MEPs want the new international procurement instrument to apply more widely

Parliament has adopted its position on the international procurement instrument, a tool to help provide EU companies with more opportunities to tender outside the EU.

With 590 votes for, eight against and 99 abstentions, Parliament on Tuesday backed the overall aim of the proposed International Procurement Instrument (IPI) but tweaked its design, scope and member states’ discretionary powers in the way it is applied.

The IPI encourages public procurement markets in countries that protect this sector to be more open. It does so by introducing measures that limit non-EU companies’ access to open EU public procurement tenders if they come from countries that do not offer similar access to EU enterprises. The instrument would empower the Commission to determine whether and to what extent companies from a third country must be subject to an IPI measure.

EU tools to remedy unequal access, with fewer exceptions

MEPs agree to two types of IPI measures from which the Commission can choose to resolve unequal access to public procurement markets: adjusting the score given to bids made by companies subject to IPI (without affecting the price to be paid to the successful bidder), or excluding the company from bidding.

In addition, national contracting authorities can only opt out from IPI measures in two cases - when all bids have been made by companies from countries subject to an IPI measure; and in cases where the public interest overrides IPI considerations, such as in areas of public health or environmental protection. This extends the intended leverage of the instrument. However, MEPs insist that companies from least developed countries and vulnerable developing countries should be exempt.

Parliament also brings all European public contracting authorities under the scope of the IPI to ensure it is applied uniformly in all EU countries.

More tenders affected

MEPs establish different thresholds to determine which procurement procedures are subject to an IPI measure: those worth at least €10 million for works and concessions (such as highway construction) and €5 million for goods and services.

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“In a convincing vote Parliament cleared the way for the IPI, a much needed upgrade of the EU toolbox to respond to an increasingly hostile trade environment. With Parliament’s changes, we have an IPI that is easy to understand and to apply, and we cut bureaucracy to the bare minimum. Our goal is to complete the negotiations with EU ministers by next spring. The ball is now in Council's court to start working with us without delay on the final version of an effective, efficient and straightforward tool,” said rapporteur Daniel Caspary (EPP, DE).

Next steps

The adopted text serves as the negotiating mandate for the parliamentary delegation that is set to start talks on the final form of the instrument with the Council on 16 December.

Background

The EU has opened its public procurement markets to a significant degree to competitors from third countries and has been advocating for the end of protectionist measures on international public procurement markets.

Parliament has been working on the file since the Commission’s original proposal in 2012, then modified in 2016. Member states only reached an agreement on the topic in June 2021.