10. Additional Rules
- Conditions for limited tender
- Request documentation
- Modification of evaluation criteria or specifications
- Conditions for participation
- Minimum time limits
- Late submissions
- Value for money and broader benefits to the Australian economy
- Receipt and opening of submissions
- Awarding contracts
- Contract management/Standard verification
10.1 The rules set out in Division 2 are additional to those in Division 1 and must not be interpreted or applied in a manner that diminishes or negates Division 1.
10.2 A procurement, except a procurement that is specifically exempt in accordance with Appendix A, is subject to the rules contained in Division 2 if the expected value of the procurement is at, or above, the relevant procurement threshold.
10.3 A relevant entity must only conduct a procurement at or above the relevant procurement threshold through limited tender in the following circumstances:
- when, in response to an approach to market
- no submissions, or no submissions that represented value for money, were received,
- no submissions that met the minimum content and format requirements for submission as stated in the request documentation were received, or
- no tenderers satisfied the conditions for participation, and the relevant entity does not substantially modify the essential requirements of the procurement; or
- when, for reasons of extreme urgency brought about by events unforeseen by the relevant entity, the goods and services could not be obtained in time under open tender or prequalified tender; or
- for procurements made under exceptionally advantageous conditions that arise only in the very short term, such as from unusual disposals, unsolicited innovative proposals, liquidation, bankruptcy, or receivership, and which are not routine procurement from regular suppliers; or
- when the goods and services can be supplied only by a particular business and there is no reasonable alternative or substitute for one of the following reasons
- the requirement is for works of art,
- to protect patents, copyrights, or other exclusive rights, or proprietary information, or
- due to an absence of competition for technical reasons; or
- for additional deliveries of goods and services by the original supplier or authorised representative that are intended either as replacement parts, extensions, or continuing services for existing equipment, software, services, or installations, when a change of supplier would compel the relevant entity to procure goods and services that do not meet requirements for compatibility with existing equipment or services; or
- for procurements in a commodity market; or
- when a relevant entity procures a prototype or a first good or service that is intended for limited trial or that is developed at the relevant entity’s request in the course of, and for, a particular contract for research, experiment, study, or original development; or
- in the case of a contract awarded to the winner of a design contest, provided that
- the contest has been organised in a manner that is consistent with these CPRs, and
- the contest is judged by an independent jury with a view to a design contract being awarded to the winner; or
- for new construction services consisting of the repetition of similar construction services that conform to a basic project for which an initial contract was awarded through an open tender or prequalified tender, and when the initial approach to market indicated that limited tender might be used for those subsequent construction services.
10.4 A procurement at or above the relevant procurement threshold conducted by limited tender is not required to meet the rules in paragraphs 10.6 - 10.13 (Request documentation), 10.19 - 10.29 (Minimum time limits), or 10.35 (Awarding contracts).
10.5 In accordance with the general rules for accountability set out in these CPRs, for each contract awarded through limited tender, an official must prepare and appropriately file within the relevant entity’s records management system a written report that includes:
- the value and type of goods and services procured;
- a statement indicating the circumstances and conditions that justified the use of limited tender; and
- a record demonstrating how the procurement represented value for money in the circumstances.
10.6 Request documentation must include a complete description of:
- the procurement, including the nature, scope and, when known, the quantity of the goods and services to be procured and any requirements to be fulfilled, including any technical specifications, conformity certification, plans, drawings, or instructional materials;
- any conditions for participation, including any financial guarantees, information and documents that potential suppliers are required to submit;
- any minimum content and format requirements;
- evaluation criteria to be considered in assessing submissions; and
- any other terms or conditions relevant to the evaluation of submissions.
10.7 However, relevant entities are not obligated to release confidential information, information sensitive to essential security or information that may impede competition.
10.8 Relevant entities must ensure that potential suppliers and tenderers are dealt with fairly and in a non-discriminatory manner when providing information leading to, or following, an approach to market. Relevant entities must promptly reply to any reasonable request from a potential supplier for relevant information about a procurement, and when responding to such enquiries must avoid a potential supplier, or group of potential suppliers, gaining an unfair advantage in a competitive procurement process.
10.9 In prescribing specifications for goods and services, a relevant entity must:
- not use specifications or prescribe any conformity assessment procedure in order to create an unnecessary obstacle to trade;
- when possible, set out the specifications in terms of performance and functional requirements; and
- base technical specifications on international standards, when they exist and apply to the relevant procurement, except when the use of international standards would fail to meet the relevant entity’s requirements or would impose greater burdens than the use of recognised Australian standards.
10.10 Where an Australian standard is applicable for goods or services being procured, tender responses must demonstrate the capability to meet the Australian standard, and contracts must contain evidence of the applicable standards (see paragraph 10.37).
10.11 A specification must not require or refer to a particular trademark or trade name, patent, copyright, design or type, specific origin, producer, or supplier, unless there is no other sufficiently precise or intelligible way of describing the requirement. In an exceptional circumstance when this type of specification is used, words such as ‘or equivalent’ must be included in the specification.
10.12 A relevant entity may conduct market research and other activities in developing specifications for a particular procurement and allow a supplier that has been engaged to provide those services to participate in procurements related to those services. Relevant entities must ensure that such a supplier will not have an unfair advantage over other potential suppliers.
10.13 When, during the course of a procurement, a relevant entity modifies the evaluation criteria or specifications set out in an approach to market or in request documentation, or amends or reissues an approach to market or request documentation, it must transmit all modifications or amended or reissued documents:
- to all the potential suppliers that are participating at the time the information is amended, if known, and, in all other cases, in the same manner as the original information; and
- in adequate time to allow potential suppliers to modify and re-lodge their submissions, if required.
10.14 Relevant entities may specify conditions for participation that potential suppliers must be able to demonstrate compliance with in order to participate in a procurement or, if applicable, class of procurement. Conditions for participation must be limited to those that will ensure that a potential supplier has the legal, commercial, technical and financial abilities to fulfil the requirements of the procurement.
10.15 Conditions for participation may require relevant prior experience when that experience is essential to meet the requirements of the procurement but must not specify, as a requirement, that potential suppliers have previous experience with the relevant entity or with the Australian Government or in a particular location.
10.16 In assessing whether a tenderer satisfies the conditions for participation, a relevant entity must:
- evaluate financial, commercial, and technical abilities on the basis of the tenderer’s business activities, wherever they have occurred; and
- base its determination solely on the conditions for participation that the relevant entity has specified in either the approach to market or the request documentation.
10.17 A relevant entity may exclude a tenderer on grounds such as bankruptcy, insolvency, false declarations, or significant deficiencies in performance of any substantive requirement or obligation under a prior contract.
10.18 Officials must make reasonable enquiries that the procurement is carried out considering relevant regulations and/or regulatory frameworks, including but not limited to tenderers’ practices regarding:
- labour regulations, including ethical employment practices;
- occupational, health and safety; and
- environmental impacts.
10.19 Potential suppliers must be required to lodge submissions in accordance with a common deadline.
10.20 Relevant entities must provide sufficient time for potential suppliers to prepare and lodge submissions in response to an approach to market. Time limits discussed in this section represent minimum time limits to lodge submissions and should not be treated as default time limits.
10.21 The time limit for potential suppliers to lodge a submission must be at least 25 days from the date and time that a relevant entity publishes an approach to market for an open tender or a prequalified tender, except under the following circumstances when a relevant entity may establish a time limit that is less than 25 days but no less than 10 days:
- when the relevant entity has published details of the procurement in an annual procurement plan on AusTender, at least 30 days and not more than 12 months in advance, and those details include a description of the procurement, the timing of the approach to market and the procedure to obtain request documentation;
- when the relevant entity procures commercial goods and services;
- in the case of second or subsequent approaches to the market for recurring procurements; or
- when a genuine state of urgency renders the normal time limit impracticable.
10.22 When a relevant entity has not electronically issued an approach to market, the 25 day period referred to in the preceding paragraph must be extended to 30 days.
10.23 The time limits stated above apply to each approach to market. That is, a single approach to market must comply with the time limits or, in the case of a multi-stage procurement (such as inviting expressions of interest followed by a prequalified tender), each approach to market must comply with the time limits stated in paragraph 10.21.
10.24 When a relevant entity intends to specify conditions for participation that require potential suppliers to undertake a separate registration procedure, the relevant entity must state the time limit for responding to the registration in the approach to market. Any such conditions for participation must be published in sufficient time to enable all potential suppliers to complete the registration procedures within the time limit for the procurement.
10.25 When a relevant entity extends the time limit for registration or submission, or when negotiations are terminated and potential suppliers are permitted to lodge new submissions, the new time limit must apply equitably.
10.26 Late submissions must not be accepted unless the submission is late as a consequence of mishandling by the relevant entity. A relevant entity must not penalise any potential supplier whose submission is received after the specified deadline if the delay is due solely to mishandling by the relevant entity.
10.27 Relevant entity mishandling does not include mishandling by a courier or mail service provider engaged by a potential supplier to deliver a submission. It is the responsibility of the potential supplier to ensure that the submission is dispatched in sufficient time for it to be received by the relevant entity by the deadline.
10.28 Late submissions should be returned unopened to the potential supplier who submitted them, to:
- ensure that they are not evaluated or compared with submissions which were submitted by the due time and date;
- demonstrate to other tenderers that the process for receiving submissions is fair and impartial; and
- eliminate scope for any suggestion that the submission was rejected for any reason other than because it was late.
10.29 It may be necessary to open a late submission if there is no return address or any indication of which approach to market the submission relates. When a submission has been opened under such circumstances the potential supplier should be advised that the submission was rejected due to lateness and advised of the reason it was opened.
10.30 In addition to the considerations at paragraph 4.4, for procurements above $4 million, Commonwealth officials are required to consider the economic benefit of the procurement to the Australian economy.
10.31 The policy operates within the context of relevant national and international agreements and procurement policies to which Australia is a signatory, including free trade agreements and the Australia and New Zealand Government Procurement Agreement.
10.32 Procedures to receive and open submissions must guarantee fairness and impartiality and must ensure that submissions are treated in confidence.
10.33 When a relevant entity provides tenderers with opportunities to correct unintentional errors of form between the opening of submissions and any decision, the relevant entity must provide the opportunity equitably to all tenderers.
10.34 Further consideration must be given only to submissions that meet minimum content and format requirements.
10.35 Unless a relevant entity determines that it is not in the public interest to award a contract7, it must award a contract to the tenderer that the relevant entity has determined:
- satisfies the conditions for participation;
- is fully capable of undertaking the contract; and
- will provide the best value for money, in accordance with the essential requirements and evaluation criteria specified in the approach to market and request documentation.
10.36 A relevant entity must not cancel a procurement, or terminate or modify an awarded contract, so as to avoid the rules of Division 2 of these CPRs.
10.37 Where applying a standard (Australian, or in its absence, international) for goods or services, relevant entities must make reasonable enquiries to determine compliance with that standard:
- this includes gathering evidence of relevant certifications; and
- periodic auditing of compliance by an independent assessor.
7 Public interest grounds generally arise in response to unforeseen events or new information that materially affects the objectives or reasons underlying the original procurement requirement as specified in the request document.
Last updated: 08 March 2017