Public Procurement in Europe

Public Procurement in Europe

The economic significance of public procurement in Europe is considerable, with yearly purchasing valued at 3,5 percent of the region’s GDP. Public procurement is regulated by two separate EU Directives: the Public Sector Directive on the coordination of procedures for the award of public works contracts, public supply contracts and public service contracts; and the Utilities Directive, coordinating the procurement procedures of entities operating in the water, energy, transport and postal services sectors.

The aim of this study is to improve the understanding of the impact and effectiveness of the EU public procurement directives. The analysis covers all 27 EU Member States and the 3 EEA countries. The study is prepared in the context of a comprehensive evaluation of the procurement directives currently being undertaken by the European Commission and to help inform decisions about future policy.

The first part of the report identifies and discusses patterns of use of the different procedures and circumstances that may be associated with the choices made by the authorities when selecting the type of procedure for a particular contract. We identify patterns in the use of the various procedures and techniques (across countries, over time, and across sectors), and we investigate circumstances that may influence the use of the different procedures.

The second part provides a detailed analysis of the costs and effectiveness of administering and participating in selected tender procedures/techniques foreseen by EU procurement legislation. The analysis looks at procurement under the Directives in comparison to procurement under national procurement regulations and to private procurement.

Our analysis is based on a number of very rich data sources. The analysis of patterns of use is largely based on the TED database (i.e. a web portal of the Supplement the Official Journal of the EU) maintained by the Commission which contains detailed information on about 540.000 individual purchases or nearly 2 million contracts by authorities in 30 countries over the 2006-2010 period. These purchases represent more than 1,4 trillion euro in value. We have also collected original data from a large scale survey among awarding authorities and firms in the EU/EEA. This survey adds significantly to previously almost non-existent primary information on the perceived costs and benefits of different procurement processes. About 5500 authorities and 1800 businesses responded. In addition there have been about 150, more qualitatively focused, in-depth interviews and discussions with purchasers and suppliers. This included a focused exercise to understand how business to business (B2B) procurement is conducted in large corporations across Europe.

The study is available for download here: Further materials can found at the European Union Websites here