Bidding for public construction contracts abroad: licensing…

The pattern

Public works add four layers on top of normal procurement rules:

A licence, classification or registry that proves you can build at a given size.
Bonds and guarantees sized to the contract.
Local labour, wage and safety rules.
Liability rules that outlast the contract, such as France’s ten-year décennale insurance.

Market	Licence or classification	Foreign firms	Key bonds and guarantees
United States	None federally; SAM registration	Federal TAA threshold $6.683m	100% performance + 100% payment over $150k; bid ≥ 20%
United Kingdom	None; pre-qualification questionnaires	Works threshold £5,193,000	Performance bond typically 10% (market practice)
France	None; Qualibat often requested	Décennale insurance mandatory	Retention ≤ 5% (3% for SMEs at many buyers)
Germany	Pre-qualification (PQ-VOB)	15% construction withholding without exemption	Per VOB/A
Spain	Clasificación for works ≥ €500k	Non-EU firms need it	Per contract
Italy	SOA for works ≥ €150k	EU/agreement firms qualify per tender	Per contract
Netherlands	None; VCA safety certification expected	Chain liability for wage taxes	Per UAV contract
Poland	None for firms; licensed site staff	Third-country firms rejected by default	Bid ≤ 3%; performance ≤ 5% (10%)
Japan	Construction licence + keishin review	JV share rules	Per contract
Korea	Construction registration	Local member ≥ 30% below GPA thresholds	Per contract
Singapore	BCA registry (CRS)	Singapore entity needed	Per tender
Australia	State/territory builder licences	Skills Guarantee ≥ A$10m	Set by contract
Canada	Provincial licensing	—	Bid 10%; 50% performance + 50% labour and material
Brazil	Per edital	—	Performance guarantee up to 30% on large works
UAE	Emirate-level classification	Trade licence; ICV	Per tender
Saudi Arabia	Contractor classification	Regional HQ rule	Bid 1–2%; performance 5%

United States (federal)

No federal contractor licence. Registration in SAM.gov is mandatory before award. A solicitation may still ask for a state licence. See how to register in SAM.gov.
Miller Act bonds: construction contracts over $150,000 need a performance bond and a payment bond, each for 100% of the contract price, plus 100% of later increases. This threshold is no longer inflation-indexed.
$35,000–$150,000: the contracting officer picks at least two payment protections, such as a payment bond, an irrevocable letter of credit or an escrow.
Bid guarantee: at least 20% of the bid price, capped at $3 million. The FAR rewrite kept this.
Davis-Bacon prevailing wages apply to construction contracts over $2,000 performed in the US.
Foreign firms: at or above the trade-agreement construction threshold ($6.683 million), contractors from designated countries are treated like domestic ones. Buy American rules apply to construction materials separately.
Contract forms: standard FAR clauses, not FIDIC.

United Kingdom

No national contractor licence or classification.
Pre-qualification: the government prefers the Common Assessment Standard (PPN 03/24). The older PAS 91 questionnaire is no longer supported.
Threshold: the works threshold is £5,193,000 including VAT for procurements from 1 January 2026 to 31 December 2027.
Safety: under the CDM Regulations 2015, the client appoints a principal contractor when more than one contractor is involved, and the principal contractor plans the construction phase.
Bonds: performance bonds are typically capped at 10% of the original contract sum. That’s market practice, not law.
Contract forms: NEC4 dominates central government and infrastructure; JCT is common for buildings.

France

No licence or classification. Qualibat certification is voluntary but often requested as proof of capability.
Décennale insurance is mandatory (Insurance Code, L241-1) for every builder working on a French site, including foreign firms. A home-country policy generally isn’t enough. Working uninsured is a criminal offence, punishable by a fine of up to €75,000.
Retention: capped at 5% of the contract amount. For SMEs it’s capped at 3% on contracts with the State and with local authorities and public bodies spending more than €60 million a year (Decree 2024-1251).
Contract forms: the CCAG-Travaux standard conditions.
See how to bid for public contracts in France.

Germany

Pre-qualification: the PQ-VOB register lets contractors prove suitability once, instead of in every tender.
Below-threshold works follow VOB/A, with value limits that vary by federal state. See below-threshold procurement by state.
Construction withholding tax: without an exemption certificate from the German tax office, the client must withhold 15% of each payment (Bauabzugsteuer). Foreign contractors should apply for the certificate before starting work.

Spain

Classification (clasificación) is mandatory for works of €500,000 or more. Non-EU firms aren’t exempt. EU firms can prove solvency instead.
Categories run from 1 (up to €150,000) to 6 (over €5 million), based on the contract’s mean annual value.
Joint ventures: when classification is required, Spanish and non-EU members of a temporary joint venture (UTE) must each be classified; EU members prove solvency instead.
Non-EU winners can be required to open a registered Spanish branch.
See how to bid for public contracts in Spain.

Italy

SOA certification is required for public works of €150,000 or more, by category and value class (I up to €258,000, through VIII unlimited).
EU firms and firms from agreement countries can qualify tender by tender with home-country documents instead.
See SOA qualification and the MePA marketplace.

Netherlands

No contractor licence. The works procurement regulation ARW 2016 and the proportionality guide apply on a comply-or-explain basis.
VCA safety certification isn’t a legal requirement, but buyers routinely ask for it. Company certificates last three years with annual audits.
Chain liability: the main contractor is liable for subcontractors’ unpaid wage taxes and social contributions. A blocked “G-account” limits the exposure.
Building quality law: since 1 January 2024, contractors are also liable for defects not found at handover.
Contract forms: UAV 2012 for traditional contracts, and UAV-GC 2025 (published January 2025) for design-and-build.

Poland

No company licence or classification. Key staff, such as the site manager, need Polish building licences, and tenders make that a condition. EU, EEA and Swiss engineers can have their qualifications recognised.
Bid security (wadium): up to 3% above EU thresholds and 1.5% below.
Performance security: up to 5% of the bid price, or 10% if justified in the tender documents.
Third-country firms: since September 2025, contractors from countries without a procurement agreement with the EU are rejected by default unless the tender allows them.
Contract forms: FIDIC, in Polish translation, is widely used by the national roads and rail authorities.
See how to bid for public contracts in Poland.

Japan

Public works need a construction business licence and the management matters review (keishin), then registration with each buyer.
Joint ventures for single projects have minimum shares for each member (30% for two-member JVs, 20% for three).
See the Unified Qualification for foreign companies.

Korea

Contractors need Korean construction registration.
Below the GPA thresholds, many works require mandatory regional joint contracting: a local member with at least 30%.
See the Korean procurement glossary.

Singapore

Public construction needs registration in BCA’s Contractors Registration System, which requires a Singapore-registered company.
Grades set tendering limits. For general building (CW01), A1 is unlimited, A2 goes up to S$105m, and so on down to C3 at S$0.8m.
Registration is mandatory since June 2025 for any firm employing construction Work Permit or S Pass holders.
See how to register on GeBIZ.

Australia

Builder licensing is by state and territory. There’s no Commonwealth licence.
Commonwealth threshold: construction services procurement at A$7.5 million (unchanged in the November 2025 update to the Commonwealth Procurement Rules).
Australian Skills Guarantee: for construction and ICT projects of A$10 million or more:
- at least 10% of labour hours by apprentices or trainees;
- targets for women apprentices rising each year to 2030;
- extra targets on flagship projects of A$100 million or more.
Security: set by each contract, usually as bank guarantees.
See how to bid for government contracts in Australia.

Canada

Licensing is provincial.
Federal construction bonds: a 10% bid bond, then a 50% performance bond and a 50% labour and material payment bond.
See how to bid for government contracts in Canada.

Brazil

Requirements are set in each tender notice (edital) under Law 14.133/2021.
Performance guarantees can reach 30% for large works.
EU contractors: the EU–Mercosur agreement covers works at federal and listed state bodies above SDR 8 million.
See how to bid for public contracts in Brazil.

United Arab Emirates

Federal construction projects are outside the federal procurement law and effectively outside the India–UAE CEPA. Licensing and classification are run by each emirate.
Dubai (Law No. 7 of 2025, in force January 2026):
- every contractor in mainland Dubai, the free zones and the DIFC (but not airport projects) must be on a central register run by Dubai Municipality;
- new entrants start in the lowest tier;
- clients may not hire unregistered contractors;
- existing contractors have one year, to about January 2027, to regularise.
Abu Dhabi: government work needs classification by the Department of Municipalities and Transport. Since November 2025 the special grade requires AED 20 million equity, three engineers with 10+ years’ experience and AED 240 million of projects in the past ten years, and allows bids on projects of AED 100 million or more.
Foreign firms need a UAE trade licence through a branch or local company. Abu Dhabi tenders weigh In-Country Value. See the ICV certificate guide.
Contract forms: FIDIC, usually heavily amended.

Saudi Arabia

Contractor classification by the Ministry of Municipalities and Housing is required for government projects in classified fields. Certificates are electronic and valid for two years. Foreign-licensed contractors are classified like Saudi ones.
Regional headquarters rule (since 1 January 2024): government bodies generally can’t contract with foreign companies whose regional headquarters isn’t in Saudi Arabia. Exceptions:
- contracts under SAR 1 million;
- work performed outside the Kingdom;
- sole suppliers;
- emergencies.
Otherwise, a firm without a Saudi regional headquarters can win only if it’s technically superior and at least 25% cheaper than the next offer, or the only bidder.
Guarantees: a bid guarantee of 1–2% and a performance guarantee of 5%, due within 15 working days (waived at SAR 300,000 or below).
Large projects: since September 2025, projects of SAR 600 million or more can be split into portions of at least SAR 75 million.
New procurement law: published 4 September 2026 and taking effect around 2 January 2027:
- direct-purchase limit raised to SAR 1 million, with priority for local SMEs;
- change orders allowed up to 20%.
Local content: the local content authority scores local workforce, sourcing and investment, and runs price preferences and mandatory local lists.
Portal: Etimad.

Development-bank-financed works

Works financed by multilateral development banks follow the bank’s rules, not national preferences:

World Bank: at least 30% local labour on international works contracts from 1 September 2025; a 7.5% domestic preference for contractors from eligible borrower countries; performance security capped at 10%.
ADB: at least 50% local labour on international works.
Contract forms: FIDIC-based standard bidding documents.

See how to win World Bank-financed contracts.

Practical advice

Look for markets that accept home credentials. Italy and Spain accept EU qualifications; the UK, France, the Netherlands and Poland have no classification at all.
Partner where the system is closed. In Japan, Korea, Singapore, Saudi Arabia and the UAE, a joint venture with a classified local contractor is usually the fastest way in. See consortium and joint venture bidding rules.
Price the bonds. A 100% US payment bond, a 30% Brazilian guarantee and a 15% German withholding all affect cash flow.
Insure for the local liability regime, especially France’s décennale and the Netherlands’ extended defects liability.
Check labour rules early: Davis-Bacon wages, the Australian Skills Guarantee, development-bank local-labour quotas and Polish employment-contract requirements all change your staffing plan.

What changed in 2025–2026

US: the rewritten FAR Part 28 was adopted through agency deviations (September–November 2025); bond levels are unchanged.
UK: new works threshold of £5,193,000 from 1 January 2026; the Common Assessment Standard is now the preferred pre-qualification.
France: retention cap of 3% for SMEs at more buyers (Decree 2024-1251).
Netherlands: UAV-GC 2025 replaced the 2005 design-and-build conditions.
Australia: Commonwealth Procurement Rules updated (17 November 2025); the construction threshold stays at A$7.5 million.
Poland: third-country contractors rejected by default from September 2025.
Dubai: Law No. 7 of 2025 created a mandatory contractor register (January 2026).
Abu Dhabi: classification rules eased for higher grades (November 2025).
Saudi Arabia: project-splitting rules (September 2025) and a new procurement law from about January 2027.
World Bank: 30% local labour on international works from 1 September 2025.

Questions

Do foreign contractors need a local licence to bid for public works?

It depends on the country. The UK, France, the Netherlands and Poland have no contractor licence or classification. Spain (works of €500,000 or more), Italy (€150,000 or more), Japan, Singapore, Saudi Arabia and Abu Dhabi require a classification or licence for public works, and Dubai now requires registration for all contractors. Italy and Spain let EU firms qualify with home-country credentials; elsewhere you usually need a local entity.

What bonds are needed for US federal construction contracts?

Under the Miller Act, contracts over $150,000 need a performance bond and a payment bond, each for 100% of the contract price. Bids need a guarantee of at least 20% of the bid price, capped at $3 million. Between $35,000 and $150,000 the contracting officer chooses at least two payment protections.

Is décennale insurance required for foreign builders in France?

Yes. Ten-year structural liability insurance (garantie décennale) is mandatory for every builder working on a French site, including foreign firms, and a home-country policy generally isn’t enough. Working without it is a criminal offence.

What is the Australian Skills Guarantee?

A Commonwealth requirement for construction and ICT projects of A$10 million or more: at least 10% of labour hours must be performed by apprentices or trainees, with targets for women apprentices rising each year to 2030. Flagship projects of A$100 million or more carry extra targets.

Can a foreign company win Saudi government construction contracts?

Yes, but it needs contractor classification for classified fields, and since 1 January 2024 government bodies generally can’t contract with foreign companies whose regional headquarters isn’t in Saudi Arabia, except for contracts under SAR 1 million, work performed abroad, sole suppliers and emergencies. A new Government Tenders and Procurement Law takes effect around January 2027.

What local-labour rules apply to World Bank works contracts?

For international works contracts, the World Bank requires at least 30% local labour from 1 September 2025, allows a 7.5% domestic preference for contractors in eligible borrower countries, and caps performance security at 10%. ADB requires at least 50% local labour on international works.

Sources

This guide explains the rules in plain English; it isn’t legal advice. Procurement rules change, and each tender document sets its own conditions — it always prevails.

Public construction contracts abroad.