Principle of Non-Discrimination

Non-discrimination is the principle that makes the European single market real in procurement. Without it, public authorities could simply favour their own national suppliers and the theoretical openness of the European procurement market would be hollow. The principle extends beyond nationality to cover any characteristic of a supplier that is irrelevant to the subject matter of the contract.

What is the Principle of Non-Discrimination?

The principle of non-discrimination derives from the Treaty on the Functioning of the European Union, which prohibits restrictions on the free movement of goods, services, and capital between member states. In the context of procurement, it means that contracting authorities cannot, directly or indirectly, treat suppliers from other EU member states less favourably than domestic suppliers.

Direct discrimination is straightforward: a specification that explicitly requires suppliers to be registered in the purchasing country, or a criterion that awards extra points for local delivery, is directly discriminatory. Directive 2014/24/EU prohibits this categorically.

Indirect discrimination is more subtle and more common. A requirement for experience with "national regulatory framework X" when foreign equivalents are equally valid, a language requirement beyond what the contract genuinely demands, or a technical standard that only national products meet, can all amount to indirect discrimination. The test is whether the requirement creates a disproportionate burden on foreign suppliers without objective justification related to the contract.

Non-discrimination also applies to the treatment of different categories of economic operators. A contracting authority cannot favour large companies over small ones, or established incumbents over new entrants, through criteria designed to screen out those categories rather than to assess genuine capacity. This overlaps with the principle of proportionality and equal treatment.

In the UK post-Brexit context, non-discrimination under the Procurement Act 2023 applies within the UK's four nations and between UK suppliers and suppliers from GPA signatory countries. Separate bilateral and multilateral trade agreements determine the extent to which EU-based suppliers retain access to UK contracts.

Why it matters for bidders

Non-discrimination is the legal foundation for cross-border bidding in Europe. If you are a Polish company bidding on a French contract, or a Spanish company bidding on a Swedish contract, this principle is what entitles you to participate on the same terms as national suppliers. If you encounter requirements that seem designed to exclude foreign suppliers, they may constitute indirect discrimination that can be challenged.

Example

An Austrian regional government specifies that facilities management contracts may only be awarded to companies holding a specific Austrian professional licence, when equivalent licences from other EU member states confer identical competencies under a European mutual recognition framework. This requirement indirectly discriminates against non-Austrian suppliers and violates the principle of non-discrimination. The correct approach would be to accept equivalent professional qualifications from other member states, consistent with the principle of mutual recognition.

Frequently Asked Questions

Can a contracting authority specify that a supplier must have a local office?

Generally not as an absolute selection requirement, because that would effectively exclude suppliers from other EU member states who do not already have a local presence. Authorities may legitimately require that service delivery is provided from a local or regional location once the contract is operational, if that is genuinely necessary for performance. But requiring a local office as a pre-qualification condition is more likely to be found discriminatory.

Is it discriminatory to require that documents be submitted in the national language?

Language requirements must be proportionate. Requiring tender submissions in the national language of the contracting authority is generally acceptable, as the authority needs to be able to evaluate them. However, requiring that all supporting evidence (such as financial statements already prepared in another language) be translated into the national language at the bidder's cost can impose a disproportionate burden on foreign suppliers and may shade into indirect discrimination.

Does non-discrimination protect bidders from discrimination based on company size?

The primary focus of non-discrimination in EU procurement law is nationality and place of establishment. However, the broader principle of equal treatment prohibits selection criteria that are calibrated to exclude entire categories of otherwise capable suppliers, including SMEs, without justification. The two principles work together to promote genuinely competitive markets.