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3 July 2014

EU reinforces legal basis for PCP in public procurement

To promote investment in research, development and innovation (R&D&I), the European Commission has inserted elements providing a clear legal basis for pre-commercial procurement (PCP) into public procurement and EU competition rules. As uncertainty regarding potential legal challenges and future penalisation often prevents local governments from investing in PCP, these insertions are designed to provide greater legal certainty.

The 2014 public procurement directives have strengthened the pre-existing exemption for R&D services that is used by PCP. Public procurers can continue to carry out PCPs based on the new articles 14 in directive 2014/24/EU and 32 in directive 2014/25/EC. Newly published state aid rules on R&D&I also state explicitly that neither PCP nor public procurement of innovation (PPI) are considered as State Aid.

There is still some need for caution. The exemption applies only when the PCP is implemented in line with conditions already listed in the 2007 PCP communication or when the PPI is implemented through a separate open procurement procedure. Procedures that combine the procurement of R&D with follow-up deployment of commercial volumes of products in one procedure are not included due to the risk of potential competition problems in other procurement approaches.

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