Can government agencies negotiate directly with a supplier without tendering?
- 28.08.2026
We are a construction company thinking of tendering for a large public building project. We understand that there are special contract forms and retention rules. What legal issues should we be aware of?
Public construction projects typically use standard forms, such as NZS 3910 for construction contracts, and are governed by the Construction Contracts Act 2002, which provides for payment claims, payment schedules, statutory adjudication and rights to suspend work for non-payment. Since the rules were updated, retention money withheld on commercial construction contracts must be held on trust and dealt with in accordance with the Act, protecting subcontractors. Health and safety obligations apply under the Health and Safety at Work Act 2015, and principals share duties with contractors. Consider the risk allocation in special conditions, such as liquidated damages, variation procedures, time bars and bonds or guarantees. Central government agencies also apply the Government Procurement Rules, including their construction procurement requirements. Have the contract reviewed before tendering.
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