Multi-Functional Transport Satellite-based Augmentation System (MSAS) procurement issues
In March 1993, the European Union lodged a complaint with the World Trade Organization (WTO), claiming that the Japanese government violated the WTO accord on government procurement when it excluded EU companies from bidding on a next-generation Multi-Functional Transport Satellite-based Augmentation System (MSAS) for commercial aircraft. After the general assessment bidding system, the Japanese government awarded the contract to NEC, which has a business link with the U.S. company, Hughes, over Toshiba at about 4.6 billion yen, citing technological superiority. To cope with increasing air traffic, the Ministry of Transport plans to use the multi-purpose satellite and GPS (Global Positioning System) to accurately locate aircraft, mainly in skies over the Asia and Pacific Region. The new technology will shorten flight intervals from the current 10 to 15 minutes to less than 5 minutes. MASA is a computer system that corrects GPS positioning signals to improve aviation precision. Plans call for it to go into practical use around 2000.
World Trade Organization (WTO)
This international organization was established in 1995 to replace General Agreement on Tariffs and Trade (GATT). It seeks agreements and smooth implementation to reduce tariffs and other trade impediments and abolish discriminatory practices in international trade. However, the area of aviation is exempt from the General Agreement on Trade in Services except for certain auxiliary duties such as aircraft maintenance. In its complaint regarding international bidding on Multi-Functional Transport Satellite-based Augmentation System (MSAS), the European Union claimed that the Japanese request for compatibility with the more advanced specifications of the U.S. system effectively excluded EU companies from the bidding process. Based on the Agreement on Government Procurement stipulating the principle of non-discrimination, bilateral negotiations were arranged, inviting the United States to attend as a country with a vested interest. The dispute was resolved after two rounds of negotiations. In disputes that cannot be resolved through bilateral negotiations, the WTO makes its judgments through multilateral negotiations.
