Existing and potential use cases for blockchain in public procurement

19 Pages Posted: 6 Dec 2022

See all articles by Pedro Telles

Pedro Telles

Copenhagen Business School - CBS Law

Date Written: December 4, 2022

Abstract

The purpose of this paper is to assess the possibility of using blockchain technology in the realm of public procurement within the EU, particularly in connection with the award of public contracts. In this context, blockchain is used as an umbrella term covering IT technologies and cryptographic solutions used to generate consensus on a distributed ledger.

The paper starts by elaborating how blockchains and distributed ledgers work in general, includ-ing the drawbacks of different blockchain models and implementations, before looking into recent developments for distributed consensus that may herald some potential.

As for public procurement, blockchain has been used in three real use cases in Aragon (Spain), Colombia and Peru, with the first two not passing from the pilot stage and the latter being deployed in production. These use cases are analysed with an emphasis in what can be learned from the difficulties faced by each project.

Finally, this paper will posit two specific areas of EU public procurement practice that might benefit from the use of blockchain technology. The first is on data management and accessibility where current solutions have been unsuccessful, such as cross-border certification data as required by the European Single Procurement Document (ESPD) and e-Certis or the difficulties with contract data collection and publication. The second, on situations of clear lack of confidence on public powers, where the downsides of blockchain technologies and the costs they entail are an ad-vantage. Even considering these potential scenarios, the overall perspective is that the benefits of blockchain solutions do not really provide much value in the context of public procurement for now.

Keywords: public procurement; blockchain; web3; distributed ledger; smart contracts; law

JEL Classification: F13, H57, K23, K42, P45

Suggested Citation

Telles, Pedro, Existing and potential use cases for blockchain in public procurement (December 4, 2022). Copenhagen Business School, CBS LAW Research Paper No. 22-11, Available at SSRN: https://ssrn.com/abstract=4293311

Pedro Telles (Contact Author)

Copenhagen Business School - CBS Law ( email )

Porcelaenshave 18B, 1
Frederiksberg 2000
Denmark

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
372
Abstract Views
1,056
Rank
152,575
PlumX Metrics