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Bright prospects for governments and businesses

by Enrique Vich created on 01/06/2012 10:00

eProcurement can save €50 billion a year

When asked how he felt on the launch-pad of the first US mission into space, Apollo astronaut, Alan Shepard replied, “I realised I was sitting on top of a rocket built by the lowest bidder.” Even a pursuit as demanding as space exploration is thus dependent upon public sector contracts and given the inherent dangers involved in such pursuits, a rigorous process of standardisation and qualification criteria are of great importance.

The recently published EC Communication “A strategy for e-procurement”[1] states that “e-procurement can significantly simplify the way procurement is conducted, reduce waste and deliver better procurement outcomes (lower price, better quality) by stimulating greater competition across the Single Market. It can also contribute to addressing two of the main challenges the European economy is facing today: the need to maximise the efficiency of public expenditure in a context of fiscal constraints and the need to find new sources of economic growth.”

The Commission has put forward a proposal to modernise the EU's public procurement legal framework, with the objective to achieve a full transition to e-procurement in the EU by mid-2016. Moreover, the Digital Agenda for Europe[2] and the eGovernment Action Plan 2011-2015[3] highlight the importance of connecting e-procurement capacities across the Single Market.  Building upon targets originally set in the Manchester declaration in 2005, the Pan-European Public Procurement Online (PEPPOL) project supports these high level goals by providing the path for businesses to communicate electronically with European governments throughout the procurement process.

As the Large Scale Pilot (LSP) Project with the strongest emphasis on co-operation with standardisation bodies and implementation of standards, PEPPOL is building a commercial environment that facilitates cross-border procurement, from eSignatures, to eAttestations (Virtual Company Dossier), eCatalogues, eOrders and eInvoices. In particular, the electronic document exchange network (eDelivery) and post-award procurement components, such as electronic ordering and invoicing, are now frequently used by private and public organisations. PEPPOL tools and services for validation of certificates used in electronic signatures are also a success with thousands of validations performed to date. 

The PEPPOL standards-based components overcome some of the more entrenched problems that characterise cross-border business, for example with the Virtual Company Dossier where exchanged information, can be stored and reused whenever businesses are required to provide information to qualify for a tender, taking into account the specific tender requirements.  What’s more, these measures can be built upon to broaden the scope of digital services and facilitate business growth in the future, where the PEPPOL specifications can be re-used in the Business-to-Business space, at the cross-border, national and local level.

These efficiencies, according to Deutsche Bank estimates[4], could result in more than €50 billion in annual savings for government and businesses, a prediction shared by those most closely associated with the project:

We have first-hand experience of the need for standardised solutions and their enforcement at the European level; solutions that can increase a business’s market share while lowering its costs.’
  - André Hoddevik, Project Director of PEPPOL.



[2] COM(2010)245

[3] COM(2010) 743 of 15 December 2010

[4] Source: Research*EU Focus Magazine

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