United Kingdom - Country Commercial Guide
Selling to the Public Sector

Describes how major projects are secured and financed. Explains activities of the multilateral development banks in and other aid-funded projects.

Last published date: 2020-10-03

Selling to the Government

On January 31, 2020, the UK departed the European Union and entered into a transition period while it negotiates its future relationship with the EU.  During the transition period, all EU directives for procurement are applicable. The transition period ends on December 31, 2020.

At the time of writing this document, Government procurement in the UK is governed by both international obligations under the WTO Government Procurement Agreement (GPA) and EU-wide legislation under the EU Public Procurement Directives. U.S.-based companies can bid on public tenders covered by the GPA, while European subsidiaries of U.S. companies may bid on all public procurement contracts covered by the EU Directives in the European Union.

Electronic versions of the procurement documentation must be available through an internet URL immediately on publication of the Official Journal of the European Union (OJEU) contract notice. Full electronic communication (with some exceptions) will become mandatory for public contracts 4.5 years after the Public Contracts Directive 2014/24 comes into force (i.e. October 2018). For central purchasing bodies, the deadline was April 2017.

The UK public sector is currently obliged to undertake electronic invoicing initiatives. In the UK, the 2015 Small Business, Enterprise and Employment (SBEE) Act was passed and included clauses that endorse e-Invoicing as beneficial to the UK economy. Within Europe, Directive 2014/55/EU states that all EU public sector organizations must be able to accept e-invoices by 2020. Standards for e-invoicing are being developed by the European Committee for Standardisation (CEN).

There are restrictions for U.S. suppliers in the EU utilities sector, both in the EU Utilities Directive and in EU coverage of the Government Procurement Agreement (GPA). Article 85 of Directive 2014/25 allows EU contracting authorities to either reject non-EU bids where the proportion of goods originating in non-EU countries exceeds 50 percent or give preference to the EU bid if prices are equivalent (meaning within a three percent margin). Moreover, the Directive allows EU contracting authorities to retain the right to suspend or restrict the award of service contract to undertaking in third countries where no reciprocal access is granted.

There are also restrictions in the EU coverage of the GPA that apply specifically to U.S.-based companies.  U.S. companies are not allowed to bid on works and services contracts procured by sub-central public contracting authorities in the following sectors:

  • Water sector
  • Airport services
  • Urban transport sector, and railways in general
  • Dredging services and procurement related to shipbuilding

Most UK government departments and public bodies are subject to a range of EU procurement directives and to the GPA, which gives qualified foreign bidders from signatory countries equal access to each other’s public-sector contracts.

In the UK, it is now mandatory for all public-sector organizations to advertise their procurement opportunities worth over £10,000 ($13,000) on Contracts Finder.

U.S. companies bidding on Government tenders may also qualify for U.S. Government advocacy. A unit of the U.S. Commerce Department’s International Trade Administration, the Advocacy Center coordinates U.S. Government interagency advocacy efforts on behalf of U.S. exporters bidding on public sector contracts with international governments and government agencies. The Advocacy Center works closely with our network of the U.S. Commercial Service worldwide and inter-agency partners to ensure that exporters of U.S. products and services have the best possible chance of winning government contracts. Advocacy assistance can take many forms but often involves the U.S. Embassy or other U.S. Government agencies expressing support for the U.S. bidders directly to the foreign government. Consult Advocacy for Foreign Government Contracts for additional information.

Defense Procurement

The UK Ministry of Defence (MoD) publishes information on its future projects and procurements in a biweekly Defence Contracts Bulletin, which is available to U.S. subscribers online.  The European Defence Agency (EDA) also maintains an online database of defense procurement opportunities with governments and leading manufacturers throughout Europe. The EDA Electronic Bulletin Board is available free and without subscription.

However, many U.S. defense companies require more lead-time than these sources provide and detailed guidance is often needed to understand the procedures and bid evaluation criteria. The U.S. Embassy’s Office of Defense Cooperation (ODC) provides insight, guidance, and advocacy in support of U.S. defense contractors competing for sales and cooperative development programs for military equipment and services, including missiles and defense systems, munitions, sensors, ships, aircraft and helicopters. ODC may be contacted at telephone 011-44-20-7891-3737 or email odclondon@state.gov

Key Link:

U.S. Embassy London website ODC information  

Digital Market Place- Information Technology (IT)

Digital Marketplace is an online procurement database for IT work, web hosting, work through the cloud, or purchasing datacenter space. Digital Marketplace uses framework agreements to award contracts. There are different framework agreements for different IT services.

  • G-Cloud: Cloud technology and support
  • Digital Services: IT specialist work for specific projects
  • Crown Hosting Data Centers: Work on the physical datacenter for legacy systems

G-Cloud framework agreements operate slightly differently from other framework agreements. G-Cloud frameworks allow buyers to pay for services as they use them rather than being tied to long-term, inflexible contracts.

Suppliers should apply to the specific frameworks that they want to compete for work in.

Financing of Projects

London is a major source of international project financing.  The UK is seen as a safe haven and has attracted substantial amounts of investment for some key infrastructure projects.  London’s future as a major financial services center will greatly depend on the post-Brexit arrangements the UK is able to negotiate with the EU and other trading partners.

UK importers are carefully considering the volume and price of their purchases.  Therefore, U.S. exporters should consider offering very competitive prices and should coordinate closely with their UK business partners to explore available opportunities to finance trade transactions.

Multilateral Development Banks

London is home to the headquarters of the European Bank for Reconstruction and Development (EBRD), an international financial institution whose single largest shareholder is the U.S. Government.  The EBRD supports projects from central Europe to central Asia.  Investing primarily in private sector clients whose needs cannot be fully met by the market, the EBRD offers debt, equity and local currency financing with tenors not usually obtained from commercial banking sources. The Commercial Service (CS) maintains a presence at the EBRD to represent the interests of U.S. firms. 

U.S. Export-Import Bank financing is available to support major capital equipment sales to the UK.

Financing Web Resources

EU Project Financing

U.S. Government International Financing Programs

Exim BankCountry Limitation Schedule  

DFC 

Trade and Development Agency

SBA’s Office of International Trade

USDA Commodity Credit Corporation

U.S. Agency for International Development  

European Bank for Reconstruction and Development (EBRD)

Selling to the Government

Many governments finance public works projects through borrowing from the Multilateral Development Banks. Please refer to “Project Financing” Section in “Trade and Project Financing” for more information. 

Government procurement in Europe is governed by both international obligations under the WTO Government Procurement Agreement (GPA) and EU-wide legislation under the EU Public Procurement Directives. Until December 31, 2020, all EU directives are applicable in the UK. U.S.-based companies can bid on public tenders covered by the GPA, while European subsidiaries of U.S. companies may bid on all public procurement contracts covered by the EU Directives in the European Union.

Electronic versions of the procurement documentation must be available through an internet URL immediately on publication of the Official Journal of the European Union (OJEU) contract notice. Full electronic communication (with some exceptions) will become mandatory for public contracts 4.5 years after the Public Contracts Directive 2014/24 comes into force (i.e. October 2018). For central purchasing bodies, the deadline was April 2017.

The UK public sector is currently obliged to undertake electronic invoicing initiatives. In the UK, the 2015 Small Business, Enterprise and Employment (SBEE) Act was passed and included clauses that endorse e-Invoicing as beneficial to the UK economy. Within Europe, Directive 2014/55/EU states that all EU public sector organizations must be able to accept e-invoices by 2020. Standards for e-invoicing are being developed by the European Committee for Standardisation (CEN).

There are restrictions for U.S. suppliers in the EU utilities sector, both in the EU Utilities Directive and in EU coverage of the Government Procurement Agreement (GPA). Article 85 of Directive 2014/25 allows EU contracting authorities to either reject non-EU bids where the proportion of goods originating in non-EU countries exceeds 50 percent or give preference to the EU bid if prices are equivalent (meaning within a three percent margin). Moreover, the Directive allows EU contracting authorities to retain the right to suspend or restrict the award of service contract to undertaking in third countries where no reciprocal access is granted.

There are also restrictions in the EU coverage of the GPA that apply specifically to U.S.-based companies.  U.S. companies are not allowed to bid on works and services contracts procured by sub-central public contracting authorities in the following sectors:

  • Water sector
  • Airport services
  • Urban transport sector, and railways in general
  • Dredging services and procurement related to shipbuilding

Most UK government departments and public bodies are subject to a range of EU procurement directives and to the GPA, which gives qualified foreign bidders from signatory countries equal access to each other’s public-sector contracts.

In the UK, it is now mandatory for all public-sector organizations to advertise their procurement opportunities worth over £10,000 ($13,000) on Contracts Finder

The Procurement Pipeline lists shorter term procurements and potential upcoming procurement opportunities. Opportunities in Scotland are listed at Public Contracts Scotland, Wales publishes their public contracts on Sell 2 Wales and Northern Ireland on eSourcing NI (Northern Ireland).

Defense Procurement

The UK Ministry of Defence (MoD) publishes information on its future projects and procurements in a biweekly Defence Contracts Bulletin, which is available to U.S. subscribers online.  The European Defence Agency (EDA) also maintains an online database of defense procurement opportunities with governments and leading manufacturers throughout Europe. The EDA Electronic Bulletin Board is available free and without subscription.

However, many U.S. defense companies require more lead-time than these sources provide and detailed guidance is often needed to understand the procedures and bid evaluation criteria. The U.S. Embassy’s Office of Defense Cooperation (ODC) provides insight, guidance, and advocacy in support of U.S. defense contractors competing for sales and cooperative development programs for military equipment and services, including missiles and defense systems, munitions, sensors, ships, aircraft and helicopters. ODC may be contacted at telephone 011-44-20-7891-3737 or email odclondon@state.gov

Key Link:

U.S. Embassy London website ODC information