10 December 2007 | Paul Snell
The European Commission is to introduce new legislation to govern defence procurement.
It has created a specific rule for defence procurement to make tenders more open and available to non-domestic bidders. The EC said current EU procurement rules were ill-suited to most defence and security equipment.
It said although article 296 of the European Treaty protected some defence purchases from non-domestic competition on security grounds, many countries were using the exemption for all purchases.
"In practice many member states have used it to exempt almost all defence and sensitive security procurement from internal market rules," it said.
It is hoped the new rule, included with two other communications, will make the European defence market more transparent and more competitive. The directive includes specific requirements and precautions to be taken when awarding defence contracts.
Charlie McCreevy, EU commissioner for internal market and services, said in a speech: "Introducing transparent and competitive procurement rules is crucial for the establishment of a common defence market. This will lead to greater openness of markets between member states."
A voluntary code allowing foreign companies to bid for military contracts has already been signed by 22 member states (Web news, 30 June 2006).