Procurement Act amended – what do the changes mean for the City of Espoo and suppliers?

Among the most significant changes are the greater emphasis placed on market consultations and procurement preparation, the requirement to divide procurements into lots, and new obligations aimed at promoting competition. For suppliers, the changes create new opportunities to participate both in competitive tendering and in procurement preparation through market dialogue.

The preparation of public procurements will play an increasingly prominent role under the amended legislation. For procurements exceeding EUR 10 million, contracting authorities will in future be required either to conduct a market consultation or to assess different implementation options as part of procurement planning. Procurement documentation must describe the key stages of the preparation process and the grounds for the decisions made during it. The aim is to ensure that the progress of procurement preparation and the decisions made along the way can be verified retrospectively.

The City of Espoo has long used market dialogue as part of its procurement preparation, so conducting market consultations is not a new practice for the city. Suppliers will continue to have opportunities to take part in dialogue supporting procurement preparation through market consultations and to present solutions available on the market. A well-executed market consultation helps ensure that a procurement is designed appropriately and in a way that supports competition.

One of the most visible changes introduced by the reform concerns the division of procurements into lots. From 1 October 2026, procurements exceeding the EU threshold values must, as a rule, be divided into lots, making it easier for SMEs to participate in competitive tendering.

Dividing procurements into lots gives suppliers new opportunities to submit bids even when they would not be able to offer the entire procurement package. Procurements can be divided into separate lots within a single invitation to tender, through separate invitations to tender, by using a framework agreement or through a dynamic purchasing system.

However, a procurement may be left undivided where there are justified grounds for doing so. Such grounds may relate, for example, to the nature of the procurement, the way it is implemented, overall responsibility, cost implications or the findings of a market consultation. In future, contracting authorities will be required to justify any decision not to divide a procurement into lots. The importance of these justifications is further underlined by the fact that decisions not to divide procurements into lots may in future be appealed to the Market Court.

The objective of increasing competition is also reflected in the new rules concerning situations where only one bid is received. From 1 October 2026, an open procurement procedure exceeding the EU threshold values must, as a rule, be discontinued if only one bid is submitted.

If the contracting authority still wishes to proceed with the procurement, the competitive tendering process must be organised again. However, an exception to the obligation to discontinue the procedure may be made, for example, if the procurement was preceded by a market consultation, if the procurement has been divided into lots, or if there is another particularly compelling reason for doing so.

Security and security of supply will have a more visible role under the amended legislation. Contracting authorities may in future set requirements for the subject matter of a procurement to ensure the availability, functionality and uninterrupted use of the product, service or works throughout its life cycle. These changes are particularly significant in procurements related to the continuity of critical services or functions.

The reform strengthens the consideration of security, preparedness and security of supply from the procurement planning stage onwards. For suppliers, this may be reflected in requirements concerning matters such as reliability of supply, business continuity management, security and supply chains.

The rules governing the use of in-house entities have been tightened. From 1 July 2027, a new minimum ownership requirement of 10 per cent will apply to the use of in-house entities operating as limited liability companies.

At the same time, the regulation of procurements covered by Annex E, such as catering services, has been aligned with the rules applying to national procurements.

The Act also introduces a definition of a resource entity, which will in future replace the term resource subcontractor. The provisions concerning subcontractors and resource entities have also been clarified. These changes provide greater clarity on the conditions under which a supplier may rely on the resources of other entities in competitive tendering, as well as on how grounds for exclusion relating to subcontractors and resource entities are assessed.

New mandatory grounds for exclusion have also been added to the Act. These concern aggravated accounting offences, aggravated impairment of the environment and aggravated nature conservation offences. The changes place greater emphasis on the responsibility and reliability of suppliers. In addition, a contracting authority may exclude a supplier from a competitive tendering process if shortcomings in the supplier’s reliability could pose an evident risk to national or local security.

The provisions governing amendments to procurement contracts have also been clarified, and their scope has been extended to national procurements. From the City of Espoo’s perspective, the change highlights the importance of anticipating contractual issues and managing changes during the contract period. Potential market disruptions, changes in costs and supply chain disruptions can be taken into account when drafting the contract, for example through price adjustment or termination clauses. From the supplier’s perspective, the importance of familiarising themselves carefully with contract terms and preparing for possible changes in the operating environment during the contract period will increase.

Although the reform of the Procurement Act includes a number of individual changes, their common objective is to increase competition and strengthen dialogue between contracting authorities and the market. The reform supports open, competition-enhancing and carefully prepared procurements in which market expertise can be utilised more extensively than before.

For suppliers, the reform creates more opportunities to participate in public procurement. Companies should therefore actively follow the City of Espoo’s upcoming competitive tendering processes and take part in market dialogues. Market dialogue offers a practical way to contribute to procurement preparation and an opportunity to present solutions available on the market before the competitive tendering process begins.

Participating in public procurement is worthwhile, as it enables companies to offer their expertise to the city and contribute to developing solutions for the future.

You can easily explore key upcoming tender opportunities from the City of Espoo through the procurement calendar published on the city’s website. The calendar is updated at least four times a year. (The procurement calendar is currently available in Finnish.)

More detailed information on ongoing competitive tendering processes and invitations to market dialogue is available in the Hilma service(external link, opens in a new window). In Hilma, you can also create your own search alert, for example based on the Common Procurement Vocabulary (CPV) code.

More information and guidance on public procurement. 
See also the frequently asked questions about public procurement