Malta Business Bureau welcomes EU procurement proposal, but ‘European preference must not be obligatory’

The Malta Business Bureau has largely welcomed newly proposed public procurement regulations by the European Commission, but stressed that European preference must remain a tool.

The Commission has proposed public procurement rules which aim to simplify the EU’s public procurement framework, deliver administrative savings, establish new minimum quality standards, and would introduce new European preference mechanisms. It would also introduce a new digital marketplace for procurement.

The proposal will now have to be negotiated by the European Parliament and the Council of the European Union.

Gabriel Cassar, the Malta Business Bureau’s (MBB) Head of Projects and Sustainability, said the bureau welcomes the European Commission's efforts to simplify the EU public procurement framework through greater digitalisation, transparency and a working cross-border marketplace. The MBB is the EU business advisory organisation of The Malta Chamber of Commerce and the Malta Hotels and Restaurants Association.

“A well-functioning public procurement market can play an important role in supporting competitiveness, innovation and the efficient use of public funds. For businesses, however, the effectiveness of the framework will ultimately depend on whether it makes public procurement more accessible, predictable and proportionate, while reducing unnecessary administrative burdens," Mr Cassar said.

Nigel Caruana, a policy analyst from the MBB’s Brussels Office, went on to say that for Malta, specialised procurement projects often struggle to attract sufficient bidders.

“Rules that shrink an already thin market, or that raise input costs without creating local industrial capacity, will not strengthen competitiveness.”

He said that the MBB particularly welcomes measures aimed at improving digitalisation, data collection, transparency and the once-only principle. “Best price-quality ratio can be a useful default, provided price remains a real criterion and quality requirements stay linked to the subject-matter of the contract.”

The Commission’s proposal includes a minimum quality weighting of 30 per cent when it comes to public procurement decisions, rising to 50 per cent for labour-intensive contracts. This means that public sector buyers will need to consider quality, not only price. The Commission explained that public authorities would be able to deviate from this approach if they can explain how quality will otherwise be ensured.

The proposed Act would also establish a new common EU framework of European preference mechanisms. On this point, Mr Caruana said that European preference must remain a tool, “not an obligation: Product-specific, and available only where equivalent supply exists. Island and peripheral economies need to be allowed flexibility where competition in the Single Market is lacking.”

He said that additional requirements on origin, social conditionality or content should not discourage businesses from participating or make cross-border and SME participation more difficult.

Featured image: Micaela Parente / Unsplash