Outsourcing EU foreign policy?
Last August, the European Commission’s Service for Foreign Policy Instruments (FPI) issued a procurement notice which invited private companies “to contribute to reinforcing EU foreign policy priorities by supporting the development of a hub for strategic foresight and analysis.”
As we have all noticed, more and more governments and international institutions are opting to outsource non-core tasks in the open market. All well and good. But to my knowledge this is the first tender covering a substantial area of foreign policy.
Should private companies, even if they are increasingly providing a wide entire range of services to governments – such as operational training, security, international aid – also provide strategic foresight and analysis to support EU foreign policy priorities? Or should one not assume that “reinforcing EU foreign policy priorities” is the hard core of EU policy? How otherwise it is possible to ensure accountability and good diplomacy? Is it not the core responsibility of European External Action Service, created in 2011, to devise and implement EU foreign policy, especially in areas such as defence, terrorism, multilateralism and diplomacy?
I believe there should be limits to outsourcing. After all, EU foreign policy is the mechanism through which national governments forge their diplomatic interactions at the European and international level. It is a precious mechanism which must never be entrusted to a private interest. Of course, companies can provide advice, data, analysis, etc. But at the end of the day, it is democratically elected governments that must decide what use to give to that advice.
The Commission tender, worth the handsome sum of €4 million, had a deadline of January 2023. It specified that “the action will contribute to support EU foreign policy priorities by supporting the development of EU foresight and analysis focusing on: multilateralism, battle of narratives, peace/security/defence, disinformation and terrorism.” The successful applicant would contribute to formulating EU foreign policy priorities, even in areas such as security, defence, disinformation and the fight against terrorism.
Taken at face value, this implies that a private contractor could become indirectly responsible for the formulation of EU or even NATO policies. This would involve access to EU classified information (EUCI), something only EU institutions are supposed to handle. Private companies can and do of course play support roles. But they should never take over the role of the EEAS in promoting “EU interests” in the world!
Europe is currently in search of strategic autonomy. It means that articulating meaningful strategies for EU foreign policy is more important than ever. This in turn requires good governance. How can we expect EU diplomats to be devoted to their foreign policy objectives if at the same time we move towards privatising parts of that same foreign policy? When the most challenging aspect of EU foreign policy goes to outside contractors, it can be demoralising. The EEAS must maintain strategic control of EU foreign policy. This is absolutely vital given the spread of disruptive technologies and disinformation.
On the technical aspects of this tender. It was published as an external action procurement, i.e. it was somewhat different from the usual procurement procedures of EU institutions.
Articles 178 & 179 of the Financial Regulation of 2018/1046 derogate many of the rules for procurement of contracts by institutions ‘on their own account’ for procurement in the area of external action.
In short, for external action tenders, there is a risk of less transparency and less flexibility. For example, the procurement documents cannot be found on the internet, as was suggested in the contract notice. Only 12 questions were addressed to the Commission by potential applicants, of which half were not answered because it was too late. True, the European Commission was not obliged to answer them, but it is important to exercise diligence. A few days before the deadline, four questions were answered and published as clarifications…. And virtually all questions were about how to be able to participate! It is specified in I.3) Communication of tender that procurement documents are available for unrestricted and full direct access, free of charge, at: https://etendering.ted.europa.eu/cft/cft-display.html?cftId=11931. However, no documents were provided.
As for the scope of access to this contract, it was NOT subject to the WTO Agreement on Government Procurement, but rather open to companies in accordance with the specific provisions in the basic instrument, and to international organisations according to Article 179 FR. The additional information to the contract notice confirms that “For this contract award procedure, financed by NDICI rapid response actions, participation is open without limitations. Participation is also open to international organisations.”
In addition, the contract notice stipulated that no other documents except the declaration on honour, additional information and clarifications were available. So, the specifications and criteria for an award were in practice only available to selected companies.
The value of the contract was announced as €4 million over a period of four years. However, the possibility to add a follow-up contract worth another €4 million was mentioned as the tender was considered a ‘basic project’. According to the notice, “Subsequent to the initial contract resulting from the current tender procedure, new services consisting in the repetition of similar services, up to the estimated amount of € 4,000,000, may be entrusted to the initial contractor by negotiated procedure without prior publication of a contract notice, provided the new services are in conformity with the same basic project.”
It is therefore no wonder that only big consultancy firms responded to this call and only two were shortlisted by the Commission, despite the importance of ensuring true competition. In the past, normal procedures did not require the publication of all information either, but when that rule was changed, the degree of competition changed too, for the better. That has not happened in external action procurement yet. Why not is unclear to me.
Outsourcing core business raises fundamental questions. One practical consequence of it is that in-house expertise and knowledge is either reduced or not developed in the first place – unless the specifications would oblige a knowledge transfer from the contractor to the EEAS, which does not seem to be the case with this particular tender.
There are even bigger questions related to the way this procurement was carried out: the period of application was very short, only minimal information was provided, the scope and detail of the services to be delivered were not well-defined, the selection criteria for a very broad scope of services were also not well defined: and as a result only two offers were received.
The views expressed in this article reflect that of its author and not necessarily that of EU Watch or any of its representatives.
Professor Dr. Cristina Vanberghen
Vanberghen is an academic and political commentator, with expertise in public and private sector in the area of digitalization, consumer policy and foreign policy. She was political director in a Ministry of Foreign Affairs, and director with Deloitte and Touche and Ernst & Young and has published widely on subjects ranging from cybersecurity, artificial intelligence, foreign affairs, EU integration and political reform.