Implementation of Green Procurement in the Swedish Procurement System

1. Implementation of Green Procurement in the Swedish Procurement System Linda Dahlström “The New Public Procurement Procedures and Instruments” Ankara 5-6 February 2008

2. Public Procurement in SwedenCurrent situation • 40 billion EUR • 10 000 contracting entities

3. Legal Framework for GPP in Sweden • EC Treaty • Government Procurement Agreement (GPA) • Public Procurement Directives (2004/18/EC and 2004/17/EC) • Judgments of the European Court of Justice • The Swedish Public Procurement Acts (2007:1091, 2007:1092)

4. The ”Legal” Way forward • New Swedish procurementlegislationwhichimplements the provisions of the procurementdirectives. (January 2008) • A proposalthat contractingauthoritiesshould set environmentalrequirementswhereappropriate with regard to the nature of the procurement.

5. Background GPP in Sweden • 90’s - Early engagement by NGO:s and in local Municipalities, County Councils and in some Governmental Agencies • Committee for Ecologically Sustainable Public procurement appointed by the Swedish Government 1998-2001 • Development of the Swedish Instrument for Ecologically Sustainable Procurement (EKU) 2001 • Swedish Environmental Protection Agency survey on GPP 1998, 2002, 2004, 2007

6. Background GPP in Sweden • Strong support for GPP from the Prime Minister in the Governmental declaration in 2002 • Swedish Action plan 2007-2009 • Legislation on green cars bought or leased by Governmental Agencies 1 Jan 2006 Developments • Sustainable procurement (social, ecological and economic dimension)

7. The government’s action plan for ’07 – Environmental public procurement • Purpose to increase the level of environmental procurement • Assessment of the current situation • Target for the next three years • Measures for achieving the targets • Clarification of the various actors’ responsibilities

8. The government’s action plan for ’07 – Environmental public procurement • Assessment of the current situation - Questionnaires, case studies • 60 % of central government, regional and local agencies regularly specify environmental requirements • In 1/3 of the cases environmental requirements are framed in such a way that they have no effect!

9. The government’s action plan for ’07 – Environmental public procurement • Main Obstacle - Lack of knowledge and experience on how to set environmental requirements

10. The government’s action plan for ’07 Environmental public procurement • Vision Whereverpossibleaccording to the law on public procurement, authorities at government, municipality and countylevelsshouldissuerequirements for environmentalissues in the public procurement process This must not involve an increase in the administrative burden for companies or makingparticipationharder for companies, especially small companies.

11. The government’s action plan for ’07 Environmental public procurement • Vision Public purchasers and suppliershave access to tools, training and othertypes of support with regard to environmentalissues in connection with public procurement

12. The government’s action plan for ’07 Environmental public procurement • Objectives 1. The proportion of authorities at government, municipality, and county levels that regurlarly issue well-formulated environmental requirements should increase from the current level of 60 % to 80 % 2. The proportion of state framework agreements with well-formulated environmental agreements should increase from the current level of 63 % to 90 %

13. The government’s action plan for ’07 – Environmental public procurement • Measures 1. State authorities, guidance and skills 2. Involve politicians and other decision- makers at local and regional level 3. Secure the skills among purchasers 4. Offer an effective and simple tool 5. National targets for public consumption

14. The government’s action plan for ’07 Environmental public procurement • State authorities, guidance and skills - environmental requirements in the state framework agreements

15. The government’s action plan for’07 Environmental public procurement • Involve politicians and other decision-makers at local and regional level - information campaign - conferences

16. The government’s action plan for’07 Environmental public procurement • Secure the skillsamongspurchasers - set up a helpdesk for GPP - A web-basedbasiccourse on environmentalrequirements - Information material produced on environmentalrequirements and the legal framework - offer integration of GPP in existingprocurementtrainingcourses

17. The government’s action plan for ’07 Environmental public procurement • Offer an effective simple tool for GPP l - Environmentalcriteriareviewed, quality, content, level,user-friendliness and functionality - The toolre-launched and marketed

18. The government’s action plan for ’07 – Environmental public procurement • Cost benefit analysis • Follow up - The Swedish Environmental Protection Agency should continouously follow up the development of environmental requirements in public procurement

19. The government’s action plan for ’07 – Environmental public procurement • Involve allr elevant stakeholders in the process

20. The Swedish Environmental Public Procurement Structure Ministry of Finance The Swedish Public Procurement Act Ministry of Environment Ministry of Enterprise The Swedish Competition Authority (supervision) The National Financial Management Authority, Coordination of Central Procurement Swedish Environmental Protection Agency Swedish Environmental Management Council 10 000 Procuring entities 290 Municipalities 12 County Councils 450 Central Authorities

21. The Swedish EnvironmentalManagment Council (MSR) • Jointly owned by the Swedish state, the Swedish Association of Local Authorities and Regions and the Confederation of Swedish Enterprises.

22. MSR – GUIDANCE FOR SUSTAINABLE PROCUREMENT • Internet based • Criteria for 9 product areas • Guidelines and education • Aid and support (helpdesk) for public procurement officers purchasers • State financed, work contribution from different stakeholders • Staff- 8 full time

23. MSR – consensus process Prioritized products - Board decision Working group - start Publishing Pre-study (lca, market analysis, stakeholder analysis etc) Referral Open stakeholder meeting Decision committee Referral consideration Final criteria proposition Working group - stop

24. Websites • The Swedish Competition Authority, supervisory authority for public procurement in Sweden (www.kkv.se) • The Swedish Environmental Management Council (www.msr.se) • The Swedish Environmental Protection Agency (www.naturvardsverket.se)

25. The Swedish Legal Frameworkbelow the EC thresholds Linda Dahlström Ankara 5-6 February 2008

26. Thresholds Works EUR 5 278000 Supplies/services • Utilities EUR 422 000 • Central level EUR 137 000 • Other contracting authorities EUR 211 000

27. Principles in the Treaty applying to public contracts • non-discrimination on grounds of nationality -Article 12 • free movement of goods and prohibition of quantitative restrictions on imports/exports and measures having equivalent effect –Art. 28 -30 • freedom of establishment -Article 43 et seq. • freedom to provide services -Article 49 et seq.

28. Fundamental Principles Deriving from Treaty Provisions • equality of treatment • obligation of transparency • proportionality • mutual recognition

29. ECJ Case Law The ECJ has jurisdiction under art.177 of the EC Treaty to interpret Community law where the situation in question is not governed by Community law but the national legislature, in transposing the provisions of a directive into domestic law, has chosen to apply the same treatment to purely internal situations and to those governed by the directive, so that it has aligned its domestic legislation to Community law. (C-28/95 A. Leur Bloem)

30. ECJ Case law • “The mere fact that the Community legislature considered that the strict special procedures laid down in those directives are not appropriate in the case of public contracts of small value does not mean that those contracts are excluded from community law.” • “… bound to comply with the fundamental rules of the Treaty.” (C-59/00 Bent Mousten Vestergaard, p 20)

31. ECJ Case law • “That obligation of Transparency which is imposed on the contracting authority consists in ensuring, for the benefit of any potential tenderer a degree of advertising sufficient to enable the services market to be opened up to competition and the impartiality of procurement procedures to be reviewed.” (C-324/98 Telaustria p 62, C- 458/03 Parking Brixen p 49)

32. ECJ Case law(C-195/04 Opinion of Advocate general) • A sufficient degree of publicity for low value contracts ? - “not necessarily an obligation to publish” - “.. The appropriate degree of publicity is to be determined by reference to the potential market for that contract.” - “ a sufficient degree of publicity for low value contracts a matter for national law”

33. Objective of public procurement policy outside the scope of the directives • Same as above thresholds ? (Establishment of a single market, Open up public procurement to competition, value for money, anti-corruption tool) • Public Procurement directives suitable legislation also for below EU thresholds ?

34. Public Procurement Outside the scope of the EU directives – The Swedish Example • ~ 95 % of total nr of procurement procedures ( 200 000) • ~ 80 % of total procurement value • ~ 32 billion EUR • Legal framework below thresholds applied by many contracting entities (10 000) and procurement officers • Nr of complaint procedures ???

35. Background • 1952, Procurement Ordinance (domestic preferences removed) • 1973 Procurement Ordinance and Procurement Regulation • 1994 The Swedish Public Procurement Act (interpretation of the rules for procurement outside the scope of the EU directives in accordance with the ”old” procurement regulation

36. The Swedish Public Procurement Acts • Two new laws in force 1st January 2008 (classic and utilities) 16 chapters: (1-2 general provisions, 15 procurement outside the scope of the directives, 16 remedies • Provisions regarding public procurement outside the scope of the directives presently drafted by government with the purpose to simplify (implemented ? 2009, 2010)

37. Chapter 15 (PP ACTS) • Contracts below the EU threshold values • B-services irrespective of value • Secrecy or other special restrictions in respect of national secrecy – regardless of value • Defence, supplies and services which have no civil use – regardless of value

38. Procedures (Chapt 15 PP Acts) • Simplified Procedure: - all suppliers entitled to submit tenders - negotiation possible with one or several tenderers • Selective Procedure: - all suppliers entitled to apply to submit tenders - the contracting entity invites certain suppliers to submit tenders - negotiation possible with one or several tenderers • Informal Procedure: - No formal requirements

39. Publication requirements • Simplified procedure: the notice shall be published in an electronic database which is publicly accessible or through the publication of contract notices in some other way - which leads to efficient competition. • Selective procedure: the invitation to apply to tender should be published in an electronic database which is publicly accessible • Content of Notice

40. Written request for tenders • Under certain circumstances the contracting entities may send a written request for tenders to a supplier without publishing a contract notice.

41. Informal Procedure • Low value • Particular reasons, such as great urgency resulting from circumstances which could not have been anticipated and are outside the control of the entity, may procurement take place without formal requirements

42. Informal Procedure • The contracting entity should if needed establish an internal policy for the use of the informal procedure

43. Time limits • Simplified Procedure - Reasonable time • Selective Procedure - Reasonable time (never less than 10 days from the day on which the invitation to apply was published)

44. Tender opening • Technical specifications - Not limited except reference to Environmental specifications • Award of contract - Relative weighting or Ranking

45. Remedies • Review and Damages same above and below EU thresholds • County Administrative Court (Review) • District Court (damages)

46. Thank You ! Linda Dahlström Swedish Competition Authority linda.dahlstrom@kkv.se