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Public Procurement in Europe

 

The European Union – EU- consists of 28 memberstates and all of them need to accept and follow the EU directives. EU directives are EU laws which need to be implemented in national law by each memberstate.

The EU public procurement contracts account for about 16 % of the gross domestic product (GPD) and are therefore a significant part of the market.

There are two major EU directives on public procurement which will be in force untill 17 April 2016:

  • (‘Classical’) Directive 2004/18/EC on the coordination of procedures for the award of public works contracts, supply contracts and public service contracts
  • (‘Sector’) Directive 2004/17/EC coordinating the procurement of entities operating in the water, energy, transport and postal services sectors.

 

On 17 April 2016, three new directives will come into force.

Be aware that although the national legislation on public procurement is based on these European directives, and therefore the actual national legislation might differ slightly from memberstate to memberstate.

 

The directives cover contracts above certain thresholds (valid till 31 December 2016):

  • public works contracts worth over € 5.186.000
  • public supply and service contracts worth over:
    • € 134 000 in the case of central government authorities
    • € 207 000 for sub-central entities or
    • € 414 000 for entities operating in the water, energy, transport and postal services.

Remedies European legislation (2007/66/EG) guarantees firms equivalent levels of legal redress against contract-awarding authorities that do not comply with the rules.

Defence contracts are still largely covered by national legislation. The EU aims to create an EU market for defence equipment while preserving national security interests with the EU directive 2009/81/EG

The EU adheres to World Trade Organization (WTO) agreement on fair international competition for public contracts. This agreement, known as the Agreement on Government Procurement (GPA), has 39 members including the 27 EU countries. The agreement bans discrimination in the awarding of public contracts and lays down procedural rules.