Emmanuel Macron, Bruno Le Maire and Roland Lescure announced it (and shared it widely) this weekend: after being passed by the Senate in June, the Green Industry Act has been passed by the French National Assembly.
Among the 15 flagship measures of this Act, which aims to make France Europe’s leader in green industry, are measures and provisions concerning public procurement contracts. Better still, an entire section (Title II) is devoted to the “environmental challenges of public procurement”. Prime Conseil offers you an overview through a few key points.
1. Lack of non-financial transparency: grounds for exclusion from public procurement contracts
This is one of the main contributions of the Green Industry Act, set out in its Article 13, soberly entitled: “measures to green public procurement”.
One of the flagship measures accompanies the transposition of the CSRD directive by giving public buyers the option to exclude candidates that fail to meet their obligations to publish non-financial information, in particular environmental information.
In practical terms, companies subject to the obligation to publish an “ESG” report and which have failed to meet that obligation for the year preceding the contract notice (the tender) may be excluded. As things stand, that covers almost all listed companies, as well as those with turnover above €40m. The thresholds are due to fall on 1 January 2024, then again in 2025.
This option is nevertheless left to the public buyer’s discretion. We will therefore almost certainly have to wait for guidance from the DAJ (the Legal Affairs Directorate) to learn more about how it will apply in practice.
2. New environmental objectives introduced into SPASERs
First of all, what is a SPASER? Under the French Public Procurement Code, the “SPASER”, or “Socially Responsible Purchasing Promotion Scheme”, sets out purchasing policy objectives including social elements aimed at contributing to the social and professional integration of disabled or disadvantaged workers, and environmental elements, together with the arrangements for implementing those objectives and monitoring them each year.
The Green Industry Act adds new elements to SPASERs, such as: the objective of reducing the environmental footprint, the objective of cutting emissions and the consumption of energy, water and materials, and taking digital sobriety into account.
The Senate was sceptical about how this Act will be applied in practice, noting that in 2022 fewer than one third of the public buyers required to publish a SPASER complied with that obligation. There is indeed reason to question how these obligations will be implemented, since to date no sanction is provided for non-compliance.
That said, among the novelties brought by the Green Industry Act is the option for several public buyers to draw up a SPASER jointly, an opportunity many local authorities should seize.
3. Environmental criteria added to the bid selection criteria
This is only half new, not least because we see it more and more in the public procurement contracts and tender responses we work on, but the amendment to Article L.2152-7 of the French Public Procurement Code is worth noting!
This short passage is added at the end of the article: “including the price or cost criterion and one or more other criteria covering qualitative, environmental or social aspects.”
Note that public buyers will be able to choose between criteria covering qualitative, environmental or social aspects, and will most likely favour the “qualitative” aspects already present in almost every contract. That said, we see more and more scoring criteria including a CSR dimension in tender rules, so the trend is set to strengthen.
4. An obligation to use “retrofitted” vehicles
This is one of the substantial changes brought by the Green Industry Act, at least in terms of the noise it has made.
Contracting authorities are now invited to acquire or use – when renewing their fleets – vehicles “whose combustion engine has been converted to a battery-electric or fuel-cell powertrain, to bio-CNG or to hydrogen”.
We will have to wait for the implementing decree to know what proportion of vehicles is concerned, but this could well upset the balance of public vehicle procurement contracts in the months ahead!
Conclusion
Although it was adjusted and at times scaled back in order to be passed, the Green Industry Act is a genuine step forward in greening the economy and re-industrialising.
Beyond the announcements, this Act also affects public procurement contracts in the various respects set out above. While the new exclusions, the introduction of SPASERs and the renewal of vehicle fleets will take time to be rolled out in practice, the public buyers and companies quickest to adapt and respond to these issues will undoubtedly be the big winners in tomorrow’s public procurement.