Stricter environmental requirements in public procurement
On 4 August 2023, the Ministry of Trade, Industry and Fisheries issued a press release announcing the adoption of regulatory changes that entail stricter environmental requirements in public procurement. The purpose of the change is to reduce the overall climate footprint and environmental impact of public procurement.
The change means that, as a general rule, climate and environment shall be used as an award criterion with a weight of at least 30% in public procurement. If it is clear that it provides a better climate and environmental effect, the green award criteria can be replaced with climate and environmental requirements in the technical specifications.
Exceptions to the requirements also apply if the procurement, by its nature, has an insignificant climate footprint or environmental impact. Both exemptions from the requirements must be justified in the procurement documents (“comply or explain principle”).
The changes apply to the Procurement Regulation, the Utilities Regulation and the Concession Contract Regulation, and will enter into force on 1 January 2024.
In many procurements, environment as an award criterion can be an appropriate instrument for achieving the desired environmental effects. However, in many types of procurement, we find that contracting authorities want to use other instruments to achieve the best environmental effect, such as setting qualification requirements, minimum requirements in the technical specifications or other contract terms – or a combination of the above. To what extent it will be possible to continue such a practice, is uncertain. In any case, with more stringent environmental requirements, it will be important to adequately justify any need for exceptions.