Join an hourlong webinar on Tuesday, June 15, 2021, 9 am ET / 14:00 UK / 15:00 CET to discuss next steps in bid challenges internationally. The free session, sponsored by GW Law School and King’s College, London, will feature leading experts in procurement from three continents: Europe, Africa and North America. Among other global developments, the panel will discuss a pending congressionally mandated study of bid protests at the U.S. Department of Defense — a study, Chris Yukins argued in a recent essay in the University of Pennsylvania’s Regulatory Review, that should recognize that governments increasingly look to bid challenges for early warnings of failure in a procurement system.
Category: United States
NASPO Study of State Procurement in the Pandemic – Key Lessons Learned
In a groundbreaking academic study coordinated by the National Association of State Procurement Officials (NASPO), private and public supply chain professors from across the United States conducted a nationwide survey of states’ responses to the pandemic. The study was based on over 100 hours of interviews conducted by the academic research team (Professors Robert Handfield (North Carolina State University), Zhaohui Wu (Oregon State University), Andrea Patrucco (Florida International University), Christopher Yukins (George Washington University) and Thomas Kull (Arizona State University)) with many states’ procurement staff, suppliers, and other state officials. Key takeaways from the study:
Assessing state procurement systems through a maturity model. Different states responded very differently to the pandemic, based in part on their organizational structures and preparations for the disaster. To help states better prepare, the researchers developed a “maturity model” to assess state procurement systems, in preparation for future catastrophes.
Courage and professionalism in the face of catastrophe. The researchers’ interviews with state procurement officials and suppliers “corroborate observations made in much of the disaster science research: disasters often bring out the best in us, and people rise to the occasion.” The study noted “how private citizens collaborated with entrepreneurial state employees to identify innovative and little-known PPE suppliers and often established innovative solutions to seemingly hopeless situations where PPE could not be found. Purchasing managers, staff members, and CPOs [Chief Procurement Officers] emerged as heroes. Our interviews revealed the pride and renewed sense of professional identity . . . . We observed a growing sense of camaraderie as people faced a common crisis.”
Centralization of the state procurement function was a key factor in success. The study’s results suggested “that increased centralized governance of state procurement led to a more effective response in tackling large-scale supply chain disruptions.” Centralized procurement “enabled increased coordination, improved leveraging of the volume of the state’s purchasing power, and provided for more efficient application of contracting expertise to a difficult market situation.” A centralized approach, the study found “also led to better coordination among disaster relief entities, PPE suppliers and hospitals, counties, and agencies requiring PPE to operate.”
Constitutional issues in federal-state confrontations over critical supplies. In principle, the federal government should have helped better coordinate states’ responses to the pandemic. In practice, however, during the early stages of the pandemic the federal government was repeatedly accused of abusing its powers under the Defense Production Act to seize and redirect emergency supplies that had been purchased by individual states — although, under the U.S. federalist system of government, the states bear first responsibility for the health and welfare of their citizens, constitutionally, practically, and politically. The study argued that “[s]erious consideration should be given to whether the Defense Production Act should be amended to recognize the deference owed by the federal government to the states under the Constitution, much as many other federal laws (such as those governing federal grants, use of National Guard troops, etc.) recognize and defer to the sovereign authority of the states.”
Trade Policy in Procurement in the Biden Administration
“Assessing the Trade Agenda for Government Procurement in the Biden Administration,” paper presented by Chris Yukins at the Thomson Reuters Government Contracts Year in Review Conference (Feb. 2021)
The attached paper, prepared shortly before President Biden was inaugurated, discussed key trade issues for the incoming administration in public procurement. The piece reviewed major trade measures in procurement taken during the Trump administration – most of which were predictable from the time Trump was elected. The paper turned to the major trade challenges that face the Biden administration, in areas as diverse as climate change, cybersecurity and the protectionism in post-Brexit Europe, and then assessed how the Biden administration might address these challenges, especially given Joe Biden’s support for “Buy American” policies during the 2020 campaign. The paper also assessed how the new administration might cooperate on these difficult issues with the United States’ allies abroad. The paper concluded that the Biden administration’s main challenge was restoring confidence abroad in the United States as a responsible trading partner in procurement; once that goal was met, the paper argued, the more technical issues of trade in procurement would be much easier to address.
The paper’s concerns that the new administration might take a protectionist turn, per Joe Biden’s campaign promises, soon proved well-founded. On January 25, 2021, only a few days after entering office, President Biden signed an executive order calling for strengthened “Buy American” policies in U.S. procurement. Commenting on the order, The Economist wrote that while the order was “protectionist in spirit,” the United States’ existing trade commitments “mean that Mr Biden’s measures may not have much effect.” For background on the executive order– including the history of the Trump administration trade policies in procurement, and questions raised by the new order — please see the slides attached here.
The denouement to the Biden executive order suggests that, in the short term at least, the Biden administration will not go beyond the tighter Buy American Act requirements imposed by the Trump administration
The denouement to the Biden executive order suggested that, while it called for closer scrutiny of waivers and exceptions to the Buy American Act, in the short term at least the Biden administration would not go beyond the tighter Buy American requirements launched by President Trump in July 2019 under Executive Order 13881. President Trump’s order calling for stricter “Buy American” requirements was published as a proposed implementing Federal Acquisition Regulation (FAR) rule on September 14, 2020 (85 FR 56558), and the final FAR rule was published on January 19, 2021 (86 FR 6180). The final Trump rule, in keeping with his executive order, aggressively tightened domestic content requirements under the Buy American Act. President Biden took office the next day, on January 20, 2021. President Biden issued his “Buy American” executive order (EO 14005) several days later, on January 25, 2025. On or about that same date, the Biden administration undertook a FAR review to assess whether the Trump regulations needed to be reconsidered. By February 25, 2021 (roughly one month later) the Biden administration concluded that no further changes were needed to the “Buy American” regulations. FAR Case 2021-004, closed 2/25/21. The Biden administration thus appeared to close the book on further changes to the FAR “Buy American” rules, at least temporarily — perhaps at least until the broader policy reviews called for by the Biden order (such as a review of the “Buy American” exception for commercial information technology) are concluded.
Webinar – European Commission White Paper on Foreign Government Subsidies – December 1, 2020
King’s College London and GW Law will be presenting a free webinar on the European Commission’s “White Paper” on foreign government subsidies, which would impose new EU measures to address foreign subsidies, including in public procurement.
Book Discussion – “Joint Public Procurement and Innovation: Lessons Across Borders” – September 24, 2020 (webinar)
Held on Thursday, September 24, 2020
Join an online discussion of a recently published book on new approaches to procurement, Joint Public Procurement and Innovation: Lessons Across Borders (Bruylant 2019). Selected chapters from the book are available here.
Clockwise: Professors Gabriella Racca, Jean-Bernard Auby, Christopher Yukins, Laurence Folliot Lalliot
Introductions
Jean-Bernard Auby – University SciencePo, Paris, France
Gabriella M. Racca – University of Torino, Italy
Christopher R. Yukins – George Washington University, USA
Laurence Folliot-Lalliot – Paris Nanterre University, France
Discussants: Caroline Nicholas, Paulo Magina (photo: Flickr-Lisbon Council), Rozen Nogellous, Stéphane De La Rosa
Discussion
Caroline Nicholas – Senior Legal Officer, UNCITRAL
Rozen Noguellou – University Paris 1, France
Paulo Magina – Head of the Public Procurement Unit, OECD
Stéphane De La Rosa– University Paris-Est Créteil, France
GW Law Webinar – A Tumultuous Year for Trade
Thursday, 3 September 2020
This year has seen an unprecedented rise in trade barriers – both direct and indirect – involving public procurement. Join a free 60-minute webinar sponsored by George Washington University Law School’s Government Procurement Law Program, to hear leading experts on emerging trade barriers affecting grants and procurement.
Cybersecurity Controls and the Section 889 “Huawei” Ban: Scott Sheffler (Feldesman Tucker) and Tom McSorley (Arnold & Porter) will discuss two important measures that the U.S. government is taking to address security risks – the U.S. Department of Defense’s Cybersecurity Maturity Model Certification (CMMC), and the governmentwide interim procurement rule and final grants guidance banning Huawei and other Chinese companies under Section 889 of the National Defense Authorization Act for FY2019.
These measures, driven in part by the broadening role of foreign firms in the U.S. government’s supply chain, and in part by the specific challenges posed by Huawei and other Chinese high-technology firms to U.S. security, impose substantial compliance burdens on contractors and grantees in U.S. procurement. For many in the U.S. government, it would be “nothing less than madness to allow Huawei to worm its way into one’s next-generation telecommunications networks,” and Section 889 and parallel initiatives (such as the “Clean Network” initiative) are intended to shield the United States.
In practical terms, the Cybersecurity Maturity Model Certification (CMMC) and Section 889 may make it very difficult – if not impossible – for foreign vendors to compete in U.S. markets
In practical terms, the CMMC and Section 889 may make it very difficult – if not impossible – for foreign vendors to compete in U.S. markets, raising questions under the United States’ international free trade agreements and reciprocal defense procurement agreements. (The vulnerabilities in the U.S. government’s information technology supply chain are the subject of an upcoming GAO report, and a separate private-sector study is assessing barriers to procurement trade generally.) Although the Trump administration, bowing to industry pressure and the Defense Department’s concerns, extended the Section 889 implementation deadline to September 30, 2020 for Defense Department contractors, the compliance burdens remain quite serious.
Trump Administration’s “Buy American” Order for Medicines – and the Biden Plan: From its start, the Trump administration has adopted a broad range of “Buy American” measures, including a recent change to federal grants rules which says that grantees should, when possible, buy U.S. goods. Although even some supporters have criticized the Trump administration’s “Buy American” efforts as ineffective, Trump’s protectionist rhetoric has undoubtedly affected the international debate over free trade in procurement.
In response to the COVID-19 pandemic, on August 6, 2020 President Trump issued an executive order for “on-shoring” the manufacture of essential medicines bought by the U.S. government. The order calls for limiting U.S. market-opening commitments under the World Trade Organization (WTO) Government Procurement Agreement (GPA) and free trade agreements – a process which could trigger months of renegotiations with trading partners and result in limiting U.S. access to foreign markets. Jean Heilman Grier, former procurement negotiator at the Office of the U.S. Trade Representative, has written on the Executive Order.
Jean Grier has also written on Democratic candidate Joe Biden’s own Buy American plan, which also calls for broader U.S. domestic preferences. Jean Grier will join Robert Anderson, former lead at the WTO on GPA issues, to discuss trade, procurement and the upcoming U.S. elections. Jean’s recent posts: (1) Trump’s Buy American Order for Medicines, (2) Buy American legislation, and (3) Biden Buy American Plan.
Impact of the Pandemic: Of course controversial trade measures have been driven in part by the COVID-19 pandemic.
Robert Anderson co-wrote an article with Anna Mueller of the WTO on the constraints and flexibility afforded by the WTO’s Government Procurement Agreement. For their part, co-moderators Laurence Folliot Lalliot and Christopher Yukins co-wrote a piece in Concurrences, the competition periodical, on the pandemic’s lessons for international markets, including especially the pandemic’s disruptive effect on protectionism. While the pandemic exacerbated economic nationalism and trade barriers, the pandemic also pointed up the sometimes mortal dangers of cutting off international supply chains.
European Trade Measures: Roland Stein (of the BLOMSTEIN firm, Berlin) and Professor Michal Kania (University of Silesia/Poland) will discuss important developments in access to European procurement markets:
White Paper — Possible Exclusion of Subsidized Foreign Firms: Following on 2019 guidance from the European Commission to member states on abnormally low bids from vendors from outside the European Union, in June 2020 the Commission issued a white paper on “levelling the playing field as regards foreign subsidies.” The white paper launches an EU-wide consultation on how to address foreign subsidies which distort EU procurement markets; among other measures under consideration, member states might exclude vendors that receive foreign subsidies. The white paper notes that the EU continues to assess the proposed International Procurement Instrument, a measure which has received cautious support from European industry and which would allow member states to raise new barriers against vendors from nations (including potentially the United States and China) that do not cooperate in EU efforts to open procurement markets.
Exclusion for Non-Domestic Content: Article 85 of EU Directive 2014/25/EU, which governs utilities’ procurement, says that a bid may be rejected if more than 50% of the products being offered would come from nations that have not entered into a free trade agreement with the EU (such as China) – a rarely enforced restriction which, as codified in German law, was recently applied by an important German court, the Brandenburg higher regional court.
Program Moderators: Professor Christopher Yukins (GW Law School) and Professor Laurence Folliot Lalliot (Université Paris Nanterre).
Government Procurement Review (8th edition, 2020) – available online
The Government Procurement Review, one of the leading compilations of procurement laws from around the world, is now available in its 8th edition. Congratulations to the editors, Jonathan Davey and Amy Gatenby of the law firm of Addleshaw Goddard.
The volume, published annually, covers procurement law from fourteen countries and the European Union, including reviews by leading procurement practitioners from Australia, Austria, Belgium, Brazil, Canada, the Dominican Republic, Germany, Greece, Italy, Mexico, Russia, Switzerland, the United Kingdom and the United States.
For further information on foreign and international sources on public procurement law, please see the research guide prepared by GW Law’s government procurement research librarian, Mary Kate Hunter.
FEATURE COMMENT: Maximizing Recovery: Contractor Reimbursement For COVID-19 Paid Leave Under § 3610 Of The CARES Act
In this piece in the Government Contractor, Christopher Yukins and Kristen Ittig reviewed key issues under Section 3610 of the CARES Act, a provision which allows agencies to modify existing contracts, under appropriate circumstances, to reimburse contractors for leave paid to employees during the COVID-19 pandemic. 62 Government Contractor para. 156 (June 10, 2020).
Webinar: Opening Online Marketplaces to Government Micro-Purchases — June 30, 2020
Tuesday, June 30, 2020 – 9:00 Pacific, 12:00 Eastern, 18:00 CET
On Tuesday, June 30, 2020, at noon Eastern time, join a free hour-long webinar sponsored by George Washington University Law School’s Government Procurement Program to discuss GSA’s recent contract awards in the “commercial platforms” initiative — contracts estimated to be worth $6 billion annually, which were awarded to Amazon Business and two other online marketplaces.
- Moderator Christopher Yukins (GWU) will introduce GSA’s “commercial platforms” initiative, and discuss potential challenges in implementation.
- Robert Handfield, the Bank of America University Distinguished Professor of Supply Chain Management at North Carolina State University, and Director of the Supply Chain Resource Cooperative, will discuss how the government’s use of commercial platforms could improve the resilience of public supply chains in times of crisis.
- Thomas Kull, professor of supply chain management at the W. P. Carey School of Business at Arizona State University, will review the training that will be needed under this initiative, as non-procurement professionals take on substantial purchasing responsibilities through the new platforms.
- Andrea Patrucco, professor of project and supply chain management at Penn State Beaver, will discuss the potential impact of this initiative in state and local governments, and internationally.
Special guest Roger Waldron, president of the Coalition for Government Procurement (a leading industry association of commercial contractors who sell regularly to the federal government), will join the panel to discuss industry’s perspectives on GSA’s initiative. The Coalition has raised a number of concerns regarding the new commercial platforms initiative, including concerns regarding agency accountability, pricing, supply chain security, counterfeit goods, and market concentration.
The panelists have co-authored a background article for the seminar in the Government Contractor; the piece was published in the days before GSA announced the contract awards. In the article, Professors Christopher Yukins (George Washington University), Robert Handfield (North Carolina State University), Thomas Kull (Arizona State University) and Andrea Patrucco (Penn State University Beaver) discuss key themes for the upcoming webinar: challenges in what is, in essence, a new method of procurement; improvements that the initiative will bring to supply chain resilience; training that will be needed for federal purchasers; and, the possible impacts on procurement markets, both in the United States and abroad.
GSA’s commercial platforms initiative, by opening online marketplaces to federal users’ micro-purchases, could have an enormous impact on broad portions of the federal marketplace. If the challenges can be met—if GSA’s commercial platforms initiative succeeds – it may serve as a model for other public purchasers across the United States, and across the globe.
Webinar — Public Procurement in the Time of COVID-19: A Conversation Between Professor Michal Kania (U. Silesia/Poland) and Professor Christopher Yukins (GWU)
On June 5, 2020, Professors Michal Kania (University of Silesia in Katowice, Poland, and a former Fulbright Scholar at GWU Law) and Christopher Yukins joined to discuss lessons learned in procurement from the COVID-19 pandemic.