The EU threshold for works contracts refers to the monetary limit set by the European Union for public works contracts. This is the maximum amount that can be spent on a public works project without having to go through a competitive tendering process.

The threshold is determined by the EU Procurement Directive and is updated every two years to reflect changes in the economy. As of 2021, the EU threshold for works contracts is €5,350,000 for central government authorities and €5,350,000 or €4,350,000 (depending on the country) for sub-central government authorities.

When a public authority wishes to undertake a construction project exceeding this threshold, it must follow the EU procurement rules, which require a competitive tendering process for awarding the contract. This ensures that all interested parties have an equal chance to bid for the project, and that the final contract is awarded to the most qualified and cost-effective bidder.

In addition to the EU threshold for works contracts, there are also thresholds for supply contracts and service contracts. The threshold for supply contracts is currently €139,000 for central government authorities and €214,000 or €139,000 for sub-central government authorities. The threshold for service contracts is €139,000 for all public authorities.

It is important to note that these thresholds only apply to public authorities and do not impact private sector contracts. Private sector contracts are subject to national laws and regulations, which may or may not have their own thresholds.

In conclusion, the EU threshold for works contracts is an important tool for ensuring transparency and fairness in public procurement. By requiring a competitive tendering process for projects exceeding the threshold, the EU helps to promote a level playing field for all interested parties and ensures that public funds are used in the most efficient and effective way possible.