A recent joint statement has highlighted concerns over Latvia's proposed public procurement reform, which aims to drastically increase the thresholds for public contracts that can be awarded without a transparent bidding process. Specifically, the reform would allow state and municipal entities to procure goods, services, and undertake construction works without public tendering for amounts ten times higher than current limits. This change could result in up to 555 million euros being spent annually without notifying the market, undermining fairness and competition in the tender process.

The implications of this reform are significant, particularly for competition among suppliers. With the reduced availability of information regarding contracts, fewer businesses may be able to enter the bidding landscape. The European Commission estimates that each additional bid in a procurement process can lead to a decrease in contract prices by an average of 2.5%. This means that the new rules may not only limit opportunities for companies to compete for contracts but could also lead to higher costs for the state and taxpayers due to a lack of competitive pricing resulting from decreased competition.

Additionally, the reduction in publicly available data raises concerns about the ability of oversight institutions to monitor public procurement effectively. The inability to conduct proactive supervision and identify potential risks associated with public spending could foster an environment conducive to mismanagement or corruption. Critics argue that increasing the thresholds for non-transparent spending is counterproductive to accountability and the responsible use of public funds, and they emphasize the need for more robust safeguards to protect public interests.