Abnormally Low Tender in Public Procurement Law

Abnormally low tender: price appears inappropriately low. Duty of clarification. § 123 BVergG 2018, Art. 69 Directive 2014/24/EU. Exclusion where no explanation given.

Definition: An abnormally low tender exists where the tender price or the costs offered appear inappropriately low in relation to the works, supplies or services required, so that the contracting authority is obliged to require an explanation of the price calculation from the tenderer before excluding or accepting the tender.

Last updated: January 2026 · Legal status: § 123 BVergG 2018, Art. 69 Directive 2014/24/EU, § 60 VgV

What is an abnormally low tender?

An abnormally low tender (also called a "dumping" tender) is a tender whose price is so far below the customary market level or the prices of other tenderers that there are well-founded doubts as to whether the tenderer can perform the contract properly and in full at that price.

Procurement law does not lay down a fixed threshold at which a tender automatically qualifies as abnormally low. The contracting authority must decide on a case-by-case basis whether a tender appears suspiciously low. The following indicators may be considered: a significant shortfall against the other tenders (e.g. more than 20–30%), a substantial shortfall against the authority's own cost estimate, or obvious omission of essential cost items.

An abnormally low tender may not simply be excluded — the contracting authority must first obtain an explanation from the tenderer.

Significance and function

The procurement law treatment of abnormally low tenders protects three interests: the contracting authority's interest in proper performance, the other tenderers' interest in fair competition, and the public interest in compliance with wage, social and environmental standards.

A price that is too low may have various causes, with different consequences:

Permissible reasons for low prices:

Particularly economical production methods or innovation
Favourable purchasing conditions
Technical efficiency or particularly advantageous production conditions
Subsidies (provided they are lawful and demonstrated)

Impermissible grounds that may lead to exclusion:

Undercutting of applicable minimum wages or collective agreements
Breach of social, labour or environmental law
State aid that infringes EU law
Strategic undercutting without a realistic calculation basis (loss-leader tender)

Clarification procedure:

The contracting authority requests an explanation in writing
The tenderer submits the calculation and reasoning
The contracting authority assesses the explanations
If the explanation is plausible: the tender remains in the competition
If the explanation is not plausible or is missing: the tender is excluded

Legal basis

In Austria § 123 BVergG 2018 governs the treatment of abnormally low tenders; at EU level Art. 69 of Directive 2014/24/EU provides the basis; in Germany § 60 VgV sets out the corresponding duties.

§ 123 BVergG 2018 obliges the contracting authority, before excluding an abnormally low tender, to obtain a written explanation from the tenderer concerned. The tenderer has the opportunity to justify the tender. Only where the explanations are unsatisfactory or the tenderer fails to provide any may the tender be excluded.

Art. 69 of Directive 2014/24/EU provides for a duty of clarification and lists, by way of example, aspects on which the tenderer may comment: production processes, technical solutions, purchasing conditions, originality of the solution, compliance with labour and social law.

§ 60 VgV imposes essentially the same requirements in Germany.

Procedure at a glance

Step	Content
1. Identification	Contracting authority identifies a strikingly low price
2. Request for clarification	Written request to the tenderer with a deadline
3. Tenderer's reply	Tenderer submits calculation and justification
4. Assessment	Contracting authority reviews plausibility of the explanations
5a. Plausible	Tender remains in the evaluation
5b. Not plausible / no reply	Mandatory exclusion of the tender

Related terms

FAQ

At what price gap is a tender regarded as abnormally low? Procurement law sets no fixed threshold. The contracting authority decides on the facts of each case. Guidance includes: a significant shortfall against the other tenders (typically more than 20–30%), a marked shortfall against the authority's own cost estimate, or obvious omissions in the calculation. What is decisive is always a holistic view of the specific circumstances.

Must the contracting authority request clarification before excluding a low-looking tender? Yes, mandatorily. The contracting authority may not exclude an abnormally low-looking tender without prior clarification. The duty applies irrespective of whether the tender is in fact unreasonable. Only after unsuccessful or implausible clarification is exclusion permissible.

What are typical grounds that lead to the exclusion of an abnormally low tender? Frequent grounds include breach of minimum wage or collective agreement rules, failure to take essential cost items into account, impermissible state aid, and a general lack of plausibility in the pricing. The tenderer bears the burden of proving the seriousness of the calculation.

Last updated: January 2026 All information provided without warranty. For legally binding advice, consult a law firm specialising in public procurement law.