摘要：Recently, media outlets reported that member states of the European Union (EU) supported the European Commission's proposal to res

ByAlexandr Svetlicinii

Recently, media outlets reported that member states of the European Union (EU) supported the European Commission's proposal to restrict participation of the Chinese suppliers of medical devices in public procurement in the EU. Once adopted, these restrictive measures will become the first instance of applying the EU International Procurement Instrument (IPI), a regulation empowering the EU to limit third country bidders' access to public procurement.

The China Chamber of Commerce to the EU (CCCEU) characterized this decision as not only "adding new complexity to China-EU economic and trade relations," but also contradicting the EU's proclaimed principles of openness, fairness and non-discrimination in market access. China's Ministry of Commerce promptly opposed this measure and criticized it as a new protectionist move that will raise further barriers in China-EU economic relations. The present note places the EU's decision in the context of international governance of public procurement and its relations with China in this domain.

It should be noted that the World Trade Organization's Government Procurement Agreement (GPA) requires participating states to accord equal treatment to each other's bidders in public procurement. Currently, the GPA has 47 parties, including 27 member states of the EU, Australia, Canada, Japan, Korea, United Kingdom and United States. China has already applied for GPA membership in 2007 and in 2019 the Chinese government submitted its seventh market access offer pledging to include more sectors and contracting entities in its GPA commitments.

Nevertheless, the negotiations stalled as the current GPA members are demanding additional market access commitments from China. As a result, while the EU guarantees access to its public procurement to bidders from GPA participating states, the EU member states and their contracting authorities have de facto allowed Chinese companies to participate in public tenders.

Due to the competitiveness of their offers, Chinese suppliers of goods and services have been successful in obtaining numerous public procurement contracts in the EU. Chinese legislation also allows participation of foreign companies in public tenders in China.

The European Commission building in Brussels, Belgium, October 4, 2024. [Photo/Xinhua]

In the absence of binding commitments towards foreign bidders, China has utilized public procurement to promote various industrial policies such as encouraging domestic manufacturing, promoting development of certain industries, stimulating investments and innovation, etc. The European Commission considered that by preferencing domestic products in public procurement, China created obstacles for EUropean bidders competing for public procurement contracts in China.

In order to pressure China to change its public procurement policies, the Commission proposed to apply restrictions under IPI that would specifically limit Chinese suppliers' access to public tenders in the EU. This decision could bring negative results as there are no binding commitments between the two parties in relation to public procurement.

What are the possible ways of addressing the diverging expectations of the parties vis-à-vis each other's public procurement policies? During their consultations with the EU, China explained that it won't be able to liberalize its public procurement unilaterally prior to completing negotiations under the GPA. Then, the current impasse could be resolved by the parties through a set of unilateral measures that would indicate their readiness to welcome each other's companies in public procurement.

For example, at the end of 2024, China's Ministry of Finance explored the possibility of according equal treatment to foreign-funded companies participating in public tenders in China. Once adopted, such measures could stimulate foreign investments in China, including those from the EU.

The European Commission, on the other hand, conducted a public consultation on the possible reform of EU public procurement directives, which could lead to the new EU-level rules on participation of third country bidders in public tenders.

Thus, through a set of unilateral measures, both sides can demonstrate openness towards foreign bidders and facilitate their participation in public tenders in line with current development strategies and other policy priorities. In this regard, the restrictive IPI measures are unlikely to facilitate this dialogue and risk creating further obstacles for trade and investment.

The author isan associate professor of Global Legal Studies at the University of Macau.

来源：中国网一点号