AEGIS Europe Feedback on the Revision of the Public Procurement Directives

AEGIS Europe welcomes the opportunity to provide its input to the revision of the Public Procurement Directives.

We are an industry alliance bringing together more than 30 European manufacturing associations representative of the whole value chain, from commodities down to consumer end products.

Public procurement is a strategic tool that can be used to strengthen Europe’s industrial base, competitiveness, and strategic autonomy. Its revision should ensure strong enforcement and alignment with EU industrial, trade, and climate policies to prevent price-driven practices that allow unfairly subsidised or non-market products to undercut European production. If effectively structured, public procurement can incentivise high environmental and social standards and contribute to strategic autonomy.

Below, you may find some of our suggestions, based on our members’ input:

• Exception on international rules: Article 20, Directive 2014/25/EU allows the derogation of EU public procurement rules ‘pursuant to international rules’ (e.g. through an international agreement). This has created a route for the undisputable circumvention of EU public procurement rules and unfair competition, especially through China’s Belt and Road Initiative projects in certain Member States (e.g. Hungary). AEGIS Europe calls for the removal of Article 20, which threatens the general interest of European Union. The uniform application of EU procurement rules across all contracting entities will then be ensured, and vital EU public interest objectives such as transparency and non-discrimination will be upheld.

• Systematic exclusion of Foreign Bidders in strategic sectors. Clear and more uniform rules for the participation of Foreign Bidders – understood as bidders from countries which are not a party to the WTO Agreement on Government Procurement (GPA) or other trade agreements with the EU, i.e. in line with EU international obligations – must be ensured to provide legal certainty to bidders and contracting entities alike. As the EU has exclusive competence on this matter, we call on the systematic exclusion of these bidders for public procurement procedures related to strategic sectors, especially for State-owned economic operators since they are of direct concern for the security of the Union.

• A long-term vision for European content: In the longer term, EU content must become the cornerstone of a credible public procurement policy. Public procurement should aim for a high share of European-based production, with limited exemptions where products are unavailable.

• Definition and enforcement of “Made in Europe”. The concept of “Made in Europe” is central to the effectiveness of EU preference in public procurement, yet it currently lacks a clear and robust definition. Experience from trade and climate policies show that origin-based criteria can be easily circumvented if they rely on formalistic or minimal transformation rules. Public procurement should therefore rely on substantive production criteria rather than formal origin labels.

• Strategic alignment with the Foreign Subsidies Regulation (FSR): The current Regulation allows a suspicious bidder already targeted by an in-depth investigation of the European Commission that has not yet been completed to bid on – and potentially be awarded – new projects. Given the systemic risks this represents for the procurement market, no such bidder should be allowed to participate in procurement procedures, be it alone or part of a consortium, unless they cooperate and facilitate the completion of an ex officio investigation. Additionally, public procurement should also consider the presence of industrial subsidies and structural overcapacities in the country of origin. In non-market economies, such factors often result in systematically underpriced products that cannot be matched by EU producers operating under normal market conditions.

• Very low bids and distortion of competition: Public procurement rules already provide contracting authorities with the possibility to exclude tenders where there is a distortion of competition, including in cases linked to dumping practices (abnormally low tenders). However, this possibility is rarely used in practice, and very low bids are often treated as a purely commercial issue. This approach ignores the reality that many such bids are the result of non market practices, including state subsidies, environmental dumping or structural overcapacities. The provisions on abnormally low tenders should therefore be reinforced, in full alignment with the FSR rules.

AEGIS Europe Statement on European content and preference

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AEGIS Europe Statement on European content and preference

AEGIS Europe supports the inclusion of European content and European preference considerations in forthcoming legislative initiatives, notably the Industrial Accelerator Act and the revision of the Public Procurement Directives.

Against a backdrop of global overcapacities, persistent unfair competition and rising economic security concerns, EU policy must more effectively support manufacturing capacity located in Europe, both for sectors already facing economic dependency and for those likely to be at risk in the coming years due to their strategic nature and ongoing market evolutions. European industries operate under high standards in terms of sustainability, safety and innovation.

Forthcoming EU legislation should therefore enable greater transparency on where products are manufactured, allowing public authorities and market actors to better align purchasing, investment and policy decisions with Europe’s industrial, climate and security objectives, while remaining proportionate and adaptable to sector-specific needs and constraints.

In situations where simple but reliable and mandatory information is seen as an effective instrument to promote products proudly made in Europe, and provided that clear and representative customs rules of origin or European content criteria are supported and recognised as such by the sector and value chain concerned, mandatory origin marking should be considered as a mean to achieve these objectives and should be proposed under the Industry Accelerator Act.

In any case, European content considerations must be addressed in a coherent manner across EU instruments and not confined to public projects alone. As a strategic lever, public procurement should also fully contribute to supporting European industrial capacity. The revision of the Public Procurement Directives should therefore allow for a genuine European preference, including through clear thresholds and criteria reflecting the proportion of value originating outside of Europe.

Contracting authorities should exclude economic operators from countries that are not parties to the WTO Government Procurement Agreement (GPA) or to equivalent agreements with the EU, as well as tenders where a substantial share of the products or components originates from third countries.

Overall, the Industrial Accelerator Act and the revision of the Public Procurement Directives should rely on consistent principles and criteria, ensuring that demand-side measures, funding, and procurement rules jointly contribute to strengthening European production, resilient supply chains, and strategic autonomy.

AEGIS Europe and its members stand ready to engage constructively with the European Commission to help deliver a balanced framework that promotes European manufacturing, preserves an open but fair internal market, and reinforces Europe’s long-term industrial strength.

AEGIS Europe Position on the Review of the Foreign Subsidies Regulation

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AEGIS Europe welcomes the opportunity to submit its input to the European Commission as part of the Review of the Foreign Subsidies Regulation (FSR). In recent years, there has been an increasing influx of bidders from economic operators from third countries. If we consider that EU funds (e.g. European Structural and Investment Funds, Connecting Europe Facility) can be involved and de facto awarded to economic operators, distorting competition based on price, this is even more relevant as it can contribute to a decreased competitiveness of EU companies.

This situation, which has been documented notably by the OECD in its publications on measuring distortions in international markets (e.g. rolling stock value chain, aluminium, semi-conductors), can lead to a loss of market share and deindustrialisation of the EU, as well as having negative effects on competition in the Single Market. Coupled with increasing contractual requirements and award criteria focused mostly if not exclusively on price, European companies could be discouraged to submit bids due to low chances of winning, which would be detrimental to the quality of the solutions supplied to public authorities and create supply risks.

Against this background, the FSR is an autonomous EU trade instrument of outstanding importance for ensuring a level playing field in European procurement markets. Below, we present a series of recommendations to further strengthen the tool.

Identification of subsidies most likely to distort the internal market:

AEGIS Europe believes that a number of foreign subsidies should be considered to have a distortive effect on a per se basis, notably all subsidies to beneficiaries active in sectors: o Characterised by structural excess capacity. o Featuring high-tech and/or dual-use products to a significant extent; or, o Designated as strategic by the government providing the subsidies (e.g. in policies such as Made in China 2025).

Also to be considered distortive per se should be foreign subsidies to operators which have privileged and/or protected access to a significant non-EU market, especially if the non-EU market is the operator’s domestic market.

Additionally, we believe that it would be beneficial to integrate elements arising from previous investigations of the European Commission, such as explicitly considering the amount of the subsidies compared to the estimated valued of the public procurement as a relevant fact for assessing a potential distortion.

Balancing test:

AEGIS Europe insists that a balancing assessment must start from the presumption that there is a fundamental and strong EU interest in favour of removing the effects of distortive foreign subsidies, especially those endangering sustainable and diversified supply chains and the preservation of a strong industrial base in Europe.

In addition, because a balancing assessment must involve an adequately transparent and coherent analysis of both short-term and medium-term impacts of the distortions in question, the Commission should carry out full and timely consultation of relevant EU industries and give meaningful consideration of their input.

Beef up ex officio review:

Ex officio investigations should be launched towards economic operators that have already been subject to one or several in-depth investigations in other public procurement procedures that remained incomplete due their withdrawal of the bids in question. When an economic operator has been targeted by a public procurement investigation and that investigation is either not concluded or has resulted in determination that the company received distortive foreign financial contributions, there must be an automatic investigation if this company participates in other tenders – be it above OR below the threshold. Any award to an economic operator for which the Commission has already identified a strong presumption of distortive foreign subsidies poses a major risk to the credibility of the instrument. Therefore, this issue should be addressed in the 2026 review to remedy this flaw.

Finally, the Commission should also investigate, through ex officio review, how foreign subsidies may create distortions through the opening of factories by State-owned third-country companies in the EU or change of ownership of European companies to the benefit of State-owned third country economic operators.

Lower the public procurement threshold:

The threshold of EUR 250 million for public procurement is high and fails to capture many important projects, for example in the construction or rail supply industries. A revised threshold of EUR 150 million would be more appropriate to partly solve the current challenges faced by the instrument in conjunction with more ex officio investigations. Hence the power of the Commission to request the notification of foreign financial contributions in a public procurement procedure below the notification thresholds is key given the easy circumvention of the instrument by foreign economic operators. In any case the ex officio mechanism should be efficiently and more systematically utilised, especially if the threshold remains unchanged.

Strengthening enforcement towards Contracting Entities and Member States:

The FSR rightly aims at minimising disruptions and delays in public procurement procedures, which is in the interest of Contracting Entities and industry alike. In particular, the Commission cannot start an investigation related to a tender once the tender has been awarded to a bidder (Article 29 (8)).

However, the Commission should have the authority to overrule an award decision if two factors are met: (i) the contracting entity did not ensure the notification process whereas the project value was above the public procurement threshold; (ii) the economic operator to which the contract has been awarded has been subject of a previous in-depth investigation, whether complete or incomplete.

This will strengthen the knowledge of the instrument and the willingness of certain Contracting Entities to comply with the obligations. Furthermore, coordination with Member States should be strengthened in case patterns are noticed, and Member States should also support the European Commission in helping Contracting Entities with awareness-raising on their obligations as well as capacity-building measures.

Simplify the instrument and reduce the administrative burden:

The European Commission should consider it a priority to reduce the administrative burden and reporting obligations, as this would have a positive impact on all concerned parties (Contracting Entities, Industry and European Commission itself), while ensuring that a balance is found and that the objectives of the Regulation are fully met. For economic operators that have to submit information multiple times over the same year because they regularly participate in public tenders above the notification threshold, one notification per year should be sufficient, provided of course that they – or their parent company or their subsidiaries – do not receive any new foreign financial contribution in the meantime.

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AEGIS Europe is an industry alliance that brings together more than 30 European manufacturing associations representative of the whole value chain, from commodities down to consumer end products. Our Members account for more than €500 billion in annual turnover, as well as for millions of jobs across the EU.

AEGIS Europe contribution to public consultation on the FSR Guidelines

AEGIS Europe contribution to public consultation on the FSR Guidelines

AEGIS Europe welcomes the opportunity to submit its input to the European Commission on the upcoming Guidelines requested by 13 January 2026 as per Article 46 of the Foreign Subsidies Regulation (FSR). y

First of all, AEGIS Europe would like to reaffirm that the Foreign Subsidies Regulation represents an important trade autonomous tool to protect the European Industry’s competitiveness and guarantee a level playing field on the Single Market, be it for public procurement or concentrations.

Regarding articles 4 and 5 of the FSR on the identification of subsidies most likely to distort the internal market, AEGIS Europe believes that a number of foreign subsidies should be considered to have a distortive effect on a per se basis, notably all subsidies to beneficiaries active in sectors: 

• Characterised by structural excess capacity. 

• Featuring high-tech and/or dual-use products to a significant extent; or,

• Designated as strategic by the government providing the subsidies (e.g. in policies such as Made in China 2025).

Also to be considered distortive per se should be foreign subsidies to operators which have privileged and/or protected access to a significant non-EU market, especially if the non-EU market is the operator’s domestic market. The ability of non-EU companies to accept unfavourable or unconventional contract conditions should also be deemed as an indicator of such companies receiving a subsidy. Finally, these indicators should be assessed collectively rather than separately.

Regarding the balancing test, AEGIS Europe insists that a balancing assessment must start from the presumption that there is a fundamental and strong EU interest in favour of removing the effects of distortive foreign subsidies, especially those endangering sustainable and diversified supply chains and the preservation of a strong industrial base in Europe. In addition, because a balancing assessment must involve an adequately transparent and coherent analysis of both short-term and medium-term impacts of the distortions in question, the Commission should carry out full and timely consultation of relevant EU industries and give meaningful consideration of their input.

When considering commitments and redressive measures, we believe that the repayment of the foreign subsidy is normally not to be considered an adequate redressive measure. Furthermore, there should be limits on the commitments that the Commission may accept in lieu of redressive measures, especially in cases of less than full cooperation. In particular, the Commission should not be allowed to accept commitments in cases of significant or full non cooperation.

In public procurement procedures, it is worth highlighting a few relevant points. In recent years, there has been an increasing influx of bidders from economic operators from third countries. If we consider that EU funds (e.g. European Structural and Investment Funds, Connecting Europe Facility) can be involved and de facto awarded to economic operators, distorting competition based on price, this is even more relevant as it can contribute to a decreased competitiveness of EU companies. This situation has been documented notably by the OECD in its publications on measuring distortions in international markets (e.g. rolling stock value chain, aluminium, semi-conductors). This situation can lead to a loss of market share and deindustrialisation of the EU, as well as having negative effects on competition in the Single Market.

Coupled with increasing contractual requirements and award criteria focused mostly if not exclusively on price, European companies could be discouraged to submit bids due to low chances of winning – which would be detrimental to the quality of the solutions supplied to public authorities. The threshold of EUR 250 million for public procurement is high and fails to capture many important projects, for example in the construction or rail supply industries. Hence the power of the Commission to request the notification of foreign financial contributions in a public procurement procedure below the notification thresholds is key given the easy circumvention of the instrument by foreign economic operators. In any case the ex officio mechanism should be efficiently utilised, especially if the threshold remains unchanged.

When an economic operator has been targeted by a public procurement investigation and if either the investigation is not terminated or results in determination that the company at stake has received distortive foreign financial contributions, there must be an automatic investigation if this company participates in other tenders – be it above OR below the threshold.

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AEGIS Europe is an industry alliance that brings together more than 30 European manufacturing associations representative of the whole value chain, from commodities down to consumer end products. Our Members account for more than €500 billion in annual turnover, as well as for millions of jobs across the EU.

AEGIS Europe welcomes judgement of the ECJ (Case-652/22) Kolin Case - Public Procurement

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Brussels, 27 January 2025 - On October 22nd, 2024, the Court of Justice of the European Union (CJEU) issued a ruling in the Kolin Inşaat Turizm Sanayi ve Ticaret case (C-652/22 – the “Kolin case”).

The case concerns a request for a preliminary ruling directed to the CJEU by a Croatian Court, during the proceedings to assess the legality of a decision to award a contract for the construction of a railway infrastructure to a competing bidder of the Turkish company Kolin. The competing bidder was allowed to amend its bid after the deadline for submission and Kolin argued that there was a violation of the principle of equal treatment. The CJEU upheld that bidders originating from a third country, which has not signed an international agreement on public procurement with the EU, cannot claim equal treatment with other bidders in this area and cannot effectively invoke the provisions of the EU public procurement directives.

AEGIS Europe welcomes this ruling as a major and positive development, having argued for years that these foreign bidders – especially from China – should not be treated in the same way as European bidders, considering the lack of reciprocity and the numerous market entry barriers (localisation requirements, discrimination in public procurement procedures to name a few). This was the outcome of many years of legal uncertainty, despite the positive interpretation of a Guidance on the participation of third country bidders in the EU procurement market published by the European Commission in 2019.

Nevertheless, AEGIS Europe has identified critical points that still need to be addressed in order to guarantee the positive and durable effects of this ruling:

a) At present, there are no legal acts governing the access of third-country contractors to public procurement procedures in member States, despite it being an exclusive EU competence. Therefore, the CJEU stated that it is up to a particular contracting entity to assess whether it should allow such a contractor to participate in a procedure. This poses significant challenges and creates legal uncertainty for contracting authorities but also for bidders themselves (which third countries are affected by the decision, how to assess what can legally be done etc.). It is crucial that this decision and the principle of non-equal treatment are formally enshrined in legal acts to guarantee legal certainty.

b) The risk of circumvention linked to EU based entities being ultimately controlled by foreign entities originating from countries with which the EU has no international agreement on public procurement, or to consortia involving both a European entity and a foreign one. AEGIS Europe strongly believes that the announced revision of the EU public procurement directives in 2026 constitutes a unique and crucial opportunity to implement the outcome of the Kolin case. It is even more important now that the European Commission confirmed, in the newly released Competitiveness Compass, the introduction of a European preference in public procurement for critical sectors and technologies, recognizing the importance of safeguarding European capacities against unfair competition, global overcapacities and market access restrictions.

Media contact: email: info@aegiseurope.eu | www.aegiseurope.eu

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About AEGIS Europe: AEGIS Europe is an industry alliance that brings together more than 30 European manufacturing associations and companies representing the whole value chain from metals and ceramics to transportation industries committed to manufacturing in the EU on a truly level playing field ensured by a rules-based free and fair international trade. Our members account for more than €500 billion in annual turnover, as well as for millions of jobs across the EU.