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Procurement procedures

Prequalification (Präqualifizierung)

Prequalification is an upfront process in which companies prove their general suitability for public contracts in advance and have it entered in a register.

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What does prequalification mean?

Prequalification (PQ) is a process that lets companies prove their general suitability for taking part in public procurement procedures in advance and independently of a specific contract. The verified proof is stored in an official list or a prequalification database. In specific tenders, prequalified companies can then refer to their PQ entry instead of putting together the proof of suitability again each time.

There are several prequalification systems in Germany. For construction work, the prequalification list of the Association for the Prequalification of Construction Companies (PQ-Verein) is the relevant one. For supplies and services, there is the Official List of Prequalified Companies (AVPQ), which is run by the Chambers of Industry and Commerce (IHK). Both lists regularly check the expertise, capability, reliability and legal compliance of the registered companies.

Prequalification creates a presumption: if a company is prequalified, it is generally assumed to meet the general suitability criteria. In individual cases, however, the contracting authority can require additional contract-specific proof that goes beyond the standard prequalification. Prequalification therefore does not replace the full suitability check, but it makes it much simpler.

Relevance for bidders

For bidders, prequalification offers considerable advantages. The effort of putting together proof of suitability for each individual tender drops significantly. Instead of compiling commercial register extracts, certificates of good standing, reference lists and revenue figures again and again, stating the PQ number is enough. This saves time and reduces the error rate when submitting bids.

In addition, prequalification signals a certain basic reliability and professionalism to the contracting authority. Companies that regularly take part in public tenders should consider prequalification, because the effort of the one-time setup and the annual upkeep is usually more than offset by the time saved in individual procedures.

Legal framework

Above the EU thresholds, prequalification is governed by Section 48 VgV (Public Procurement Ordinance). For construction work, the rule is in Section 6b VOB/A. Keeping official lists of prequalified companies is provided for in Section 48(8) VgV. In Article 64, EU Procurement Directive 2014/24/EU allows official lists of approved economic operators to be set up. Below the thresholds, Section 35 UVgO (Sub-Threshold Procurement Ordinance) governs prequalification.

Related terms

Participation deadline (Teilnahmefrist)
The participation deadline is the period within which companies must submit their request to participate in a two-stage procurement procedure.
Prior information notice (Vorinformation)
The prior information notice is an early notice that contracting authorities use to inform the market about planned purchases.
AVPQ (official register of prequalified companies)
The AVPQ is an official register in which companies can prove their general suitability for public supply and service contracts in advance and have it recorded.
European Single Procurement Document (ESPD)
The European Single Procurement Document is a standardized form that bidders can use to provide preliminary proof of their suitability for public contracts.
Capacity reliance (Eignungsleihe)
Capacity reliance lets bidders rely on the capacities of other companies to prove their suitability.
Open procedure (Offenes Verfahren)
The open procedure is the most transparent procedure type. Any interested company can submit a bid, and there is no preselection.
Procedure types
Procedure types refer to the different procurement procedures available to public contracting authorities for procuring services.
Negotiated procedure (Verhandlungsverfahren)
The negotiated procedure is a procedure type in which the contracting authority can negotiate the content and terms of bids with selected bidders.
Restricted procedure (Nicht offenes Verfahren)
The restricted procedure is a two-stage procurement procedure that starts with a competitive call for participation, after which only selected applicants are invited to submit a bid.