Every federal contract notice shows a procurement method: open tender, limited tender, or prequalified tender. That one field tells you a lot about who had a chance to compete last time, and who may get a chance next time. This guide explains the methods, the thresholds behind them, and why panels matter so much.

Two methods: open and limited

Under the Commonwealth Procurement Rules (CPRs), federal procurement is done by open tender or limited tender (paragraph 9.1).

  • Open tender means the agency publishes an open approach to market and invites submissions from anyone (paragraph 9.8). Multi-stage processes count as open tender if the first stage is open.
  • Limited tender means the agency approaches one or more suppliers directly, when the process does not meet the rules for open tender (paragraph 9.9).

What the thresholds are for

Before choosing a method, the agency must estimate the procurement's maximum value, including options, extensions and renewals (paragraph 9.2). It must not split a procurement into parts just to stay under a threshold (paragraph 9.5).

At or above the relevant threshold, the stricter rules in Division 2 of the CPRs apply, unless an exemption in Appendix A applies (paragraph 9.7 (opens in a new tab)). The thresholds are:

  • $125,000 for non-corporate Commonwealth entities, such as most departments
  • $400,000 for prescribed corporate Commonwealth entities
  • $7.5 million for construction services

At or above the threshold, a limited tender is only allowed under one of the conditions in paragraph 10.3, or under an Appendix A exemption, and the agency must report the condition or exemption it relied on to AusTender (paragraphs 9.10 and 9.11). Our guide to reading limited-tender reasons explains what those reasons mean.

Below the threshold, agencies have more freedom to approach suppliers directly, as long as they still achieve value for money. That is why many smaller contracts show "limited tender" without any special reason.

Some lower-value procurements are also covered by the Indigenous Procurement Policy, which has a mandatory set-aside for Indigenous businesses for most procurements valued from $80,000 to $200,000 (GST inclusive), and for remote procurements of any value.

Panels: the third path

Many agencies buy through panels, which the CPRs call standing offers. A panel is set up once, usually by an open or limited tender, and agencies then buy from the suppliers on it over several years.

Buying from an existing panel is not subject to the Division 2 rules, although the general rules in Division 1 still apply (paragraph 9.12). When a panel has several suppliers, officials should approach more than one of them to maximise competition (paragraph 9.14).

This is what changes who can bid. Once a panel is in place, the work under it usually goes only to the suppliers on that panel. If you are not on it, your real chance to compete may be when the panel is set up again or refreshed.

Reading the method on a notice

One detail catches people out. When a contract is bought from a panel, officials should report the method used to set up the panel, not the method used for that purchase (paragraph 9.13). So a notice can say "Open tender" even though only panel members were invited.

The full notice gives you clues. A SON ID means the contract was bought from a standing offer, and Suppliers Invited shows how many suppliers the agency approached. A notice showing "Open tender", a SON ID and four suppliers invited is almost certainly a panel purchase, not an advertised tender. Our guide to reading a contract notice covers the other fields.

What it means for you

  • Open tender last time is a good sign that the next round may also be advertised, though agencies can change their approach.
  • Limited tender with a reason tells you why the agency went direct. Some reasons, such as an urgent need, may not repeat. Others, such as only one supplier being able to do the work, may.
  • A panel purchase usually means getting onto the panel is the first step.

The Department of Finance's panels guide is useful background, but it notes it has not yet been updated for the CPR changes of 17 November 2025, so rely on the CPRs themselves for any rules or numbers.

How Contract Horizon helps

Contract Horizon shows an open or limited badge on every contract it lists, on every plan, including Free, so you can see at a glance how the work was bought last time. Pro and Team add the limited-tender reason in plain words, the re-tender score, and contract-family history. A free account lets you save a search, get a weekly digest, and add end dates to your calendar. The pricing page sets out what each plan includes. When you have found a contract worth chasing, the guide to preparing for a re-tender 6 to 12 months out covers what to do next.

Contract Horizon is an independent reading of the public record. The contract notice on AusTender is always the source to check.