Published: July 2016Contents
i) What are the hot topics?
The UK's vote to leave the EU in June sent shockwaves round the world and the implications for procurement law in the UK are still being hotly debated. With potential outcomes ranging from no change under an EEA model, to reliance on the World Trade Organization Agreement on Government Procurement regime, through to repealing the statutory framework altogether, the long-term shape of UK procurement law and the UK's international procurement obligations is uncertain.
What is clear is that EU procurement rules will apply until the UK leaves the EU (which is not expected to be before March 2019), and even after ‘Brexit’, the UK government intends to retain existing EU laws as a transitional measure. As the UK seeks to define its new trading relationships with the EU and worldwide, it will no doubt have a particular interest in the recent Canada-EU experience of the Comprehensive Economic and Trade Agreement (CETA) and the US-EU Transatlantic Trade and Investment Partnership negotiations.
ii) Tell us about any key legal developments – recent or pending – and their international impact.
In January 2016 the European Commission published a revised proposal for an International Procurement Instrument (IPI), which is designed to promote open access to public procurement markets around the world. The IPI would allow the Commission to investigate alleged discrimination against EU firms and, as a last resort, envisages that bids from countries that had discriminated against EU firms could be penalised by increasing their prices.
Meanwhile, the deadline for implementation of the 2014 EU Directives passed on 18 April 2016, although in May 2016 the Commission had to request 21 Member States to transpose one or more of the Directives fully. The European Single Procurement Document (ESPD) has also come into force. The ESPD is a self-declaration regarding a firm's suitability, financial standing and technical ability, and is designed to reduce the administrative burden on bidders. As of 26 January 2016, EU contracting authorities are required to accept ESPDs.
iii) What are the biggest opportunities and challenges for practitioners and clients?
Practitioners and clients face a number of challenges, including adapting to the implementation of the EU Directives across 28 Member States and monitoring the impact of Brexit. Bidders in countries that do not have reciprocal procurement arrangements with the EU will also need to monitor the progress of the European Commission's IPI carefully.
However, the future also presents opportunities. Practitioners will be called upon to opine on the ever-changing Brexit landscape and any new rules as they evolve, and once contracting authorities have adjusted to the new EU regime they may discover, for example, that rules requiring a greater degree of preparation upfront lead to improved procedures and outcomes. The general trend towards the opening of procurement markets as reflected in trading agreements like CETA also creates opportunities for bidders in markets that hitherto may have been closed to them.