“Dividing public procurement into lots is a key demand of European SMEs. According to the proposal, Member States may provide that public buyers shall divide contracts into lots.
SMEunited encourages all Member States to provide for mandatory division into lots when possible to effectively support SME participation in public tenders”, stated SMEunited President Davide Galli in his first reaction to the European Commission’s proposal for revised Public Procurement rules.
SMEs acquire a disproportionately small share of public contracts across the EU. Price-only tenders and oversized, bundled contracts have long prevented smaller companies from participating in public markets they are technically capable of serving. “A mandatory best price-quality ratio with a minimum weighting for quality is the shift SMEs have been asking for. Combined with an obligation for buyers to justify any decision not to divide a contract into lots, this change could make it easier for specialised SMEs that have been priced out for years to access public procurement”, Mr Galli continued.
At the same time, Mr Galli noted that several structural barriers for SMEs remain unaddressed. The in-house exception, which permits public bodies to award contracts internally without competition, retains its current 80% threshold, allowing practices that have long undermined private competition at local level to continue. Furthermore, this approach does not reflect existing best practices at Member State level, which already apply considerably lower thresholds to protect fair competition at local level.
The new European preference chapter allows buyers to opt out if compliance would result in “disproportionate costs”, a term the proposal leaves undefined and which could be misused to undermine the aim of the proposal.
Late payments from public authorities negatively impact SME participation in public procurement. “Provisions for advance payment, as provided for in the proposal, can create incentives and open new possibilities for SMEs”, reacted Mr Galli.
Mr Galli also reacted to the provisions in the Innovation Act that complement the Public Procurement Act. “SMEs are a major driver of innovation. Strengthening their role in R&D procurement with SME-friendly provisions, such as reduced guarantee requirements, plays an important role in levelling the playing field and facilitating higher SME participation”.
“A rule is only as strong as its enforcement. We look forward to working with the co-legislators to further strengthen the proposal and ensure that the revision creates a level playing field for all European SMEs and fulfils its main goal: supporting SME access to the public market”, Mr Galli concluded.
