Germany’s new procurement act threatens to lock out startups from public contracts
New German procurement laws could make it harder for startups to win public contracts. The draft rules, meant to speed up government purchasing, instead add extra paperwork for young companies. Many in the tech sector warn the changes will push them away from bidding altogether.
Under the Procurement Acceleration Act and Wage Compliance Act, most startups will lose their current exemptions. Previously, firms could secure direct contracts worth up to €100,000 for innovative products in their first four years. Now, they must prove compliance with wage standards before qualifying.
The new laws risk shutting out startups from public sector opportunities. Without exemptions, young firms must meet stricter wage checks before competing for contracts. Industry groups fear this will slow innovation and reduce participation in government tenders.
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