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European defence procurement reform faces uphill struggle despite new code
- Article Tools
| 09 January 2006 |
By Joris Janssen Lok
The code of conduct for contracts worth more than EUR1 million (USD1.2 million), was agreed on 21 November 2005 at a meeting of the EDA's Steering Board. It is designed to encourage competition in the European defence equipment market, where contracts are currently exempt from normal EU internal market rules on public procurement.
Member states who subscribe to the new inter-governmental regime will commit to "maximising fair and equal opportunities" for all suppliers based in other subscribing member states, by publicising procurement opportunities through a single online portal - a tool provided by the EDA - and by setting transparent and objective criteria for selecting bidders and awarding contracts, a statement by the EDA said.
As for suppliers based outside the EU, "whether a member state also wishes to invite any third party to a competition will remain entirely a matter for the individual member state to decide", the agency added.
"We expect the large majority of the 24 EU member states that back the European Security and Defence Policy [ESDP] - the entire EU except Denmark - to commit to the code of conduct," a senior Dutch EDA official told IDR.
"The EU Commission has heavily supported the EDA in its code of conduct initiative. The ultimate objective is to make the code of conduct legally binding and to abolish Article 296 of the treaty establishing the European Community. This is the article that allows the exemption of defence procurements from the framework of EC internal market rules," the official said.
"But the commission knows that for now this is politically unachievable; we will have to get to that point step by step. For the time being, commitment to the code of conduct will be voluntary and non-binding, and no sanction is envisaged for any non-observance of this code by any member state."
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