Public Contract in Public Procurement Law 2026

Definition: A public contract is a written contract for pecuniary interest between one or more public contracting authorities and one or more economic operators concerning the supply of goods, the provision of services or the execution of works.

Last updated: January 2026 · Legal basis: Art. 2 para. 1 no. 5 Directive 2014/24/EU; § 103 para. 1 GWB; § 4 BVergG 2018

---

What is a public contract?

The public contract is the central subject matter of regulation of the entire procurement law. Whenever a public contracting authority procures a service from a private company for consideration, a public contract arises which must be procured according to the rules of procurement law.

The procurement-law definition encompasses four constitutive elements:

1. Pecuniary interest: The contracting authority pays consideration (money or service equivalent to money).
2. Written form: The contract must be concluded in written or electronic form.
3. Public contracting authority as a contracting party: At least one contracting party must be a public contracting authority.
4. Subject of performance: Goods, services or works.

Types of public contracts

Procurement law recognises three basic types that are subject to different thresholds and rules:

Supply contract (§ 103 para. 2 GWB)

Purchase, leasing, hire or lease of goods or products. Examples: office furniture, vehicles, computers, pharmaceuticals.

Service contract (§ 103 para. 4 GWB)

All contracts not classified as supply or works contracts. Examples: cleaning services, IT consulting, planning services, security services.

Works contract (§ 103 para. 3 GWB)

Execution, or design and execution, of works or turnkey buildings. Examples: road construction, school construction, bridge renovation.

Distinction from concessions

A decisive criterion of distinction from the public contract is the operating risk. In concessions, the concessionaire bears the substantial economic operating risk; in public contracts, the contracting authority pays a contractually agreed remuneration.

Distinction from in-house awards

In-house awards do not constitute public contracts in the procurement-law sense, if the entity engaged belongs to the contracting authority and the latter exercises control similar to that over its own departments (§ 108 GWB; Art. 12 Directive 2014/24/EU).

Thresholds

The procurement-law obligations depend significantly on the value of the public contract. Above the EU thresholds, the comprehensive obligations of the procurement directives apply; below, national procurement law with simplified requirements applies.

Related terms

• Public contracts
• Public contracting authority
• Supply contract
• Service contract
• Works contract
• Concession

FAQ

Is every contract of an authority with a company a public contract? No. Exceptions apply, inter alia, to in-house awards, certain service concessions, employment-law contracts and contracts for the acquisition of real estate.

Must a public contract always be concluded in writing? Procurement law requires written or at least electronic form; oral contracts are problematic under procurement law and rarely appropriate in practice.

From what value do I need a formal tender? The obligation to conduct a formal tender begins when the national value thresholds are reached; the strictest EU obligations apply from the EU thresholds.

---

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