Following the adoption of the European Green Deal at the end of 2019, sustainability became a dominant theme in European policy and legislation. A wave of regulation - from the taxonomy and CSRD to due diligence requirements and new rules on ecodesign - was intended to fundamentally transform the functioning of the European economy.
The ambitions were high, but criticism soon began to emerge and intensified in line with broader global developments. Industrial associations, as well as a number of governments, warned that stringent environmental requirements were placing a burden on European companies at a time when their competitors in the United States, China and elsewhere were not subject to comparable regulation. The debate culminated in 2024 with Mario Draghi’s report on Europe’s competitiveness.
The European Commission is therefore now introducing partial deregulation. However, it is not abandoning sustainability altogether. Rather, it is seeking new pathways and instruments. One such instrument is to be public procurement, whose potential is currently not being fully utilised.
The idea of green public procurement (GPP) is not new. As early as the 1990s, it was the subject of debate, but a turning point came in 2002 when the European Court of Justice confirmed that environmental requirements could form a legitimate part of public procurement criteria. In response, the European Commission began promoting green procurement primarily through non-binding recommendations and the sharing of best practices.
The rules currently in force since 2014, which govern public procurement in the European Union, do not prohibit green purchasing. On the contrary, they explicitly allow sustainability (environmental and social) criteria to be incorporated, for example, when defining participation conditions in tender procedures or setting specific contractual performance conditions relating to environmental impact. Similarly, sustainability can be included as a criterion for evaluating bids. While tenders must always be assessed primarily on their economic advantage, lifecycle costs of a product may also be taken into account.
The problem, however, is that merely “allowing” such approaches is often insufficient to achieve the desired objectives. The practice of green public procurement varies significantly between Member States — working very well in some, while remaining almost negligible in others. The reasons range from political priorities and economic conditions to administrative capacity. Soft instruments such as recommendations or the sharing of best practices alone cannot resolve this structural issue.
This is why so-called minimum mandatory requirements for green public procurement are now gaining traction at the European level. These would consist of binding minimum environmental standards that contracting authorities would be required to include in tenders. This represents a fundamental shift from voluntariness to obligation.
These minimum requirements would not be set by individual Member States but uniformly by the European Commission for the entire Union. The Commission could, for example, stipulate that from a certain year onwards, contracting authorities may only procure certain products that meet defined minimum environmental parameters. Alternatively, it could require that construction contracts above a certain value meet higher energy standards, or that computers and servers purchased with public funds carry energy efficiency certification.
This mechanism has a certain logic. Centrally defined criteria reduce the administrative burden on contracting authorities, which no longer need to define complex requirements themselves. At the same time, they strengthen the single market, as manufacturers meeting the minimum requirements can be confident that their products will satisfy procurement criteria across the EU.
However, minimum mandatory requirements also carry risks. If set too low, they will not result in any meaningful progress towards greater sustainability. If set too high, they may significantly increase costs by limiting the pool of suppliers capable of meeting them. Rigid parameters may also hinder innovation or disadvantage smaller firms that lack the capacity to invest quickly in new technologies or certifications.
This does not mean that minimum requirements should be avoided. On the contrary, they can be a powerful and useful tool. However, their introduction must be preceded by a thorough, evidence-based and participatory process that takes into account differing national conditions as well as market needs. Only then can criteria be set that are ambitious yet realistic and economically viable.
Sustainability is not the only strategic objective that public procurement is expected to serve. To some extent, it is also to be linked with the protection of European industry and the pursuit of geopolitical interests. The “Made in EU” initiative, discussed particularly in the context of the forthcoming Industrial Acceleration Act, suggests that the EU intends to use public procurement to support domestic production by setting minimum local content requirements within the European Economic Area for selected strategic sectors.
However, there is no consensus between Member States and the European Commission on which sectors should be covered by the Made in EU requirement. Nordic countries favour using it only very sparingly in justified cases (e.g. defence contracts), whereas countries such as France seek to introduce mandatory demand for European-made products as broadly as possible.
Assessing the impact of the Made in EU initiative is further complicated by the fact that it is unlikely to be limited strictly to the European Economic Area. A leaked European Commission document suggests that certain third countries considered strategic partners could also be included within the preferential framework. In this sense, “Made in EU” may not mean exclusively produced in Europe, but rather produced within geopolitically reliable value chains.
The forthcoming Industrial Acceleration Act develops this framework further. Its ambition is to accelerate industrial investment, strengthen European industry, reduce dependence on third countries, and use public procurement as a tool for actively shaping demand. Governments and public institutions are expected to act as first buyers, helping sustainable products and services overcome costly early stages and gain a foothold in the market.
Linking economic, sustainability and geopolitical priorities offers real synergies, particularly in sectors such as mobility, zero-emission technologies and renewable energy. However, potential points of friction must also be recognised and addressed in advance.
Preferential treatment for European and selected other producers may trigger international disputes or retaliatory measures from other countries and manufacturers. Tensions may also arise for smaller contracting authorities, for whom green procurement and the Made in EU initiative may represent a capacity-intensive agenda that is difficult to implement in everyday practice.
The ongoing reform of public procurement will thus become a key test of whether Europe can reconcile its green ambitions with realistic economic policy. Minimum mandatory requirements for public procurement may provide an effective path towards achieving these objectives — but only if accompanied by adequate support for contracting authorities, an internationally compatible framework, and a clear vision of what Europe wants to produce and where it intends to source from. Success will depend not only on the rules themselves, but on the ability to design and implement a strategy that balances sustainability, industrial policy, international relations and economic reality.
This article was published by Ekonews.cz in February 2025.
