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Pause for thought: European Commission publishes its first review on the implementation of EU Public Procurement Rules

Scotland
01/11/2012
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The European Commission has published the first Annual Public Procurement Implementation Review which assesses the implementation of public procurement rules in the European Union. The Review states 'The correct, efficient and effective application of EU public procurement rules across the Union remains a constant challenge'. To assist with this challenge the Commission has gathered information directly from the Member States, to establish how they are applying public procurement rules in their respective territories with the aim of gaining a better understanding of the current problems and addressing concerns. At present, purchases by public authorities and utility companies account for nearly 20% of EU GDP. The Review is therefore far reaching and will have a significant impact in the public procurement arena.

Key findings of the review include:

1. The economic significance of the European public procurement market
Transparency: The Review has highlighted that transparency in the public procurement markets has been continuously improving. The number of contract notices advertised continues to grow in recent years and the number of contract award notices has grown even faster.
Procurement below EU Threshold: The information available on the award of contracts below the EU thresholds is both incomplete and inconsistent. Nevertheless using the data provided 2,291,543 public contracts were awarded below the EU thresholds, amounting to around EUR102 billion in value.
Concessions: The Commission noted the information provided on concessions was limited, inconsistent and should thus be treated with caution. In general, the data highlighted wide disparity in use of concessions by member states.
2.
 Overview of national structures application of procurement law, e-procurement and central purchasing systems.
National structures responsible: Most member states designate specific authorities with responsibility for i) framing procurement policy, ii) providing guidance to contracting authorities/entities and tenderers, iii) preparing legislation, iv) monitoring implementation of the public procurement rules, v) publishing and information sharing, and vi) maintaining relations with their other member states and following EU developments.
National arrangements for review: First-instance independent reviews of procurement decisions are carried out by judicial bodies in 13 member states and by an administrative body (some of which are quasi-judicial) in 14 member states.
E-procurement: E-procurement has increased but yet still only accounts for 5-10% of procurement procedures. Interestingly several member states are moving towards full implementation of e-procurement in the pre-award phases. A large proportion of member states have drafted an e-procurement strategy with the focus of aiming to make the most of electronic tools in conducting public procurement.
3. The implementation of EU law: infringements at EU and national levels
Infringements: From 1 January 2009, 61 infringement cases in relation to incorrect transposition and wrong application of the procurement rules have been opened against member states in which the procedure reached at least the stage of sending a letter of formal notice. 53 of these concerned incorrect application, of which only 4 were attributable to the UK.

Comment

The report demonstrates the volume of valuable information available with regard to the EU public procurement market. Utilising this information correctly creates the potential for more in-depth and better analysis in the future, which will then drive future policies to improve application of the public procurement rules throughout the Union. For present purposes however, the Review highlights significant discrepancies in terms of the availability of information from member states on various aspects of procurement, its depth and comprehensiveness. The Commission has therefore pledged to increase their efforts to collect, analyse and report on information available on the application of public procurement rules in member states. Whether the Commission is successful in doing this shall be revealed in the next Annual Public Procurement Review in 2013.

To see the full Review please click here.

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