knowledge 22 July 2026 |

Proposed EU Public Procurement Regulation: Key Reform Areas

The proposal seeks to address perceived shortcomings identified in the current framework, including legal complexity, declining competition, limited SME and cross-border participation, and fragmented procurement rules. Key features emerging from the draft include the consolidation of the procurement framework, greater emphasis on strategic procurement, measures relating to economic security and third-country participation, expanded digitalisation initiatives, and a fundamental revision to procurement procedures.

Assuming the official published proposal mirrors the draft, it is still just the starting point for the European legislative process. The process from proposal to a finalised Regulation can generally take up to 2 years, with potential for significant revision during that time. However, the draft shows the clear intention of the Commission as to the scale of reform of public procurement law which it hopes to achieve.

1. A Single Public Procurement Regulation

A key feature of the proposal is the replacement of Directives 2014/23/EU, 2014/24/EU and 2014/25/EU with a single directly applicable Regulation governing public contracts, utilities procurement and concessions.

According to the explanatory memorandum, this reform is intended to simplify the existing framework, reduce legal fragmentation and address inconsistencies arising from divergent national transposition. It also forms part of a wider effort to consolidate procurement-related requirements currently dispersed across numerous sector-specific legislative instruments into a single, coherent framework.

The proposal places emphasis on strategic procurement throughout the procurement lifecycle. Moving beyond a system that merely permits strategic considerations, it aims to embed wider Union objectives throughout the procurement lifecycle, including environmental sustainability, social inclusion, innovation, resilience and economic security. To support this approach, contracts would generally be awarded on the basis of the best price-quality ratio, including minimum quality weighting requirements, rather than predominantly on price.

Historically, EU procurement legislation has recognised the role of member states in tailoring implementation measures for their national regimes. The move from directives to a regulation removes national discretion, and may  prove one of the most significant aspects of the reform.

2. Procurement Procedures and Planning

A further objective of the draft Regulation is to simplify and increase flexibility in procurement procedures. The current procedural framework would be replaced by an "open-negotiated procedure" as the default approach, supplemented by a dynamic simplified procedure for recurring purchases of off-the-shelf solutions and a new innovation challenge procedure for the development and acquisition of innovative solutions not yet available on the market. The restricted procedure and competitive dialogue would be abolished under the proposed Regulation.

A particularly unusual feature of the draft Regulation is the apparent removal of the ability to shortlist candidates on the basis of selection criteria. While there is provision for reducing the number of tenderers through successive rounds of negotiation, this assumes that authorities will by default be required to manage negotiations with all bidders meeting the selection criteria.

The proposal also introduces new planning obligations. Public buyers would be required to publish a "Needs Plan" at the beginning of each budgetary period, with market consultations expressly encouraged to inform procurement strategies and identify available or innovative solutions. The draft further seeks to reduce barriers to participation, for example by restricting unjustified demands for prior public-sector experience.

While the introduction of Needs Plans and greater use of market consultations may improve predictability and early market engagement, it remains to be seen whether these measures will simplify procurement processes in practice or introduce additional administrative requirements and a steep learning curve.

3. Award criteria

The proposed Regulation significantly limits the ability to conduct price only competitions. Lowest price may only be used where quality can be ensured through technical specifications or contract performance clauses, and provided that the use of lowest price can be justified by reference to the nature of the contract.

There is a clear emphasis on quality in the proposed Regulation; a minimum quality weighting of 30% applies generally to all competitions. Where the competition concerns labour intensive services, a minimum quality weighting of 50% applies.

It has long been a requirement that award criteria have a link to the subject matter of the contract: The draft Regulation provides some clarity on the interpretation of this concept, confirming that it includes both direct and indirect links (and thereby resolving any residual uncertainty about the permissibility of supply-chain criteria).

4. European Preference Measures

One of the more notable aspects of the draft Regulation is the introduction of "European preference" measures, which is in line with recent developments to promote European competitiveness and respond to geopolitical threats. While EU procurement rules have traditionally been relatively open to international competition, the proposal would give public buyers greater scope to favour EU suppliers and "covered" suppliers (i.e. those from a jurisdiction which is party to a treaty with the EU covering public procurement).

Under the draft, public buyers could restrict participation by non-EU suppliers in public procurement procedures (codifying the CJEU caselaw in Kolin and Quingdao), require minimum levels of EU or covered content, apply evaluation preferences for covered suppliers at award stage and, in some cases, reject tenders where covered goods, services or works account for less than 50% of the total tender value. The proposal also introduces a framework for determining whether operators, goods, services or works are "covered", supported by a Commission-managed online tool.

The Commission would also have powers to restrict access for certain third-country operators, including where equivalent access is not provided to EU suppliers, where security of supply concerns arise, or where restrictions are considered necessary to protect essential EU interests.

Taken together, these measures would mark a significant change in the approach to third-country participation in EU procurement markets. However, a number of practical questions remain, including how origin requirements will be assessed in complex supply chains and how compliance with content thresholds will be verified in practice.

5. Digitalisation and Procurement Data Spaces

The proposal seeks to improve how procurement information is collected, shared and accessed across the EU through a more integrated digital framework.

A central feature is the creation of an interoperability network that would enable contracting authorities and economic operators using different eProcurement platforms to communicate through a common framework. While the draft sets out the broad parameters and objectives of the network, the detailed arrangements would be developed through delegated and implementing acts adopted by the Commission. The proposal also envisages harmonised standards for procurement procedures and documentation, together with a new electronic eligibility service based on digital business credentials and company profiles.

The Regulation would also require Member States to establish National Public Procurement Data Spaces (NPPDS), feeding into an EU-level Public Procurement Data Space managed by the Commission. This is intended to support greater transparency and facilitate monitoring of procurement markets, SME participation, cross-border procurement and strategic procurement objectives. The data to be included in the NPPDS is very extensive, covering not only procurement documents, but also contract documents (down to the level of individual payments). Documents must be transmitted to the NPPDS as soon as possible after creation, giving rise to a potentially onerous administrative burden.

From a practical perspective, the proposals could improve access to procurement information and reduce duplication where businesses participate across multiple jurisdictions. However, significant aspects of the digital framework remain to be developed by the Commission, making it difficult at this stage to assess the full implementation burden. Contracting authorities and eProcurement providers may ultimately need to make substantial changes to existing systems to comply with new interoperability, data-sharing and reporting requirements.

6. Exclusion Grounds

The draft Regulation consolidates exclusion grounds currently spread across a number of sector-specific instruments into a single framework. Many of the mandatory grounds mirror those currently set out in Article 57 of Directive 2014/24/EU, including corruption, fraud, terrorism, money laundering and human trafficking. However, the draft also introduces and consolidates additional mandatory grounds relating to environmental crime, breaches of EU restrictive measures, fraudulent use of non-cash payment instruments, offences concerning child sexual exploitation, and offences linked to deforestation legislation.

The discretionary grounds broadly reflect the existing framework, including insolvency, grave professional misconduct, anti-competitive conduct, poor contract performance and misrepresentation. The most notable addition is a new ground permitting exclusion where an operator is considered insufficiently reliable to address risks to the security or public safety interests of the Union or a Member State.

The key change is the proposal that the self-cleaning grounds will no longer be available for mandatory exclusion (although an authority will still be permitted to enter into a contract with an entity subject to these grounds if there are overriding public interest grounds). Aside from this, the core architecture of Article 57 of Directive 2014/24/EU is therefore largely preserved, albeit with a further emphasis on security, resilience and wider policy objectives.

In practice, the new security-based exclusion ground may prove challenging to apply consistently, particularly where exclusion decisions are based on broader risk assessments rather than clearly defined misconduct or criminal convictions.

7. Framework Agreements

Framework agreements remain available, but the proposed Regulation imposes stricter constraints on their term. It is proposed that single-supplier frameworks will have a maximum duration of 3 years (which is a reduction from the current limit of 4 years), while multi-supplier frameworks are proposed to have a maximum duration of 5 years.

Under the draft Regulation there is no additional flexibility afforded to utility undertakings; frameworks entered into by these undertakings are proposed to have the same duration as those entered by other public buyers (whereas under the existing regime, utilities are permitted to enter into 8 year frameworks).

Furthermore, in contrast to the current rules, the proposed Regulation does not seem to allow for longer durations where justified by the subject matter of the contract.

It seems likely that these changes have been made in recognition of the fact that overreliance on frameworks can affect the competitive dynamic on the wider market. However, the changes may have the impact of materially reducing the usefulness of frameworks to contracting authorities in practice.

8. Modification of Contracts

The rules on modification of concluded contracts have received a substantial overhaul in the proposed Regulation.

The safe harbour which allows for modifications that are set out clearly in the contract has been retained, although it has been reformulated. Similarly, authorities will continue to be permitted to modify contracts to obtain additional deliveries where a change of contractor cannot be made, or where the need to modify the contract arises from unforeseeable circumstances, although again the test has been revised.

It is proposed that there will no longer a be 50% limitation on the value of changes made, although changes exceeding 50% of the value of the estimated contract will need to be published by way of a modification notice in advance of making the change. Modifications of a lower value must be the subject of a modification notice published after the change is made.

In addition, the safe harbour which was based on the original Pressetext case law has been reformulated. In circumstances where there is an established line of case law as to the application of this safe harbour, contracting authorities will be left to navigate uncertainty as to how the new test will be interpreted.

The “de minimis” safe harbour has been completely removed in the proposed Regulation, which will be a disappointment to contracting authorities. Currently, many routine variations are managed under this exemption. Its removal means that all modifications, however minor, must be assessed against the substantive modification tests.

Concluding Remarks

While the draft remains subject to change and formal publication by the Commission, it provides an indication of the proposed direction of travel for EU procurement law.

If adopted in its current form, the reforms would have significant implications for Member States, contracting authorities and economic operators, potentially requiring changes to procurement processes, digital infrastructure, governance arrangements and compliance frameworks. The introduction of strategic procurement obligations, European preference measures and security-related considerations may also reshape how contracts are designed, competed and evaluated.

At this stage, however, a number of important questions remain unanswered. Many aspects of the proposed framework are expected to be developed through delegated acts, implementing measures and further guidance, meaning the practical implications of the reforms will only become fully apparent as the legislative process progresses and the supporting measures take shape.