The European Union is finalizing sweeping changes to its procurement rules that will allow national governments favor European suppliers in critical public services. 

The revamp of the bloc’s public procurement regime is a center-piece of the EU’s “Made in Europe” drive as it tries to boost its economic sovereignty.

According to a draft of the proposal, seen by Bloomberg News, the European Commission, the EU executive’s arm, is set to propose European preference rules for sectors including gas supply and energy extraction, water and electricity networks, railway, ports, airports and postal services. Buyers would also gain the right to reject any tender for goods and services in which non-European content exceeds half its value, according to the draft proposal.

“Public buyers may apply European preference requirements, including by restricting participation, requiring minimum Union or covered origin, or granting evaluation preferences,” according to the document which could still change before publication.

A commission spokesperson declined to comment on the leak but said the goal of the upcoming text is to “make public procurement simpler, and to create the right framework to optimize the use of public money to match our strategic objectives.” 

The proposal, which is expected to be presented after the summer break, represents the EU’s attempt to leverage its €2.6 trillion ($2.97 trillion) public procurement market as it grapples with increased competition from the U.S. and China. The bloc is also exploring “Made in Europe” provisions in its Industrial Accelerator Act, which calls for new conditions around foreign investment into Europe.

Brussels is looking at ways to boost its economic sovereignty as it tries to improve its competitiveness and reduce dependencies on other trading partners. The EU’s trade deficit with China has continued to grow, reaching €360 billion last year. Brussels and Beijing have restarted talks on rebalancing their economic relationship, with China warning that it could take measures to protect the rights and interests of its companies.

The commission is especially worried about the dependencies European operators continue to have on Chinese suppliers, particularly in the field of chips and rare earth minerals.

In addition to the sectors singled out for European preference, other areas like energy, transport, health, digital infrastructure, water and financial-market infrastructure were flagged as additional sectors where supply chain dependency posed a risk, particularly on security grounds. As a result, public buyers will be encouraged — and in certain contexts required — to address risks related to security and public safety interests, according to the draft proposal.

Though the new regime is designed to favor EU member states, some non-EU suppliers would also be covered, such as firms from countries that have signed the World Trade Organisation Government Procurement Agreement membership, such as the U.S. and the U.K., or have concluded a trade agreement with the EU that includes procurement chapters.

Some exceptions would be made in cases where no European supplier can meet the demand, no valid bids have been submitted in the previous two years, or meeting the criteria would imply disproportionate costs.

In addition, the commission could strip benefits from non-EU operators if the country of origin fails to grant reciprocal market access to EU firms.