The EU’s International Procurement Instrument – IPI

 

SUMMARY OF:

Regulation (EU) 2022/1031 on the International Procurement Instrument – IPI

WHAT IS THE AIM OF THE REGULATION?

The European Union (EU) International Procurement Instrument (IPI) regulation aims to promote reciprocity in access to international public procurement markets.

It also lays down procedures for the European Commission to:

• investigate alleged measures or practices negatively affecting the access of EU businesses, goods and services to non-EU procurement markets, and consult with the non-EU countries concerned;
• impose, as a last resort, IPI measures to restrict access to EU public procurement procedures for businesses, goods and services from the non-EU countries concerned.

KEY POINTS

Application

The regulation applies to all public procurement procedures covered by:

• Directive 2014/23/EU on awarding concession contracts – see summary;
• Directive 2014/24/EU on public procurement – see summary; and
• Directive 2014/25/EU on public procurement in the utilities sectors (water, energy, transport and postal services) – see summary.

IPI measures can only apply to businesses, goods or services from non-EU countries that are not parties to the plurilateral World Trade Organization Agreement on Government Procurement or to bilateral or multilateral trade agreements concluded with the EU that include commitments on access to public procurement or concession markets, or to businesses, goods or services from countries that are parties to such agreements but only with respect to public procurement procedures for goods, services or concessions that are not covered by those agreements.

Investigations and consultations

On its own initiative, or following a substantiated complaint by an interested party in the EU or by an EU Member State, the Commission:

• may initiate an investigation into an alleged non-EU country measure or practice by publishing a notice in the Official Journal of the European Union, inviting interested parties and Member States to provide information;
• shall, upon initiation, invite the non-EU country concerned to submit its views, provide relevant information and enter into consultations to eliminate or remedy the alleged measure or practice;
• can suspend the investigation and consultations at any time if the non-EU country:
  • takes satisfactory corrective action to eliminate or remedy the measure or practice, or
  • commits to ending the measure or practice within 6 months.

The investigation and consultations must be concluded within 9 months (or 14 months in justified cases).

Upon conclusion of the investigation and the consultations, the Commission publishes a report that sets out the main findings and a proposed course of action. The Commission:

• shall terminate the investigation if the alleged measures or practices are not maintained or do not result in a serious and recurrent impairment of access by EU businesses, goods or services;
• shall adopt an IPI measure if the existence of the alleged measure or practice is confirmed.

IPI measures

If the investigation finds that such measures or practices exist, the Commission shall, if it considers it to be in the EU’s interest, adopt an IPI measure (a measure limiting the access of businesses, goods or services originating in non-EU countries to the EU public procurement or concession markets by means of an implementing act).

The EU’s interest will take into account all various interests taken as a whole, including the interests of EU businesses.

The IPI measure:

• may be designed as a score adjustment to tenders submitted by non-EU-country bidders or exclude tenders completely;
• applies to all public procurement procedures above a threshold of €15,000,000 (excluding VAT) for works and concessions, or €5,000,000 (excluding VAT) for goods and services, including dynamic purchasing systems and framework agreements;
• expires after 5 years but may be extended for a further 5 years.

Obligations for tenderers

For all public procurement procedures subject to IPI measures, successful tenderers (regardless of their origin):

• must not subcontract more than 50% of the total value of the services contract to non-EU businesses subject to an IPI measure;
• must not supply or provide goods or services originating in the country subject to an IPI measure that would represent more than 50% of the total value of the contract whose subject matter covers the supply of goods;
• must pay a charge, if the above obligations are not observed, of 10–30% of the total value of the contract.

Exemptions

The Commission may, following a request by a Member State, adopt a list of local contracting authorities in the Member State, based in areas with a population below 50,000 inhabitants, to be exempted from the application of this regulation.

No IPI investigation shall be initiated in respect of the least-developed countries.

Exceptions

Contracting authorities and contracting entities may on an exceptional basis decide not to apply an IPI measure if:

• there are only tenders from businesses originating in a non-EU country subject to an IPI measure; or
• it is justified for overriding reasons relating to the public interest.

FROM WHEN DOES THE REGULATION APPLY?

It has applied since 29 August 2022.

BACKGROUND

For further information, see:

• International public procurement (European Commission).

MAIN DOCUMENT

Regulation (EU) 2022/1031 of the European Parliament and of the Council of 23 June 2022 on the access of third-country economic operators, goods and services to the Union’s public procurement and concession markets and procedures supporting negotiations on access of Union economic operators, goods and services to the public procurement and concession markets of third countries (International Procurement Instrument – IPI) (OJ L 173, 30.6.2022, pp. 1–16).

RELATED DOCUMENTS

Commission Implementing Regulation (EU) 2019/1780 of 23 September 2019 establishing standard forms for the publication of notices in the field of public procurement and repealing Implementing Regulation (EU) 2015/1986 (eForms) (OJ L 272, 25.10.2019, pp. 7–73).

Communication from the Commission – Guidance on the participation of third-country bidders and goods in the EU procurement market (OJ C 271, 13.8.2019, pp. 43–66).

Directive 2014/23/EU of the European Parliament and of the Council of 26 February 2014 on the award of concession contracts (OJ L 94, 28.3.2014, pp. 1–64).

Successive amendments to Directive 2014/23/EU have been incorporated in the original text. This consolidated version is of documentary value only.

Directive 2014/24/EU of the European Parliament and of the Council of 26 February 2014 on public procurement and repealing Directive 2004/18/EC (OJ L 94, 28.3.2014, pp. 65–242).

See consolidated version.

Directive 2014/25/EU of the European Parliament and of the Council of 26 February 2014 on procurement by entities operating in the water, energy, transport and postal services sectors and repealing Directive 2004/17/EC (OJ L 94, 28.3.2014, pp. 243–374).

See consolidated version.

Regulation (EU) No 952/2013 of the European Parliament and of the Council of 9 October 2013 laying down the Union Customs Code (recast) (OJ L 269, 10.10.2013, pp. 1–101).

See consolidated version.

Regulation (EU) No 978/2012 of the European Parliament and of the Council of 25 October 2012 applying a scheme of generalised tariff preferences and repealing Council Regulation (EC) No 732/2008 (OJ L 303, 31.10.2012, pp. 1–82).

See consolidated version.

Council Directive 92/13/EEC of 25 February 1992 coordinating the laws, regulations and administrative provisions relating to the application of Community rules on the procurement procedures of entities operating in the water, energy, transport and telecommunications sectors (OJ L 76, 23.3.1992, pp. 14–20).

See consolidated version.

Council Directive 89/665/EEC of 21 December 1989 on the coordination of the laws, regulations and administrative provisions relating to the application of review procedures to the award of public supply and public works contracts (OJ L 395, 30.12.1989, pp. 33–35).

See consolidated version.

last update 08.11.2022