EU Commission drafts regulation to bar foreign firms from public contracts over security risks

The European Commission is set to present a draft regulation in September that would allow public authorities to exclude foreign companies from EU public procurement when they pose risks of undue interference, data leakage, or threats to security and public safety. The proposal covers all stages of the procurement process—from market planning to contract execution—and would permit a non‑mandatory European preference in awarding contracts. It aims to protect critical infrastructure, supply chains, technologies and essential services against physical, cyber or hybrid threats, and to reduce strategic dependence on third‑country suppliers. The draft reflects growing concerns about data transfers to the United States and China and follows recent national actions, such as France ending contracts with Microsoft and replacing Palantir with a French firm, and several EU states cancelling contracts with Huawei over security worries.