Adopts procurement reform that prioritizes Australian businesses
17 Nov 2025
On 17 November 2025, Australia adopted revised Commonwealth Procurement Rules to prioritize Australian businesses for government contracts. Under the updated rules, for procurements with an expected value of $10,000 or more and below the relevant procurement thresholds, government entities must invite only Australian businesses to tender.
A business is considered Australian if it has at least 50 per cent Australian ownership (or is principally traded on an Australian exchange), is a tax resident and has its principal place of business in Australia. For procurements below the relevant thresholds, businesses from New Zealand are treated as Australian businesses, in accordance with the Australia–New Zealand Closer Economic Relations Trade Agreement.
- The new rules apply to construction procurement valued at $10,000 or more and below $7.5 million.
- For all other public procurement valued at $10,000 or more and below $125,000, procurement agencies must first approach Australian businesses.
Procurement agencies may approach other suppliers if no Australian business submits an offer, if submissions do not represent value for money, or if there is a documented justification for seeking external suppliers.
Nature of measure:
Type:
-
Treatment and operation (Operational conditions)
Industry:
Inward FDI:
Yes
Outward FDI:
No
Sources:
