Public procurement

Public procurement refers to the process by which public authorities, such as government departments, local authorities or state-owned enterprises, purchase goods or services from the private sector.

Public procurement rules ensure that public money is properly used when public authorities make purchases from the private sector.

How do governments award contracts to business

To prevent fraud, waste, corruption, or local protectionism, the laws of most countries regulate government procurement to some extent. Laws usually require the procuring authority to issue public (competitive) tenders if the value of the procurement exceeds a certain threshold.

 

The standard way of awarding contracts for goods to businesses is competitive tendering, which allows the greatest number of firms to bid. Within competitive tendering, there are different types of public procurement procedure.

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