Contracting authority vs contracting entity: who buys in EU public procurement
A contracting authority is a public body buying under Directive 2014/24/EU; a contracting entity buys for water, energy, transport or postal services.
Tomasz Kowal · Data and public procurement
Updated 8 November 2026 · 4 min read
A contracting authority is a public buyer under Directive 2014/24/EU: "the State, regional or local authorities, bodies governed by public law or associations formed by one or more such authorities or one or more such bodies governed by public law" (article 2(1), point (1)). A contracting entity is a buyer under Directive 2014/25/EU that procures for water, energy, transport or postal services, and it can be a public undertaking or even a private company holding special or exclusive rights.
Putting it simply: ministries, municipalities, public hospitals and universities are contracting authorities and follow the full public procurement rules. Water companies, grid operators, railways and postal operators are contracting entities and follow a separate, lighter set. Central purchasing bodies are contracting authorities that buy for many others at once.
Where it comes from
Contracting authorities. Directive 2014/24/EU splits them into two groups. "Central government authorities" are those listed in its Annex I (article 2(1), point (2)); every other contracting authority is "sub-central" (point (3)). The split sets the threshold: from 1 January 2026, supplies and services must be advertised EU-wide from EUR 140,000 for central government and EUR 216,000 for sub-central buyers (Delegated Regulation (EU) 2025/2152, amending article 4).
Bodies governed by public law (point (4)) are bodies set up to meet needs in the general interest "not having an industrial or commercial character", with legal personality, and financed for the most part by the State or other public bodies, or under their management supervision, or with a board more than half appointed by them. This test brings in most public hospitals, universities and public agencies.
Contracting entities. Directive 2014/25/EU, article 4, covers contracting authorities and public undertakings that pursue one of the activities in articles 8 to 14 (gas and heat, electricity, water, transport services, ports and airports, postal services, extraction of oil, gas and coal), and also private entities that pursue them "on the basis of special or exclusive rights". The supply and service threshold is EUR 432,000 from 1 January 2026 (Delegated Regulation (EU) 2025/2150).
Central purchasing bodies. Article 2(1), point (16), of Directive 2014/24/EU defines one as "a contracting authority providing centralised purchasing activities". Article 37 lets Member States allow, or require, authorities to buy through them; Directive 2014/25/EU has the equivalent in article 2, point (12), and article 55.
Why it matters for a manufacturer
- Utilities buy under lighter rules. A contracting entity may choose a negotiated procedure with prior call for competition freely (2014/25, article 44(2)); a contracting authority may only negotiate in listed situations (2014/24, article 26(4)). Contracts for an activity that the Commission has found "directly exposed to competition" fall outside the directive (2014/25, articles 34 and 35), so some energy purchases never reach TED.
- The buyer type tells you the segment. A body governed by public law can be a hospital, a university or a public research institute. Reading who the buyer is says more about the end user than the CPV code alone.
- Central purchasing bodies concentrate demand. One framework can serve hundreds of authorities. In Italy, Decree-Law 66/2014, article 9, lists Consip and one central purchasing body per region, where one has been set up, among the soggetti aggregatori. In Poland, articles 47 and 48 of the Public Procurement Law let the Prime Minister or a minister designate a central purchasing body for government administration. The suppliers on those frameworks are often the distributors worth approaching.
- Status is not always obvious. The Court of Justice held in Oymanns (C-300/07) that German statutory sickness insurance funds are bodies governed by public law (the ruling applied the 2004 directive, whose definition the 2014 directive carries over), which is one reason their drug rebate tenders appear on TED. Hospital purchasing groups organised as private companies, and privately owned hospitals, may fall outside the definition; we treat their status as a case-by-case question.
In the Cresques evidence base, 36,397 distinct public buyers in 30 countries have published award notices since November 2023 (see /methodology).
Example
A regional health authority runs a framework for wound dressings on behalf of its twelve hospitals. The notice names the authority as buyer, lists twelve participating hospitals and shows three suppliers per lot. The same quarter, a regional water company awards a contract for pipe fittings after a negotiated procedure with a prior call for competition. The first is a contracting authority acting as a central purchasing body; the second is a contracting entity under the utilities directive. A fittings manufacturer reading only health notices would miss the water company entirely.
Related terms
Questions
- What is the difference between a contracting authority and a contracting entity?
- A contracting authority is a state, regional or local authority, a body governed by public law, or an association of them, buying under Directive 2014/24/EU. A contracting entity buys for gas, heat, electricity, water, transport, ports and airports, postal services or fuel extraction under Directive 2014/25/EU, and can include public undertakings and private firms holding special or exclusive rights.
- Is a public hospital a contracting authority?
- Usually yes. A publicly owned or publicly financed hospital normally meets the three tests for a body governed by public law: a general-interest purpose that is not industrial or commercial, legal personality, and public financing or control. Private hospitals generally do not, so check the status case by case.
- Which EU thresholds apply in 2026 and 2027?
- For supplies and services: EUR 140,000 for central government authorities and EUR 216,000 for sub-central contracting authorities (Delegated Regulation (EU) 2025/2152), and EUR 432,000 for contracting entities in the utilities sectors (Delegated Regulation (EU) 2025/2150). Works: EUR 5,404,000. All from 1 January 2026, net of VAT.
- What is a central purchasing body?
- A contracting authority that buys on a permanent basis for other contracting authorities, or awards contracts and framework agreements they can use (Directive 2014/24/EU, article 2(1), point (16), and article 37). Its single award can cover the demand of hundreds of buyers.
- Are German statutory health insurers contracting authorities?
- The Court of Justice held in case C-300/07 (Oymanns, 2009) that German statutory sickness insurance funds are bodies governed by public law and therefore contracting authorities. This is one reason their drug rebate tenders appear on TED. Hospital purchasing groups set up as private companies need a separate assessment.
