Commenting on the vote of the European Parliament's Internal Market and Consumer Affairs Committee, the Lib Dem MEP attacked the 'naked protectionism' which has been allowed into the report.
Dr Bennion said: "This proposal was supposed to be about opening up the market, allowing better competition and making it easier for SMEs and microenterprises to put in for public tenders. But thanks to petty games from the other political groups, we're now left with a report that stifles competition, excludes SMEs and creates legal uncertainty."
"I'm deeply disappointed but not surprised by the outcome today. It is not the first time that Parliamentarians are presented with basically sound proposals from the European Commission, only to have vested interests steal the show."
"One effect of changes voted through this morning is that fewer private companies would be able to tender for public contracts. Furthermore, the Committee has revoked the sensible proposal to divide public procurement into several categories in order to help SMEs - which is one of the key objectives in the ongoing Boost SMEs campaign by the wider Lib Dem ALDE group of MEPs.
"As part of the ongoing campaign, I'm calling on colleagues to rally support from the other political groups so that we can try to get a better outcome on this issue when it comes to a full vote in Parliament next year.
"We need to help small businesses in Britain and across Europe with a sensible reform of public procurement rules."