Not sure what an RFP or eTendering means? Our glossary breaks down complex procurement jargon into plain language, so you can focus on making better decisions with confidence.
In the EU, SMEs are businesses with fewer than 250 employees and a turnover of ≤ €50 million (or balance sheet ≤ €43 million). Public procurement policy often encourages SME participation by structuring tenders (e.g., using lots or simpler procedures) to be accessible to smaller firms. In tender documents, you might see references to ensuring opportunities for SMEs or statistical tracking of SME contract awards.
The requirements a supplier must satisfy to be deemed eligible and capable to perform the contract. These criteria relate to the bidder’s qualities (not the specifics of their bid for the work). For example, selection criteria can include minimum financial turnover, relevant past experience, technical capability, certifications, and staffing levels. In a restricted procedure, selection criteria are used to pre-qualify suppliers for the tender stage. In an open procedure, they are checked alongside the bid. Selection criteria must be proportionate and relevant to the contract (e.g., not asking for excessive turnover for a small contract).
One of the three main categories of procurement (the others being goods/supplies and works). Services are tasks or activities performed by a contractor for the contracting authority, rather than delivering physical items. Examples include consulting, maintenance, cleaning, IT services, training, security services, etc. Service contracts in public procurement often require defining the scope of work, service levels, and deliverables expected, and may be evaluated on quality measures in addition to cost.
A short pause (a “cooling-off” period) after the contract award decision is announced, but before the contract is actually signed. In EU procurements, the standstill period is typically a minimum of 10 calendar days when using electronic communication. During this time, unsuccessful bidders are informed of the decision and can review the reasons or decide if they want to challenge the award. The contract cannot be concluded until the standstill period ends. This practice enhances transparency and offers aggrieved bidders a window to seek remedies (such as a legal appeal) before the contract is finalized.
A company or individual that the main contractor hires to carry out a portion of the work in a contract. Bidders often propose certain tasks to be done by specialist subcontractors. In the bid, the tenderer might be required to declare any intended subcontracting. While the subcontractor will perform part of the contract, the main contractor remains fully responsible to the contracting authority for delivering the contract obligations. Public contracts sometimes limit or regulate subcontracting (for example, requiring approval of key subcontractors or ensuring they also meet certain criteria).
A general term for an entity that provides goods or services. In procurement context, “the supplier” refers to a bidding or contracting company that offers to supply the required items or services to the buyer. It is synonymous with terms like vendor, economic operator, bidder (when they are competing), and contractor (once they have a contract).
The practice of incorporating environmental and social considerations into procurement processes, so that the purchased goods/services not only deliver value for money but also benefit society and minimize environmental damage over their life cycle. This can include green procurement (eco-friendly products, energy efficiency) and social procurement (e.g., requiring employment of disadvantaged groups or adherence to labor standards). Sustainable public procurement aims for a positive impact on sustainability goals while fulfilling the purchasing need.
The online portal which is the digital version of the Supplement to the OJEU, dedicated to European public procurement notices. TED is where all high-value EU public tender notices and award notices are published and can be accessed by the public. Suppliers can search TED for contract opportunities across the EU. TED is updated daily and is free to use, providing a central database of EU tenders.
The part of the tender documents that describes the goods, services, or works to be provided in detail. Technical specifications outline the requirements and characteristics for what is being procured – for example, design dimensions, material quality, performance standards, functional requirements, etc. Bidders must ensure their offer complies with these specifications. Specs can be written as precise technical descriptions or as performance/output requirements that the solution must achieve.
In everyday terms, tender is often used interchangeably with bid – it means an offer submitted by a supplier in response to an invitation. (“To tender” also means to submit an offer.) More formally, it can refer to the whole procurement process (a “tender process”), but in this glossary we use it as the noun for the supplier’s proposal. A tender usually includes both technical and financial proposals as required by the tender documents.
The collection of documents issued by the buyer that bidders must follow and respond to when preparing their offers. These typically include the instructions to tenderers, technical specifications or Terms of Reference, evaluation criteria, draft contract conditions, pricing forms, and any templates (for example, an ESPD form). Together, the tender documents provide all the information needed for a supplier to understand the requirement and submit a compliant bid.
Another term for a bidder – the company or entity that submits a tender (bid) in response to a procurement invitation. This term is commonly used in European procurement documents. For example, “each tenderer must sign the declaration” simply means each bidding company must sign. Once a tenderer wins, they become the contractor for the contract.
A document detailing the scope of work, objectives, tasks, and responsibilities for a services contract (especially in consulting or technical assistance projects). The TOR describes what is expected from the consultant or service provider, including background, methodology, deliverables, and timeline. It is essentially the services equivalent of a technical specification. Bidders base their proposals on the TOR, explaining how they will achieve the stated objectives. A good TOR ensures all parties are clear on the project requirements and outcomes.
Procurement thresholds refer to the monetary values that determine the procedures to be followed. For instance, EU law sets different threshold values for central government contracts, sub-central, works, concessions, etc. If a contract’s estimated value is at or above these thresholds, it must be advertised EU-wide (OJEU) and use the prescribed procedures. Thresholds are adjusted every two years and published by the European Commission. Similarly, national rules may define thresholds for simpler processes (like the limit below which you can just get three quotes). Bidders should be aware that above-threshold tenders have more formalities, while below-threshold tenders might only be nationally advertised.
The requirement that the procurement process is open and clear to all stakeholders. Transparency means that all tender opportunities are publicly advertised (when required), the rules and criteria are published in advance, and decisions (like award decisions) are explained or documented. This principle helps prevent favoritism or corruption because everything from evaluation scores to contract awards can be scrutinized. In practice, transparency is implemented by public tender notices, clear tender documents, informing unsuccessful bidders of reasons, and publishing award information.
A consumption tax that is applied to goods and services in many countries (the standard sales tax in the EU). In public tenders, prices are often requested “excluding VAT” because VAT is a recoverable tax for government entities or the evaluation needs to compare net costs. Bidders should clarify whether their financial offer includes VAT or not, as specified in the tender. While VAT itself isn’t a procurement term, understanding how it’s treated in bids is important – for example, a bidder adds the applicable VAT on invoices, but the competition is usually on the pre-VAT price.
The period during which a bidder’s offer must remain open for acceptance. From the bid submission deadline (or a date specified in the bid), the bid is legally binding on the bidder for the validity period. For example, a tender might require bids to be valid for 90 days. This means the bidder cannot change or withdraw their offer in that time, and the contracting authority can accept it and form a contract. If the authority takes longer than the validity period to decide, they may ask bidders to extend their bid validity.
A guiding concept in procurement meaning the optimal use of resources to achieve the intended outcome. It is often defined as the best combination of whole-life cost and quality to meet the purchaser’s requirements. Achieving value for money doesn’t always mean choosing the cheapest option – it means considering price and what is obtained for that price (quality, efficiency, durability, etc.). Public entities are expected to secure VfM in their procurements, ensuring public funds are well spent.
A bid that deviates from some of the base requirements by offering a different way to meet the underlying need. Variants are often innovative solutions or different technical approaches that still fulfill the essential objectives of the tender. Many tenders do not allow variants, but when they do, they specify conditions (e.g., bidders might have to also submit a compliant base bid). If allowed, variant bids must still meet minimum standards and are evaluated against the same criteria, provided the comparison is fair. They give buyers flexibility to consider creative options.
Another word for a supplier or seller, particularly common in private sector or IT contexts. In public procurement, “vendor” is used interchangeably with supplier or bidder. It simply denotes a company that offers goods or services for sale. (For instance, a vendor might register in a vendor database or on an e-procurement platform to receive tender alerts.)
See GPA (Government Procurement Agreement). The GPA is a World Trade Organization agreement that many major economies have joined to mutually open their government procurement markets. Under the GPA, signatory countries (such as EU members, the USA, Japan, Canada, etc.) agree to let each other’s companies bid on certain government contracts above set values, with principles of non-discrimination similar to EU internal rules. Essentially, it internationalizes some procurement in line with the free trade principles. (For example, an EU tender above threshold is also open to bidders from GPA countries like the US or Canada, even though those countries are outside the EU.)
A category of procurement referring to construction-related contracts. “Works” typically means the execution of or design for engineering and building projects (e.g., construction of roads, schools, hospitals, infrastructure). A works contract may also include the associated design if the contractor is tasked with design-and-build. This is distinguished from supply (goods) and service contracts. Works contracts often follow specific procedures and higher thresholds because they tend to be high-value. They may invoke particular regulations (for example, requiring performance bonds, specific safety standards, etc., given the nature of construction).
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