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Procurement

European Health Union: European Commission proposes Changes to the Joint Procurement Agreement

On 11 November 2020, the European Commission has announced a range of proposals to build a European Health Union. The proposed measures reflect on the learnings from the current COVID-19 and previous influenza pandemics and seek to enhance Member States’ preparedness for future health crises, which also includes a greater involvement of the EU. As part of its set of measures, the Commission is proposing to revise the current EU joint procurement framework.

  1. Current Joint Procurement Framework

In 2010, as part of its “lessons learnt from the A/H1N1 pandemic”, the European Council called for the development of a joint procurement framework for vaccines and antiviral medication. Subsequently, the European Parliament and Council adopted Decision 1082/2013/EU (the “Decision”) on serious cross-border threats to health, which, among others, provides that the EU and any interested Member States may conduct a joint procurement procedure. The detailed procedure was then agreed between the Commission and the Member States in the Joint Procurement Agreement (the “JPA”).

  1. Proposed Changes to the Joint Procurement Framework

As part of its announcement, the Commission has published a draft Regulation on serious cross-border threats to health, which would repeal Decision 1082/2013/EU. The draft Regulation proposes a number of changes to the current joint procurement framework:

  • Participation in joint procurement activities would now also be open to EFTA and EU candidate countries. The Decision only envisaged participation of EU Member States. However, in reality, this change only constitutes a clarification because since the beginning of the COVID-19 pandemic, several EEA, EFTA, candidate and potential candidate countries have joined the current JPA. This includes countries, such as Norway, Iceland, Liechtenstein, Montenegro, North Macedonia, Albania, Serbia, as well as Bosnia and Herzegovina and Kosovo.
  • Consistent with the current JPA, the draft Regulation also provides that participation in any joint procurement initiative is voluntary. However, the draft Regulation introduces a new requirement that countries that choose to participate in a joint procurement must not procure the same goods “through other channels” or “run parallel negotiation processes”. This is a significant change from the current JPA, which does not preclude participating countries from negotiating bilaterally in parallel to the joint initiative. This change clearly reflects the frictions earlier this year where some Member States formed alliances placing national interests ahead of the common EU interest in the procurement of personal protective equipment and medicinal products to treat COVID-19.
  • The Commission and Member States are required to coordinate and exchange information, among others, in relation to joint procurement, stockpiling and donation of medical countermeasures under various EU instruments.

It is likely that the proposed Regulation will undergo further changes during the legislative process. Once the Regulation is adopted, the Commission and participating countries will need to consider adjusting the terms of the current JPA to reflect the new framework.

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