According to the working group: "Web Services Policy defines a flexible policy data model and an extensible grammar for expressing the capabilities, requirements and general characteristics of a Web service, and defines mechanisms for associating policies with Web service constructs."
WS-Policy is a significant standard in the realm of SOA run time governance, and has recieved the attention of many vendor organizations.
The WS-Policy working group recently published a primer which provides an introductory description to this policy language using numerous examples. The WS-Policy Primer 1.5 document lists the following organizations as editors of the working draft: Microsoft Corporation, BEA Systems, Inc., IBM Corporation, Layer 7 Technologies, and webMethods, Inc. The specification has existed since 2002, but was not submitted to the W3C (World Wide Web Consortium) standards organization until recently in spring of 2006.
The submission of the specifications to the W3C have reduced one of the major objections to adoption, and it's likely that more vendors will support WS-Policy going forward. However, one of the issues frequently raised with WS-Policy is that it does not sufficiently articulate policy semantics to the extent needed for many applications of policy in the Web Services realm. While very extensible and flexible, this flexibility does not always produce interoperability between vendor implementations.
The WS-Policy 1.5 Working Drafts can be downloaded here.