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Updates to the Commonwealth Procurement Rules: What do you need to do?
Australia | Publication | 11月 2025
This article was co-authored with Vivian Truong.
Introduction
On 17 November 2025, updated Commonwealth Procurement Rules (CPRs) will commence1 (the 2026 CPRs), repealing the previous CPRs which commenced on 1 July 2024 (the 2025 CPRs). Key changes can be seen in relation to:
- New requirements to consider Australian businesses and Small and Medium Enterprises (SMEs) for certain procurements.
- An increase in the non-construction procurement threshold (the first increase in 20 years) from $80,000 to $125,000 (incl GST).
- Additional guidance on when and how negotiations with tenderers are to be conducted.
It is essential for all Commonwealth officials assisting with Commonwealth procurement, and all suppliers to the Commonwealth, to have an understanding of the CPRs. The CPRs govern how non-corporate Commonwealth entities2 and prescribed corporate Commonwealth entities undertake Procurement3 activities, and are designed to encourage value for money for the Commonwealth Government and taxpayers, while also emphasising flexibility, ethics, and fair competition.
Terms used in this article have the meaning given to them in Appendix B to the CPRs unless otherwise indicated.
Do the 2026 CPRs apply to my procurement?
Released on or after 17 November 2025
The 2026 CPRs will apply to all procurements where the approach to market (ATM)4 is released on or after 17 November 2025. For example, the requirement to first consider Australian businesses only applies to procurements below the relevant thresholds where the ATM is released on or after 17 November 2025.
Released before 17 November 2025
The 2025 CPRs still apply to procurements where the ATM is released before 17 November 2025. For procurements with an estimated value between $80,000 and $125,000, where not procuring from a standing offer, the procurement must be undertaken as an open tender, unless an exemption applies. For procurements via a standing offer where suppliers are approached before 17 November 2025, current practices apply.
For further information in relation to application of the 2026 CPRs, please see guidance materials on the Department of Finance website.
Key changes
Key changes to the CPRs and associated practical implications that Commonwealth officials and suppliers to the Commonwealth should be aware of are highlighted in the table below. A full list of the changes to the CPRs can be found on the Department of Finance website.
| Paragraph / Section | Change | Practical Implication |
|---|---|---|
| 2.11, Figure 1 Resource Management Framework | Addition of Procurement Connected Policies and ICT Procurement policies to the Procurement Framework diagram. | Commonwealth officials should be familiar with the Procurement Connected Policies, and ICT Procurement policies, and in particular as to whether they apply to their Procurements. |
| 3.7 How to use the Commonwealth Procurement Rules | Clarification that all thresholds and values are inclusive of GST. Minor edits made to other paragraphs to remove references to GST. | Entities should ensure when applying sections of the CPRs referring to dollar values, that they are considering them as inclusive of GST. |
| 3.10 and 3.11 Compliance with the two divisions of the CPRs | Update of thresholds from $80,000 to $125,000 for specified prescribed corporate Commonwealth entities’ application of the CPRs. | Australian Digital Health Agency, Australian Human Rights Commission, High Speed Rail Authority, National Portrait Gallery of Australia, Old Parliament House, Regional Investment Corporation and the Commonwealth Superannuation Corporation should closely review any non-construction procurements with a value between $80,000 to $125,000 to ensure the Divisions of the CPRs are applied and the procurement is correctly reported. |
| 4.4.a Achieving value for money | Clarification that competition is encouraged amongst potential suppliers to ensure value for money. | Now limited to an entity or person who may respond to an ATM. |
| 4.5.c Achieving value for money | Inclusion of ethical conduct as a factor in consideration of value for money. | Commonwealth officials must consider ethical conduct as a factor when assessing value for money. Consideration may be given to what could be requested or assessed to determine ethical conduct when approaching the market. |
| 5.1 and 5.3 Encouraging competition | Update to paragraphs in recognition of Australian business prioritisation. | Aspects of the previous non-discrimination paragraph (size, degree of foreign affiliation or ownership, location, or the origin of the goods and services) have been moved to paragraph 10.2, meaning that these aspects will now apply (subject to the CPRs) where Division 2 of the CPRs applies. |
| 5.4 Consideration of Australian businesses |
New requirement for Non-corporate Commonwealth Entities (NCEs) to first consider Australian businesses for procurements below the procurement thresholds. With the exception of procurements from standing offers, NCEs must only invite Australian entities to provide submissions where the expected procurement value is at or above $10,000 and below the relevant procurement threshold. Where the Indigenous Procurement Policy applies, this must first be satisfied before approaching Australian businesses. In the event no submissions are received, or no submissions are received that represent value for money, a procurement may be undertaken. If an official determines approaching Australian businesses is not appropriate, the decision must be clearly documented. |
Where an official determines approaching Australian businesses is not appropriate, documentation of such a decision may include:
b) demonstrated that the requirements are highly specialised and not available from any Australian business; or Information such as the Australian businesses identified, and the capability limitations of these suppliers such as relating to cost, quality and schedule should be included, along with associated risk should be documented. Documentation should be stored so that it will be accessible should it be required for future reviews or audits. Reporting will be required on AusTender for relevant entities from 1 July 2026, including reasons why an Australian business was not contracted for a procurement where there was a requirement to do so. ATM documentation should be updated to ensure tenderers must meet the definition of Australian business to be eligible for the procurement, including within the conditions for participation where the requirement applies and the ATM is to be released to the open market. Responses should be verified by the procuring entity. |
| 5.5 Consideration of Australian businesses |
New requirement for NCEs to first consider SMEs for procurements under $125,000 from the Management Advisory Services Panel, People Panels, or standing offers managed by the Digital Transformation Agency (DTA). For standing offers managed by the DTA, where the Indigenous Procurement Policy applies, this must first be satisfied before approaching Australian businesses. In the event no submissions are received, or no submissions are received that represent value for money, a procurement may be undertaken. If an official determines approaching SMEs is not appropriate, the decision must be clearly documented. |
ATM documentation should be updated to ensure tenderers must meet the definition of SME to be eligible for the procurement. ATM documents should require a declaration that the Supplier meets the definition of SME as at the time of their response, and the procuring entity should verify such declarations. Where an official determines approaching SMEs is not appropriate, the reasons and basis for that determination should be documented and may include:
This documentation should be supported by information evidencing the determination, such as any market analysis, supplier capability assessment, or records of previous unsuccessful SME engagement. Documentation should be stored so that it will be accessible should it be required for future reviews or audits. Reporting will be required on AusTender for relevant entities from 1 July 2026, including reasons why an Australian business was not contracted for a procurement where there was a requirement to do so. |
| 6.6 Efficient, effective, economical and ethical procurement | Provision moved from Division 2, into Division 1, to better reflect its intent to be applied to all procurements, where relevant.5 | Procuring entities should ensure that reasonable enquiries are carried out in relation to relevant regulations or regulation frameworks, including labour regulations and ethical employment practices, workplace health and safety and environmental impacts, for all relevant procurements, rather than just where division 2 of the CPRs applied. |
| 7.25 Treatment of Confidential Information | Update to require officials to alert suppliers to further categories of potential disclosure of procurement information, including to other Commonwealth entities where it serves the Commonwealth’s legitimate interests, such as for policy development, research, compliance regulatory and other non-commercial purposes. | Request and contract documentation should be updated to alert suppliers to these further categories for potential disclosure. |
| 7.27 and 7.28 Standard verification | Paragraph 7.27 incorporates provisions regarding standards that were previously included in Division 2.6
Minor edit has also been made to 7.28, to clarify that, where compliance with a standard was required, this should be checked during the contract period. |
Procuring entities should ensure that ATM documentation requires suppliers to demonstrate the capability to meet the determined standards, and contracts should include obligations that assist in evidencing the applicable standards. This will be required for all relevant procurements, rather than just where Division 2 of the CPRs applied. |
| 9.7.a Procurement threshold | Amended text to increase the procurement threshold for NCEs for non-construction procurements from $80,000 to $125,000 (incl GST). | Entities should update procurement guidance, templates and policy to reflect the amended thresholds. Care should be given to ensure correct application of the CPRs to procurements that now fit within this threshold. |
| 9.14 Procurement from standing offers | Clarification that with respect to standing offers with more than one potential supplier, the procuring entity should approach multiple suppliers from the relevant arrangement to make submissions. | Procuring entities should clearly document any considerations as to how they have classified potential suppliers, and include additional time for considering multiple responses in the procurement schedule. |
| 10.6.e Request documentation
10.18 and 10.19 Negotiations 10.27 Minimum time limits |
New requirement for request documentation to include intention to conduct negotiations, where applicable. 7 New section outlining when and how negotiations with tenderers may be conducted, to provide clarity to entities and suppliers.8 Removal of text, due to duplication with the new negotiations section (10.18 and 10.19). |
ATM documentation should be updated to specify if the procuring entity intends to conduct negotiations. However, where no single tenderer is assessed as providing best value for money in accordance with the essential requirements and evaluation criteria of the ATM and request documentation, a procuring entity may conduct negotiations. Where the procuring entity conducts negotiations, any elimination of a tenderer participating in negotiations must be done in accordance with the essential requirements and evaluation criteria of the ATM and request documentation. Where remaining tenderers are to submit any revised tenders, a common deadline must be given for submission. For procurements where there may be negotiations, procuring entities should consider the potential impact of any essential requirements and evaluation criteria on the negotiation phase when preparing the ATM and request documentation. Consideration should be given to whether any entity templates, guidance material or policy documentation should be updated as a result. |
| 10.8 Request documentation | Minor clarification that responses to information requests from potential suppliers should ensure that no other suppliers or potential suppliers gain an advantage in a competitive procurement process.9 |
Procuring entities should be cognisant to ensure that, when responding to any requests from potential suppliers for relevant information in relation to a procurement, information is not given that could be perceived to be giving an advantage to that supplier. Where possible, it is generally preferable for such information to be provided to all potential suppliers to avoid the perception of advantage. |
| 10.9 and 10.12 Specifications | Minor clarification that an entity must not use specifications with the purpose or effect of creating an unnecessary obstacle to trade; and that entities must not provide an advantage for any supplier over other suppliers.10 |
Where requiring conformity with a particular standard, procuring entities should consider if these will be creating an unnecessary obstacle to trade. |
| 10.32 Handling of submissions and additional information | Clarification that procedures to receive, open and handle submissions must be fair and must ensure that submissions and any additional information received are treated in confidence. 11 |
Procuring entities should ensure that their internal process or policy documents such as Tender Evaluation Plans are updated to reflect and require compliance with the broadened submission handling requirements (i.e. will also apply to handling and additional information). |
| Appendix B: Definitions | ||
| Various |
New definitions have been included for Australian business, Management Advisory Services Panel, New Zealand business and People Panel. Minor updates have been made to the definitions of SMEs and Standing Offer. |
Commonwealth Officials should ensure relevant definitions, particularly in relation to Australian business, New Zealand business and SMEs, appropriately flow through any procurement documentation. |
Key takeaways
From 17 November 2025, the 2026 CPRs will apply to all new ATMs. Relevant entities should review and update their internal policies, procurement templates and ATM documentation to comply with the changes implemented in the 2026 CPRs. Any ATMs to be released on or after 17 November 2025 should be reviewed for compliance with the 2026 CPRs, including in relation to applicable thresholds (for consideration in relation to SMEs and Australian business) and additional requirements to be included in the request documentation (such as in relation to negotiations). Guidance or alerts may be circulated to Commonwealth officials associated with procurement. Where policy and documentation will take time to update, appropriate guidance notes alerting personnel that the changes have not yet been incorporated should be displayed.
Particular changes can be seen in relation to consideration of Australian business, SMEs, procurement thresholds and inclusion of requirements around the negotiation processes which signal a continued and ongoing intent to build Australia’s sovereign capability.
If you require support in relation to the implementation of the 2026 CPRs, including in relation to procurement planning, preparation of ATM documentation, application of the CPRs, or updating procurement policies, procedures and templates, please do not hesitate to contact members of our Government Team listed below.
Footnotes
1
The new CPRs are made by the Minister for Finance under section 105B(1) of the Public Governance, Performance and Accountability Act 2013 (Cth).
2
As defined through paragraphs 2.7 to 2.9 of the CPRs. Generally, a Procurement covers the process of acquiring goods and services, from such time as a decision is made on a procurement requirement. A Procurement may include risk assessment, analysis of markets and supply chains, evaluation of alternative solutions, and the awarding and reporting of a contract.
3
As defined in Appendix B to the CPRs, this means ‘any notice inviting potential suppliers to participate in a procurement which may include a request for tender, request for quote, request for expression of interest, request for information or request for proposal’.
4
Change in response to recommendation 1 of the Australian National Audit Office performance audit Procurement Complaints Handling (Report No. 19 of 2022-23) (ANAO Procurement Complaints Handling Audit).
5
Change in response to recommendation 1 of the Australian National Audit Office performance audit Procurement Complaints Handling (Report No. 19 of 2022-23) (ANAO Procurement Complaints Handling Audit).
6
Change in response to recommendation 1 of the Australian National Audit Office performance audit Procurement Complaints Handling (Report No. 19 of 2022-23) (ANAO Procurement Complaints Handling Audit).
7
Change in response to recommendation 1 of the Australian National Audit Office performance audit Procurement Complaints Handling (Report No. 19 of 2022-23) (ANAO Procurement Complaints Handling Audit).
8
Change in response to recommendation 1 of the Australian National Audit Office performance audit Procurement Complaints Handling (Report No. 19 of 2022-23) (ANAO Procurement Complaints Handling Audit).
9
Change in response to recommendation 1 of the Australian National Audit Office performance audit Procurement Complaints Handling (Report No. 19 of 2022-23) (ANAO Procurement Complaints Handling Audit).
10
Change in response to recommendation 1 of the Australian National Audit Office performance audit Procurement Complaints Handling (Report No. 19 of 2022-23) (ANAO Procurement Complaints Handling Audit).
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