Context: A Quiet Mindset Change in How Europe Buys
The European Parliament has now taken its position on the future of public procurement, setting the tone for a sweeping reform of how Europe allocates its EUR 2.5 trillion in annual public contracts—roughly 15% of EU GDP. Once a compliance-heavy, price-focused process, procurement is being reimagined as a strategic lever for economic resilience, sustainability, and industrial innovation.
What the Parliament’s IMCO Report tells us
In his landmark report on the Single Market, former Italian Prime Minister Enrico Letta urged a more European, more strategic approach to procurement. His thinking helped shape Commission President Ursula von der Leyen’s 2024–2029 Political Guidelines, which call for an overhaul of procurement rules to better serve Europe’s industrial, social, and environmental priorities.
That overhaul is now underway. The European Commission is finalizing an evaluation and preparing an impact assessment, with legislation expected by late 2026. To influence this process, the Internal Market and Consumer Protection Committee (IMCO) adopted its own initiative report on July 7. While non-binding, the report shows the Parliament’s thinking ahead of the reform and the position it will likely take once the legislative process starts.
Diagnosing the Flaws of “Price-Only” Awards
IMCO’s diagnosis is clear: the current procurement framework has too often favored the cheapest bid over value, quality, and innovation. This has weakened Europe’s ability to use public procurement as a lever for strategic autonomy.
The report urges the Commission to reduce market fragmentation by harmonizing procurement rules across Member States. It calls for greater SME participation, more resilient supply chains, and wider uptake of variant bids, particularly in construction and infrastructure.
Key Recommendations for Strategic Procurement
Parliament outlines several concrete actions:
- Move beyond price-only awards by strengthening the use of MEAT (Most Economically Advantageous Tender) criteria.
- Introduce price review clauses in contracts to accommodate inflation and commodity price fluctuations.
- Digitize procurement procedures using interoperable platforms, with specific attention to SME access.
- Encourage, but not mandate, the use of social and environmental criteria to promote sustainability.
These proposals received cross-party support from political groups within Parliament, including ECR, EPP, Renew, and the Greens. The report is set for adoption at the September Plenary.
Sector Spotlight: Agri-Food, Utilities, & Biotech
Though the final text avoids naming specific sectors, earlier drafts cited healthcare, energy, and security as candidates for targeted procurement models. The final report leaves room for tailored sectoral adaptation, while promoting strategic procurement models that prioritize long-term value and resilience.
- Agri-food & local sourcing: Parliament highlights procurement's role in food security and sustainable diets, encouraging sourcing of EU-origin products.
- Utilities & infrastructure: The report acknowledges the unique challenges faced by electricity grid operators, proposing streamlined rules for large-scale investment.
- Biotech sector: IMCO promotes innovation-led procurement models, calls for stronger IP protections, promotes joint procurement, and invites biotech firms to share best practices.
What This Means for Suppliers & SMEs
The direction is clear: procurement will be more strategic, digital, and value-based. For businesses supplying services, infrastructure, or innovation-driven goods, this shift could affect:
- How contracts are awarded
- What counts as “value” in bids
- The role of sustainability criteria
- Whether local and EU-based supply chains are favored
- How SMEs compete in cross-border tenders
The Parliament’s openness to best practices from industry offers a window for sector engagement. The focus on intellectual property protections is especially relevant for companies in tech, health, and life sciences.
Next Steps & How to Engage
The Commission is now preparing its proposal, expected in Q4 2026. This moment presents a critical opportunity for industries to shape the outcome. The most compelling contributions will likely draw from proven procurement models within each sector, surface persistent barriers that prevent SME access and cross-border participation, and showcase how variant bids have improved flexibility and value in complex tenders. Likewise, the increasing relevance of intellectual property protection in innovation-led procurement demands a thoughtful, evidence-based case from firms that rely on proprietary technologies.
Materials presented by Edelman's public & government affairs experts. For additional information, reach out to Francisco.Herrera@Edelman.com.
