How public-sector bodies implement climate protection in procurement

At the latest since the extensive amendment in 2016, German public procurement law offers a wide range of options for incorporating environmental and social considerations into procurement. Until now, contracting authorities have generally been free to apply these options.

However, in light of advancing climate change, the legal pressure to actually use these options is continuously increasing. This is reflected, for example, in the previously largely overlooked and now increasingly prominent Art. 13 of the 2019 Federal Climate Protection Act (Bundes-Klimaschutzgesetz, “KSG”). According to its Section 1 Sentence 1, “public-sector bodies must take into account the purpose of this Act and the objectives established for its fulfillment in their planning and decision-making.”

According to the official explanatory memorandum, this requirement is intended to further specify the public sector’s general exemplary function and to take effect in all of its decisions with any scope for assessment, consideration or discretion. This expressly also applies to procurement measures. Pursuant to Art. 13 (2) sentence 1 KSG one must examine “how this can contribute to achieving national climate protection goals pursuant to Art. 3.” If there are “several possible implementation options” in the individual case, Art. 13 (2) sentence 2 KSG requires that “in consideration of other relevant criteria related to the respective measure’s goal, preference shall be given to such measures helping to achieve the goal of reducing greenhouse gas emissions over the measure’s entire life cycle at the lowest possible costs.” This does not give climate protection aspects a general or absolute priority over other concerns. However, they must be included in the decision with the appropriate importance according to the principle of proportionality and the provisions of public procurement law and thus cannot be disregarded without further ado.

The course for a targeted implementation of the statutory requirement to take account of climate protection is set primarily during the development and structuring of an award procedure, specifically in the context of the assessment of demands, the preparation of specifications, the list of criteria and the identification of the most economical offer. The “General Administrative Regulation on the Procurement of Climate-Friendly Services (AVV Klima)” of October 19, 2021, contains helpful further specification of the KSG’s general objectives.

In contrast to the specific requirements of Art. 13 (2) and (3) KSG, which only apply to the federal level, the general consideration requirement pursuant to Art. 13 (1) sentence 1 KSG is directly binding on all “public-sector bodies” at federal and state level, i.e., including local authorities and, according to the explanatory memorandum, “all public authorities and other public-sector bodies such as social insurance funds, educational institutions, local and long-distance public transport companies, hospitals, care facilities...”. Their legal form or funding body is irrelevant in this context. Public-sector enterprises in a legal form under private-law are also covered to the extent they perform public tasks. Art. 13 of the KSG expressly does not interfere with the legislative and organizational competence of the federal states and municipalities. However, the specific requirements set out in paragraphs 2 and 3 in particular have a strong impact on the relevant provisions of state law and already provide an exemplary guideline in this respect.

The requirements of Art. 13 KSG are likely to gain increasing importance over the next years if Germany fails to meet the mandatory climate goals defined in the KSG, i.e., if the CO2 budget granted to the Federal Republic of Germany against the backdrop of the Paris Agreement is getting smaller. In light of the German Constitutional Court’s latest case law on climate protection, the step from a mere consideration requirement to an optimization requirement and as such a legally more binding consideration of climate concerns in all tender procedures and their increased importance in the selection process seems to be quite small. In such case, the previously mainly negative attitude towards the granting of subjective rights and thus towards the contestability of possible violations of Art. 13 KSG, for example, in review proceedings under the German Act against Restraints of Competition (“GWB”), may well change.