The new law on public procurement as a strategy to enable sustainable development in Switzerland

The subject of sustainable development, in its three dimensions - economic, social and environmental - is nowadays the focus of many political, economic or social discussions. However, for this development to be realised, it needs to ’walk the talk’. In Switzerland, the Federal government wants to set the good example with the revision of the law on public procurement, which will enter into force on January 1, 2021. The revised legislation intends to provoke a paradigm shift towards greater sustainability in public procurement and quality-based competition. But will this change really be effective?  

Public procurement is an important component of the Swiss economy. In 2018, the Federal administration alone spent 5.55 billion Swiss francs on construction, goods and services; the Federal government, Swiss cantons and municipalities combined spend a total of 40 billion each year, roughly 8% of Swiss GDP. On June 21, 2019, the Federal Parliament approved the complete revision of the Federal Law on Public Procurement (LAPub), which will enter into force on January 1, 2021, together with the relevant application decree. The new law aims the allocation of public funds that is sustainable economically, socially and environmentally.

In an article recently published by sui generis , the Swiss legal ’open access’ peer-reviewed journal, Prof. Federica De Rossa and doctoral assistant MLaw Clarissa David of the USI Institute of Law (IDUSI) critically analyse the scope of these legislative changes and make some recommendations to promote the effective realisation of the change intended by the legislator towards greater sustainability of public procurement.

"The federal law on public procurement has a free-market imprint and is based on mere economic efficiency. By incoporating the three dimensions of sustainability into the aims of the law, the legislator has instead sought to adapt a more "strategic" use of public procurement, requiring contractors to include environmental, social and ethical requirements in public tenders in relation to the object of the contract, whenever this appears possible", explains Prof. De Rossa, director of IDUSI. "These changes will also have a positive impact on the behaviour of private economic actors, who will be encouraged to implement effective corporate social responsibility if they want to increase their chances of being awarded the contract. The real challenge will be to implement the social dimension of sustainability (e.g. fostering reconciliation, women in top management, inclusion of disabled people, etc.) through public procurement, which is still too hesitant today. It is here that the public sector is required to be bold and creative. At the same time, jurisprudence will have to clarify how far the new law allows the public sector to achieve the paradigm shift".

The new law will also have an important impact on public procurement at the cantonal and municipal level, as Clarissa David, co-author of the article, points out, "since, with a view to greater harmonisation, it has shaped the new version of the Intercantonal Concordat on public procurement, to which the cantons will have to decide whether to adhere. In the meantime, a number of cantons have already considered the inclusion of sustainability in calls for tenders: Ticino, for example, is the first canton, in its new 2020 law, to have made the award criterion mandatory for the training of appretices, and to have included the criterion of social responsibility (CSR). In this context, the directives that the Council of State is drawing up in order to give concrete form to the broad CSR criterion will be key to establish contracting parties’ boundaries and avoid any discriminatory and protectionist applications".

The article entitled "La durabilité dans le nouveau droit des marchés publics: un changement de paradigme effectif?" (see attachment, in French) is also the result of research performed as part of the Sustainable Public Procurement project financed by the Swiss National Science Foundation (NRP 73 Sustainable Economy), led by Prof. Peter Seele (USI, Faculty of Communication, Culture and Society) together with Prof. De Rossa and Prof. Matthias Stürmer of the University of Bern (see Quicklink for details).