Procurement Australia’s naming in Section 55
Some of our NSW members have let us know there has been some confusion about our status as a prescribed entity under Section 55 of the NSW Local Government Act.
We are named in Section 55 as Maps Group Limited trading as Strategic Purchasing which, of course, was what we were called before our name change to Procurement Australia in February 2010.
The simple (legal) fact is that it is only a change to our trading name, not to the underlying legal entity. To clarify the situation for our member's peace of mind, we have asked Scott Alden from DLA Phillips Fox for some clarification. In summary, any NSW council can access our contracts on goods and services, ranging from the One Card through to Stationery and HR, with the assurance of an ISO-accredited, watertight tender process that is fully compliant with your tendering requirements under Section 55. This is regardless of when those contracts were put in place.
Below are excerpts from Scott Alden's detailed response:
Change of name, not change of entity
"Maps is the current legal entity. As a matter of law a corporate entity is able to change names at any time and the underlying legal entity remains the same with the same Constitution, ACN, ABN, Board, functions and powers. Accordingly, Maps' existing and prospective clients in NSW can be confident that by engaging Your PA Procurement Australia (the trading name of Maps)...to undertake its bulk purchasing activities, they will be complying with the tendering requirements set out in section 55 of the Act."
Scott Alden
Partner, DLA Phillips Fox
1 October 2010
Validity of contracts prior to Procurement Australia's naming in Section 55
"As a general rule, legislation does not apply retrospectively. This general rule also applies to amending legislation, such that the amendment is not considered to be included in the original act as if it had always been included but rather has effect from the date the amending act comes into operation. Therefore, the Local Government (General) Amendment (Tendering) Regulation 2010 (NSW) which amended the Local Government (General) Regulation 2005 (NSW) to include Procurement Australia as a prescribed person for the purposes of section 55 of the Act will only apply from 9 April 2010.
As you know, section 55 of the Act requires councils to invite tenders before entering into certain contracts for goods, materials or services. However, section 55(3) of the Act enables contracts to be excluded from the tendering requirements, including contracts for the purchase of goods, materials or services specified by a prescribed person, i.e. Procurement Australia.
If a Council wishes to enter into a contract under panel arrangements which were established prior to Procurement Australia’s naming in section 55, this would be valid and fall within the section 55(3) exemption irrespective of when that panel was established. This is due to the fact that section 55 of the Act is enlivened when council is entering into a contract and not when a panel is established. Therefore, any such contract entered into by Council on or after 9 April 2010 will be considered valid as the contract is being entered into when Procurement Australia is named as a prescribed person. The section 55(3) exemption will not apply to contracts with Procurement Australia’s panel providers entered into by Council prior to 9 April 2010, however, we understand that this is not an issue."
Scott Alden
Partner, DLA Phillips Fox
1 October 2010
To find our more about our contracts in NSW, please contact Andy Norton on 0412 396 698 or email anorton@paltd.com.au.