International procurement instrument

30-11-2017

Over the years, the EU has opened up its public procurement markets to third countries to a large degree, yet many of these countries have not granted the EU a similar privilege. This situation has been difficult to address through multilateral or bilateral trade negotiations alone. With this in mind, the European Commission proposed the creation of an international procurement instrument in 2012. The aim of this instrument is twofold: to improve the conditions under which EU businesses can compete for public contracts in third countries and to give the EU more leverage when negotiating its access to foreign public procurement markets. To overcome a legislative deadlock on the 2012 proposal, in 2016 the Commission submitted an amended version that would enable it to open investigations into alleged discrimination against EU parties in foreign public procurement markets. If such practices were to be confirmed, the Commission would enter into consultations with the third country concerned to obtain reciprocal concessions on its procurement market. As a last resort, the Commission would be able to impose a price penalty on tenders originating in the third country concerned, giving EU and non-targeted countries' tenders a competitive advantage on EU procurement markets.

Over the years, the EU has opened up its public procurement markets to third countries to a large degree, yet many of these countries have not granted the EU a similar privilege. This situation has been difficult to address through multilateral or bilateral trade negotiations alone. With this in mind, the European Commission proposed the creation of an international procurement instrument in 2012. The aim of this instrument is twofold: to improve the conditions under which EU businesses can compete for public contracts in third countries and to give the EU more leverage when negotiating its access to foreign public procurement markets. To overcome a legislative deadlock on the 2012 proposal, in 2016 the Commission submitted an amended version that would enable it to open investigations into alleged discrimination against EU parties in foreign public procurement markets. If such practices were to be confirmed, the Commission would enter into consultations with the third country concerned to obtain reciprocal concessions on its procurement market. As a last resort, the Commission would be able to impose a price penalty on tenders originating in the third country concerned, giving EU and non-targeted countries' tenders a competitive advantage on EU procurement markets.