Published today in the Diário da República (DR), decree-law no. 112/2025 introduces flexibility in public procurement rules to boost the construction sector, aiming to enhance housing supply and address the imbalance between supply and demand.
In promoting this initiative, the decree emphasizes removing legal barriers that hinder contracting authorities from leveraging the benefits of ‘off site’ construction techniques and the combined contracting of design and construction services.
The immediate implementation of these flexible mechanisms does not negate the need for a structural revision of the Public Contracts Code (CCP), which was approved by decree-law no. 18/2008 on January 29, to fully realize the objectives of the ongoing state reform.
The decree-law, approved by the Council of Ministers on September 18 and published today, modifies Article 43 of the CCP, enabling contracting authorities to adopt the design-build approach not only in exceptional and well-justified cases but whenever they deem it appropriate based on discretionary judgments and current public interests.
To maximize the impact of this measure, an exceptional increase in thresholds for adopting prior consultation and direct adjustment procedures is also stipulated for contracts aimed at promoting public or cost-controlled housing.
These measures, by creating conditions to accelerate construction, are poised to increase housing supply, constituting necessary changes to ensure the right to housing, per the decree-law text.
Until the end of 2026, for contracts dedicated to public or cost-controlled housing, contracting authorities may adopt simplified public or limited competition procedures when the contract value falls below the thresholds specified in Article 474, sections 2, 3, or 4 of the Public Contracts Code, depending on the circumstances.
Simplified prior consultation can now be adopted with invitations to at least five entities when the contract value is simultaneously below the thresholds mentioned in Article 474, sections 2, 3, or 4, and below one million euros.
Direct adjustment procedures under Article 128 of the Public Contracts Code become possible when the contract value is 15,000 euros or less.
Also, until December 31, 2026, in contracts for promoting public or cost-controlled housing, direct adjustment is allowable when the contract value is 60,000 euros or less.
For leasing, acquiring movable goods, or services contracts, direct adjustment is permissible if the contract value is 30,000 euros or lower, whereas, for other contracts, it is allowed up to 65,000 euros.
The new decree applies to public contract formation procedures initiated after its enactment, i.e., within five days.
