Contract Award in Public Procurement Law

Contract award refers to the entire process of public procurement – from needs assessment through the procurement procedure to the conclusion of the contract.

Definition: Contract award is the entire legally regulated process by which public contracting authorities conclude contracts for works, supplies or services with companies, while observing the principles of competition, transparency and equal treatment.

Last updated: January 2026 · Legal status: EU primary law (TFEU), Directive 2014/24/EU, BVergG 2018, GWB

What is contract award?

Contract award – also called public procurement – encompasses all steps that public bodies must follow when procuring goods, works and services. In a narrower sense, the term refers to the formal course of the procurement procedure; in a broader sense, it includes the entire procurement strategy from the needs assessment to the performance of the contract.

Public procurement accounts for around 14 per cent of GDP in the EU and is thus one of the most significant economic sectors with a regulated procedural framework. In Austria and Germany, contract award is strictly regulated to ensure that public funds are used efficiently, transparently and without discrimination.

Significance and Function

Contract award simultaneously serves the protection of public budgets and the maintenance of effective competition on the internal market.

Fundamental Principles of Contract Award

Contract award is shaped by several indispensable fundamental principles, which derive from EU primary law (Art. 18 Directive 2014/24/EU, Art. 49 and 56 TFEU) as well as from the national procurement statutes:

Principle of competition: Contracts must in principle be awarded in competition in order to determine the most economical tender.
Transparency requirement: Procurement procedures and decisions must be traceable and documented.
Principle of equal treatment: All bidders must be treated without discrimination and by uniform standards.
Proportionality: Requirements on bidders and the design of the procedure must be proportionate to the subject matter of the contract.
Economic efficiency: The contract must be awarded to the most economical tender, not necessarily the cheapest.

Phases of Contract Award

The procurement process is divided into clearly defined phases that build on one another and are legally safeguarded.

Needs assessment and market exploration: Definition of the procurement need; optional market consultation (Art. 40 Directive 2014/24/EU, § 28 VgV)
Choice of procurement procedure: Dependent on contract value, contract type and market situation (open procedure, restricted procedure, negotiated procedure, etc.)
Preparation of procurement documents: Specifications, conditions of participation, award criteria
Notice: Publication in the Official Journal of the EU (for EU-wide procedures) or on national platforms
Bid submission deadline and bid opening: Receipt of tenders; opening after the deadline expires
Bid examination and evaluation: Formal examination, suitability check, substantive evaluation against the award criteria
Bidder information and standstill period: Information about the intended award decision; waiting period before contract conclusion
Award and conclusion of contract: Acceptance of the most economical tender; commencement of contract performance

Procurement Procedures at a Glance

Depending on the threshold and subject matter, various procurement procedures are available:

Open procedure: Any number of companies can submit a tender; highest transparency
Restricted procedure: Only selected companies receive the invitation to tender
Negotiated procedure: Contracting authority negotiates with selected bidders; only permissible under certain conditions
Competitive dialogue: For particularly complex contracts
Innovation partnership: For the procurement of solutions not yet available on the market
Direct award: Only permissible in the sub-threshold area and up to certain value limits

Legal Basis

Contract award is anchored in law at several levels.

EU primary law: Art. 49, 56 TFEU (fundamental freedoms); general principles of equal treatment
EU secondary law: Directive 2014/24/EU (classical area); Directive 2014/25/EU (utilities); Directive 2014/23/EU (concessions); Directive 89/665/EEC (review)
Austria: BVergG 2018 (Federal Procurement Act 2018); BVergGKonz 2018; BVergGVS 2012; state procurement laws
Germany: §§ 97–184 GWB (Act against Restraints of Competition, Part 4); VgV; VOB/A; UVgO; SektVO; KonzVgV

Related Terms

FAQ

Does procurement law also apply to contracts below the EU thresholds? Yes. National procurement rules also apply below the EU thresholds. In Austria, the BVergG 2018 contains its own provisions for the sub-threshold area; in Germany, the UVgO (supplies and services) and VOB/A Section 1 (works) govern sub-threshold procurement. In addition, the EU fundamental freedoms always apply where there is cross-border interest.

When may a contracting authority award directly, without a tender? A direct award without competition is only permissible in narrowly defined statutory exceptions: in the sub-threshold area up to certain value limits, in the negotiated procedure without a call for participation on grounds of urgency, or where a single supplier can be demonstrated to be unique. The contracting authority bears the burden of proof for the existence of the exceptional conditions.

Can a procurement procedure be terminated after publication? Yes, a procurement procedure can be revoked for objective reasons – for example if no economical tender has been received, the need has changed, or serious procedural errors have occurred. Bidders may be entitled to reimbursement of bid preparation costs if the revocation was unlawful.

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