European Commission vows to make procurement easier for authorities and bidders

The European Commission has launched a Green Paper on modernising the EU public procurement market, pledging to “make life easier” for public authorities and bidders.

The Commission said it was essential to put the roughly 17% of the EU’s GDP accounted for by public procurement to the best possible use, if the EU economy was to be re-launched and jobs were to be created.

It acknowledged stakeholder demands for a review of the EU public procurement system “to streamline its procedures and better adapt them to new challenges, e.g. the need for a more efficient use of public funds as well as taking into account social and environmental concerns”.

The EU suggested that SMEs (small to medium-sized enterprises) need better and easier access to public contracts throughout the region.

“Similarly, procurers need simple and flexible procedures allowing them to contribute effectively to the achievement of the common objectives of the Europe 2020 strategy: fostering innovation, protecting the environment, fighting climate change and social exclusion,” it added.

The Green Paper sets out areas for possible reform, covering issues including:

• “Do the current procedures need to be simplified, in particular for small local and regional authorities? How can this usefully be done without jeopardizing essential guarantees for transparency and non-discrimination amongst bidders?
• How can the Commission reduce red tape for economic operators, notably SMEs? How can bidding across intra-European borders be facilitated?
• Under which conditions should contracts between public authorities be exempted from the application of EU public procurement rules?
• Should the EU public procurement rules be modified to allow other policy objectives such as promotion of innovation or environmental or social considerations to be better taken into account? For instance, should there be EU rules establishing obligations to buy only products respecting certain environmental conditions or to set aside a certain percentage of the budget for innovative goods and services? Are customised rules needed for the procurement of social services of general economic interest, to better match the specificities of these services?
• Does the EU need stricter rules or better safeguards to prevent favouritism, corruption or conflicts of interest?
• How can efficient competition in procurement markets be guaranteed? For instance, how could the development of dominant suppliers, bid rigging or market sharing between bidders be avoided?
• What should be done to improve the access of European undertakings to third country public procurement markets?”

The Commission signalled its view that e-procurement made procedures more efficient, gave companies improved access and ensured more choice for procurers. It is consulting separately on how to ensure e-procurement is used more widely.

The Commission said it was also currently undertaking a “comprehensive ex-post evaluation” to take stock of the efficiency and cost-effectiveness of the current European public procurement rules.

The results of this evaluation and of the Green Paper consultation will be discussed at a conference on public procurement reform, planned for 30 June 2011 in Brussels.

Internal Market and Services Commissioner Michel Barnier said: "We need to clarify public procurement rules to make life easier for both public authorities and companies bidding for contracts in Europe. Access of smaller companies to procurement markets, reducing red tape, or promoting European cross-border procurement will be under the spotlight during the consultation. My ambition is also to make sure that public procurement can help job creation, innovation, and protection of the environment."

A copy of the Green Paper can be downloaded here. The deadline for responses is 18 April 2011.