Debarment Regime: Guide for Western Australian Government agencies

What the Regime does

The Regime establishes grounds, process and governance that allows us to work with suppliers to improve business practices, and in the worst cases of wrongdoing, prevents suppliers from contracting with us.

The Regime applies to suppliers that supply, and subcontract to supply, goods, services, community services and works to the WA Government. 

Finance’s Director General is the decision maker responsible for debarment investigations and determining whether a supplier may be:

• excluded (suspended or debarred) from doing business with the State, or
• invited to enter a supplier undertaking with the State instead of being excluded.

In this guide, a reference to an excluded supplier means a supplier that is suspended or debarred.

How we apply the regime

The Regime is applied to State agencies bound by the Act. 

The Regime commenced on 1 January 2022 but is retroactive so it may affect contracts in place before 1 January 2022.

Components of the regime

The Regime comprises:

• the Act which sets the broad parameters for the debarment regime
• the Regulations which set the processes for the debarment regime.

A supplier is a person or organisation that directly or indirectly supplies or proposes to directly or indirectly supply goods, services, or works to a State agency.

A supplier:

• holds a contract with a State agency or subcontracts under a contract with a State agency, or
• makes or proposes to make an offer to a State agency to supply goods, services, or works as a contractor or subcontractor.

Suppliers may be excluded because of their own conduct or that of their senior officers.

Affiliates of debarred supplier may also be excluded. Affiliates are entities linked to the debarred supplier by common control, ownership, senior officers, or succession.

For more information on senior officers or affiliates, refer to the Regulations.

Exclusion under the Regime means the suspension or debarment of a supplier or affiliate(s) of the supplier.

Exclusion

Exclusion under the Regime means the suspension or debarment of a supplier or affiliate of the supplier.

There are 3 categories of debarment conduct. The consequences that follow for debarred suppliers and affiliates under each category are the same, but the grounds and duration are different. 

Only Category A debarment conduct is a ground for suspension.

The information below provides a summary. However, please refer to the Regulations for the full list of conduct for which suppliers may be excluded.

If you would prefer to see the information summarised in table format, please visit Debarment Regime: exclusion table. 

Suspension

The decision maker may suspend a supplier prior to the making of a debarment decision if:

• the supplier is under investigation for Category A debarment conduct by the supplier or one of its senior officers, and
• suspension is in the public interest.

The supplier may be suspended for an initial period of 12 months. The decision maker may extend the suspension by 6 month increments, up to a maximum of 5 years if:

• an official investigation or proceedings in relation to the underlying conduct is pending or still in progress, and
• the decision maker has not yet made a debarment decision.

The decision maker may terminate the suspension of a supplier at any time and must terminate the suspension if:

• an official investigation or proceedings in relation to the underlying conduct is discontinued, withdrawn or dismissed, or
• the decision maker decides not to debar the supplier.

Suspension of affiliates

An affiliate of a supplier may also be suspended, if:

• that entity is under investigation as an affiliate of a debarred supplier or that entity will become an affiliate when the principal supplier is debarred,
• that entity is a ‘supplier’ as defined in the Act, and
• suspension is in the public interest.

The affiliate may be suspended for the same duration as the principal supplier.

Category A debarment conduct

Category A debarment conduct captures the most serious offences and contraventions covered by the Regime.  Schedule 1 of the Regulations lists specific legislative provisions that are  Category A debarment conduct.

Before a supplier can be debarred for Category A debarment conduct, the decision maker must be satisfied that:

• the supplier or a senior office of the supplier has been convicted of an offence or had a penalty imposed with respect to the conduct, or
• the conduct occurred and the supplier has not denied that conduct in submissions made to the decision maker, and
• debarment is in the public interest.

The decision maker must make the debarment decision within 3 years of:

• date of conviction or the date on which the penalty was imposed, or
• date on which the conduct occurred.

A supplier may be debarred for up to 5 years for Category A debarment conduct.

Category B debarment conduct

Category B debarment conduct captures offences and contraventions under the legislation listed in  Schedule 2 of the Regulations.

Before a supplier can be debarred for Category B debarment conduct, the decision maker must be satisfied that:

• the supplier or a senior officer of the supplier has engaged in Category B debarment conduct, and
• debarment is in the public interest.

The decision maker must make the debarment decision within 3 years of:

• date of conviction or the date on which the penalty was imposed, or
• date on which the conduct occurred.

A supplier may be debarred for up to 2 years for Category B debarment conduct.

Other debarment conduct

Other debarment conduct is conduct by a supplier or senior officer of a supplier that is not Category A or B debarment conduct, but the decision maker is satisfied is of a such a nature that procuring goods, services or works from the supplier would be likely to have a material adverse effect on:

•  the integrity of, and public confidence in, the procurement activities of State agencies, or
• the reputation of the State, or
• the business risk to State agencies.

Other debarment conduct also includes:

• a failure to cooperate with a debarment investigation, and
• debarment under another debarment regime.

Before a supplier can be debarred for other debarment conduct, the decision maker must be satisfied that:

• the supplier or a senior officer of the supplier has engaged in other debarment conduct, and
• debarment is in the public interest.

The decision maker must make the debarment decision within 3 years of:

• date of conviction or the date on which the penalty was imposed,
• date of debarment under the other debarment regime, or
• date on which the conduct occurred.

A supplier may be debarred for up to 2 years for other debarment conduct.

Debarment of Affiliates

An affiliate of a debarred supplier can be debarred provided that:

• the entity falls within the definition of ‘affiliate’ in the Regulations, and
• the decision maker is satisfied that debarment is in the public interest.

The decision maker must make the decision to debar an affiliate within 3 years of the debarment of the principal supplier.

The affiliate may be debarred for a period up to the maximum period for which the principal supplier could have been debarred.

What do I do if I believe a supplier has engaged in conduct that may be grounds for exclusion?

If you believe a supplier to your State agency may have engaged in debarment conduct, you should email Procurement Systems.

How do I find out if a supplier has been debarred?

If a supplier is debarred, the supplier’s name will be published on the Tenders WA Excluded Suppliers page.

We will also issue a notification to:

• all State agency Directors General (DGs)
• nominated contract managers if the supplier has current contracts awarded on Tenders WA.

The supplier’s user registration(s) will be removed from Tenders WA to limit the supplier’s ability to submit offers via Tenders WA while they are debarred.

We encourage you to check the status of suppliers on Tenders WA on a regular basis. The WA Procurement Rules require you to award all contracts valued at $50,000 or more on Tenders WA.

How do I find out if a supplier has been suspended?

If a supplier is suspended, we will issue a notification to:

• all State agency DGs
• nominated contract managers if the supplier has current contracts awarded on Tenders WA.

The supplier’s user registration(s) will be removed from Tenders WA to limit the supplier’s ability to submit offers via Tenders WA while they are suspended. We will also update the Excluded Suppliers page to note that there are currently suspended supplier(s).

There is no public register of suspended suppliers. Each State agency should establish a process to allow procurement officers to check current suspended suppliers before awarding a contract.

‘Contracts’ includes:

• standing offers
• contracts under a standing offer
• single agency contracts including:
  • leases
  • service agreements.

What do I do if I have a contract with an excluded supplier?

If you have an existing contract with a suspended supplier, the suspension decision does not affect the status of the contract so the contract continues, but:

• you must not exercise available extension options, or increase the scope of the contract, and
• you are encouraged to review your contractual rights and approach to contract management during the suspension period.

If you have an existing contract with a debarred supplier:

• you may choose to terminate the contract
• you must not exercise available extension options, or increase the scope of the contract, and
• if you do not choose to terminate the contract, you are encouraged to review your contractual rights and your approach to contract management during the debarment period.

In exceptional circumstances, a State agency may seek a waiver of the consequences of suspension or debarment, with respect to a particular contract or subcontract. A State agency must obtain approval to do so from the decision maker. The decision maker must be satisfied that granting the waiver is in the public interest.

If you have queries about managing your contract during the exclusion period, you should email Procurement Assurance.

What do I do if I have a contract involving an excluded subcontractor?

If you have an existing contract under which the supplier has subcontracted the supply of goods, services, or works to an excluded subcontractor, the status of the contract is not affected by the suspension or debarment decision.

You’re encouraged to review your contractual rights and approach to contract management during the suspension or debarment period.

If you have queries, email Procurement Assurance.

How will I know if I have received an offer from an excluded supplier?

Finance will remove the supplier registration(s) of excluded suppliers from Tenders WA to limit their ability to submit offers via Tenders WA.

The WA Procurement Rules require you to use Tenders WA to advertise your Request if the value of the procurement is $250,000 or more. We strongly encourage you to use Tenders WA to close all tenders and quotes valued at $50,000 and above.

Whether you choose to close your request in Tenders WA or not, you are obligated to ensure that you don’t award a contract to an excluded supplier. You’re also obligated to ensure your awarded contracts don’t include a subcontract or agency arrangement with an excluded supplier.

In all cases, before you award a contract you’re encouraged to:

• check the Debarment Register on the Tenders WA Excluded Suppliers page
• check the Tenders WA Excluded Suppliers to see if there are currently any suspended suppliers (the page will not list the names of suspended suppliers)
• check with your CPO (or other internal contact designated by your agency) or email Procurement Assurance for suspended suppliers.

What do I do if I’ve received an offer involving an excluded supplier?

The request conditions applicable to your procurement will set out what to do if you receive an offer from an excluded supplier.

You must not consider offers from or award any new contracts to:

• an excluded supplier in their own right or as an agent or representative of another supplier, or
• a supplier who is not excluded that is seeking to supply goods, services, or works using a subcontract with an excluded supplier.

You should ensure that the request conditions applicable to your procurement contain the right to reject any or all offers, so that you may rely on that right if you receive an offer naming an excluded supplier. Refer to the Request Conditions and General Conditions of Contract (December 2021) for an example of this type of provision (see Part A, clause 2.3).

In exceptional circumstances, these consequences might be waived, where it is in the public interest. A State agency must ensure approval to do so is obtained from the decision maker.

If you have queries about dealing with an offer from an excluded supplier, email Procurement Assurance.

Suppliers aren’t permitted to seek or be awarded a contract if their an offer contains a subcontracting relationship with an excluded supplier. This means that you must reject any offers that name an excluded subcontractor.

You’re encouraged to:

• remind suppliers of their obligation to check any subcontractor(s) named in their offer against the Debarment Register on Tenders WA before submitting their offer
• properly identify subcontractors when they submit their offer, or to seek prior approval before engaging a subcontractor during the life of a contract.

How will I know if an offer includes a subcontract with an excluded supplier?

In all cases where subcontractors are named in an offer, you should check:

• the subcontractor(s) against the Debarment Register on the Tenders WA Excluded Suppliers page
• check the Tenders WA Excluded Suppliers page to see if there are currently any suspended suppliers (the page will not list the names of suspended suppliers)
• check with your CPO (or other internal contact designated by your agency) or email Procurement Assurance for suspended suppliers.

What do I do if I’ve received an offer from a supplier that includes a subcontract with an excluded supplier?

If a supplier submits an offer that includes a subcontracting arrangement with an excluded supplier, you must reject the offer.

You should ensure that the request conditions applicable to your procurement contain the right to reject any or all offers, so that you may rely on that right if you receive an offer naming an excluded supplier. This includes offers received from non-excluded suppliers that name an excluded subcontractor. Refer to the Request Conditions and General Conditions of Contract (December 2021) for an example of this type of provision (see Part A, clause 2.3).

Check your templates:

• ensure that your request and contract documents give your agency appropriate rights and discretion to give effect to the consequences of suspension or debarment under the Act and Regulations, including:
  • ensuring that your request document gives your agency the right to reject offers involving excluding suppliers
  • ensuring that your contract documents provide the discretion to refuse to extend the scope or term of a contract with an excluded supplier and the right to terminate a contract with an excluded supplier
• if you’re using a template that we didn’t publish, such as your agency’s own works procurement templates, you can request a copy of model contract clauses from ProcurementAdvice@finance.wa.gov.au. The model clauses provide guidance on how to incorporate the Regime into your agency’s procurement documentation. It may also be necessary to seek legal advice, if required.
• if you're using templates published by Finance, check that you are using the current version. Updated goods and services templates and community services templates were published in December 2021 and early 2022.

Use Tenders WA to advertise (and close) your requests:

• although you’re only required to publicly advertise tenders valued at $250,000 or more, we encourage you to use Tenders WA to facilitate all requests valued at $50,000 or above.

Check Tenders WA before you award a contract:

• check the Debarment Register on the Excluded Suppliers page on Tenders WA before varying, extending or awarding a contract.

Establish internal processes for checking for suspended suppliers:

• these processes should allow procurement officers to check for suspended suppliers before varying, extending, or awarding a contract.

Award your contract in Tenders WA:

• if you award your contract in Tenders WA, including ensuring you list any subcontractors, you will be notified if the awarded supplier or subcontractor is subsequently excluded
• ensure the expiry date of your contract is accurate.

Procurement Assurance

If you have queries about the Regime, current excluded suppliers, or you have identified potential debarment conduct by a supplier, email Procurement Assurance.

Contact Procurement Systems

If you have queries about Tenders WA, email Procurement Systems.