E N F O R C E M E N T   AND   C O M P L I A N C E

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What is this Agreement and what does it do?

Who benefits from this Agreement?

How can this Agreement help my company?

Can the U.S. Government help me if I have a problem?

How can I get more information?

What is this Agreement and what does it do?

The purpose of this Agreement is to expand the Japanese Government's procurement of competitive computer products and services from the United States and other foreign countries. Japan agreed that its procurement would be based on the principles of non-discrimination, transparency and fair and open competition.

The Agreement is in the form of an exchange of letters and an attachment dated January 22, 1992, between the U.S. Trade Representative and the Ambassador of Japan to the United States. It entered into force in stages, a process that was completed by April, 1993. It has no expiration date.

Who benefits from this Agreement?

Any U.S. company interested in supplying computer hardware, software or services to a national government department or quasi-governmental organization in Japan that is specified in this Agreement can benefit from Japan's commitment to open, non-discriminatory procurement procedures.

How can this Agreement help my company?


This Agreement applies to procurement by:

-Japanese national government entities that are listed in Appendix I (offsite link) of the Agreement on Government Procurement of the World Trade Organization (WTO), and

-quasi-governmental agencies that are listed in Annex II of this Agreement.

For procurement by prefectural and local governments, Japan undertook only to "request their cooperation in following the purport" of the Agreement, so procurement by these entities is not subject to the terms of the Agreement.

The following are the products and services that are covered:

-computer products, including peripherals and packaged software;

-computer services, including the operation and maintenance of computers, input of data into computers, development of computer systems (including the development of software and systems integration), maintenance of computer software, and other related services.

Procurement is covered if its value exceeds either 100,000 SDRs or the threshold in the Agreement on Government Procurement of the World Trade Organization (WTO), whichever is lower. An SDR (Special Drawing Right) is the value of a weighted basket of currencies calculated daily by the International Monetary Fund (IMF). It is used between IMF-member states to settle international business transactions. You can obtain the daily value of the SDR by calling the International Monetary Fund at (202) 623-7171. For the WTO threshold, see the Exporter's Guide to the WTO Agreement on Government Procurement. In April, 2001, 100,000 SDRs equaled approximately $126,000. The threshold listed by Japan in the WTO Government Procurement Agreement for 1998-99 for procurement of goods and services by central government entities was 130,000 SDRs, or approximately $164,000.

Procurement Procedures

The procurement procedures set forth in this Agreement can be summarized as follows:

Japanese procuring entities will announce their major procurement plans in advance in the Kanpo, Japan's official gazette (similar to the Federal Register). Suppliers can purchase the Kanpo, which is in the Japanese language, at certain bookstores in major cities worldwide.

In the pre-solicitation phase of the bidding process, all potential foreign and domestic suppliers will be accorded equal access to information. No advantage of advance knowledge will be given to any potential supplier. (To facilitate information access, the Japanese Government has decided to create a consolidated procurement information home page, which will contain all the information that is needed for bidding in all product categories covered by this Agreement. This home page should go on line in 2001.)

The Agreement states that specifications will be formulated in an impartial manner. All potential suppliers will be accorded fair and equal opportunities to participate in the bidding process. (Japan recently announced that a pilot program for digital bidding and contracting will begin in 2003, aimed at full implementation in 2005.) Single tendering will only be used in exceptional cases, and it will not be used to favor domestic suppliers. Evaluation of bids will be conducted in a transparent manner, and any testing criteria will be the same for all potential suppliers. Contracts will be awarded to the lowest bidder who has met the evaluation criteria. Once a final selection is made, procuring entities will publish information on the contract award and, on request, will provide unsuccessful bidders with information on why they were not selected.

Complaint Mechanism

The Japanese Government maintains an independent Procurement Review Board to review complaints by potential suppliers concerning the procurement of products and services covered by this Agreement. A complaint may be filed with this Board at any time during the procurement process, but it must be filed within 10 days of the time that a supplier knows, or reasonably should have known, the basis of the complaint. Within 10 days of the filing of a pre-award complaint, the Board will generally request a suspension of the procurement process, pending resolution of the complaint. Post-award complaints must be filed within 10 days of the award. In these cases, the Board generally requests suspension of performance of the contract pending resolution of the complaint.

Within 90 days of the filing of a complaint, after conducting an investigation which can include a hearing, the Board reports its findings and recommendations. If it finds that the procurement was not consistent with the intent or a specific provision of the Agreement, it may recommend an appropriate remedy such as issuing a new tender package, seeking new bids for the contract, re-evaluating existing bids, awarding the contract to another supplier, or terminating the contract. If the procuring entity does not follow the Board's recommendations, it must send a copy of its decision and the rationale for it to the Board within one working day. In such cases, Japan's Ministry of Foreign Affairs responds to external inquiries concerning the procuring entity's decision.

Can the U.S. Government help me if I have a problem?

Yes. If your company is experiencing difficulties selling computer products or services to a Japanese government department or a quasi-governmental agency covered by this Agreement, contact the Office of Trade Agreements Negotiations and Compliance's hotline at the U.S. Department of Commerce.

The Center can help you understand your rights and Japan's obligations under the Agreement, and it can alert the appropriate U.S. Government officials to help you resolve your problem. With your concurrence, the U.S. Government can, if appropriate, raise the particular facts of your situation with Japanese officials and ask them to review the matter.

How can I get more information?

The complete text of the U.S.-Japan Computer Products and Services Procurement Agreement is available on the Office of Trade Agreements Negotiations and Compliance's web site.

If you have questions about this Agreement or how to use it, you can e-mail the Office of Trade Agreements Negotiations and Compliance (TANC) which will forward your message to the Commerce Department's Designated Monitoring Officer for the Agreement. You can also contact the Designated Monitoring Officer at the following address:

Designated Monitoring Officer -

U.S.-Japan Computer Products and Services Agreement

14th Street & Constitution Avenue, N.W.

Washington, D.C. 20230

Phone: (202) 482 -3013

Fax: (202) 482 -0952

The Designated Monitoring Officer can also provide you with useful trade leads and contacts.

You can obtain additional information by visiting the following web sites in the International Trade Administration of the Department of Commerce:

The U.S. Commercial Service, American Embassy, Tokyo

The American Embassy in Tokyo helps U.S. companies enter the Japanese market and expand their sales there.

The International Government Procurement web site of the Department of Commerce's Trade Agreements Negotiation and Compliance contains general information on international government procurement opportunities.

TANC offers these agreements electronically as a public service for general reference. Every effort has been made to ensure that the text presented is complete and accurate. However, copies needed for legal purposes should be obtained from official archives maintained by the appropriate agency.