European Innovation Act and Public Procurement Act: real progress, but pieces are still missing

BRUSSELS, BELGIUM – The Commission has cast the EU Innovation Act and the Public Procurement Act as a practical solution to resolving real challenges faced by European small and medium-sized enterprises (SMEs). Unfortunately, while the proposal released today shows progress, the draft still lacks some key pieces.

The European Innovation Act has the potential to create a better environment for SMEs, but the Act still has some puzzle pieces missing. A more integrated framework would support experimentation, innovation, scaling up, and cross-border growth. IP ownership should be strengthened, since buyers can still reclaim IP rights on vague grounds. And the Act still does not provide a clear definition of strategic priorities for economic operators and what qualifies as a critical task.

‘We are concerned that the regulatory sandboxes proposal will take the form of a Recommendation rather than a legislative instrument. This is an area where our members have specifically been calling for harmonisation at EU level, a non-binding tool risks leaving sandbox rules to diverge across Member States, recreating exactly the fragmentation that SMEs and startups are trying to escape,’ emphasised Mike Sax. ‘This is an area where our members have specifically been calling for harmonisation at the EU level. A non-binding tool risks leaving sandbox rules to diverge across Member States, recreating exactly the fragmentation that SMEs and startups are trying to escape,’ emphasised Sax. 

‘The shift toward quality and innovation criteria, and the instinct to back European businesses, comes with good intention but we need to be careful that SMEs and startups with specific or non-EU supply chains are not penalised for structural realities they can’t easily change,’ said Mike Sax. ‘The shift toward quality and innovation criteria, and the instinct to back European businesses, comes with good intention but we need to be careful that SMEs and startups with specific or non-EU supply chains are not penalised for structural realities they can’t easily change,’ said Sax.  

ACT welcomes the Innovation Act and the Public Procurement Act’s focus on SMEs’ and startups’ needs, including removal and simplification of disproportionate rules together with the reduction of required financial guarantees by 50 per cent. The establishment of a new Competence Centre at the EU Intellectual Property Office (EUIPO) offers free EU-wide IP support. Increased transparency by requiring public buyers to publish consultation documents and Q&As will help smaller firms to track opportunities. 

Consolidating public procurement rules into a single regulation is exactly the kind of simplification that lets SMEs respond to calls for tender instead of being deterred by their complexity. Three clear procedures, including a dedicated procedure for innovation, together with a single EU-wide procurement platform, with one-time registration and interoperability with national platforms, will meaningfully lower the barrier for smaller firms.  

ACT looks forward to engaging with the EU institutions on such files to ensure alignment amongst them and other pending proposals that impact SMEs.  

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About the Association for Competitive Technology (ACT) 

ACT is a global technology trade association representing startups, scaleups, small and medium-sized enterprises (SME). We work directly with our members worldwide to advocate for a policy environment that takes into account their real-world challenges and supports innovation, access to capital, job creation, and the ability of small technology companies to grow and compete globally.