Concept and definition of public procurement matters
Public procurement matters is a clearly defined legal term that encompasses all processes in which the state, its authorities, or other public-law bodies, within the scope of their activities, award contracts to private individuals or companies. Public procurement matters thus particularly cover legal and procedural processes related to the acquisition of goods, construction works, or services for the public sector.
The legal treatment of public procurement matters is of particular relevance in Germany and in the European legal area, as the awarding of public contracts is subject to numerous formal and substantive requirements.
Legal foundations and regulatory areas
Public procurement system
The public procurement system regulates the requirements, procedures, and obligations for public procurement processes in order to ensure transparency, equal treatment, and competition. The main legal sources in Germany are:
- Act against Restraints of Competition (GWB), in particular Part 4 (§§ 97 ff.), which sets key principles and requirements for procurement procedures.
- Procurement Regulation (VgV), which provides detailed rules for the procurement procedure.
- Sub-threshold Procurement Regulation (UVgO) as the legal basis for procurements below the EU thresholds.
- Contracting and Procurement Regulation for Construction Works (VOB/A) as well as for services (VOL/A).
- Provisions of European procurement law, such as Directives 2014/24/EU and 2014/25/EU.
Distinction from related areas
Public procurement matters differ from purely civil law contractual relationships, in particular through the application of specific provisions of public law. A key distinguishing feature is the adherence to procurement law principles and control mechanisms.
Procedure for public procurement matters
Tendering and announcement
The awarding of public contracts is generally carried out within the framework of a tender, which must be made public. A distinction is made between open procedures, restricted procedures, negotiated procedures, and competitive dialogues. The choice of procurement procedure depends on the subject of the contract and the anticipated contract value.
Offer and contract award phase
In the tender procedure, bids are submitted based on the tender documents. After the submission deadline, the evaluation of bids usually follows, in which, alongside the price, suitability and award criteria must be considered. The procurement regulation requires an objective and transparent selection decision.
Contract conclusion and implementation
After the contract has been awarded, a public law contract is concluded through acceptance, which sets the legal framework for the provision of services. Special requirements also apply to contract implementation, including change order review and contract amendments during performance.
Special requirements and principles in the area of public procurement matters
Principle of transparency and equal treatment
Public procurement matters are subject to the principles of transparency and non-discrimination. These principles are intended to ensure fair and open competition, both nationally and within the European context.
Economy and frugality
A central procurement principle is the economical and efficient use of public funds. This leads to requirements regarding the design of the contract notice and the evaluation of offers.
Monitoring and legal protection
Public procurement matters are accompanied by extensive monitoring and corrective mechanisms. These include, in particular, review procedures before the public procurement tribunals (§§ 155 ff. GWB) and the public procurement divisions of the higher regional courts. Affected bidders may seek legal protection in the event of breaches of procurement law.
European law influences
The regulations on public procurement matters are significantly shaped by European requirements. The EU procurement directives set binding standards across the Union, for example regarding thresholds, review mechanisms, and information obligations. Implementation into national law occurs through the provisions laid down in the GWB and the associated regulations.
The primary law ban on discrimination and the European fundamental freedoms also influence the interpretation and application of national regulations in the field of public procurement matters.
Significance in economic life and public oversight
The awarding of public contracts is an essential tool for controlling public investments and comprises a substantial part of the domestic economy. It ensures access to public funds for private companies and significantly influences market developments. At the same time, comprehensive legal regulation prevents corruption and nepotism, and strengthens trust in state processes.
Summary
Public procurement matters cover all legal processes related to the procurement of services by the state or state institutions. The complex regulatory areas serve to ensure competition, transparency, non-discrimination, and prudent use of public funds. Numerous national and European regulations detail both the procedures for awarding contracts and the rights and obligations of the parties involved. The comprehensive level of regulation underscores the paramount importance of public procurement matters for public administration and economic order.
Frequently asked questions
What are the legal bases for awarding public contracts?
The key legal bases for the awarding of public contracts are the Act against Restraints of Competition (GWB), the Procurement Regulation (VgV), the Sector Regulation (SektVO), the Concession Award Regulation (KonzVgV), as well as the Contracting and Procurement Regulation for Construction Works (VOB/A) and the Sub-threshold Procurement Regulation (UVgO). These legal provisions govern both the types of procedures (open, restricted, negotiated, etc.) and requirements for transparency, equal treatment, and economy. Depending on contract value, contracting authority, and contract type, different rules apply, with European requirements in the EU Directives 2014/24/EU, 2014/25/EU, and 2014/23/EU also being essential. Preventing discrimination and ensuring fair competition are always at the forefront. Numerous relevant administrative provisions and state laws must also be observed.
Who is eligible to participate in a procurement procedure and what are the grounds for exclusion?
In principle, all companies operating in the market are eligible to participate in procurement procedures, provided there are no grounds for exclusion. Typical reasons for exclusion are set out in § 123 GWB (mandatory exclusions, e.g. criminal convictions for corruption or money laundering) and § 124 GWB (optional exclusions, e.g. serious violations of labor law). In addition, formal errors in submitting bids, missing evidence, or failure to meet suitability criteria may result in exclusion. The exclusion can be judicially reviewed. The decisive factors are always the specific requirements and exclusion criteria defined in the procurement documents.
How is the legal review of review petitions handled in the event of procurement law violations?
If a procurement procedure is considered erroneous, affected bidders can submit a review petition to the responsible procurement tribunal (§ 160 ff. GWB). The tribunal reviews whether the petition is admissible and justified, in particular whether the applicant faces or has suffered damage. The review covers compliance with procurement law provisions, the certainty and transparency of procurement documents, the proper selection of the procedure, deadlines, and equal treatment of all bidders. Certain deadlines must be observed in the review procedure, in particular, violations must be immediately reported. The decision of the procurement tribunal can be appealed immediately to the higher regional court.
What rights do bidders have during the procurement procedure?
Bidders have extensive rights to equal treatment, transparency, and comprehensibility of decision-making criteria during the procurement procedure. They may obtain information about the evaluation of their bids (§ 134 GWB) and about contract awards. When the contract is awarded, there is a seven-day waiting period during which losing bidders may file legal remedies. They are also entitled to inspect the files during the review procedure (§ 165 GWB). The legal basis is European and national cartel procurement law. If a bidder’s rights are violated, effective legal protection (e.g., review proceedings, interim injunctions) is available.
What special provisions apply when contracting to subcontractors?
When involving subcontractors, specific procurement law regulations must be observed. The bidder is obliged to state the intended subcontractors in the bid and to demonstrate their suitability (§ 47 VgV, § 36 VOB/A). Changes or replacements of subcontractors require the approval of the client. Furthermore, labor, social, and collective bargaining obligations must be observed; depending on the tender, additional requirements such as minimum wage laws or collective agreement compliance rules may apply. In case of subsequent changes to the use of subcontractors, this may, under certain circumstances, constitute an amendment to the main contract and have legal consequences.
How are contract modifications treated legally during the contract term?
Contract amendments following contract award are subject to strict legal restrictions (§ 132 GWB). Significant changes that could alter the character of the contract or the equal treatment of bidders are generally inadmissible and may only occur under specifically regulated conditions, such as unforeseeable circumstances or minor changes. Otherwise, there is a risk that the contract must be retendered. Permissible are necessary adjustments provided for in the original contract or of minor importance. If a change violates procurement law requirements, review proceedings and compensation claims by excluded bidders may ensue.
What procurement law obligations exist after the contract has been awarded?
After the contract has been awarded, contractors and contracting authorities have various obligations to observe. The contractor must comply with the specifications made in the procurement procedure, especially regarding suitability and performance. Changes in service delivery or personnel must be reported and approved. Contracting authorities must ensure compliance with all procurement and contractual requirements during the entire contract period. Further obligations may include documentation requirements, reporting duties, and, where applicable, proof of compliance with social or environmental standards. Failure to comply with these obligations may result in legal consequences such as termination, compensation, or exclusion from future procurements.
