Better tools won’t automatically build more houses – a reflection on the leaked EU procurement proposal from the perspective of circularity

Author: Lina Svensberg

This is my second reflection on the leaked proposal for a new EU procurement regulation. A week ago I posted this one, and I recommend that you skim it for context first.

It also builds on this reflection that I wrote last year about how EU policy on circular economy has developed over the past twenty years, which may be interesting to read before or after this one.

So, let’s start with the basics, what are the key differences between the 2014 directives and this proposal in terms of circularity?

Well, the comparison is a bit unfair. Imagine we’re back in the early 2010s. Spotify is a few years old. Airbnb is starting to spread across Europe. Someone has heard of a cool new ride sharing concept called Uber in the States, and rumours that it will come to Europe soon. I remember sitting at different bars in Barcelona in 2012, where I lived at the time, talking with my friend Tobias Jansson, a Swedish sustainability nerd, who had come across a new, cool concept called circular economy, that he thought was promising and wanted to build some kind of consultancy business around. The recently founded Ellen MacArthur Foundation had released its first report on circular economy in January 2012, and Tobias saw the potential. He had already registered the domain circulareconomy.se. And, well, it was far from mainstream. The buzzword for urban innovation at the time was “smart”. In Barcelona, the first Smart City Expo World Congress had happened one year earlier, in 2011. The future was smart, and full of sensors!

But under the surface people were starting to explore the concept of circular economy. Not only Tobias and his peers, over in Brussels things had started moving. The first big Commission communication with circular economy in the title, Towards a circular economy: A zero waste programme for Europe, was published in 2014, a few months later than the 2014 procurement directives, and the first Circular Economy Action Plan (CEAP I) was published in 2015.

So the 2014 directives weren’t big on circular procurement, for natural reasons, even if they provided quite some tools that in practice can be used for it, like technical specifications that could refer to production processes and to any stage of the life cycle. Also life-cycle costing, including end-of-life costs, quality criteria in the award, and contract performance conditions with environmental content were there. By using tools from different toolboxes, you could put together a set of tools for circular procurement, and apply it. And some did, especially the Dutch and the Belgians. But most didn’t.

Fast forward to 2026.

For a few years, circular economy stayed where we left it in 2012: an interesting idea, a growing number of consultants, a first Action Plan in 2015 that was mostly about waste.

Then came the Green Deal in December 2019, and everything got bigger. Climate neutrality by 2050, and environmental challenges reframed as a growth agenda rather than a cost. The second Circular Economy Action Plan followed in March 2020, and this time it was not about waste management. It was about whole product life cycles, about sector strategies for electronics, textiles and construction, and about turning the old Ecodesign Directive into something that could cover almost everything. That became the Ecodesign for Sustainable Products Regulation (ESPR). It also introduced the idea of a Digital Product Passport, which the ESPR later gave a legal framework.

From there it moved fast.

The ESPR can now cover almost any physical product, with rules on durability, repairability, recycled content and resource use, though the actual requirements arrive product group by product group, through delegated acts. Batteries have their own regulation, with recycled content targets and a passport of their own. Packaging has its own too. Textiles and construction products are on their way. There is a right to repair. And a Circular Economy Act is coming, meant to create a single market for secondary raw materials.

None of this existed in 2014. And not in 2020 either, for that matter. But something else has changed too.

In 2012, circular economy was an environmental idea with a business case, to simplify a bit. In 2026, it is also industrial and security policy. Draghi wrote about dependency and competitiveness. The Competitiveness Compass and the Clean Industrial Deal put procurement front and centre of Europe’s industrial strategy. In March 2026, the Commission proposed an Industrial Accelerator Act, which would set sectoral requirements for what public buyers should buy. Recycled material is no longer only about emissions, it is about not depending on someone else for your raw materials.

Europe has to look after itself now, in a way we would not have imagined over those beers in Barcelona. So the new proposal arrives into a very different world than the 2014 directives did.

But what does the proposal actually say?

I will highlight three things that I think are the key ones:

The first is that green and circular procurement gets its own place in the text. Article 52 gives green public procurement a place of its own and frames it in life-cycle terms. Article 53 is about circularity specifically: resource efficiency, waste prevention, longer lifetimes, repair, reuse, refurbishment, remanufacturing, recycled content, secondary raw materials. It says that when preparing what they plan to buy, buyers should consider whether the need could be met through circular business models – product-as-a-service, leasing, sharing, renting – instead of buying something new. And it allows requirements on the procurement of refurbished, remanufactured or previously used products.

None of this was directly prohibited in 2014. Several of the building blocks were already in the text. Life cycle was defined, specifications could cover production processes, award criteria could be environmental, and leasing and rental were right there in the definition of a supply contract. But nobody was encouraged to use them as part of an explicit circular procurement framework, because there wasn’t one. However, and here is the big difference from 2014: Not prohibited is one thing. Explicitly allowed and encouraged is another thing.

The second is consolidation. Less fun to talk about at parties, but structurally this is the big one.

When it came to strategic environmental procurement, the 2014 directives were largely permissive, to use some legal language. It means that they said what a buyer could do, not what a buyer had to do and there was no real mechanism in there for making strategic environmental procurement requirements mandatory. So when the EU actually did want to require something, there was nowhere in procurement law to put it. It ended up in the product legislation instead. Ecodesign got a procurement article. So did batteries, construction products, packaging, net-zero technologies. Which means that anyone who wanted to know what was mandatory had to look across many different regulations, all with their own logic.

The new draft builds the broader mechanism that was missing, Article 55, and brings a number of those scattered procurement requirements under a common framework. It does something similar for accessibility, cybersecurity and other cross-cutting requirements, so this is not only about circularity. You could say that procurement law is taking back some of what had drifted out into other regulations.

The third is that the tools get sharper.

Article 83 makes functional requirements the starting point rather than an option. Specifications shall describe the solution in functional terms, unless the characteristics can’t be captured that way. And article 84 requires buyers to consider variants, and to give their main reasons when they don’t allow them.

Article 85 says the link to the subject-matter may be indirect, and that it covers the works, supplies or services at any stage of their life cycle. One could say that this article is what turns life-cycle and production-method requirements mainstream.

Article 99 allows contract conditions on waste handling, sustainability due diligence, “or other requirements in a circular economy”.

However, allowed and encouraged is one thing. Obliged is another. Much of this remains permissive: it tells buyers what they may do, and gives them a stronger legal basis for doing it. That is not the same as requiring them to do it.

One exception is concessions, and I’ll come back to that another time. If you want to know more, my guess is that Steven A. D. Van Garsse will have wise things to say.

Zooming out

So – to summarise. We now have a toolbox labelled circularity. Some of the tools existed before, in other toolboxes, and some are sharper. Personally, I cannot really think of anything obvious that is missing. And Member States have an obligation to build and monitor the competence needed to use them (Article 135). But public buyers are not obliged to use them, which is what some of the early criticism has focused on.

I’d like to zoom out from that.

As I wrote last week, having the tools doesn’t mean you actually will use them. But having the competence also doesn’t mean that the tools will be used. Say you want to build houses. You get a shiny new toolbox, and you learn how to use everything in it. Will houses appear? Not necessarily. You need resources, land, a plan, approvals from the municipality, and someone who decided that a house should be built there in the first place.

Article 5 says buyers shall take the EU’s strategic priorities into account. That is the toolbox being pointed in a direction. But saying that a toolbox should be used for building houses isn’t the same as creating the necessary conditions for houses to be built.

What would get houses built, and those new shiny tools put to use, is clear strategic direction, resources allocated to match it, the people who actually understand the toolbox present in the strategic conversations, and better coordination between everyone involved. Neither the procurement regulation nor procurement professionals are going to solve that on their own.