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The EU industry commissioner is pushing plans to let governments favour domestic suppliers in public procurement, under a new “Buy European” initiative that could limit Chinese access to key contracts.
A draft overhaul of the EU’s procurement rules, seen by the FT, would allow public authorities to prefer companies from the bloc and partner countries covered by trade agreements or World Trade Organization rules on public procurement.
The proposal, which would also simplify existing procurement rules, is expected to be published in September by French commissioner Stéphane Séjourné, though it remains subject to change during internal discussions.
It is likely to trigger significant debate within the Commission and among EU capitals wary of increasing protectionism. But Brussels has already taken measures to favour European companies and many want to strengthen legislation to respond more forcefully to procurement restrictions imposed by China and the US.
The measures come as Brussels seeks to boost the bloc’s competitiveness and reduce its dependence on foreign providers in key sectors. If adopted, they would enable authorities to reject bids for utilities, infrastructure, transport and other contracts from companies based in countries such as China.
“We are giving enough legal certainty so that the price criteria are not always what public authorities choose,” said one EU official.
The proposals are part of a broader push to favour European businesses and services, including in key technologies such as cloud computing, artificial intelligence and electric vehicles.
But unlike the bloc’s recent Industrial Accelerator Act, which applies to strategic technologies such as electric vehicles and clean energy and in effect enables the exclusion of Chinese companies, the Public Procurement Act is less strict and focuses on creating a “preference” for EU firms, the official said.
The proposal would not force public authorities to exclude bidders from countries such as China. Instead, it sets out the legal basis for them to choose European operators.
European officials are increasingly concerned by the influence of Chinese companies in areas such as transport and logistics. In April, the Commission blocked a Chinese maker of rolling stock for railways from helping to build a new metro line in Lisbon, after it found the company had benefited from unfair public subsidies.
However, the proposal allows public authorities not to apply a European preference where the services cannot be sourced on the continent or where doing so would entail “disproportionate costs”.
Public procurement accounts for about 15 per cent of the bloc’s GDP and should be used as a “strategic investment tool” to strengthen European industry, the draft states, calling it a “powerful economic policy lever” with growing geopolitical significance.
The European Commission said: “As is our usual practice, we don’t comment on leaks. That being said, the goal of the upcoming PPA is twofold: to make public procurement simpler and to create the right framework to optimise the use of public money to match our strategic objectives.”
