What does SektVO (Sector Ordinance) mean?
The Sektorenverordnung (SektVO, Sector Ordinance) is a German statutory ordinance that governs the award of contracts above the EU thresholds by so-called sector contracting entities. Sector contracting entities are companies that operate in drinking water supply, energy supply, transport and postal services. These sectors are seen as special areas of the economy in which monopolistic or oligopolistic structures often exist, so specific procurement rules are needed.
The SektVO transposes EU Utilities Directive 2014/25/EU into national law. Compared to the VgV (Public Procurement Ordinance), which applies to classic contracting authorities, the SektVO contains some special features and simplifications. For example, under Section 13 SektVO, sector contracting entities can freely choose between the open procedure, the restricted procedure, the negotiated procedure with a competitive call for participation, the competitive dialogue and the innovation partnership. The negotiated procedure without a competitive call for participation is allowed only in the exceptional cases listed in Section 13(2) SektVO. In addition, the thresholds in the utilities sector are higher than in the classic sector.
A key feature of sector procurement is that private companies can also count as sector contracting entities if they operate in these sectors on the basis of special or exclusive rights. Public companies that operate in these sectors also fall under the SektVO. Drawing the line to classic procurement law can be complex in individual cases.
Relevance for bidders
For bidders who take part in tenders by utilities, transport companies or energy suppliers, knowing the SektVO is essential. The rules that differ from the VgV concern, among other things, the procedure types, the deadlines and the suitability check. In particular, the greater flexibility in choosing the procedure type can mean that bidders encounter negotiated procedures more often.
Bidders should keep in mind that sector contracting entities can set up their own qualification systems that apply over longer periods. Being admitted to such a qualification system can make access to future tenders easier and reduce the effort for proof of suitability.
Legal framework
The SektVO is based on the enabling provision in Section 113 GWB (German Act against Restraints of Competition) and transposes EU Directive 2014/25/EU. The current version of the ordinance entered into force on April 18, 2016, and has been amended several times since. It contains rules on procedure types (Sections 13 et seq.), deadlines (Sections 16 et seq.), suitability requirements (Sections 33 et seq.) and award criteria (Sections 52 et seq.). Since January 1, 2026, the thresholds for the utilities sector have been EUR 432,000 for supplies and services and EUR 5,404,000 for construction work (net amounts, valid until December 31, 2027).