Conflict of Interest in Public Procurement Law 2026

Conflict of interest in public procurement: situation in which persons on the contracting authority's side hold private interests that jeopardise impartial conduct of the procedure.

Definition: A conflict of interest in public procurement law exists where persons involved in a tender procedure on the contracting authority's side – e.g. members of the evaluation panel, external advisers, or experts – hold private, professional, or economic interests that could impair, or actually do impair, their impartiality in conducting the procedure.

Last updated: January 2026 · Legal basis: Directive 2014/24/EU Art. 24; BVergG 2018 § 26; GWB § 6(3)

What is a Conflict of Interest?

Conflicts of interest are one of the most sensitive topics in public procurement law, as they threaten the integrity of the entire tender procedure and the equal treatment of all bidders. Art. 24 of Directive 2014/24/EU explicitly obliges contracting authorities to detect, prevent, and remedy conflicts of interest. This obligation belongs to the core of EU procurement law and serves to protect competition and the trust of the economic community in public tender procedures.

Conflicts of interest can arise through:

Family or personal relationships with bidders or their employees
Financial interests in bidding undertakings
Previous employment with a bidder
Sideline activities for a bidder
Receipt of benefits or gifts
Involvement of subsequent bidders in the drafting of the tender documents (so-called prior involvement)

Statutory Regulation

The duty to avoid conflicts of interest is codified at European and national level and is backed by concrete legal consequences.

In Austria, § 26 BVergG 2018 governs the exclusion of persons involved in a tender procedure where a conflict of interest exists. Affected persons must abstain from the procedure and notify the contracting authority without delay. In Germany, § 6(3) VgV contains corresponding rules; in the antitrust strand of procurement law, the general basis is found in § 6 GWB.

Forms of Manifestation

Conflicts of interest occur in procurement practice in very different forms.

Personal Conflict of Interest

An employee of the procurement office is married to the managing director of a bidder or previously worked there.

Economic Conflict of Interest

A member of the evaluation panel holds shares in a bidder or is a silent partner.

Institutional Conflict of Interest

An external adviser who has assisted in drafting the specification later applies in their own right or advises a bidder.

Prior Market Involvement

Undertakings that have been involved in market exploration or concept development may have an information advantage that has to be treated as a conflict of interest.

Duties of the Contracting Authority

Contracting authorities are obliged to take appropriate measures to identify, prevent, and remove conflicts of interest.

These measures include:

Disclosure obligations: all persons involved in the procurement must proactively disclose any conflicts of interest
Bias check: the contracting authority must examine whether disclosed interests actually constitute a conflict
Exclusion of affected persons: where a conflict of interest is established, the affected persons must be excluded from the procedure
Documentation: conflicts of interest and the measures taken must be documented in the procurement file

Legal Consequences of Non-compliance

If a conflict of interest is not detected or not remedied, this can lead to annulment of the tender procedure, voidness of the concluded contract, or claims for damages.

In review proceedings, bidders can raise a conflict of interest as a procurement error. If the conflict of interest has influenced the award decision, the award can be annulled. In addition, a conflict of interest may carry criminal-law relevance (e.g. bribery, breach of trust).

Related Terms

FAQ

Must every personal relationship to a bidder be reported as a conflict of interest? Yes; in case of doubt disclosure is preferable. The contracting authority then decides whether a conflict of interest actually exists. Not every acquaintance necessarily constitutes a conflict; what matters is the intensity of the relationship and its influence on the award decision.

What applies where an adviser drafted the specification and a bidder employs that adviser? In this case there is a risk of a conflict of interest. The contracting authority must examine whether the bidder gains an unjustified advantage through the involvement of its adviser. Where this is the case, exclusion of the bidder may be required.

Can a bidder be excluded because of a conflict of interest on the contracting authority's side? It is not the bidder that is excluded but the affected person on the contracting authority's side. However, if the conflict of interest has led to a bidder being favoured, this may constitute procurement breaches that lead to annulment of the procedure.

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