knowledge | 15 February 2021 |
Rights of Access of UK Suppliers Under the Trade and Cooperation Agreement
As a result of the EU/UK Trade and Cooperation Agreement, much of the access that UK suppliers previously enjoyed to the EU’s procurement markets, and vice versa, has been preserved.
The EU and the UK successfully concluded a free trade deal, the Trade and Cooperation Agreement (TCA) on 24 December 2020. The agreement was ratified by the UK Parliament on 30 December 2020. The Council of the EU agreed on the provisional application of the TCA from 1 January 2021, pending ratification by the European Parliament, expected late February 2021.
Procurement was a late addition to the negotiations, but the final agreement includes what the European Commission describes as “ambitious” provisions on procurement. Broadly, these provisions build on both Parties’ existing commitments under the General Procurement Agreement (“GPA plus”), in terms of both the scope of access to each other’s markets for public and utilities contracts, and the procedural guarantees underlying that access.
Where a procurement falls outside the scope of the GPA and TCA, EU contracting authorities are under no obligation to allow UK suppliers to participate in tenders, but may opt to do so. However, there is a guarantee of non-discrimination against UK suppliers when they are established within the EU. For this to be the case, the supplier in question must be engaged in “substantive business operations” in the EU i.e., able to show “an effective and continuous link with the economy of a Member State”.
An important exclusion from the scope of the GPA and TCA, are contracts with a financial value below the aligned EU/GPA financial thresholds. EU Treaty rules require that such contracts are advertised, and opened up to competition to tenderers from other EU Member States, when they are of potential interest to such tenderers. In practice this rule has led to many Irish public purchasers opening up below threshold contract opportunities to suppliers from Northern Ireland and the rest of the UK. This obligation no longer exists in respect of the UK generally. Guidance is awaited on whether the provisions of the Northern Ireland Protocol preserve this obligation in respect of suppliers from that jurisdiction only. Other important exclusions from the scope of the GPA and TCA include certain utility contracts, defence and security contracts and services concessions.
A detailed analysis of the procurement provisions of the Trade and Cooperation Agreement is available on request from any member of our procurement team or from your usual contact in McCann FitzGerald.
This briefing is for general guidance only and should not be regarded as a substitute for professional advice. Such advice should always be taken before acting on any of the matters discussed.