JGP Consultancy

How Has Tendering Changed Following Brexit?

Back in 2016, the UK voted to leave the European Union. Over the following years, businesses have dealt with a great deal of uncertainty about how they will be able to operate once the country finally leaves the EU. Throw in a global pandemic and it is safe to say that the need to have some clarity on what is the same and what is different is something all businesses can appreciate. In this article, we aim to break down some of what is new about tendering and what is different about the process to make it easier for you to navigate the process.

The first thing to know is that many tendering contracts will be amended to remove EU references within any legislation. This will include replacing ESPD (European Single Procurement Documentation) with Single Procurement Documentation (SPD). This means that some policies may change and the omission of the exclusion ground relating to fraudulent activity impacting the EU’s fiscal interest. This has the potential to make it slightly easier to approach some tenders but it is important to understand the differences in this basic jargon now we have left the EU. There has also been a transfer of supervisory power to the Cabinet Office and away from the European Commission meaning you may need to research how to liaise with this government body should this change impact you.

Authorities no longer are obliged to publish contracts to the OJEU as the UK is now a member of the GPA (Government Procurement Agreement). The GPA is a branch of the World Trade Organisation meaning that in the future there is a potential opportunity to win tenders more globally as the relationships between other countries and the UK are redefined and new trading partners emerge. As it stands procurement thresholds are the same and financial thresholds are set to be reviewed in the first quarter of 2022.

A trend inspired by Brexit and the pandemic has been government bodies and public sector businesses turning their focus towards internal domestic supply chains which is excellent for British businesses. There has already been an implemented target of 1/3rd of government tendering spending going towards SMEs in the year 2022 meaning that Brexit may actually be potentially beneficial for your business and introduce more opportunities for growth. The British government has set aims of a competitive yet sustainable market for SMEs which means businesses can be open to more opportunities and can expect to see a steady flow of tenders applicable to them as the implications of Brexit become more clear.

One of the main drawbacks is the impact that will be faced by import-dependent businesses who may have new import costs and difficulties in securing needed resources. For construction and logistics companies this will especially be a significant hindrance to how they can operate and function so it will become more and more necessary to consider the import of goods when deciding to bid for a tender. On the other hand, this may also be excellent for internal production businesses who can now compete more fairly with overseas suppliers and win more domestic tenders as the hefty and uncertain import fees and changes in regulations do not apply. This will make British public sector businesses turn to domestic suppliers more and more so there is potential for an influx of tenders emerging as relationships with EU businesses end and it becomes too expensive to renew those relationships post Brexit. The impact of this may be a more self-sufficient UK that produces its own raw materials.

Another major change to tendering is the fact that EU tenders will no longer be available to British businesses. In the past countries from across the EU have been able to invite businesses within other EU countries to tender which now no longer includes the UK. This potentially means businesses will have to become more confident and proactive in finding new tenders within the UK as there are fewer and fewer opportunities across the English Channel to consider as a business. Particularly businesses in Northern Ireland or businesses who work with Irish partners will have to be mindful of this shift in operations moving forward.

The decision to leave the EU has been one of the most monumental and defining political moves of the 21st century, with almost all people working in the world of business today being younger than British membership in the European Union. This means that for almost all of us this change in the status quo is a learning curve that can potentially sink the growth of many businesses. This is why it is so important to be mindful of the shift in how and where you can operate and tender, and also be mindful of some of the potential niches to fill as European business winds down in the UK and all companies need to begin to look inward at what is available within Britain as opposed to Europe.

Leave a Comment

Your email address will not be published. Required fields are marked *