Defence procurement in the UK and Europe has undergone major reform, with the laws and regulations changing dramatically.
The introduction of the Defence and Security Directive in 2009 brought a significant amount of defence procurement in the EU into the scope of a procurement regime for the first time and, within the UK, the Defence Reform Act 2014 led to a complete revamp of single source defence contracting in the UK.
The Single Source Contract Regulations 2014 impose tight controls on the pricing of single source defence contracts and subcontracts and impose wide ranging and onerous record keeping and reporting obligations – with penalties of up to £1 million for contravention of these regulations.
Any business providing supplies or services to the defence sector – whether as a prime contractor or further along the supply chain – may be affected by these changes, even businesses outside of the EU if they are seeking to provide defence supplies and services into the UK or another EU countries.
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