European Trade Union Institute, ETUI.

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16 November 2014

New EU public procurement rules open door for better social and environmental protection

public procurement

In the context of modernising its rules on public procurement, the EU adopted in February 2014 a comprehensive revision of its original 2004 directives. A new ETUI working paper argues that the revised rules in the new directive have introduced a stronger social and environmental dimension into the procedures for awarding public contracts.

Public authorities spend around 20% of GDP or 2400 billion euros on procuring works, goods and services. In the past these public contracts were awarded to the company with the lowest price, but the revised EU laws put more focus on social and sustainability criteria.

The working paper written by Eric Van den Abeele, lecturer at the University of Mons-Hainaut, provides a legal analysis of the 2014 framework on public procurement evaluating in particular the measures and provisions dealing with the obligation to comply with social, environmental and labour laws.

Van den Abeele analyses in detail article 18 of the new directive which enshrines the obligation to comply with social, environmental and labour law obligations. He also looks at how contracting authorities will have the possibility to introduce social and environmental specifications during various stages of the procedure. The author furthermore underlines how the revised criteria to award contracts give public authorities the option to include qualitative aspects (e.g. life-cycle costing) into their evaluation instead of relying only on the lowest price and to exclude lowest-price offers when these low prices are due to failures to comply with obligations arising from social or environmental laws.

However, the author also points to some weaker aspects of the new rules. He regrets that ‘several provisions are optional and have been left to the discretion of the Member State or contracting authority’. He also criticises that the ‘door has been opened to the privatisation of compulsory social security services and social services’.

The paper concludes that the co-legislators have managed to give contracting authorities and member states ‘a lever to introduce more ethics in economic relations’.

Further reading:

EurLex: Directive 2014/24/EU of the European Parliament and of the Council of 26 February 2014 on public procurement and repealing Directive 2004/18/EC (FR)

European Parliament: New EU-procurement rules to ensure better quality and value for money (Jan 2014)

ETUC: ETUC welcomes binding social clause in public procurement (Jan 2014)

ETUC: New EU framework on public procurement - ETUC key points for the transposition of Directive 2014/24/eu

Social Platform: New directive on public procurement: positive achievements (Jan 2014)

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