PROCUREMENT REGULATIONS 1995

Tier system. The regulations refer to “tier one”, “tier two”, “tier three”, “tier four” and “tier five” supplies, but the value ranges for each tier are not defined in these regulations. Regulation 2 states that the tier classification is determined by the “estimated total value” within the ranges specified in the “procurement directions”. This means the operational thresholds can be changed administratively without any amendment to the regulations. For a procurement officer, the first step is always to consult the current procurement directions, not the regulations, to know which tier a given supply falls into. This delegation reduces the certainty that a legislative instrument would provide.

Across government contract. Defined in regulation 2 as “a whole of government or common use period contract established for supplies used commonly across Agencies”. These are centrally negotiated contracts intended to leverage aggregate spending. Regulation 7(1) creates a default obligation to use such contracts, subject to the Accountable Officer’s direction otherwise. This can restrict agency flexibility and may disadvantage smaller local suppliers who cannot obtain a place on the whole-of-government contract.

Certificate of exemption. Regulation 8 allows both the Minister (for any supplies, regardless of value) and an Accountable Officer (for tier two, three, four or five supplies) to issue a certificate of exemption. The exemption operates only to relieve a requirement under regulation 4 (quotes) or regulation 5 (public tenders). It does not exempt from other requirements (e.g., requisition, order, publication). The regulation does not specify grounds for issuing a certificate; the power appears unfettered. This creates a risk of circumventing competitive processes without any legislative check.

Accountable Officer. Not defined in these regulations but presumably refers to the chief executive of an agency under the Public Sector Employment and Management Act 1993. The Accountable Officer has multiple duties: approving requisitions, endorsing fund availability, obtaining quotes/tenders, signing orders, publishing contract details, and directing departures from across-government contracts. The regulations concentrate considerable discretionary power in this role.

Procurement Review Board. Established under section 6 of the Act, the Board is constituted by regulation 6 with at least three members appointed by the Minister. Its functions (regulation 6A) are: determining appeals on eligibility or admissibility of quotes/tenders in accordance with procurement directions; auditing or reviewing agency procurement procedures or activity; and advising the Minister, agency, or others. The Board has the powers necessary to perform its functions, but those powers are not enumerated. The Board does not handle contract disputes or supplier complaints about value; it is limited to procedural issues.

Public tender. Regulation 2 defines a public tender as a tender submitted as the result of a public invitation. This implies open advertising. For tier three, four, and five supplies, public tenders must be invited unless a certificate of exemption says otherwise. The regulation does not specify what constitutes adequate public notice - that would be in procurement directions.

Estimated total value. The tier classification depends on “estimated total value” of the supplies. This estimation is inherently uncertain. If an agency underestimates and treats a supply as a lower tier, it may fail to meet the required competition standard. Overestimation may impose unnecessary compliance costs. The regulations do not provide rules for how estimates must be made (e.g., including options, renewals, or inflation).

Accountable Officers bear the primary compliance burden. They are personally required to approve requisitions, endorse fund availability, obtain quotes or tenders (or decide to seek exemptions), sign orders, direct departures from across-government contracts, and ensure publication. Failure can expose them to administrative or disciplinary action under their employment conditions. The regulations impose strict personal duties - not delegable except as allowed by the Act or other law.

Agency staff who prepare requisitions, evaluate quotes, evaluate tenders, and maintain records are indirectly affected. The requirement for a written form (regulation 3) and specific forms for orders (regulation 9) may require administrative systems or templates.

Suppliers, particularly small and medium enterprises, are affected by the tier thresholds and exemption practices. For tier two supplies, the requirement to obtain quotes from at least three established suppliers creates opportunity but also limits competition to those the Accountable Officer solicits. There is no duty to invite unsolicited quotes. For higher tiers, public tenders allow open competition, but certificates of exemption can close the door. The across-government contract preference may lock out suppliers who are not on the central panel.

The Minister has powers to issue certificates of exemption (any value), appoint Procurement Review Board members, and determine that publication is contrary to the public interest. The Minister also administers the Act and may issue procurement directions that set the tier thresholds.

The Procurement Review Board members must exercise procedural review powers. Their work affects agency accountability but the Board has no enforcement or sanction power.

Other governments: Commonwealth, state and other territory governments are relevant when their contracts are used under regulation 7(2). The regulations do not impose duties on them, but their contracts may be adopted by NT agencies with Board approval.

The general public and journalists rely on regulation 10 publication for transparency. However, tier one contracts (lowest value) are exempt from publication, as are contracts from other governments, existing contracts, and any contract the Minister decides is contrary to the public interest. This leaves significant gaps in public visibility.

Local businesses in the Northern Territory may be affected by the across-government contract preference. If the central contract goes to an interstate supplier, local businesses lose the chance to bid directly. The exemption power could be used to favour local suppliers, but there is no express local preference provision in the regulations.

Duty to requisition on approved form (r 3(1)). A person requisitioning supplies must use a form approved by the Accountable Officer. The requisition must be approved by the Accountable Officer (r 3(2)). Before approval, the requisition must be endorsed as to the availability of sufficient funds (r 3(3)). This creates a budget control gate.

Duty to obtain written quotes for tier two supplies (r 4). The Accountable Officer must obtain written quotes from at least three established suppliers before incurring expenditure on tier two supplies. This duty is absolute unless a certificate of exemption under regulation 8 authorises otherwise. “Established suppliers” is not defined, leaving some discretion in whom to approach.

Duty to invite public tenders for tier three, four, five supplies (r 5). Before incurring expenditure, the Accountable Officer must invite tenders, and those tenders must be public tenders unless an exemption is in place. This means open advertising to the market. The regulation does not provide for selective tendering or pre-qualified lists without exemption.

Duty to use across-government contracts (r 7(1)). If supplies are available under an across-government contract, the Accountable Officer must obtain them from that contract unless they direct otherwise. The power to direct otherwise is not qualified; it could be used for any reason. But if no direction is given, the mandatory language applies.

Right to obtain supplies from other government contracts (r 7(2)). Supplies may be obtained from Commonwealth, state, or other territory contracts subject to Procurement Review Board approval. This is permissive, not mandatory. The Board’s approval requirement adds an extra step.

Right to issue certificates of exemption (r 8). The Minister can issue a certificate for any supplies, regardless of value. An Accountable Officer can issue for tier two, three, four, or five supplies. The regulation does not specify grounds; the power appears unfettered. This creates a right to bypass quote/tender requirements but not other procedural duties.

Right to appeal to Procurement Review Board (r 6A(1)(a)). Persons can appeal in relation to the eligibility or admissibility of a quote or tender, in accordance with the procurement directions. The regulation does not define who can appeal (suppliers? account officers?). It does not create a right to challenge the contract award itself; only the procedural eligibility/admissibility questions.

Duty to publish contract details (r 10(1)). The Accountable Officer must publish details of contracts for supplies on the Territory Government website. This is subject to four exceptions: tier one, government suppliers, existing contracts, or ministerial public interest exemption. The content of “details” is not specified; the regulation leaves it to the Accountable Officer’s discretion.

The Procurement Regulations 1995 do not themselves prescribe any pecuniary penalties, fines, or imprisonment for non-compliance. They are procedural regulations that impose duties on Accountable Officers and others, but they do not create criminal offences or civil penalty provisions. Enforcement relies on other mechanisms.

Under section 6 of the Procurement Act 1995 (not reproduced here), the Procurement Review Board may audit or review agency procurement procedures or activity (regulation 6A(1)(b)). The Board can advise the Minister or the agency. However, the Board has no power to invalidate a contract, impose fines, or direct a remedy. Its findings may lead to political or administrative consequences but no direct legal sanction.

Accountable Officers are public servants. Breaches of mandatory procedural requirements (e.g., failing to obtain three quotes for tier two) would likely be dealt with under the Public Sector Employment and Management Act 1993 as a breach of duty or misconduct. This could lead to reprimand, reduction in classification, or termination. The regulations do not specify this; it follows from general public sector employment law.

If a contract is entered into without complying with the regulations, its validity may be questioned. The regulations are made under an Act and have the force of law. A contract formed in contravention of a mandatory requirement (e.g., no quotes, no public tender) could be void or voidable for illegality at common law. However, the regulations do not state that non-compliance invalidates a contract. Courts would need to interpret the intention of the Act and regulations; given the absence of express invalidity, a court might treat the duties as directory rather than mandatory, or may apply the principle that government contracts are not automatically void for procedural error. This creates legal uncertainty for suppliers and agencies alike.

The regulations give the Procurement Review Board power to determine appeals on eligibility or admissibility of quotes or tenders (r 6A(1)(a)). An unsuccessful supplier could appeal alleging that a quote should have been excluded or a tender considered. The Board’s decision would be binding only within the procurement process; it could not award damages or order a retender, but could direct the agency to reconsider. Judicial review of the Board’s decision may be available under the Administrative Decisions (Judicial Review) Act (NT) but is not mentioned in the regulations.

There is no provision for debarment, suspension, or exclusion of suppliers for misconduct. Nor is there any enforcement mechanism against suppliers who provide inaccurate information in quotes or tenders.

Procurement Act 1995. These regulations are made under and are subordinate to the Act. The Act establishes the Procurement Review Board (section 6), and the regulations define its composition and functions. The Act also likely contains broader objectives, definitions, and perhaps mandatory principles. The regulations must be read together with the Act. For example, the definition of “supplies” is not in the regulations; it would be in the Act. The regulations do not purport to override the Act.

Public Sector Employment and Management Act 1993. Regulation 6(3) provides that appointments to the Procurement Review Board may be by reference to an office under that Act. The same Act governs the employment of Accountable Officers and other public servants, including discipline for non-compliance.

Procurement directions. The regulations repeatedly refer to the procurement directions for definitions of tiers (r 2) and for standards on eligibility/admissibility of quotes or tenders (r 6A(1)(a)). The directions are not legislative instruments; they are executive policy documents. Their legal effect is derivative: the regulations require compliance with them in certain respects, but the directions themselves are not regulations. If the directions are inconsistent with the regulations, the regulations prevail. However, because the regulations incorporate the directions by reference for key definitions, changes to the directions automatically alter the meaning of the regulations without amendment. This is a potential rule of law concern.

Financial legislation. Regulation 3(3) requires endorsement as to availability of funds. This would interact with the Financial Management Act or the Annual Appropriation Act. The Accountable Officer must ensure expenditure is within appropriation. The regulations do not override budget law.

Contract law. The regulations do not codify contract formation; they impose pre-conditions on the decision to incur expenditure. The resulting order (regulation 9) is the document that creates a contractual obligation. Regulation 9 requires the order to be in a form approved by the Accountable Officer and signed by them. This may create an issue where a contract is formed orally or through acceptance of a purchase order that does not comply. The law of contract operates separately; non-compliance with the regulations may affect the authority of the officer to bind the Territory.

Commonwealth competition law. The regulations do not exempt NT agencies from the Competition and Consumer Act 2010 (Cth). However, government procurement is generally not subject to Part IV of that Act because the Commonwealth is not a corporation. But suppliers could face issues.

Environmental, workplace health and safety, anti-discrimination laws. Nothing in these regulations overrides those laws; they apply concurrently.

Privacy and freedom of information. Regulation 10 requires publication of contract details, but does not address privacy concerns. The Information Act (NT) may apply.

The regulations were originally made as SL No. 14 of 1995, notified and commenced 10 May 1995. They have been amended nine times up to the version in force at 27 November 2019, as recorded in the endnotes.

2000 (SL No. 24). Regulation 4 was substituted. This replaced the original requirement for tier two supplies. Regulation 8 on certificates of exemption was also amended.

2001 (SL No. 40). Amendments to regulation 2 (definitions) and regulation 6 (Procurement Review Board). The definition section was amended, likely to adjust tier references or add new defined terms.

2006 - two instruments. SL No. 9 (March 2006) and SL No. 32 (October 2006). The first amended regulations 2, 4, 5, 6, 7, 8, and 10. Regulation 5 was substituted (by No. 9) and then further amended (by No. 32). Regulation 8 was substituted by No. 9, then amended by No. 32. This was a significant overhaul.

2007 (SL No. 34). Regulation 5 was substituted again, and regulation 8 was substituted. The tier three, four, five tendering requirements were completely rewritten, and the exemption provisions were reformed.

2009 (SL No. 7). Focused on quotes for supplies. Regulation 2 was amended, regulation 4 was substituted (requiring three written quotes rather than a different number or method), regulation 5 was amended, and regulation 8 was amended. Regulation 10 was substituted - likely to introduce or modify the publication requirement.

2012 (SL No. 26). Amended regulations 2, 4, 5, 6, and 8, effective 1 July 2012. Further refinement of tier definitions, quote and tender requirements, and Board membership provisions.

2013 (SL No. 4). Only regulation 10 was amended (details of contracts to be published). This suggests fine-tuning of the publication exceptions or requirements.

2014 (SL No. 18). A notable amendment: regulation 6A was inserted, setting out the functions and powers of the Procurement Review Board. Regulations 2, 4, 5, 6, and 8 were also amended. This gave the Board a statutory basis for its review and audit functions, where previously those functions were absent from the regulations.

2019 (SL No. 28). The most recent amendments before the reprinted version. Regulations 2, 4, 5, 6, and 8 were amended. Regulation 4 was substituted again, and regulation 8 was amended. This likely adjusted the quotation threshold and exemption process.

The amendment history shows frequent tinkering, particularly with the quote and tender obligations (regulations 4 and 5 have been substituted multiple times). This suggests either changing policy preferences or ongoing attempts to calibrate the compliance burden. The Board’s functions were only codified in 2014, meaning for nearly 19 years the Board operated without regulation-defined functions beyond what the Act provided.

The text of the regulations and the endnotes do not mention any litigation history. There are no reported cases cited. This is consistent with the nature of these regulations: they are internal procedural rules that rarely give rise to private rights of action.

However, the absence of reported cases does not mean there has been no litigation. Disputes may have been resolved within the Procurement Review Board (internal appeals) or through judicial review applications that did not result in published decisions. The NT Supreme Court decisions are not always widely reported.

Potential grounds for litigation include: a supplier challenging the validity of a contract entered without required quotes or tenders; a challenge to the Minister’s or Accountable Officer’s use of a certificate of exemption; a challenge to the Procurement Review Board’s decision on an appeal; or a dispute over whether a supply was correctly classified into a tier.

Given the narrow scope of the regulations, litigation would likely focus on whether a mandatory requirement was breached and whether that breach invalidates the contract. At common law, government contracts entered without statutory authority may be unenforceable. But courts distinguish between mandatory and directory provisions. The fact that the regulations do not state that a contract entered in breach is void may lead a court to treat the duties as directory. The amendments history shows frequent tinkering with threshold values, which could generate disputes about which version applied at the relevant time.

Procurement Review Board decisions may be subject to judicial review under the Administrative Decisions (Judicial Review) Act (NT). The Board’s decisions on eligibility or admissibility of quotes/tenders are likely reviewable for jurisdictional error, denial of procedural fairness, or error of law. There is no indication of a privative clause ousting review.

The publication requirement (regulation 10) is unlikely to be litigated because it imposes no duty on suppliers and the exceptions are broad. A journalist or competitor might seek mandamus to compel publication, but that would be rare.

Overall, litigation risk is low for most aspects of these regulations, but the lack of case law also means there is no judicial guidance on key ambiguities (e.g., what constitutes “established supplier”, whether the fund endorsement is mandatory, what counts as “contrary to the public interest”).

Value thresholds are in the procurement directions, not the regulations. A procurement officer cannot determine whether a supply is tier two or five by reading the regulations. They must consult the current procurement directions, which may change without notice. Wrong classification can lead to procedural failure.

No definition of “established supplier” for tier two quotes. The Accountable Officer must obtain quotes from at least three established suppliers, but the regulations give no criteria. This could be interpreted subjectively. A supplier who is not asked cannot complain about a wrong classification.

Exemption power is unfettered. Both the Minister and Accountable Officer can issue certificates of exemption without stating reasons or grounds. There is no transparency requirement. This could be used to avoid competition for convenience rather than genuine urgency or special circumstances.

The mandatory language of regulation 7(1) (use across-government contracts) is softened by the Accountable Officer’s power to direct otherwise. No criteria are given for the direction. This creates a potential loophole; an officer could direct departure for any reason, including personal preference.

Publication exceptions are broad. Regulation 10(2) exempts tier one supplies, government suppliers, existing contracts, and any supply the Minister deems contrary to the public interest. “Contrary to the public interest” is not defined. It could include commercial confidentiality, but also decisions to avoid embarrassment. There is no requirement for the Minister’s decision to be in writing or published.

Requisition and order forms must be approved by the Accountable Officer (regulations 3 and 9). This means each agency may have different forms. Using the wrong form could technically invalidate the requisition or order.

The fund availability endorsement (r 3(3)) must occur before the requisition is approved. If an Accountable Officer approves a requisition without checking funds, the endorsement is a nullity. Future spending could be unauthorised under financial legislation.

Tier two supplies require quotes “before incurring expenditure”. If an order is placed before quotes are obtained, the requirement is breached even if the payment is later made. The timing is critical.

The Procurement Review Board appeal right (r 6A(1)(a)) is limited to eligibility or admissibility of a quote or tender. It does not cover evaluation of the merits, value for money, or ultimate contract award. A supplier cannot challenge the decision to award to another if the other’s quote was procedurally admissible.

Regulation 7(2) allows use of Commonwealth, state, or other territory contracts, but only with Procurement Review Board approval. There is no criteria for when approval will be granted. This adds an extra bureaucratic step that may discourage use of beneficial existing arrangements.

No grandfathering or transitional provisions apparent. The amendment history shows multiple substitutions of key regulations. A contract or procurement process started under one version may become subject to different rules mid-process. The regulations do not address this.

The endnotes list amendments but the base regulations as reprinted at 27 November 2019 incorporate them. However, if a reader relies on an unofficial copy, they may miss the latest amendment. The definition of tiers in regulation 2 says “in the procurement directions” - which are not reprinted.

Compliance requires a systematic process mapped to the value of the supplies being acquired. The first step is to determine the estimated total value of the supplies and classify them into the appropriate tier by consulting the current procurement directions. This classification drives all subsequent obligations.

Step 1: Requisition. Prepare a requisition on the form approved by the Accountable Officer. The form must be endorsed to confirm sufficient funds are available. The Accountable Officer must personally approve the requisition. Delegation of approval may not be permissible unless the Act allows it.

Step 2: Check for across-government contracts. Under regulation 7(1), check whether the required supplies are available under an existing across-government contract. If they are, the Accountable Officer must obtain supplies under that contract unless they issue a specific direction to depart. The direction should be documented and justified, though no criteria are provided. If the supplies are available under a Commonwealth, state, or other territory contract, they may be obtained only after obtaining Procurement Review Board approval.

Step 3: Determine the competition requirement based on tier.

• Tier one supplies: Neither quotes nor public tenders are required by these regulations. (Note: procurement directions may impose additional requirements.)
• Tier two supplies: Obtain written quotes from at least three established suppliers before incurring expenditure. If a certificate of exemption has been issued, the quote requirement does not apply.
• Tier three, four, and five supplies: Invite public tenders. The tenders must be public (open to any eligible supplier) unless a certificate of exemption provides otherwise. Ensure the tender documentation and process are consistent with the procurement directions.

Step 4: Certificates of exemption. If the Accountable Officer wishes to bypass the quote or tender requirement, they may issue a certificate of exemption for tier two, three, four, or five supplies. The Minister may issue exemptions for any supplies. The certificate should be in writing, signed, and dated. The regulation does not require reasons, but documenting the rationale protects against later audit criticism. The exemption must be obtained before the quote or public tender would otherwise be required.

Step 5: Order. After the competition process (or exemption), place an order for the supplies. The order must be in a form approved by the Accountable Officer, signed by them, and contain details of the supplies as specified in the requisition. This order is the contractual document. Ensure it is issued before any goods or services are delivered.

Step 6: Publication. After entering into the contract, publish its details on the NT Government website unless an exception applies. The exceptions are: tier one supplies, government suppliers, existing contracts, or determination by the Minister that publication is contrary to the public interest. The Accountable Officer should decide whether any exception applies and, if so, document the basis. If no exception, publish promptly. The content of the published details is not specified; at minimum, include supplier name, contract value, subject matter, and date.

Step 7: Record keeping. Retain all documents: requisitions, fund endorsements, quotes received, tender documentation, certificates of exemption, orders, and evidence of publication. The Procurement Review Board may audit procurement procedures. Records should demonstrate compliance at each step.

Step 8: Internal review. If a supplier disputes the eligibility or admissibility of a quote or tender, the matter can be referred to the Procurement Review Board for determination. The Accountable Officer should be prepared to explain the basis for inclusion or exclusion decisions.

Common pitfalls to avoid:

• Using the wrong tier classification because the procurement directions were not current.
• Failing to obtain the fund endorsement in writing before approving the requisition.
• Relying on an oral or implied direction to depart from an across-government contract.
• Issuing an order before the requisition is approved.
• Signing an order without the approved form.
• Assuming that publication is not required because the contract is low value - must check if it is tier one or falls under another exception.
• Using a certificate of exemption without documenting the decision - this may be seen as a breach of public sector accountability even if not legally required.