Germany is expected to simplify its defence procurement rules beginning in early 2026. The path for significant additional defence spending was cleared earlier this year. With the new proposal currently pending before the German Parliament, the Government aims to ensure that these funds are deployed promptly.
Background
The Act on Accelerated Procurement for the German Armed Forces (BwBBG) was first enacted in 2022 as a swift response to the security challenges posed by Russia's war against Ukraine. While Germany has ramped up its defence spending since then, it still falls short of its readiness targets. In a historic move, the German Parliament voted earlier this year to amend the constitution, paving the way for additional deficit spending on defence – a significant shift in Germany's fiscal policy.
Now, a new proposal seeks to extend the BwBBG until 2035 and introduce further streamlining measures.1 This amendment, known as the Act on Accelerated Planning and Procurement for the German Armed Forces, comes alongside administrative provisions for public procurement below EU thresholds. Notably, the proposal aligns with the European Commission's Defence Readiness Omnibus.2 The proposal is currently under review in parliamentary committee and remains subject to parliamentary approval.
Envisaged Changes
The proposed changes will simplify procurement processes for all defence tenders. Under the new proposal, procurement above EU thresholds will increasingly rely on exemptions provided in the EU Treaties. The proposal clarifies that procurements supporting European defence readiness and security of supply – such as weaponry and munitions – fall within Germany's essential security interests. This makes it easier to justify exemptions from standard public procurement rules, allowing contracts to be awarded with streamlined procurement procedures.
Within the scope of public procurement rules, the proposal introduces further simplifications. For example, negotiated procedures without prior publication will be permitted when equipment interoperability demands specific products. Additionally, the requirement to divide contracts into lots will be suspended until 2030, cutting down on administrative hurdles for large contracts. Regulatory requirements for government-to-government sales are eased.
To accelerate procurement timelines, the proposal also aims to minimize delays caused by legal challenges. In the future, ongoing legal challenges by unsuccessful bidders will no longer prevent contracting authorities from awarding contracts once the court of first instance has ruled.
In line with current discussions at the EU level, the proposal introduces certain "Buy European" options into German public procurement rules. However, contractors, subcontractors, and products from the European Economic Area or those covered by the WTO Agreement on Government Procurement are generally protected from exclusion.
Outlook
The German Defence Minister has described the proposed amendments as a "quantum leap" for the country's defence sector.3 With increased funding and anticipated reductions in bureaucracy – both under this proposal and the EU Defence Readiness Omnibus – Germany is positioning itself for substantial defence investments in the coming years. These reforms are expected to benefit defence businesses and investors alike. The extended BwBBG framework offers reliability through 2035, while streamlined procedures aim to ease administrative burdens for both companies and contracting authorities. Collectively, these measures are designed to strengthen Germany's and, ultimately, Europe's defence capabilities.
1 Draft Act available here.
2 For more information on the Omnibus see our Alert available here.
3 Statement available here.
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