Document ID: chunk:federal_register_of_legislation:F2024L00627:body:0:p14
Version: federal_register_of_legislation:F2024L00627
Segment Type: other
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Character Range: 39396–42497

of the contract.

    8.3             Relevant entities should consider and manage their procurement security risk, including in relation to cyber security risk, in accordance with the Australian Government's Protective Security Policy Framework.
    8.4             As a general principle, risks should be borne by the party best placed to manage them; that is, relevant entities should generally not accept risk which another party is better placed to manage. Similarly, when a relevant entity is best placed to manage a particular risk, it should not seek to inappropriately transfer that risk to the supplier.
       1. Relevant entities should limit insurance requirements in contracts by reflecting the actual risk borne by suppliers in contractual liability caps.
       2. Suppliers should not be directed to take out insurance until a contract is to be awarded.

    9.            Procurement method
    9.1             Australian Government procurement is conducted by open tender or limited tender. These methods are detailed in this section.

Requirement to estimate value of procurement
    9.2             The expected value of a procurement must be estimated before a decision on the procurement method is made. The expected value is the maximum value (including GST) of the proposed contract, including options, extensions, renewals or other mechanisms that may be executed over the life of the contract.
    9.3             The maximum value of the goods and services being procured must include:
       1. all forms of remuneration, including any premiums, fees, commissions, interest, allowances and other revenue streams that may be provided for in the proposed contract;
       2. the value of the goods and services being procured, including the value of any options in the proposed contract; and
        3. any taxes or charges.
    9.4             When a procurement is to be conducted in multiple parts with contracts awarded either at the same time or over a period of time, with one or more suppliers, the expected value of the goods and services being procured must include the maximum value of all of the contracts.
    9.5             A procurement must not be divided into separate parts solely for the purpose of avoiding a relevant procurement threshold.
    9.6             When the maximum value of a procurement over its entire duration cannot be estimated the procurement must be treated as being valued above the relevant procurement threshold.

Procurement thresholds
    9.7             When the expected value of a procurement is at or above the relevant procurement threshold and an exemption in Appendix A is not applied, the rules in Division 2 must also be followed. The procurement thresholds (including GST) are:
       1. for non-corporate Commonwealth entities, other than for procurements of construction services, the procurement threshold is $80,000;
       2. for prescribed corporate Commonwealth entities, other than for procurements of construction services, the procurement threshold is $400,000; or
        3. for procurements of construction