The state of Hesse has decided to comprehensively modernise its public procurement law: With the reform of the Hessian Procurement and Collective Bargaining Act (HVTG), the state government is creating the basis for simplified, accelerated and legally compliant procurement procedures. At the same time, fair working conditions are to be given greater consideration. The reform provides for the following key points:

In future, supplies and services up to a value of €100,000 can be awarded without a formal procurement procedure. The new exemption limit for construction services is €750,000 - a very high figure in a nationwide comparison. The previous standardised limit of €10,000 is therefore largely no longer applicable. The significantly higher exemption limits give local and state authorities more room for manoeuvre. Public projects can be implemented more quickly and bureaucratic hurdles can be reduced.

Social aspects and fair wages also play a much more important role. When selecting bidders, it is not only the pure price that should be decisive, but also fair working conditions. At the same time, controls are being tightened to counteract wage dumping and unfair competition.

The preparation of tenders is simplified for companies. If a prequalification procedure on compliance with collective agreements and suitability has been completed, individual verifications no longer need to be repeated for subsequent contracts, which is of particular benefit to medium-sized companies.

According to the Hessian Ministry of Economics, the reform is characterised by efficiency, trust and fairness: public procurements are to be processed more quickly and working and competitive conditions are to be improved at the same time. In view of the current economic challenges, this sends out a clear signal in favour of sustainable and competitive procurement practices, it says. Representatives from industry and trade unions have largely welcomed the initiative. The construction industry association praises the new regulations as a practical improvement and IG BAU sees the reform as an important step towards greater collective bargaining and employee protection.