The European Union has issued new public procurement rules Thursday that broadly favor open source technologies. The controversial European Interoperability Framework (EIF) is a set of recommendations about interoperability standards to be used by EU member states, specifically in how data is exchanged by public administrations (http://news.yahoo.com/s/pcworld/20101216/tc_pcworld/controversialeuropeaninteroperabilityframeworkannounced). Specifically, the EIF will create standards for how administrations, businesses and citizens communicate with each other within the EU.

Not everyone is happy about it, including several giant U.S. and European Internet and technology companies. The final text of the framework is broadly supportive of open standards, something many companies that own proprietary technology are not keen about.

“Due to their positive effect on interoperability, the use of such open specifications has been promoted in many policy statements and is encouraged for European public service delivery,” the text reads. “The positive effect of open specifications is also demonstrated by the Internet ecosystem.”

The Business Software Alliance (BSA) (http://www.bsa.org/country.aspx?sc_lang=en), a trade group whose members include Microsoft, SAP, IBM, Dell and HP, recently argued that this will mean companies must give away their patents if they want to win public sector contracts. However, the Commission says that public administrations may decide to use less open specifications, “if open specifications do not exist or do not meet their interoperability needs.”

Not very comforting, it seems.

The EIF also requires that in all cases, specifications should be “mature and sufficiently supported by the market.” It also says that intellectual property rights related to the specification must be licensed on fair, reasonable and non-discriminatory (so-called “FRAND”) terms or on a royalty-free basis so that both proprietary and open-source software can compete on an equal footing. This has settled an argument between those who believed that FRAND licensing was incompatible with open source and those who wanted FRAND established as the main standard.

The word “standard” has a specific meaning in Europe. Only technical specifications approved by a recognized standardization body can be called a standard. However many ICT systems rely on the use of specifications developed by other organizations such as a forum or consortium. The EIF has created the term “formalized specification” to cover both options.

Unlike other E.U. rules, the EIF is not subject to the approval of the European Parliament or member states.