Procurement by third parties (Australia)

What third‑party procurement is

Third‑party procurement is when a third party procures goods or services for a relevant entity. The Department of Finance guidance states this can be a valid way to procure provided the outcome achieves value for money and the arrangement is not used to avoid the Commonwealth Procurement Rules.

How it differs from subcontracting or other arrangements

Subcontracting by a supplier is explicitly not treated as third‑party procurement and is not reportable on AusTender. Reporting and contracting consequences depend on whether the relevant entity or the third party signs the contract and whether the Commonwealth makes a financial commitment.

Practical consequence for suppliers

Where a relevant entity procures on behalf of a third party and the Commonwealth commits funds, the entity reports the Commonwealth’s commitment value and may note the third party’s contribution in the contract description. If there is no Commonwealth commitment, reporting is not required.