Two starting positions, two toolkits
The public contracting authority is bound by procurement law; the private client is not. For the public client, the VOB/A (the German award rules for construction contracts, Part A) governs when award may be refused and a procedure ended. The private client can negotiate, cut items and ask for new quotes.
| Question | Public contracting authority | Private client |
|---|---|---|
| Which rules bind the award? | VOB/A, public budget law, EU procurement law above the EU threshold | the client's own will and the conditions of the request for quotes |
| What happens to a tender that is too expensive? | No award on an inappropriately high price (section 16d(1) no. 1 VOB/A) | Rejection possible without giving reasons |
| May the procedure be ended? | Only on the grounds in section 17(1) VOB/A, with a reasoned notice | At any time, bearing in mind the client's own commitments |
| May there be negotiation? | Only as far as the type of procedure allows | Yes, with documented tender versions |
The public client: no award, and cancellation
The VOB/A gives the public client two separate tools that are often confused. The first concerns the individual tender: "The contract may not be awarded on a tender with an inappropriately high or low price" (section 16d(1) no. 1 VOB/A; unofficial translation, as are all quotations in this article). How appropriateness is assessed is covered in the article on checking and evaluating tenders.
The second tool concerns the whole procedure: the Aufhebung (cancellation of the tender procedure). Under section 17(1) VOB/A it is possible where no tender has been received that meets the tender conditions (no. 1), where the tender documents must be fundamentally changed (no. 2) or where other serious reasons exist (no. 3). Applicants and tenderers must be informed "stating the reasons" and "without delay in text form", where relevant also of the intention to start a new procedure (section 17(2)).
For the budget, the key point is that the VOB/A names no separate ground for cancellation where tenders exceed the cost estimate. Whether a lack of funding is a serious reason is assessed case by case; published case law tends to tie it to a careful, current cost estimate. The conditions and the alternatives are covered in the article on tenders above the estimate.
Value limits: the federal government and the Länder calculate differently
The permitted type of procedure decides how much room remains once the tenders are in. Under the decree of the Federal Ministry for Housing, Urban Development and Building (BMWSB) of 15 December 2025, in force since 1 January 2026, the following value limits excluding VAT apply to the federal government under section 3a VOB/A: Beschränkte Ausschreibung ohne Teilnahmewettbewerb (restricted tender without a prior call for competition) up to EUR 150,000, Freihändige Vergabe (direct negotiated award) up to EUR 100,000, Direktauftrag (direct order) up to EUR 50,000.
These values do not automatically bind the Länder (federal states) and municipalities. Each Land sets its own value limits. One example: in its information notice dated 4 May 2026, the Aufsichts- und Dienstleistungsdirektion Rheinland-Pfalz (the supervisory and services directorate of Rhineland-Palatinate) expressly notes that the federal values do not apply in Rhineland-Palatinate. For construction works it gives EUR 250,000 for a restricted tender without a prior call for competition, EUR 100,000 for direct negotiated award and negotiated award, and EUR 10,000 for a direct order, in each case as an estimated net value.
Above the EU threshold, other rules apply. For works contracts it has stood at EUR 5,404,000 since 1 January 2026 (notice in the Federal Gazette, BAnz AT 18.12.2025 B4), previously EUR 5,538,000. The types of procedure and their value limits in detail are covered in the articles on procurement types and thresholds and on procurement above and below the EU thresholds.
For the budget, this means: the estimated contract value chooses the procedure. An estimate that is too low can lead into an impermissible type of procedure; an estimate without a date cannot be compared with the tenders.
The private client: free, but only as good as the basis of comparison
The private client's freedom is only useful if the tenders are comparable. Quotes on different scopes of works compare prices for different buildings. Three rules keep the comparison clean: the same documents for all tenderers, every change sent to all of them, every tender version filed with its date.
Negotiation is no substitute for revision. A discount on an unchanged scope rarely closes a real budget gap; cutting, simplifying or moving items into options is more effective.
The articles in this branch
- Tenders above the estimate: cancel, negotiate, retender: when a budget shortfall supports cancellation, what cost estimate that requires and which routes the private client has.
- Unit price, lump sum or general contractor: which contract protects the budget: the types of contract compared, ranked by which cost risk stays with the client.
- The payment plan: instalments and security: interim payments under the BGB and the VOB/B, the builder's security and the final invoice as questions of cash flow.
This article reflects the state of the rules and of published case law on the date of checking and is intended for professional guidance. It does not replace legal advice or an examination of the individual case.