E X E C U T I V E S U M M A R Y

Contracting out to private militaryand security companies: the marketfor security services

Nikolaos Tzifakis

� Centre for European Studies 2012

Today, the global trend for contracting out the supply of military and securityservices is steadily growing. Security is being transformed from a service for thepublic or common good into a privately provided service. The largest privatecompanies in the field have developed more advanced know-how and greatermaterial and human resources than the security agencies and armies of manysovereign states. In this respect, several analysts have made observations on therestructuring of public–private relations in the domain of security. They note thatwhat is actually taking place is a broader shift from vertical, centralisedgovernment to horizontal, fragmented security governance.

The implications of outsourcing security services to private agencies are nota priori positive or negative. Ultimately, everything boils down to the way publicand private actors deal with the questions of ‘when’ and ‘how’ to go aboutcontracting out security services.

With regard to the ‘when’, states should determine their ‘inherently govern-mental functions’ and keep these functions out of the market’s reach. They shouldalso entrench their independent decision-making capacity in order to select themost appropriate solutions to deal with their security issues. More importantly,states should continue to struggle to protect the safety of their people, irrespectiveof the latter’s ability to purchase security services in the market. The combination ofpublic and private security would not necessarily be detrimental to the publicinterest if states stopped retracting resources and operational objectives inresponse to the expansion of the private security supply.

With respect to the ‘how’, states should attempt to mitigate some of theshortcomings in the operation of the private market for security services bytaking the following steps:

This is an executive summary of a research paper published by the CES. The full version can be foundat www.thinkingeurope.eu.

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European View (2012) 11:125–126DOI 10.1007/s12290-012-0197-3

• preventing supply from determining its own demand;• launching competitive bids for every single contract and striving to obtain

several offers;• refraining from awarding cost-plus contracts for services whose outsourcing

is primarily intended to increase cost efficiency;• avoiding contracting out services to corporations that enjoy a monopoly in

the market;• paying greater attention to post-award contract management by substan-

tially increasing the capacity and authority of oversight institutions;• avoiding transferring contract supervision to private agencies; and• calculating the cost of contract management when considering the option of

outsourcing services.

Moreover, states should increase the accountability of the global privatesecurity industry by taking the following measures:

• effectively regulating the activity and the operation of private military andsecurity companies at both the national and international levels, in line withthe recommendations of the UN Working Group on Mercenaries;

• reversing the climate of general impunity that prevails in several locationswhere the private security sector thrives (for instance, in post-conflictcountries);

• explicitly stipulating the responsibility of prime contractors for subcontractoractivities;

• demonstrating zero-tolerance concerning serious cases of misconductinvolving corporations or individual contractors; and

• excluding, or altogether eliminating, recurrently and seriously negligent orunscrupulous corporations (and their affiliates) from future contracts.

Nikolaos Tzifakis is a lecturer in international relations in the Department ofPolitical Science and International Relations at the University of Peloponnese,and a research associate at the CES.

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