The aggregation of contracts refers to the grouping together of similar contracts. The requirement to aggregate contracts is not a new obligation however has been the subject of much confusion in the past. This blog post will aim to clarify when requirements are to be aggregated for the purpose of calculating the value of a contract and, more importantly, when specific Lots can be exempt from the rules.

The current rules simplified

In simple terms the current rules are:

The current rules in more detail

Regulation 6 of the Public Contracts Regulations 2015 sets out the methods for calculating the estimated value of procurement. This calculation is particularly important in determining whether an opportunity falls within the rules of the 2014 EU Directive (i.e. above the EU thresholds).

Restrictions on sub-dividing contracts

Regulation 6(6) of the Regulations states the following:

“A procurement shall not be subdivided with the effect of preventing it from falling within the scope of this Part, unless justified by objective reasons.”

It is important to clarify that this does not restrict the use of Lots. In fact the use of Lots is encouraged within the Regulations (please see this blog post for more information). The above restriction on subdividing is only applicable for the purposes of calculating the total value.

The inclusion of “objective reasons” has caused a quandary for many. This added wording is a direct transposition of Article 5(3) of the 2014 EU Directive. Rulings in EU cases have demonstrated that it is worth treading carefully when using “objective reasons” for not aggregating contracts. For example, it was ruled in case C-574/10 that a motive of avoiding the Directive does not have to exist for the non-aggregation to be unlawful. In this case Germany argued that the splitting of contracts was for the purpose of encouraging SMEs. The Court of Justice of the European Union (CJEU) rejected this justification stating that this could have been achieved through the use of Lots. A similar justification on the grounds of encouraging SMEs was also rejected in the case C-360/89.

Aggregating of similar and regular contracts

Regulation 6(16) stipulates that supply or service contracts which are regular in nature or which are intended to be renewed within a given period must also be aggregated. The Regulation proceeds to explain how this is to be calculated:

It is also worth noting that Regulation 6(10) states the following:

“In the case of public works contracts, the calculation of the estimated value shall take account of both the cost of the works and the total estimated value of the supplies and services that are made available to the contractor by the contracting authority provided that they are necessary for executing the works.”

The use of Lots

Although contracts of the same type or for the same work are to be aggregated this does not mean that the contracts all have to be advertised together; separate Lots can be advertised in separate contract notices (which will help encourage the involvement of SMEs) but if the total aggregated value of these Lots exceeds the various thresholds then they must all comply with the applicable rules.

When can a Lot be made exempt?

There are provisions under Regulation 6(14) to 6(15) for individual Lots to be exempt from the procedure rules under certain circumstances. These circumstances are:

Subject to the above circumstances more than one Lot can be excluded. However, these excluded Lots will still need to be considered when calculating the total aggregated value.

What about ‘Separate Operational Units’?

Regulation 6(3) advises that where a contracting authority is comprised of Separate Operational Units, account shall be taken of the total estimated value for all those units. However, Regulation 6(4) proceeds by declaring that where a Separate Operational Unit is independently responsible for its procurement, or certain categories of its procurement, the values may be estimated at the level of the unit in question. Therefore, contracts from Separate Operational Units will not always have to be aggregated.

Where to publish your different opportunities?

Proactis – providers of the Tenders Direct Blog – also run myTenders. MyTenders offers a publication service to contracting authorities and allows notices to be published to OJEU, Contracts Finder and directly to specified suppliers. The portal enables authorities to carry out all required procurement procedures, regardless of the thresholds applicable to them, in one place. For further information on how the myTenders portal can help you carry out your fully compliant procurement procedures please contact 0844 222 9009 or visit

5 Responses

  1. I was wondering if you can please help me with this regarding solar PV projects. What is the OJEU threshold for solar PV design and install projects?

    Which category does it falls?
    1. Services or Goods: £181,302; OR
    2. Works: £4,551,413

  2. So if I am following this correctly…

    On a construction project where someone wanted to adopt a Construction Management type approach e.g. appoint general builders, electrician’s, ground workers etc. Each of whom would respond (contractually) direct to the employer but may be managed by a Contractor responsible for the delivery of the contract.

    The regulations would see the total value for the purposes of applying the thresholds as the sum of the general builders, electrician’s, ground workers etc. For the purposes of the procurement process each of these would constitute a lot within the public works contract as without all the trades it is unlikely that there would be anything that would be “sufficient in itself to fulfil a economic or technical function”

    1. Hi Sean,

      Many thanks for your comment and apologies for the delayed response.

      My understanding of the regulations surrounding aggregation and the use of lots would exclude your example because the Contracting Authority would be contracting for the service of the construction management rather than the construction itself. As the Contracting Authority would not be awarding contracts for the building, electrical work, ground work etc it would not be appropriate to use lots.

      We have found that in these circumstances the Contracting Authority often instead sets very stringent rules around the sub-contracting. For example, the construction of the new Forth Road Bridge in Edinburgh required the main contractor who was awarded the contract to advertise their sub-contract opportunities on the Scottish national portal – Public Contracts Scotland. The Contracting Authority did not contract with each of the individual contractors carrying out the work but simply had a contract with the management company. The terms of this contract insisted on the management company allowing SMEs the opportunity to be awarded the sub-contracts by requiring the open advertisement of the opportunities through the national public procurement portal.

      I hope that the above helps clarify the situation but should you have any further queries then please do not hesitate to contact us.