Public procurement in the EU accounts for 14% of GDP but remains underutilized in advancing environmental and social goals. Most contracts prioritize price over sustainability, despite procurement being responsible for at least 11% of the EU’s greenhouse gas emissions.
CAN Europe advocates for revising public procurement rules to prioritize high-quality, environmentally friendly products and services. Procurement should be guided by the Ecodesign for Sustainable Products Regulation and implementing Acts, while contracting authorities remain free to request labels demonstrating specific additional environmental/social characteristics. Mandatory sustainability criteria would strengthen green markets and ensure greater coherence between sectoral procurement rules and the general framework.
Legally binding social and environmental conditions are needed to ensure procurement aligns with sustainability principles in Article 18(2) of Directive 2014/24/EU. Currently, sustainability obligations fall on Member States rather than contracting authorities, reducing effectiveness. Clear, enforceable minimum conditions would enhance procurement’s impact.
Key Principles for Evaluating the existing Public Procurement legal framework
- Effectiveness: Procurement should strategically support a green and social economy, i.e. social enterprises, cooperatives and energy communities as major actors of such an economy. Companies bidding for public procurement should be obliged to respect minimum social and environmental conditionsn including a ban on companies engaging in environmental or social dumping.
- Relevance: Public procurement must address geopolitical risks, such as reliance on Russian fossil fuels and Chinese-dominated green tech supply chains. It should prioritize products with lower material footprints and energy use, considering the full lifecycle. Companies should therefore provide a public transformation plan at installation level to improve energy and resource efficiency. Secondary legislation adopted under the Ecodesign Regulation should serve as a reference for the revised public procurement framework.
- Coherence: Procurement rules must align with EU social and environmental objectives. Contracting authorities should directly enforce Article 18(2), with an expanded Annex X listing relevant legislation, centralised data sharing and greater support to contracting authorities. Minimum requirements should include:
- Compliance with the Do No Significant Harm (DNSH) principle;
- Public transformation plans at installation level to increase energy and resources efficiency and shift processes towards phasing out fossil fuels, including through a switch to renewable energy sources as a priority;
- Respect for labour standards, esp. collective bargaining and workers’ upskilling/reskilling;
- Preventing relocation to lower-standard non-EU countries;
- Responsible tax behavior, evidenced by public country-by-country tax reporting.
- Strategic Autonomy: A “Made in Europe” requirement would not as such guarantee social and environmental outcomes and cannot be a substitute for a security of supply strategy. “Made in Europe” could be considered for to-be-defined vital or strategic goods and services, regulation should shield these sectors from external competition and trade agreements be reviewed to ensure compatibility. Defining “made in Europe” in the framework of public procurement would be needed. Short supply chain requirements and local requirements with social and environmental benefits for local ecosystems may be more effective for protecting local jobs and should be expressly allowed as exceptions to the equal treatment principle.
- EU Added Value: A harmonized framework with minimum social and environmental conditions would reduce legal fragmentation and simplify compliance. Centralized data sharing and digital templates would enhance transparency, reduce administrative burden, and support SMEs.
