EU funding for innovation

Innovation procurement: business opportunities


Public procurement presents great opportunities for small and medium businesses. It offers a huge potential market for innovative products and services, and provides the funding needed to research, develop and scale up solutions that address public sector issues.

There are two main approaches to the procurement of innovation in the public sector:

  • pre-commercial procurement
  • public procurement of innovative solutions

Pre-commercial procurement (PCP)

PCP is the procurement of research and development of new innovative solutions before they are commercially available. PCP is designed to steer the development of solutions towards concrete public sector needs.

Under Horizon 2020, groups of public sector procurers can get enhanced support to address a common agreed challenge. The funding enables these procurers to work together in seeking relevant solutions from the market place.

Find out more about the pre-commercial procurement.

Public procurement of innovative solutions (PPI)

PPI occurs when public authorities act as a launch customer for innovative goods or services. These are typically not yet available on a large-scale commercial basis and may include conformance testing.

Find out more about the public procurement of innovative solutions.

Benefits of PCP and PPI

Businesses can benefit from the opportunities presented by the PCP and PPI contracts. For example:

  • businesses and organisations supported by PCP are typically funded at a rate of 100 per cent of eligible costs
  • businesses keep the intellectual property generated as a result of the PCP
  • businesses gain valuable insight into market requirements from potential end-users (public sector bodies)

In addition, businesses quite often need to collaborate with other organisations to develop a capable consortium, thereby developing their supply-chain and customer base.

Where to find PCP/PPI opportunities?

You can find all contract notices and Horizon 2020 funded procurement opportunities listed in the TED section of the Official Journal of the EU.

For more information, see the European Commission's overview of innovation procurement initiatives or browse through the frequently asked questions about PPC and PPI.

You can also watch videos below from the eafip initiative to get better acquainted with innovation procurement.