Electronic Auction in Public Procurement

Electronic auction: Iterative electronic process for improving bids after the initial evaluation. Art. 35 Directive 2014/24/EU, §§ 153 et seq. BVergG 2018, § 23 VgV.

Definition: The electronic auction is an iterative electronic process carried out after a full initial evaluation of bids that enables bidders to successively improve their prices and/or other measurable bid parameters in order to determine the award decision.

Last updated: January 2026 · Legal basis: Art. 35 Directive 2014/24/EU, §§ 153 et seq. BVergG 2018, § 23 VgV

What is an electronic auction?

The electronic auction is a procedural instrument in public procurement law deployed after the initial evaluation of bids that allows admitted bidders to improve their bids electronically in several rounds – typically by reducing prices or improving other measurable criteria. It is not a stand-alone procurement procedure but a method embedded as a procedural phase in a regular procurement procedure (open procedure, restricted procedure, negotiated procedure).

The electronic auction is characterised by the following:

Iterative structure: The auction proceeds in several rounds. After each round, bidders are informed of their current position in the ranking and the distance from the leading bid.
Electronic conduct: The entire auction takes place via an electronic platform that enables real-time transmission of bids.
Enhanced competitive effect: The transparency about the current ranking motivates bidders to improve their bids.

Significance and function

The electronic auction can intensify competition and lead to more favourable outcomes for the contracting authority – it is, however, only suitable for standardisable performances whose bid parameters are quantifiable.

Conditions for use

The electronic auction may only be used for contracts where the specification of works is sufficiently precise and the evaluation criteria are quantitatively measurable. Art. 35(2) Directive 2014/24/EU expressly excludes certain contracts:

Contracts for intellectual services (e.g. architectural or engineering services)
Construction works where the quality of execution plays a substantial role
Contracts in which non-quantifiable quality criteria predominate

Typical use cases are standardised supply contracts (e.g. office supplies, IT hardware) or clearly defined services (e.g. cleaning services by area).

Course of the electronic auction

The course of an electronic auction follows a statutorily structured scheme:

Initial evaluation: The contracting authority evaluates all bids received in time on the basis of the established award criteria.
Invitation: All bidders who have not submitted a bid liable to exclusion are invited to participate in the auction. The invitation contains the results of the initial evaluation as well as technical information about the platform.
Auction rounds: In each round, bidders can improve their prices or other parameters. After each round, all bidders receive their current ranking but not the identity of the other bidders.
Conclusion: The auction ends after a pre-determined number of rounds, after expiry of a time period without new bids, or when no further improvements are received.
Award: The contract is awarded on the basis of the final auction results, taking all award criteria into account.

Minimum number of bidders

The electronic auction requires a sufficient number of bidders to be admitted to ensure genuine competition. With only one admitted bidder, no meaningful auction can take place; the contracting authority should in this case cancel the procedure or not conduct the auction.

Legal basis

The electronic auction is regulated under EU law and transposed into national law.

Art. 35 Directive 2014/24/EU – General rule and conditions for use
Annex V Part E Directive 2014/24/EU – Mandatory information in the invitation to the auction

Austria

In Austria, the conditions and course of the electronic auction are governed in detail by §§ 153 et seq. BVergG 2018 (Federal Law Gazette I No. 65/2018). § 153 BVergG 2018 defines the electronic auction and makes clear that it may only be used in conjunction with certain procurement procedures and only for suitable contract types. The notice must already indicate the planned conduct of an electronic auction.

Germany

In Germany, § 23 VgV (Procurement Regulation) governs the electronic auction for the above-threshold area. § 10 UVgO contains a corresponding provision for the below-threshold area. The contracting authority must indicate in the notice that an electronic auction will be conducted. The technical requirements for the auction platform are set out in § 23(3) VgV.

Related terms

FAQ

Can an electronic auction be used for construction works? In principle no, if the quality of execution is a substantial criterion. Directive 2014/24/EU excludes intellectual services and contracts in which non-quantifiable quality criteria dominate. For standardised construction works, an auction may be considered in individual cases.

Do bidders learn the identity of their competitors during the auction? No. After each round, bidders receive information about their current ranking position and the distance to the leading bid, but not the identity of the other bidders. This is intended to prevent collusion.

Must the intention to conduct an electronic auction be announced in advance? Yes. The contracting authority must already indicate in the contract notice that it will conduct an electronic auction (Art. 35(3) Directive 2014/24/EU).

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