Jurisdiction(s):
United Kingdom

Vertical (in-house) and horizontal (co-operation) exemptions under the Procurement Act 2023: control tests, 80% activity thresholds and practical implications for subsidiary and inter-authority contracting

Published by a LexisNexis Public Law expert

Practice notes

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This practical guidance relates to the Procurement Act 2023 regime

As of 24 February 2025, the principal provisions of the Procurement Act 2023 (PA 2023) are operative. Competitions started on or after that date must proceed under PA 2023, while those launched under the prior instruments—the Public Contracts Regulations 2015 (PCR 2015), SI 2015/102, the Utilities Contracts Regulations 2016, SI 2016/274, the Concession Contracts Regulations 2016, SI 2016/273, and the Defence and Security Public Contracts Regulations 2011, SI 2011/1848—must continue to be conducted and administered in accordance with that framework. This guidance concerns vertical and horizontal public procurement under PA 2023. For further background, see Practice Notes: Introduction to the Procurement Act 2023—PA 2023 and Procurement Act 2023 transitional and saving arrangements—PA 2023. For practical guidance on vertical arrangements (previously referred to as ‘Teckal’ or ‘in-house’ arrangements) and horizontal arrangements (previously referred to as ‘Hamburg’ or ‘co-operation’ arrangements) under PCR 2015, see Practice Note: The ‘in-house’ (Teckal) and ‘co-operation agreement’ (Hamburg) exemptions. PCR 2015 is EU-derived domestic legislation and therefore constitutes assimilated law under sections 2 and 6 of the European Union (Withdrawal) Act 2018. PA 2023 does not stem from EU law, in contrast with certain assimilated the...

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Katherine Calder

DAC Beachcroft

Katherine is a Partner at DAC Beachcroft and heads the firm's Public Procurement Law team and chairs its Infrastructure & Projects group. Katherine has over 20 years’ experience of advising public bodies, utilities and the private sector on public procurement issues. Katherine has advised upon the procurement issues inherent within a wide variety of PPPs, PFIs, regeneration and outsourcing projects, across sectors and covering most aspects of local and national public infrastructure; from new homes, schools, energy facilities, roads to IT projects.Highlights over her career include numerous education, waste and housing PPPs/PFIs; the 2012 Olympic Games; the Thames Tideway Tunnel super-sewer; high profile defence agreements; the complex alliances and other significant partnerships for the National Highways, the Metropolitan Police, Thames Water, Transport for London, the Greater London Authority and many central government departments. She also advises private sector bidders on how to do their very best in...

Sarah Foster

DAC Beachcroft

Sarah is a Legal Director at DAC Beachcroft and specialises in commercial and public procurement law. Having a strong commercial/projects background, after advising large, national public sector organisations for over 12 years, Sarah approaches public procurement advice from a pragmatic and solution focussed angle with the ability to see the “bigger picture”. Sarah has undertaken highly complex project structuring advice for clients including for Department of Health and Social Care, the Cabinet Office, the Department for Education and multiple NHS trusts jointly working within an integrated care system. Clients praise her commerciality and practical approach to dealing with difficult legal issues and is a go-to contact for many clients seeking sensible and pragmatic legal advice. She provides tailored commercial advice to clients, facilitating innovative solutions and successful outcomes.Sarah is an expert in understanding the regulatory framework in which public sector clients...

Web page updated on 22/05/2026

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