Consortia, joint ventures and subcontracting in tenders

A company that cannot meet a tender's qualification requirements alone can often meet them with others: by bidding as a consortium or joint venture, by relying on another company's financial or technical capacity, or by naming subcontractors. In the EU these routes are set out in the procurement Directive, with conditions: a partner's experience counts only if the partner performs the related work, and the buyer can require firm commitments and joint liability.

Last updated 15 September 2026 5 min read

General guidance, not legal advice. Public procurement rules differ by country, by buyer and by procedure, and the tender documents and the law that governs them decide. Where a guide cites a rule, it names the jurisdiction and links the official text.

The short answer

A requirement you cannot meet alone can often be met together with others. There are three lawful routes, and the tender documents say which ones a buyer accepts and on what terms.

Route	How it works	Typical use
Consortium or joint venture	Two or more companies bid together as one bidder	Combining turnover, experience or capabilities for a large contract
Reliance on another company's capacity	The bidder uses another entity's financial standing or technical ability to meet the selection criteria	A parent company's financial strength, a specialist's references
Subcontracting	The bidder bids alone and names companies that will perform parts of the work	Specialist parts of the contract

In the EU

Directive 2014/24/EU sets the framework:

Groups may bid without forming a company first. Groups of suppliers, including temporary associations, may take part, and a buyer may not require them to have a specific legal form in order to submit a tender. It may require one once the contract is awarded, to the extent necessary for its satisfactory performance (Article 19(2) and (3)).
A bidder may rely on other entities' capacities for economic and financial standing and for technical and professional ability, whatever the legal links between them. For educational and professional qualifications or relevant professional experience, the other entity must actually perform the works or services for which that capacity is needed. The bidder must prove the resources will be at its disposal, for example with a commitment from the other entity. The buyer checks that entity against the selection criteria and the exclusion grounds, and must require it to be replaced if it fails a relevant selection criterion or a compulsory exclusion ground (Article 63(1)).
Joint liability. Where a bidder relies on another entity's economic and financial standing, the buyer may require the two to be jointly liable for performing the contract (Article 63(1)).
Critical tasks. For works and service contracts, and siting or installation work within a supply contract, a buyer may require certain critical tasks to be performed by the bidder itself or, for a group, by a member of the group (Article 63(2)).
Lots. A buyer may divide a contract into lots, and one that decides not to must give the main reasons (Article 46(1)). A lot sized for smaller suppliers can make a partnership unnecessary.

In the United States (federal)

The FAR recognises contractor team arrangements: two or more companies forming a partnership or joint venture to act as a potential prime contractor, or a potential prime contractor agreeing with other companies that they will act as its subcontractors under a specified government contract or acquisition programme (FAR 9.601). Small-business programmes add their own rules on teaming and subcontracting, which are outside the scope of this guide.

In the United Kingdom

Under the Procurement Act 2023 a buyer may set conditions of participation only as a proportionate means of ensuring that suppliers have the legal and financial capacity or the technical ability to perform the contract (section 22). How a consortium, or a supplier relying on others, meets those conditions is set out in the tender documents; read them before agreeing a structure with partners.

Choosing the structure

Question	Consortium or joint venture	Reliance on capacity	Subcontracting
Who signs the contract?	The group, or a company it forms	The bidder	The bidder
Who answers to the buyer?	Usually every member, often jointly	The bidder, and the other entity where joint liability is required	The bidder
Whose experience counts?	The members'	The other entity's, if it performs the related work (EU)	As the documents allow
Main risk	Disputes between members during the contract	The other entity withdrawing its commitment	A subcontractor failure you remain responsible for

Practical steps

Read the rules on groups and subcontracting before approaching partners. Some buyers require a lead member, joint and several liability, or a declaration from each member.
Sign a teaming or consortium agreement before bidding. Cover scope, pricing, liability, exclusivity, and what happens if you win or lose.
Get commitments in writing, in the form the buyer asks for, from every entity whose capacity you rely on.
Check each partner against the exclusion grounds and selection criteria. One partner's problem can exclude the whole bid or force a late replacement. See Can one missed mandatory requirement disqualify a bid?
Keep the critical tasks where the buyer wants them. If the documents reserve tasks to the bidder, do not plan to subcontract them.

Frequently asked questions

Does a consortium have to form a company before it bids?

Not in the EU: a buyer may not require a group to have a specific legal form in order to submit a tender, although it may require one after the award where that is necessary for performing the contract (Directive 2014/24/EU, Article 19). Elsewhere, follow the tender documents.

Can we use a subcontractor's references to qualify?

In the EU, yes, but for relevant professional experience and professional qualifications only if that company will actually perform the works or services concerned, and you must show the buyer that its resources will be available to you, for example with a written commitment (Directive 2014/24/EU, Article 63(1)).

Who is responsible if a consortium partner fails to deliver?

Between the partners, the consortium agreement and the contract decide. Towards the buyer, group members are commonly held jointly responsible, and in the EU a buyer may require joint liability where a bidder relies on another entity's financial standing (Directive 2014/24/EU, Article 63(1)). Take legal advice on the agreement before signing it.