At the federal and state/territory level, there are typically two types of government agencies for procurement purposes:

• departments and agencies which do not have a separate legal identity to the Crown (complying with the procurement laws and policies in most cases is mandatory for these bodies). At the federal level, examples include the Department of Defence, the Department of Foreign Affairs and Trade, and the Attorney General's Department; and
• other government created bodies that have a separate legal identity to the Crown (e.g., bodies created by statute or government-owned companies). At the federal level, examples include the Australian Broadcasting Corporation, the Commonwealth Scientific and Industrial Research Organisation and the Reserve Bank of Australia. Treatment of these bodies differs. In some cases they may choose to subject themselves to the procurement laws and policies and in other cases they can be directed to comply.At the local government level, each local government body will be required to comply with the local government procurement laws set by the responsible state government.

As a practical matter, most government created authorities and companies will have in place very similar procurement requirements to government departments and agencies.

Private entities are generally not covered by the government procurement frameworks. However, in a number of cases, private sector entities may be permitted to benefit from government purchasing. For example, private schools and hospitals may be allowed to buy from government established supply arrangements.

One public body may provide products or services to another public body.  There is no exemption from procurement requirements just because the supplier and customer are each public bodies.  However, if the public bodies re each part of the Crown there will be no legally binding contract as the procurement will have been awarded within a single entity.  Additionally, the Commonwealth Competitive Neutrality Policy Statement applies competition principles to government activities (both federal and state/territory).  It aims to remove a net competitive advantage that government business activities may have over competitors by virtue of their public ownership.

Any contracts that are awarded by government departments or agencies using public money or relating to public property will generally be subject to the procurement laws. It is important to check in each case whether the proposed procurement activity is covered by the relevant procurement laws, especially where the relevant activity is not for procuring goods or services or the means of acquisition or contracting are non-standard.

For the purposes of the federal CPRs, grants, investment (or divestment), sales by tender, loans, purchases of property or services for resale or of property or services used in the production of goods for resale and any property right not acquired through the expenditure of public money, statutory or ministerial appointments, and engagement of employees are not considered to be “covered” procurement activities.

At the federal level, the CPRs contain rules in two divisions. Division 1 applies to all procurements regardless of value. Division 2 applies additional rules to procurements valued at or above the relevant procurement threshold (unless an exception applies). The Division 2 rules require a higher level of transparency (e.g., stronger requirements to conduct open tenders and to follow certain rules in conducting the procurement).

The procurement thresholds are:

• for non-corporate Commonwealth entities, other than for procurements of construction services, A$80,000;
• for prescribed corporate Commonwealth entities, other than for procurements of construction services, A$400,000; or
• for procurements of construction services by non-corporate Commonwealth entities and prescribed corporate Commonwealth entities, A$7.5 million.

For states and territories, the financial threshold for a contract usually determines the procurement method that must be used.

The parties to the contract may agree on changes, however the procuring agency must always ensure that the change is not sufficiently different to the initial approach to market so as to trigger rules requiring a new procurement.

At the federal and state/territory level, one agency is usually appointed as the lead agency to manage the framework arrangement (usually referred to as whole-of -government procurement arrangement). At the federal level, the lead agency is usually the Department of Finance.

Australian governments typically use whole-of -government procurement arrangements for certain types of supplies. Where there is such an arrangement for a type of supply, it is usually mandatory for government customers to purchase under the arrangement (unless an exemption applies).

Whole-of-government arrangements are often used for items routinely purchased by government bodies without the need to be further customised prior to use (e.g., supplies for hospitals, computer equipment, telecommunications services, cleaning services).

Whole-of-government arrangements may also be used for bespoke services, such as to pre-qualify suppliers able to provide certain IT services. From the pre-qualified list, government bodies may then conduct a further procurement to select a provider for particular projects.

Defence establishes framework arrangements for certain supplies, including IT services or to pre-qualify to participate in defence research programmes.

The National Public Private Partnership Policy and Guidelines which indicate the default position of the government on all key issues) are generally applied by the federal and state/territory (not local) governments. Individual jurisdictions supplement the Policy with additional local rules. PPPs must be considered for any project with capital investment over $A50 million.

Australia does not have the special laws for concession contracts encountered in civil law jurisdictions.

The Competition and Consumer Act 2010 (Cth) (“CCA”) was enacted to encourage competition in Australia. The CCA prohibits practices such as cartel conduct, anti-competitive agreements, boycotts, misuse of market power, exclusive dealing, resale price maintenance and acquisitions that substantially lessen competition. The CCA prohibits collusive tendering and price fixing and would apply to bid rigging between competitors.

At the federal level, Part 7.6 of the Criminal Code Act 1995 (Cth) prohibits bribery of a Commonwealth government official. The states and territories also have laws prohibiting bribery and the giving of secret commissions.

There is also legislation and supporting codes of conduct and policies at federal and state/territory level regulating the conduct of public servants and elected officials. These include requirements to obtain approval to receive gifts and register the receipt of any gifts and for dealing with actual or perceived conflicts of interest.