Thirteen percent of government IT tenders illegally specifies trademarks when they engage suppliers from the private sector for specific IT contracts worth billions of euros, writes Open Forum Europe in its Procurement Report 2010, published on 23 May.
"The forthcoming revision of the EU Public Procurement Directives should take into account discriminatory practices persisting in the procurement market."
The advocacy organisation lobbying for more competition on the ICT market and a supporter of open standards and open source software, examined 441 invitations to tender published last year by public administrations in the Supplement to the Official Journal of the European Union.
OFE concludes that government agencies "are increasingly resorting to negotiated procedures using one preferred supplier without any call for competition. While there can be good grounds for applying the negotiated procedure without any call for competition, it can also be used to renew contracts with existing vendors without the complications of holding an open tender."
OFE wants the EU to scrutinize this bypassing of public procurement.
Long-term costs
A second recommendation from the group, representing IT companies including Deloitte, Google, IBM, Oracle, Red Hat, small and medium sizes enterprises and consumer organisations, is that EU lawmakers use the procurement guidelines to explain the long-term costs of vendor lock-in. OFE says this will encourage public administrations to develop a long term view.
A third recommendation is to force also the EU institutions to improve their public procurement.
OFE says that public procurement accounts for nearly 20 percent of the EU's gross domestic product – around 2.2 trillion euros according to Eurostat figures from 2009. "By opting for one preferred supplier, public bodies are inadvertently helping existing suppliers maintain their stranglehold on markets to the detriment of new competitors."
More information:
OFE Procurement Monitoring Report 2010 (pdf)