New regulation has been backed which will stop suppliers from non-EU countries from bidding for public sector contracts, if home markets do not offer equal opportunities to EU businesses.

The new rulings will apply to public sector contracts worth more than €5 million and where goods and services from outside of EU terrorises make up more than 50 per cent of the total value.

The regulation would make undeveloped countries exempt from the rulings in order to prevent harming economic growth in these cases, despite such measures critics have said that the regulation threatens to damage the UK by establishing protectionist trade measures.

European trade commissioner Karel De Gucht, said: “I am a firm believer in open markets. Europe’s public sector market is one of the most open in the world and should remain so. This stands in contrast to many third (non-EU) countries.”

EU creates new procurement rulings