Germany’s parliament committee on Economic Affairs and Energy has announced that it has approved a draft law aimed at accelerating public procurement procedures, with the goal of simplifying processes and supporting economic activity.
The proposal will now proceed to a final vote in the Bundestag.
Simplification and digitalization measures
The reform introduces several key changes, including raising the threshold for direct contract awards to €50,000 and reducing documentation requirements.
It also prioritizes small and medium-sized enterprises (SMEs) and start-ups, allowing contracting authorities to require main contractors to include SMEs in subcontracting processes.
Supporting investment and modernization
The reform is closely linked to the rollout of Germany’s Special Fund for Infrastructure and Climate Protection, with authorities encouraged to use the new rules to accelerate project implementation.
Policymakers also emphasized alignment with EU-level initiatives such as “Made in EU” and low-carbon requirements under the Industrial Accelerator Act.
Despite broad political support, the proposal has faced criticism from both opposition groups and industry stakeholders. Critics argue that the reform does not go far enough in promoting green markets or reducing bureaucracy.
Steel sector calls for stronger measures
The German Steel Federation (WV Stahl) welcomed the initiative but raised concerns over the lack of concrete and enforceable sustainability provisions.
According to the federation, the draft law does not establish binding criteria for low-emission materials such as green steel and cement.
Demand for “Made in EU” framework
WV Stahl CEO Kerstin Maria Rippel stressed that public procurement could play a key role in driving industrial decarbonization by creating demand for climate-friendly materials.
However, the absence of binding “Made in EU” requirements and measurable sustainability benchmarks limits the effectiveness of the reform.
Risk of undermining decarbonization efforts
The federation warned that without integrating sustainability and origin criteria, procurement could continue to favor lowest-cost bids, potentially supporting higher-emission imports. This could undermine Europe’s decarbonization goals and weaken domestic industrial investment.
As a result, WV Stahl called on the government to accelerate the introduction of binding rules and fully utilize existing policy flexibility. The sector emphasized the need for immediate planning certainty and stable demand signals to support ongoing investments in low-emission steel production.
