US said to mull blocking UK from Procurement Accord

Geneva, Switzerland – The US is threatening to block the UK from a 46-nation public procurement agreement, a move that would deny British companies from accessing a near US$2tn marketplace after leaving the European Union (EU), according to two officials with knowledge of the situation.

The UK will apply to rejoin the Government Procurement Agreement (GPA), a US$1.7tn trade accord that governs global appropriation rules, since it will lose its membership after Brexit in March. US negotiators have told their British counterparts that their application is outdated and needs to be revised, said the officials, who asked not to be identified because talks are ongoing.

If blocked from the pact, UK companies such as Rolls-Royce Holdings Plc and Serco Group Plc could lose access to members’ procurement processes, including the US$837bn US market. The UK will ask GPA participants to provisionally approve its final offer to join the accord during an October 17 meeting, where any member can block the accession bid. The British side would still have time to improve its offer to allay members’ concerns.

A majority of the accord’s members ‘support the UK continuing to be a part of it after we leave the European Union, which is in everyone’s interest’, according to an emailed statement from a spokesman for the UK’s Department of International Trade. “The UK is a huge part of this agreement and our continued membership will allow companies from other countries to maintain access to UK contracts worth £68bn a year.”

At least two other members of the agreement are dissatisfied with the UK’s application and doubt that it will be accepted on October 17, according to two other officials.