EU Commission proposes new procurement rules: more Europe, less China
The EU Commission wants to reform public procurement law to make it easier to exclude non-EU companies from tenders. The EU Commission has Chinese firms in mind, with EU Commissioner Stéphane Séjourné citing BYD's electric buses as an example. However, these are mostly built in Hungary.
EU Commissioner Stéphane Séjourné
Image: EU-Kommission
The EU Commission has presented a proposal to modernise and simplify EU procurement law. Although currently only a draft – requiring approval from the EU Parliament and member states – the proposal carries significant weight. It also addresses key issues in electromobility, as the new regulations would apply to typical EU-wide tenders for battery-electric buses and charging infrastructure by public transport operators, as well as to the procurement of electric vehicles for municipal fleets and their in-house operations, such as waste management services.
The proposal aims to modernise and simplify the EU framework for public procurement, enabling authorities and publicly controlled companies to award contracts more on the basis of strategic considerations. A key focus is ensuring that companies from third countries outside the EU – such as China – can be more easily excluded from procurement procedures in future than before.
EU Commissioner cites BYD buses as example
Stéphane Séjourné, EU Commissioner for Industrial Strategy, provided a concrete example when presenting the plans: “After the adoption of this reform, it won’t be because of the European commissioner if there are BYD buses in Berlin.” While the local public transport operator BVG does not currently operate any (electric) buses from the Chinese manufacturer, Séjourné was likely alluding to the order of 200 electric buses placed by Deutsche Bahn with BYD, which caused considerable controversy last December. At the time, German Finance Minister Lars Klingbeil (SPD) had called for more location-based patriotism (link in German) and stated that this order annoyed him.
It has already been the case that the cheapest bid does not necessarily win a tender. For example, Deutsche Bahn had considered not only the purchase costs but also energy consumption, maintenance effort, and other quality criteria – along with the location of production sites, the extent of the service network, and the ecological, economic, and social responsibility (CSR) of future suppliers. While BYD, which won only 5 per cent of the contract volume, the lion’s share went to the German manufacturer MAN.
However, the EU Commission now states that the exclusion of companies from third countries in procurement procedures must be further simplified. To this end, “‘European preference’ considerations” are set to be introduced. These are intended to ensure that public spending supports security, resilience, and fair competition in the EU by reducing harmful dependencies, combating unfair practices, and strengthening industrial capacities in Europe. However, these criteria will not be mandatory but rather a legally sound option for tenders. Additionally, quality criteria are to be given greater weight in future than price alone.
Strategic lever that other states already use
“This is a strategic lever – and at a time when, in particular, China, India, the United States, and all the major powers are using this lever as part of their own industrial and economic strategies,” BZ quotes EU Commissioner Stéphane Séjourné, who is considered a close ally of French President Emmanuel Macron.
A list of countries is to be created that will be treated equally to EU states because they, in turn, grant EU companies access to their tenders. According to the current status, the UK and the US will definitely be on this list, but China will not.
Electric buses made in Hungary
Returning to the Chinese vehicle manufacturer BYD: Séjourné’s example was may be a striking one, and also likely intended as a dig at the German federal government, which has so far been reluctant to restrict market access for Chinese companies, it remains unclear whether BYD could in future be excluded from electric bus tenders in the EU. This is because BYD’s electric buses for the European market have been manufactured since 2017 at the BYD plant in Komárom, which is located in the EU member state Hungary. Since then, BYD has created hundreds of jobs there, primarily for EU citizens.
The approximately 200 electric intercity buses that Deutsche Bahn ordered from BYD at the end of 2025 are also to be manufactured there. This case demonstrates that a “Chinese manufacturer” and a “vehicle produced in China” are not the same, especially since the buses are being manufactured by a Hungarian BYD subsidiary that regularly participates in EU tenders. As such, the contracting party is not actually a Chinese company.
Under the planned new EU procurement rules, such a BYD bus would therefore not automatically be excluded. The draft distinguishes between the origin of the company and the origin of the product: According to the current status, the decisive factor would likely be whether an electric bus manufactured in Hungary qualifies as an EU-origin product under EU customs rules. Additionally, public contractors could in future set requirements for the EU share of certain components.