U.S. Stalls U.K. Bid to Stay in $1.7 Trillion Market

(Bloomberg) -- A U.K. bid to rejoin a $1.7 trillion public procurement alliance stalled because its application was missing key information, according to a U.S. official familiar with the proceedings.

The U.K. failed to provide requested information and updates related to its proposal to become part of the World Trade Organization’s 46-nation Government Procurement Agreement, said the official, who asked not to be identified because discussions are ongoing. Despite the setback, there was broad support to find a way to keep the U.K. in the accord.

Britain, which will lose its access to the group after leaving the European Union in March, will try again next month to reach an agreement. The U.S. was joined by New Zealand and Moldova in rejecting the bid, according to three other officials.

The dilemma arises just as Prime Minister Theresa May tries to navigate a departure from the EU, which threatens to throw British trade relations into uncertainty. Failure to rejoin the pact could prevent U.K. companies from bidding on government contracts in member nations, including the $837 billion U.S. market.

‘Significant Progress’

GPA members will consider a provisional agreement to the U.K.’s accession bid at the next WTO government procurement committee meeting on Nov. 27, three of the officials said.

“We have made significant progress to get to this point and we will be working closely with other members in the coming weeks to ensure that an agreement can be reached in good time,” according to an emailed statement from the U.K.’s Department for International Trade. The U.K. government added that it welcomes the support of the “overwhelming majority” of GPA members that back its accession.

The purpose of the GPA is to open up government procurement markets to foreign competition, and help make the process more transparent. British officials argue that the U.K. is a special case and should receive expedited approval because it’s already a member -- although it has never independently ratified the agreement -- and can simply replicate its current commitments, deriving from its EU-membership status.

In addition to the U.S., New Zealand and Moldova, Japan, South Korea, Ukraine, and Israel had additional concerns regarding the U.K. bid, according to a separate sources familiar with the matter.

To contact the reporter on this story: Bryce Baschuk in Geneva at bbaschuk2@bloomberg.net

To contact the editors responsible for this story: Alan Crawford at acrawford6@bloomberg.net, Richard Bravo, Ben Sills

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