Procurement Law Definition

What Is Government Procurement Law

Government procurement, or public procurement, is the procurement of goods and services on behalf of a public authority, such as a government agency.
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To prevent fraud, waste, corruption, or local protectionism, the law of most countries regulates government procurement more or less closely. It usually requires the procuring authority to issue public tenders if the value of the procurement exceeds a certain threshold.

Contract awarding in Procurement

Contract awarding is the method used during a procurement in order to evaluate the proposals (tender offers) taking part and award the relevant contract. Usually at this stage the eligibility of the proposals has been concluded. So it remains to choose the most preferable among the proposed. There are several different methods for this, which are obviously related to the proposition method asked by the procurement management.


Least price: This method is the simplest and oldest of all. Under this the procurement contract is awarded to the best price. Some relevant methods are these of examining the overall or in parts and in total discount in a given price list or on a given budget. 

Most economically advantageous: This is applicable to proposals of different quality within the limits set. Under this the proposals are graded according to their price for value and the contract is awarded to the one with the best grade. Similar to this is the grading of the proposals according to time, making the proposals needing less time of implementation seem more valuable. 

Mean value: The contract is awarded to a bid closer to the mean value of the proposals. This may apply to procurements where numerous proposals are expected and there is a need for a market-representing value.

Exclusion of the extremes: Under this method the proposals that are deviating the most from the mass of the proposals are excluded and then the procedure continues with one of the above methods.

There are also many variants and/or combinations of these main methods.

Public eProcurement

The term of the Electronic Public Procurement can be defined as the usage of e-Government platform over the electronic resources (Internet and Web-based applications) to conduct transactions for purchasing the products and services from suppliers to authority's buyers.

Procurement in European Union

Government procurement in the European Union has been regulated and harmonized by community law since the 1970s. It accounts for more than EUR 2 trillion, or 19% of the EU GDP.

Procurement in United States

Government procurement by public authorities in the United States accounts for about USD 7 trillion annually. Federal procurement is governed by the Federal Acquisition Regulation. FedBizOpps and are websites where federal contracts are shown. Public announcements of awards has several exemptions, including contracts less than $3.5 million.

Procurement in United Kingdom

Tender opportunities announced by UK Government are published on a specialised website. Taking a considerable part of the state budget, Government procurement in UK is under severe public scrutiny.

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