum administrative burden.  The final thrust of the discussions was that the UNCPC under the circumstances was the best candidate but that any system chosen by the Committee might need to be modified in order to make it more appropriate for the purposes of the Agreement.  Arguments advanced during these discussions on the advantages and disadvantages of the three classification systems are reproduced below.