How Should Public Procurement Law Deal with FinTech?

Abstract

FinTech -- along with the blockchain, other distributed ledger, smart contract, and tokenization usually assumed to accompany it -- could change the way governments procure goods and services. Procurement authorities and procurement law can play a vital role in the development of FinTech. They can help build the FinTech platforms and ecosystems that help them engage in public procurement. They should not try to procure such FinTech outright. At the national level, regulators should not just leave FinTech rulemaking up to financial regulators. Contracting authorities should not just develop or use their own selected FinTech applications willy-nilly. They should contribute to overall changes in procurement law -- which extend far beyond simple supervisory or regulatory technologies (RegTech/SupTech). Governments should get serious about the Agreement on Government Procurement and similar treaties -- by creating a new authority to help develop the law needed to put FinTech-enabled procurement platforms in place. China’s own world-leading FinTech and cross-border public procurements do not always contribute to a global level playing field. Any FinTech applications facilitating public procurement should thus encourage compliance with the procurement law legal principles the international community has developed over decades.