How will Brexit change the public procurement system in the UK?

Although one should refrain from very detailed predictions about the future – especially when it is unclear what the outcome of Brexit will be – there are a few ideas which may help us glimpse some expected changes.

1. Not much will change...for now

In the coming months and years nothing will change. Certainly until the actual departure of the UK, no changes are expected to the legal framework.

Having said that, it is possible that certain procurement agents may feel emboldened to stop complying with EU law or at least interpreting the Public Contracts Regulations 2015 without taking into account case law from the Court of Justice of the European Union (CJEU). While it is still technically part of the national legislative framework we may see the influence of the CJEU waning in the near future.

2. What about the Great Repeal Bill?

Theresa May announced in the Conservative party conference in September 2016 that a Great Repeal Bill will incorporate into national law all of EU law upon the UK’s departure of the Union. While most of EU legislation applicable to procurement is already part of the UK’s national law via the various transpositions.

What is unclear however is what will happen with Treaty principles, case law of the CJEU (again) as well as some specific provisions of the various procurement Directives which depend on EU institutions. For example, will the UK have access to the European Single Procurement Document as a non-Member State?

3. It all depends on the relationship with the EU

In the end all scenarios depend on the relationship the UK strikes with the EU. The closer the relationship, the more likely it is that not much will change and the procurement legislation (and practice) of the country will resemble that of Norway’s. On the other hand a more distant relationship allows the UK to shape its own procurement regulation and policy as it may see fit. However, the UK already has considerable scope to shape procurement regulation and practice below the EU thresholds but not much has been done with that freedom so far, certainly when in comparison with other Member States. Furthermore, any profound changes to procurement legislation other than deregulation would imply re-training of procurement officers up and down the country.

4. What about the Government Procurement Agreement (GPA)?

The final wildcard of Brexit’s impact in procurement is the UK’s position within the GPA. It is not clear the UK is currently a member to the Agreement, effectively meaning it will have to negotiate its schedules of commitments with the current members. Assuming they end up broadly equivalent to the EU’s current commitments, then the flexibility mentioned above in 3 ends up being more limited than anticipated. This is due to the financial thresholds remaining unchanged and the obligation of non-discrimination against suppliers coming from parties to the GPA with identical commitments – like the those coming from the EU.

The more things change, the more they look the same.

Author: Dr. Pedro Telles

Date: December 2016

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