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Rule 44:
Reasons to exclude a supplier

The reasons an agency may exclude a supplier from participating in a contract opportunity.

  1. An agency may exclude a supplier from participating in a contract opportunity if there is a good reason for exclusion. Reasons for exclusion include:
    1. bankruptcy, receivership or liquidation
    2. making a false declaration
    3. a serious performance issue in a previous contract
    4. a conviction for a serious crime or offence
    5. professional misconduct
    6. an act or omission that adversely reflects on the commercial integrity of the supplier or offends against the Supplier Code of Conduct
    7. failing to pay taxes, duties or other levies
    8. a threat to national security or the confidentiality of sensitive government information
    9. the supplier is a person or organisation designated as terrorists by New Zealand Police
    10. human rights violations by the supplier or in the supplier’s supply chain
    11. any matter that materially diminishes an agency’s trust and confidence in the supplier.
  2. An agency must not exclude a supplier before it has evidence supporting the reason for the exclusion.
  3. An agency should notify a supplier of its exclusion and the reasons for it.

Serious performance issue

If serious issues with past performance are identified and there is supporting evidence, you should consider excluding the supplier from participating in the contract opportunity. See the guidance note on Rule 46 Awarding the contract

Bid rigging

If you discover that the same errors appear in responses from different suppliers (eg misspelled words or the same mathematical mistakes), this may indicate that these suppliers have shared information (eg cut and pasted content from each other’s responses) and may be acting anti-competitively.

For more examples and guidance on detecting and preventing bid rigging, see the Commerce Commission's fact sheets How to recognise and deter bid rigging.

A conviction for a serious crime or offence includes a conviction for foreign bribery (getting an advantage in an international transaction by offering bribes to foreign officials). For more information, read the Organisation for Economic Cooperation and Development's Foreign bribery fact sheet [PDF, 440 KB]. For information about New Zealand law relating to bribery see the Serious Fraud Office website.

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