Architects and Engineers Fees: The HOAI After the CJEU Ruling

Architects and engineers fees in Germany: the basics

The Fee Structure for Architects and Engineers (Honorarordnung für Architekten und Ingenieure, HOAI) is a federal ordinance that structures planning services and their remuneration. It defines service profiles for buildings, interiors, open spaces, civil engineering structures, transport facilities, structural engineering and building services, divides each profile into service phases (Leistungsphasen) and provides fee tables based on eligible costs, fee zones and the services commissioned. For a long time, the HOAI's minimum and maximum rates were binding. That made architects and engineers fees in Germany unusually predictable – and unusually rigid.

Today the HOAI is primarily a tool for structuring and calculating fees rather than a price regulation. Under § 1 HOAI, the ordinance applies to fees for engineering and architectural services covered by it, and its rules may be used as the basis for calculating fees in a fee agreement. This change was forced by EU law.

This article explains the CJEU's ruling, the current rules, what it means for contracts concluded before and after 2021, and the state of the planned revision.

The CJEU's 2019 judgment and its aftermath

In infringement proceedings brought by the European Commission, the Court of Justice of the European Union held on 4 July 2019 that Germany had failed to fulfil its obligations under the Services Directive (Directive 2006/123/EC) by maintaining binding minimum and maximum fees for architects and engineers in the HOAI (CJEU, judgment of 4 July 2019, Commission v Germany, C-377/17). The binding tariffs were incompatible with Article 15 of the Directive, which allows Member States to impose fixed minimum or maximum tariffs only if they are non-discriminatory, necessary and proportionate.

The ruling raised a difficult question for pending disputes between private parties: could a planner still claim the higher HOAI minimum fee where the contract had agreed a lower fee? The CJEU addressed this in Thelen Technopark Berlin (CJEU, judgment of 18 January 2022, C-261/20).

It held that a national court hearing a dispute between private persons is not required, on the basis of EU law alone, to disapply the national rule setting minimum fees, because a directive cannot of itself impose obligations on individuals. The disapplication obligation binds public authorities, while private parties disadvantaged by incorrect transposition may have state liability claims. German courts have since applied the old minimum rates in private disputes about contracts concluded before 2021, where the requirements of the old HOAI were met.

The HOAI since 2021: orientation values and text form

Germany responded by amending the HOAI with effect for contracts concluded after 31 December 2020 (§ 57(2) HOAI). The key changes:

• Orientation values: the fee tables now show orientation values ranging from the basic fee rate (Basishonorarsatz) to the upper fee rate, structured by fee zones and by areas, eligible costs or units (§ 2a HOAI). The basic fee rate is the lowest rate in the tables.
• Free agreement: the fee is based on the agreement made by the parties in text form (§ 7(1) HOAI). Fees above or below the tables can be agreed.
• Fallback: if no fee agreement has been made in text form, the basic fee rate resulting from the HOAI's calculation rules is deemed agreed for basic services (§ 7(1) sentence 2 HOAI).
• Consumer information: where the client is a consumer, the planner must inform them in text form, before they make a binding declaration, that a fee higher or lower than the table values can be agreed. If the information is not given or not given in time, the basic fee rate applies instead of a higher agreed fee (§ 7(2) HOAI).

The HOAI also contains rules that remain relevant for calculation and payment. Fees for basic services are determined by the service profile, the fee zone and the fee table, together with the area, the eligible costs based on the cost calculation or estimate, or units (§ 6 HOAI). If the parties agree to change the scope of services and the eligible costs change as a result, the fee basis for the services concerned must be adjusted by agreement in text form (§ 10 HOAI). Maturity of the final fee and interim payments follow the BGB rules (§ 15 HOAI).

Drafting fee agreements for architects and engineers

Because architects and engineers fees are now negotiable, the quality of the contract matters more than before. Points to cover include:

1. Scope of services: define the service phases and any special services (Besondere Leistungen), which are not exhaustively listed in the HOAI (§ 3(2) HOAI).
2. Fee model: lump sum, percentage of construction costs, HOAI-based calculation with an agreed fee zone and rate, or time-based fees – or a combination by phase.
3. Eligible costs: if the fee is HOAI-based, define which cost determination applies and how changes in costs affect the fee; consider fixing eligible costs for the fee calculation.
4. Changes: set a procedure for additional or repeated services, consistent with § 10 HOAI and the BGB rules on changes.
5. Text form: record the fee agreement in text form; for consumers, give the required information in time.
6. Staging: commission phases in stages, with options for later phases, which is common for public clients and developers.

Negotiating architects and engineers fees in practice

With binding rates gone, negotiations on architects and engineers fees have become more varied. Clients increasingly ask for lump sums per phase or for the whole project, sometimes with a target cost and incentive mechanism. Planners, by contrast, often prefer HOAI-based calculations because they adjust automatically when construction costs rise. Both approaches have risks: a lump sum shifts the risk of scope creep to the planner, while a cost-based fee may give the planner little incentive to keep costs down.

A common compromise is to agree the HOAI calculation method but fix the eligible costs at an early cost determination, so that later cost increases do not automatically raise the fee, combined with a separate mechanism for changes in scope. Where the planner takes on special services – for example building information modelling, sustainability certification, energy consultancy or extended site supervision – these should be described and priced separately, because the HOAI's basic service profiles do not cover them.

Interim payments and termination

Planners are entitled to interim payments for services rendered under the rules of the BGB, which § 15 HOAI applies. Contracts typically link interim payments to completed phases or milestones.

Clients should also agree termination rights, especially in staged commissions: under the BGB, a client can terminate a planning contract at any time, but must then generally pay the agreed fee less saved expenses, unless the contract provides otherwise. Since 2018, § 650r BGB has also given the client a special termination right after the planner has presented the documents of the target-finding phase (§ 650p(2) BGB), and the planner a corresponding right in certain cases. Clear staging and option clauses help avoid disputes about fees for services not performed.

Insurance and liability caps

Fee negotiations should be aligned with liability. Planners carry professional liability insurance with limits per claim and per year; the contract should require cover appropriate to the project and may cap liability in line with the insured sums, within the limits of standard terms law.

Architects and engineers fees in public procurement

Public clients award planning services through procurement procedures. Above the EU thresholds, the Public Procurement Ordinance (VgV) contains special rules for architects' and engineers' services, including the use of the competitive procedure with negotiation and design contests.

Since fees are no longer binding, price competition on planning services has increased. Contracting authorities may use the HOAI's orientation values to assess whether a bid is abnormally low, and bidders should be able to explain how their fees were calculated. Whether contract values must be aggregated across different planning disciplines to determine the threshold has been a contentious issue; contracting authorities should take advice on the current position before splitting planning contracts.

The planned revision of the HOAI

A comprehensive revision of the HOAI's service descriptions and fee tables has been discussed for several years, driven by changes in planning practice such as building information modelling, sustainability requirements and the need to reflect current costs.

The consolidated text published on gesetze-im-internet.de shows that, as of November 2026, the HOAI was last amended by an act of 22 March 2023. A broader revision of the fee structure had therefore not been adopted by that date. Planners and clients should check the current status before relying on the existing tables for long-term framework agreements, and may wish to include clauses on how a future revision affects ongoing contracts.

Fee disputes and claims

Fee disputes typically concern the scope of services actually commissioned, the classification into fee zones, the eligible costs, additional services and changes, and – for older contracts – whether a fee agreement below the minimum rate was effective. Planners must submit a verifiable final invoice; maturity of the final fee follows § 650g(4) BGB through § 15 HOAI. Clients should check invoices for consistency with the agreed fee model and the services actually delivered. Where fees are calculated on eligible costs, disputes often turn on which cost determination applies and which cost groups are eligible, so these points deserve attention when the contract is drafted rather than when the final invoice arrives.

Fee disputes are often combined with liability claims for planning or supervision defects, where clients set off damages against the fee. Our article on construction defects covers planners' liability.

How TRW & Co helps

We advise clients, developers, public authorities and planning firms on architects and engineers fees. We draft planning contracts and fee agreements, structure staged commissioning and framework agreements, review final invoices, and represent clients in fee disputes and related liability claims. For public clients and bidders, we advise on the procurement of planning services. Our work connects with our construction law and public procurement practices and our article on construction contract variations. Please contact us. This article is general information and not legal advice.