The German government is focussing on rapidly equipping the Bundeswehr, for which the easing of the so-called "debt brake" has already paved the way. As a next step, it is now tackling the procurement regulations (again). The draft bill of the BwPBBG brings with it extensive simplifications and acceleration effects, but also disadvantages, for example when dealing with unsecured financing and reduced legal protection.
The turning point in the security policy as a result of the Russian war of aggression against Ukraine already led to simplifications in procurement law in 2022 in the form of the Act to Accelerate Procurement Measures of the Bundeswehr (Gesetz zur Beschleunigung von Beschaffungsmaßnahmen der Bundeswehr, BwBBG). The German government is now going one step further: on 25 June 2025, the Federal Ministry for Economic Affairs and Energy (BMWE) and the Federal Ministry of Defence (BMVg) jointly presented the draft of the Bundeswehr-Planning and Procurement Acceleration Act (Bundeswehr-Planungs- und Beschaffungsbeschleunigungsgesetz, BwPBBG), which has now been presented to the Cabinet for approval.
The aim is to accelerate procurement procedures for armaments projects in order to increase deterrence and defence capabilities as quickly as possible. The necessary rapid increase in the capabilities of the armed forces may not fail due to overly complex procurement procedures.
Overview of key innovations
Like the BwBBG, the BwPBBG bundles a large number of special regulations into a stand-alone law. Instead of amending individual procurement regulations, the BwPBBG, as a lex specialis, will selectively modify procurement law in the Bundeswehr sector until 2035. Here is an overview of the most important planned changes:
- Broader scope of application: The draft clarifies that in future all supply, construction and service contracts of the Bundeswehr will be subject to the special rules of the BwPBBG. This includes all contracts within the remit of the Federal Ministry of Defence as well as procurements for armed forces of other EU or EEA member states and state authorities acting on behalf of the German government.
- Direct contract awards are tobe made increasingly possible. From now on, substantial security interests of the Federal Republic of Germany, on the basis of which a direct award is already possible under current law, will also be affected in the case of procurements to achieve European or NATO defence readiness.
- In future, negotiated procedures without a call for competition will be permitted beyond the previous cases of application if urgent reasons prevent a call for competition and the continuous provision of services must be ensured for defence and security reasons. Furthermore, in addition to the extended urgency awards, the exception rule due to a unique attribute is being supplemented. The call for competition can now be cancelled if there is no interoperability - i.e. if only one specific manufacturer can be considered due to a unique technical attribute in order to ensure compatibility with EU and NATO partners.
- Lot splitting: The obligation to split public contracts into partial lots is being suspended until 2030 (Section 8 draft BwPBBG). This will make it possible for major projects to be realised as an integrated whole without time delays. Even if the effects on the participation of SMEs will "have to be observed" (draft bill, p. 30), the new regulation will make it more difficult for potentially smaller and medium-sized companies and start-ups to participate.
- Exclusion of third-country companies: Contracting authorities can restrict awards to companies from EU states and require that a certain proportion of the goods or services originate from there. Bidders from GPA and free trade partner countries (such as the USA) are being treated equally to companies from EU countries insofar (Section 11 (5) draft BwPBBG).
- Limited legal protection: In future, bidders will have to lodge complaints about recognisable award violations also in the case of de facto awards. In addition, the immediate appeal against decisions of the procurement chamber will no longer have a suspensive effect if it rejects the application for review. This means that the contracting authority can award the contract immediately following a favourable decision by the procurement chamber, even if a bidder lodges an appeal. In this case, the unsuccessful bidder retains secondary legal protection.
- Award procedures without secured funding: In future, award procedures can be initiated even though the budget decision is still pending. The funding gap must be made transparent in the tender documents. The aim of the draft is to save a significant amount of time, as award and budget processes can run in parallel. If the funding commitment fails, the contracting authority may cancel the procedure without sanctions and the bidders alone bear the risk. It remains to be seen whether the industry will be reluctant to participate in projects that are not financially secure in view of such a risk.
- Innovation partnerships: The draft incorporates into the military procurement regime the innovation partnership that was previously only generally enshrined in procurement law. The draft does not make an exception to the general principle that industrial partners will not be reimbursed for their development services in the event of a withdrawal or cancellation - something that has long been demanded by business associations. In future, public contracting authorities may bundle market sounding, development and series procurement in one contract and use functional performance specifications.
Outlook
With easier direct and interim awards, the suspension of the lot principle and the reduction of legal protection, the German government has created the conditions for accelerating the awarding of defence contracts. This is offset by – considered - disadvantages and risks:
- Market access for start-ups and SMEs will inevitably become narrower. The temporary suspension of lot splitting and the privileged treatment in case of interoperability favour suppliers that are already firmly anchored in NATO and EU structures.
- In addition, financing risks hit small bidders much harder. Procedures without secured budget funds or a lack of compensation options, however, pose considerable challenges for large corporations and early-stage companies. Here, the industry is calling for appropriate compensation options and an appropriate distribution of the risk.
- The deliberate reduction of legal protection noticeably encroaches on bidders' rights, but arises from the overriding goal of building up defence capabilities in a time-critical manner. In such cases, the only option open to unsuccessful bidders is a damage claim.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
