The Sektorenverordnung (SektVO, Sector Ordinance) contains its own participation rules for certain contracts of energy suppliers, water utilities and transport companies. If you know it, you can see earlier whether you first need a request to participate, an expression of interest or admission to a qualification system.
The first check consists of three questions: Is the company a sector contracting entity? Does the purchase serve a sector activity? Does the estimated contract value reach the relevant threshold? This link follows from Section 1 SektVO and Section 106 GWB (German Act against Restraints of Competition).
Legal and source status: September 5, 2026.
What does the Sector Ordinance govern?
The SektVO specifies the procurement rules from GWB Part 4 for certain activities in utilities, transport and postal services. Among other things, it governs types of procedure, notices, suitability checks and the award. The European basis is the Utilities Directive 2014/25/EU.
Its scope covers works, supply and service contracts. The SektVO is therefore also relevant for construction companies. For concessions, by contrast, Section 1 (3) refers to the Konzessionsvergabeverordnung (Concession Award Ordinance). Defense or security specific public contracts are excluded under subsection 2. Classifying something as a public contract or a concession therefore comes before choosing the procedure. Section 1 SektVO.
You can find a short definition in the glossary entry on the Sector Ordinance.
Who is a sector contracting entity?
Section 100 GWB distinguishes two groups:
- Public contracting authorities under Section 99 Numbers 1 to 3 GWB that carry out a sector activity.
- Natural persons or legal entities under private law that carry out a sector activity on the basis of special or exclusive rights or are under the dominant influence of the public contracting authorities named above.
Dominant influence is presumed, for example, where there is a public majority of capital or voting rights. A GmbH (German limited liability company) can therefore be a sector contracting entity just as a publicly organized body can. Conversely, operating in a utility industry does not on its own establish this status. A permit granted by an authority also does not automatically count as a special or exclusive right: Section 100 (2) excludes certain rights granted transparently and based on objective criteria.
Record the exact name of the company issuing the tender. A group can contain several companies with different tasks. Check the legal basis and the specific purpose of the purchase in the notice before you draw conclusions about the procedure from a well-known brand name.
Which activities belong to the utilities sector?
The statutory description in Section 102 GWB is what counts. It covers in particular:
| Area | Activities covered, in short form |
|---|---|
| Drinking water | Providing or operating public supply networks and feeding in drinking water. Certain related activities |
| Electricity, gas and heat | Providing or operating the corresponding supply networks and the feed-in covered by law |
| Transport services | Networks for rail, tram, bus and other means of transport named in the law, under the conditions described there |
| Ports and airports | Providing ports, airports and terminal facilities for transport companies |
| Fossil fuels | Extraction of oil or gas and exploration for or extraction of coal or other solid fuels |
| Postal services | Collection, sorting, transport and delivery of postal items and certain other services |
The table does not replace a case-by-case check. For example, Section 102 contains exemptions for certain feed-ins from installations for own use. And no classification can be derived from the word "water" alone. The exact connection with the activity described by law decides.
Hypothetical example: A network company under municipal control buys pumps for its drinking water network. Here, the contracting entity status and the intended use point to a check under the SektVO. If another group company buys equipment for an activity with no sector link, its legal status and its purchase must be classified separately. The group name does not answer this question.
Which thresholds apply in 2026 and 2027?
The following values have applied since January 1, 2026. They refer to the estimated contract value excluding VAT. Reaching the value is enough. The adjustment is made by Delegated Regulation (EU) 2025/2150, and the full breakdown is in Article 15 of Directive 2014/25/EU.
| Contract type in the utilities sector | Threshold 2026/2027, net |
|---|---|
| Regular supply and service contracts and design contests | €432,000 |
| Works contracts | €5,404,000 |
| Social and other specific services under Annex XVII of the Utilities Directive | €1,000,000 |
The one-million limit only applies to the specific services covered. It is not a general threshold for services. Classify the service using the relevant annex before you use this value.
Look at the total value, not the annual budget
Under Section 2 SektVO, options and contract extensions also belong in the estimate. For framework agreements, the estimated total value of the individual contracts planned over the entire term counts. Splitting a contract to get around procurement law is not allowed.
Hypothetical calculation: A maintenance contract for a transport facility covers three years at €110,000 net each and an option to extend by one more year at €110,000. The estimated total value is €440,000. For a regular service contract, this is above €432,000, even though the annual budget stays well below it. The other requirements and possible exemptions must also be checked.
Below the relevant threshold, the SektVO does not apply just because of the sector activity. Which other rules apply depends, among other things, on the contracting entity and the relevant national rules. A national tender therefore cannot be derived from a SektVO procedure just by swapping the value limit. The starting point for the threshold check remains Section 106 GWB.
SektVO and VgV: the differences for bidders
Three differences are especially relevant when working on a bid:
| Point | SektVO | VgV |
|---|---|---|
| Choice of procedure | Open procedure, restricted procedure, negotiated procedure with a prior call for competition and competitive dialogue are all available | Generally a free choice between open and restricted procedure. Other procedures need additional requirements |
| Access via qualification | Own qualification system that you can apply to at any time, with possible awards among qualified companies | No equivalent rule for a sector qualification system under Section 48 SektVO |
| Framework agreement | Generally no more than eight years | Generally no more than four years |
The choice of procedure follows from Section 13 SektVO and Section 14 VgV (Public Procurement Ordinance). Section 48 SektVO applies to qualification systems. For terms, Section 19 (3) SektVO and Section 21 (6) VgV each allow justified special cases.
If negotiation is possible, plan capacity for technical and commercial talks. For long framework agreements, check price adjustment rules, ability to deliver and staff commitment over the term. These points affect whether a contract makes economic sense for your company.
The freedom to choose the procedure does not allow an arbitrary award without competition. A negotiated procedure without a prior call for competition needs a statutory ground for exception. Our article on Section 13 SektVO covers the details and typical false assumptions.
How do you find the right way into a procedure?
Do not limit your research to notices with a bid deadline. Under Section 36 SektVO, a periodic indicative notice can, under certain conditions, serve as the call for competition. Interested companies must then first express their interest. If you wait for a separate contract notice, you can miss this way in.
Qualification systems are another option. Companies must be able to apply for admission at any time. If the call for competition is made through such a system, restricted or negotiated procedures can be run among the candidates who are already qualified. Admission is therefore a task of its own with evidence and an owner. It is not yet a contract. Section 48 SektVO.
Create a short overview for relevant contracting entities: company issuing the tender, service areas, portal used, existing qualification system and next action. Link this overview to your monitoring for automatic tender search. For each match, save the link to the original notice and check the current stage of the procedure there.
Checklist before your decision to take part
- Are the contracting entity, sector activity and purpose of the purchase classified in a traceable way?
- Were the contract type, term, options and, where relevant, the aggregation of lots taken into account?
- Is a bid, a request to participate, an expression of interest or a qualification required?
- Who obtains references, declarations and technical evidence by each deadline?
- Is the right reserved to award on the basis of the initial bid? Then it must already be priced reliably. Section 15 (4) SektVO.
- Does a supply bid contain relevant third-country goods? Check the special rules in Section 55 SektVO.
- Does every open question have an owner and an internal date before the external deadline?
Record the result on one page. An open proof of suitability explicitly belongs in the decision paper, even if the technical scope is a good fit. This way sales, the technical team and purchasing can clarify early which work is needed before a binding bid approval.
Frequently asked questions about the SektVO
What is the SektVO?
The Sector Ordinance governs the procurement procedure for contracts of sector contracting entities within the scope of GWB Part 4. The contract must serve a covered sector activity, such as drinking water or energy supply, transport or postal services.
Which SektVO thresholds apply in 2026?
In 2026 and 2027, excluding VAT, the thresholds are €432,000 for regular supply and service contracts and design contests, €5,404,000 for works contracts and €1,000,000 for the covered social and other specific services. Reaching the relevant value is enough.
Is every Stadtwerk a sector contracting entity?
The name Stadtwerk (municipal utility) does not decide this. The requirements of Section 100 GWB and a sector activity under Section 102 GWB must be checked. For the SektVO to apply, the specific contract must also serve this activity and fall within the relevant scope.
How does the SektVO differ from the VgV?
The SektVO covers certain sector procurements. In particular, it allows a free choice that also includes the negotiated procedure with a prior call for competition and the competitive dialogue. Under the VgV, the open and the restricted procedure are generally freely available. Other types of procedure have additional requirements.
Apply the checklist to your next sector notice and set the first action needed. For ongoing research, you can then open the procuris tender search.