Public Procurement (GWB-Vergaberecht)

Public procurement in Germany in brief

Public procurement in Germany is a large market and a tightly regulated one. Federal, state and municipal authorities, public companies and utilities buy works, supplies and services worth many billions of euros each year, and the special infrastructure and defence funds have increased volumes further. Contracts above the EU thresholds are awarded under Part 4 of the Act against Restraints of Competition (Gesetz gegen Wettbewerbsbeschränkungen, GWB), §§ 97 to 186, and the associated ordinances. Contracts below the thresholds follow budget law and national procurement rules.

Bidders that believe the rules have been breached in an above-threshold procedure can apply for review to the procurement chambers (Vergabekammern), with an appeal to the Higher Regional Court.

In 2026 the framework changed. The Act to Accelerate the Award of Public Contracts (Vergabebeschleunigungsgesetz) was published on 18 May 2026 and entered into force on 1 July 2026, according to the Federal Government.

The reform aims to make procurement simpler, faster and more digital, raises the threshold for direct awards by federal authorities, allows lots to be combined in certain infrastructure projects and changes the effect of appeals in review proceedings. Defence procurement has its own acceleration act. This page explains the framework, the procedures, bid strategy, review proceedings and the reforms, for bidders and contracting authorities alike. For the wider context, see our overview of real estate and public law.

Legal framework and EU thresholds

Above the EU thresholds, the GWB sets the principles of competition, transparency, equal treatment and proportionality (§ 97 GWB) and the core rules on procedures, exclusion, award criteria and review. Detailed rules are found in ordinances: the Procurement Ordinance (VgV) for general public contracts, the Sector Ordinance (SektVO) for contracting entities in energy, water and transport, the Concessions Ordinance (KonzVgV) and the Defence and Security Procurement Ordinance (VSVgV). For works, Section 2 of the VOB/A applies in addition. The thresholds are set by EU delegated regulations every two years.

Utilities in the energy, water and transport sectors, including private companies holding special or exclusive rights, apply the more flexible Sector Ordinance, which allows a free choice between the open, restricted and negotiated procedure with prior publication. Concessions, where the operator bears the operating risk, follow the Concessions Ordinance with its own threshold and procedural freedom. Determining which regime applies is the first step in every procurement and can itself be a point of dispute.

Below the thresholds, federal and state budget law applies. For supplies and services, most authorities apply the Sub-threshold Procurement Rules (UVgO), and for works Section 1 of the VOB/A, with state procurement laws adding requirements such as collective pay compliance.

Legal protection below the thresholds is limited: there is no review by procurement chambers in most states, and bidders must rely on civil courts or state-specific complaint procedures. Since 1 May 2026, the Federal Collective Pay Compliance Act has applied to federal works and services contracts and concessions with an estimated value of at least EUR 50,000, requiring contractors to grant employees certain collectively agreed working conditions.

Procedures, exclusion and award criteria

Public authorities may choose between the open procedure and the restricted procedure; the negotiated procedure with prior publication, the competitive dialogue and the innovation partnership are available where their conditions are met (§ 119 GWB). Negotiated procedures without publication are exceptional and must be justified, for example by extreme urgency resulting from unforeseeable events or by the fact that only one company can perform the contract for technical reasons. Authorities that rely on these exceptions without solid documentation risk a declaration of ineffectiveness.

Contracts are awarded to the most economically advantageous tender, determined by the best price-quality ratio, which may take into account qualitative, environmental and social aspects in addition to price or costs (§ 127 GWB).

Bidders must be suitable and must not be subject to exclusion grounds. Mandatory exclusion applies, for example, after convictions for certain offences such as bribery, fraud or money laundering attributable to the company (§ 123 GWB); optional exclusion grounds include serious professional misconduct, significant deficiencies in performing earlier contracts and agreements distorting competition (§ 124 GWB).

Companies can avoid exclusion by demonstrating self-cleaning, including compensation of damage, cooperation with the authorities and organisational measures (§ 125 GWB). Without self-cleaning, exclusion lasts at most five years for mandatory grounds and three years for optional grounds (§ 126 GWB). Authorities consult the federal Competition Register before awarding larger contracts. See our insight on the Competition Register and self-cleaning.

In-house awards and public-public cooperation

Contracts awarded to an entity controlled by the contracting authority that carries out more than 80% of its activities for that authority and has no direct private capital participation fall outside the procurement rules (§ 108(1) GWB). Cooperation between public authorities can also be exempt. These exceptions matter for municipal companies and utilities but must be documented carefully. See our insight on in-house awards and municipal companies.

Electronic procedures and documentation

Above the thresholds, procurement procedures in Germany are conducted electronically through e-procurement platforms, and bids must generally be submitted electronically in the prescribed form. Technical problems on the bidder's side are no excuse for late submission, so bidders should upload well before the deadline. Contracting authorities must document each stage of the procedure in a procurement file, which becomes important evidence in review proceedings: bidders can request access to the file in review proceedings, subject to the protection of other bidders' trade secrets.

Sustainability and social criteria

Authorities increasingly use environmental and social criteria in public procurement, both as technical specifications and as award criteria, and some federal and state rules require them. Examples include energy efficiency requirements, life-cycle costing, the use of recycled materials and compliance with collective pay rules. Bidders should check whether such criteria are clear, linked to the subject matter of the contract and proportionate; criteria that fail these tests can be challenged in the same way as other tender conditions.

Bid strategy for public procurement

Successful participation in public procurement requires discipline. Tender documents in Germany are detailed, deadlines are strict and formal errors, such as missing declarations or alterations to the tender documents, can lead to exclusion. Bidders should:

• review the tender documents immediately on publication and raise questions within the deadlines set;
• identify and complain about apparent infringements early, because complaints must be raised within ten calendar days of recognising them, and infringements apparent from the notice or documents by the deadline for bids (§ 160(3) GWB);
• check the evaluation matrix and design the offer around the award criteria, including any concept or presentation elements;
• plan subcontracting, consortium agreements and reliance on third-party capacities in line with the tender rules, and obtain commitment declarations early;
• keep self-cleaning documentation available if exclusion grounds may be raised, and check the company's entry in the Competition Register;
• check whether the Foreign Subsidies Regulation requires a notification or declaration in larger procedures.

Consortia and subcontracting

Smaller and medium-sized companies often bid as consortia (Bietergemeinschaften) or rely on the capacities of subcontractors to meet suitability requirements. Consortia must be formed before the bid deadline and generally cannot change composition afterwards without the authority's consent. Because consortia of competitors can raise competition law questions, companies should document why joint bidding is economically justified, for example because neither member could perform the contract alone. Where a bidder relies on another company's capacities, it must show that these capacities will actually be available, typically through a commitment declaration.

Review proceedings before the procurement chambers

Before concluding the contract, the contracting authority must inform unsuccessful bidders in text form of the name of the successful bidder, the reasons for rejection and the earliest date of contract conclusion. The contract may be concluded only 15 calendar days after the information is sent, or ten days if sent electronically or by fax (§ 134 GWB). A contract concluded in breach of this duty, or awarded directly without required EU publication, is ineffective if this is established in review proceedings brought within 30 calendar days of the bidders being informed of the conclusion, and at the latest six months after conclusion (§ 135 GWB).

The procurement chamber must decide within five weeks of receiving the application, extendable in exceptional cases (§ 167 GWB). An immediate appeal lies to the Higher Regional Court within two weeks of service (§ 172 GWB). Since the 2026 reform, if the procurement chamber rejects the application, the appeal no longer has suspensive effect against the chamber's decision (§ 173(1) GWB), so the contracting authority may proceed unless the court orders otherwise. Our insight on procurement review proceedings explains the procedure in detail.

Damages claims are possible where a bidder can show that it would have won the contract but for the breach, or, in some cases, for the costs of preparing its bid. Review proceedings are, however, the more effective remedy because they can stop the award before the contract is concluded. For contracting authorities, careful documentation, clear award criteria and timely responses to complaints are the best way to avoid delays: many review applications succeed not because the authority's choice was wrong, but because its reasons were not documented.

The 2026 public procurement reform

The Act to Accelerate the Award of Public Contracts is the most significant change to German public procurement law in years. According to the Federal Government, it raises the direct-award threshold for federal contracts to EUR 50,000, so that no competitive procedure is required below that value.

The Act retains the principle that contracts must be divided into lots to support small and medium-sized enterprises, but allows lots to be combined for time reasons in infrastructure projects worth at least twice the relevant EU threshold that are financed from the special fund for infrastructure and climate neutrality or concern federal transport infrastructure such as railways, federal trunk roads, waterways and airports (§ 97a(3), (4) GWB). In such cases, contractors can be required to take SME interests into account in subcontracting (§ 97a(5) GWB).

The reform also modifies review proceedings, as described above, and promotes digital procedures. Defence procurement is subject to separate acceleration legislation for the Bundeswehr, which allows tenders to be restricted and concentrates review. Contracting authorities and bidders should update templates, internal guidelines and bid processes to reflect the new rules, and bidders active in several federal states should check how state procurement laws are being aligned with the federal reform. See our insights on the procurement acceleration reform and defence procurement law.

Contract performance and modifications

Public procurement law continues to apply after the award. Substantial modifications of a public contract during its term require a new award procedure (§ 132 GWB). A modification is substantial in particular if it would have allowed other bidders to participate or win, shifts the economic balance in favour of the contractor, considerably extends the scope or replaces the contractor.

The GWB allows certain modifications without a new procedure, such as those provided for in clear review clauses, additional works within value limits and changes necessitated by unforeseeable circumstances. Contracting authorities and contractors should therefore draft review and price adjustment clauses carefully at the outset, especially in long-term infrastructure and service contracts.

Illustration: a hypothetical German engineering firm bids for a federal motorway bridge project worth around EUR 30 million. It notices that the tender combines design and construction into a single lot and that one technical specification appears to favour a particular supplier. It checks whether the combination is permitted under the new § 97a(3) GWB for transport infrastructure, concludes that it is, but raises a complaint about the specification within ten days. The authority amends the specification, and the firm submits a compliant bid.

How TRW & Co helps

We advise bidders and contracting authorities on public procurement in Germany. For bidders, we review tender documents, draft complaints and questions, structure consortia and subcontracting, prepare self-cleaning documentation and conduct review proceedings before the procurement chambers and Higher Regional Courts. For contracting authorities, public companies and utilities, we design procedures, specifications and award criteria, assess in-house and cooperation exceptions, draft contracts and defend awards in review proceedings. We also advise on contract modifications, foreign subsidies screening and the 2026 reform, and train procurement and sales teams. To discuss a tender, please contact us. This page is general information and not legal advice.