The European Commission wants to cut the EU’s public procurement rulebook from around 900 pages to 200, in a sweeping reform that aims to simplify tendering while giving governments greater scope to favour European economic and security interests, writes Catherine Feore.
Executive Vice-President Stéphane Séjourné held up the existing body of rules alongside its much slimmer replacement, to illustrate his point.
“These here are the European rules which currently govern public procurement in Europe: 900 pages,” he said. “And this is what we are proposing today… down to 200 pages.”
The proposed Public Procurement Act would replace three EU procurement directives with a single regulation, with a view to simplifying procurement provisions spread across 26 sectoral laws and cutting the number of procedures from five to three.
The Commission estimates the changes could save businesses and public authorities €650 million a year in administrative costs.
The reform matters because of Europe’s massive purchasing power involved. EU public procurement exceeds €2.5 trillion annually, around 15% of EU GDP, covering everything from trains and hospitals to energy infrastructure, schools and IT systems.
From lowest price to strategic purchasing
The proposal is not just about cutting red tape. Brussels wants governments to use their purchasing power more strategically.
The Best Price-Quality Ratio would become the standard method for awarding contracts, with quality normally accounting for at least 30% of the assessment and 50% for labour-intensive contracts. Authorities could consider environmental and social performance, innovation, security and resilience alongside price.
The commitment to a so-called European preference has been tempered by the EU’s international commitments, but access can be restricted when a country doesn’t reciprocate market access. Restrictions could also be imposed where reliance on foreign suppliers creates security-of-supply dependencies or threatens EU economic security.
“European public money should, wherever possible, create jobs, investment and opportunities in Europe rather than filling the order books of our competitors,” Séjourné said.
Five procurement procedures would become three: open, dynamic and innovation procedures. Each would allow negotiation between buyers and bidders.
The Commission also plans an integrated EU digital procurement marketplace connecting national e-procurement platforms. A company registered through one connected system should be able to bid elsewhere in Europe without repeatedly submitting the same documentation. This is intended to reduce bureaucracy and tackle one of the current system’s weaknesses: too little competition, particularly from SMEs and companies bidding across borders.
National, regional and local priorities may appreciate this flexibility in theory, but constrained budgets often mean that price will remain the bottom line for many. This legislation offers greater freedom in determining needs, but it remains to be seen what its impact will be.
PHOTO CREDIT: European Commission Executive Vice-President Stéphane Séjourné says the rules reduced from 900 pages to 200 pages © European Union
