The European Union is building a regulatory barrier designed to keep foreign suppliers from winning public contracts worth a collective €2.5 trillion annually. New draft rules would let authorities reject bids from companies that can’t prove at least 50% of their content is European-made.
That’s roughly 15% of the EU’s entire GDP getting a “locals preferred” sign slapped on it.
What the EU is actually proposing
In major public contracts, bids that don’t meet a 50% European content threshold can be excluded entirely. Rather than outright banning foreign suppliers, the EU is taking a softer but still pointed approach. Quality criteria in contract evaluations will now carry a minimum 30% weight in scoring. Those quality metrics include factors like “security risks associated with foreign ownership or financing.”
The rules build on the Industrial Accelerator Act proposal from March 4, 2026, which already set specific quotas for certain sectors. Electric vehicles, for instance, would need 70% EU-made components to qualify for preferential treatment. The new procurement directive extends that logic across a much broader set of industries.
