Australia: What's in a name? The new Commonwealth Procurement Rules

Key Points:

Commonwealth agencies need to familiarise themselves with the revised Commonwealth Procurement Guidelines.

The Department of Finance and Deregulation has revised the Commonwealth Procurement Guidelines (CPGs), with the new Commonwealth Procurement Rules (CPRs) to come into effect on 1 July 2012.

This article outlines the changes to Commonwealth procurement effected by the new CPRs and the changes they introduce.

The CPRs are intended to update and clarify the existing CPGs and streamline procurement procedures for Commonwealth Agencies. The CPRs also focus on whole-of-government arrangements, notably co-ordinated procurement. While the core framework remains largely unchanged, the CPRs clarify requirements for the conduct of Commonwealth procurement activities.

Why have these reforms been developed?

The CPGs applied to all FMA Act Agencies and certain CAC Act bodies.

Since the introduction of the CPGs, a "wide range of procurement approaches" have been used across agencies. This result has proven to be both complex and unwieldy. A lack of clarity in the CPGs resulted in the use of different practices across otherwise similar procurements. The CPRs seek to address the recommendations of the Australian National Audit Office recommendations arising out of audit report No 11 2010-11 – Direct Source Procurement and feedback from Agencies aimed at clarifying procurement requirements.

What are the changes?

The CPRs reflect a clearer and more concise re-drafting of the CPGs. The CPRs retain the two division structure of the CPGs and many of the rules remain unchanged, including but not limited to the relevant compliance thresholds for covered procurement ($80,000 for FMA Act Agencies, $400,000 for CAC Act Agencies and $9million for construction activities). The CPRs clearly use "must" for all mandatory requirements and "should" for desirable processes.

The CPRs are divided into Divisions1 and 2. Division1 specifies the requirement for all procurements to be based on achieving value for money. Division2 applies extra requirements for procurements at or above the relevant procurement thresholds (previously "covered procurements").

The CPRs emphasise that Agencies must use whole-of-government coordinated procurement panels where they exist. Exemptions to using these panels are limited and can only be granted jointly by the Agency's Minister and the Finance Minister.

Methods of procurement

Finance has changed the terms used in the CPGs to describe methods of procurement, from "select tender" to "pre-qualified tender" and "direct source" to "limited tender". The term "open tender" remains unchanged. The new terms are also defined in more detail and align with the emphasis on value for money and "economical" use of Commonwealth resources.

The methods of procurement have been moved from Division 2 of the CPGs to Division 1 of the CPRs as have the paragraphs relating to estimating the value of a procurement.

CPRs as mandatory requirements

In the CPGs, the distinction between mandatory provisions and better practice guidelines was not always clear. Some Agencies incorrectly assumed that discretion was permitted when applying the CPGs. The new emphasis is on procurement procedures as rules, both in the name of the CPRs and language in the document.

Reporting requirements

Under the CPRs, AusTender must be used to publish "open tenders" and, to the extent practicable, make request documentation available.

Officials must maintain appropriate documentation for each procurement and retain that documentation in accordance with the Archives Act. Agencies must have appropriate documentation with the supplier (such as a contract).

All contracts and amendments must be reported on AusTender within 42days of entering into (or amending) contracts if they are valued in excess of $10,000 for FMA Act Agencies. All standing offers, regardless of value, must be reported.

All tender submissions must be kept confidential and contracts will specify what is confidential. Agencies must have a risk register for all procurements.

Limited tender

Division2 addresses the rules for a "limited tender" (previously direct source). Paragraph10.3 of the CPRs specifies the only circumstances where a limited tender can be used. These are the same as the circumstances in the CPGs.

Paragraph10.5 of the CPRs outlines the records required to support a decision to utilise a "limited tender". Importantly, the record must demonstrate how the procurement represented value for money.

Request documentation

The CPRs importantly specify that the request documentation "must include a complete description of the procurement, the conditions for participation, the minimum form and content requirements and all evaluation criteria (paragraph10.6 of the CPRs). Thus, it will not be possible to hide evaluation criteria or develop criteria during the evaluation process.

This is supported by the requirement in paragraph10.8 of the CPRs that Agencies must ensure that tenderers are dealt with fairly and in a non-discriminatory manner.

Modification of evaluation criteria or specifications

Further, if an Agency varies the evaluation criteria or specifications set out in the request documentation, the Agency must transmit all modifications to all potential tenderers participating at the time and allow them an adequate time to respond (paragraph10.12 of the CPRs).


The CPRs also include more detailed and clearer guidance on key areas of procurement. There is now a "how to use the CPRs" section and more detailed guidance on assessing value for money and more clarity on the reporting requirements.

What are your responsibilities?

The CPRs clarify responsibilities for officials performing duties in relation to procurement. Officials need to comply with the mandatory procurement requirements and thus should familiarise themselves with the requirements in the CPRs.

Internal agency procurement documentation (ie. Chief Executive Instructions and other operational guidance), any agency-specific procurement templates, and internal agency procurement training will need to be updated.

The shift in emphasis from guidelines to rules suggests that the Australian Government is serious about maintaining its reputation as a "respected, transparent and accountable procurer." As a result, Agencies and officials must adhere to the rules in the new CPRs for all Agency procurements.

You might also be interested in ...

Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this bulletin. Persons listed may not be admitted in all states and territories.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Mondaq Advice Centre (MACs)
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.