Australian Industry Participation plans
User Guide for developing a Compliance Report for
Project Proponents
April 2014
User Guide for developing a Compliance Report for Project Proponents
Australian Industry Participation Authority
Version 1.1 April 2014
Table of Contents
Introduction ............................................................................................................................... 3
About this User Guide ............................................................................................................... 4
What is a Compliance Report? .................................................................................................. 5
Compliance with approved AIP plan ..................................................................................... 5
Reporting Period ................................................................................................................... 5
Record Keeping ..................................................................................................................... 6
How to prepare a Compliance Report .................................................................................. 6
Submitting a Compliance Report .......................................................................................... 7
Evaluation of Compliance Reports ........................................................................................ 7
Information-gathering powers .............................................................................................. 7
Consequences of Non-compliance........................................................................................ 8
Annual Report ....................................................................................................................... 8
Detailed Compliance Report Outcomes .................................................................................... 9
Project Proponent Details ..................................................................................................... 9
Compliance Report Declaration ............................................................................................ 9
Project Update ...................................................................................................................... 9
Australian Industry Participation .......................................................................................... 9
AIP Activities Undertaken by Project Proponent .............................................................. 9
AIP Activities Undertaken by Procurement Entities ....................................................... 11
Promotion of AIP plan and/or local suppliers................................................................. 12
Upcoming AIP Activities .................................................................................................. 12
Procurement of Key Goods and Services ............................................................................ 12
Sourcing decisions during the period ............................................................................. 12
Supplier Performance ..................................................................................................... 14
Ongoing Commitment Summary .................................................................................... 14
Adjustments to Previously Reported Project Commitments ......................................... 15
Forecast Major Contracts ............................................................................................... 15
Other ................................................................................................................................... 16
Attachments ............................................................................................................................ 17
Abbreviations and Acronyms .............................................................................................. 17
Key Concepts and Definitions ............................................................................................. 17
User Guide for developing a Compliance Report for Project Proponents
Australian Industry Participation Authority
Version 1.1 April 2014
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Introduction
The User Guide for developing a Compliance Report for Project Proponents (Project
Proponent Compliance Report User Guide) provides guidance on the steps required to be
taken by a project proponent to report on its Australian Industry Participation (AIP) plan. The
Compliance Report template has been developed in accordance with the Australian Jobs
(Australian Industry Participation) Rule 2014 and the rules in the Australian Jobs Act 2013
(the Act).
The key objective of an AIP plan for a major project is that Australian entities should have
full, fair and reasonable opportunity to bid for the supply of key goods or services for the
project. The Act does not mandate the use of Australian entities.
The Compliance Report will provide details on how the AIP plan is being implemented to
provide Australian entities with full, fair and reasonable opportunity to participate in the
project.
Full, fair and reasonable opportunity is the key principle of the Australian Industry
Participation National Framework (AIP National Framework). The AIP National Framework
encourages a nationally consistent approach to maximising Australian industry participation
in investment projects and significant public and private sector activity. The AIP National
Framework was agreed between Commonwealth, state and territory governments in 2001
to promote, develop and maintain a sustainable Australian industry capability by
encouraging competitive Australian industry participation in investment projects.
Further information on the Act, AIP Authority, AIP National Framework and other AIP
initiatives can be found at www.industry.gov.au/aip.
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About this User Guide
The Project Proponent Compliance Report User Guide outlines the steps required to be
taken by a project proponent if they are required to provide a Compliance Report to the AIP
Authority under the Act. It provides guidance on how to prepare a Compliance Report.
Project proponents are encouraged to contact the AIP Authority early in the development of
a Compliance Report. When preparing a Compliance Report project proponents must use
the approved Compliance Report template available at www.industry.gov.au/aip.
All Compliance Reports submitted must be in the form approved by the AIP Authority.
The Project Proponent Compliance Report User Guide should be read in conjunction with
the User Guide for developing an Australian Industry Participation plan. These User Guides,
and associated documents and information may be updated from time to time. To ensure
the most up to date versions of the User Guides are being used please visit
www.industry.gov.au/aip.
For further guidance on AIP plans and Compliance Reports, please contact the AIP Authority
by:
Email: aip@industry.gov.au
Phone: +61 2 6213 6404
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What is a Compliance Report?
A Compliance Report documents the actions and activities that project proponents have
undertaken to implement the approved AIP plan. The Compliance Report should detail how
full, fair and reasonable opportunity was provided to include capable Australian entities in
the project. The outcomes that were achieved as a result of these actions should be
documented in the Compliance Report. Evidence of these actions and outcomes should be
provided as an attachment. To assist project proponents prepare a Compliance Report, a
template is available at www.industry.gov.au/aip.
As detailed in the Act, the key objective of an AIP plan is that Australian entities should have
full fair and reasonable opportunity to bid for:

The supply of key goods or services for a project; and

If the project involves establishing a new facility – the supply of key goods or services for
the new facility’s initial operational phase.
The concept of providing full, fair and reasonable opportunity to Australian entities is the
core principle of the AIP National Framework. The definitions are as follows:
Full – Australian industry has the same opportunity afforded to other global supply chain
partners to participate in all aspects of a project (e.g. design, engineering, project
management, professional services and IT architecture).
Fair – Australian industry is provided the same opportunity as global suppliers to
compete on projects on an equal and transparent basis, including given reasonable time
in which to tender.
Reasonable – tenders are free from non-market burdens that might rule out Australian
industry and are structured in such a way as to provide Australian industries the
opportunity to participate in projects.
Compliance with approved AIP plan
It is a requirement of the Act that as long as an approved AIP plan is in force, a project
proponent for a major project must comply with Part B of the AIP plan. Part B of the AIP plan
aims to ensure project proponents of a major project provide full, fair and reasonable
opportunity for Australian entities to bid for supply of key goods and services to the project.
The purpose of compliance with the approved AIP plan is to check the progress of the
project and monitor outcomes achieved against the obligations under the plan.
Reporting Period
After approval of an AIP plan, for as long as the plan remains in force, regular Compliance
Reports must be submitted to the AIP Authority on the actions and activities that have been
undertaken to implement the approved AIP plan.
A project proponent must submit a Compliance Report for each six month period
commencing on the day that the AIP plan is approved until the project is completed. The
date by which a Compliance Report must be given to the AIP Authority is within the first
three months after the end of each six month reporting period.
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The AIP Authority may, by written notice to the project proponent, determine a different
reporting period for the provision of Compliance Reports.
Record Keeping
A project proponent for a major project must keep such records as are reasonably necessary
to enable the AIP Authority to ascertain compliance with Part B of the AIP plan. Such records
must be kept for a minimum period of five years.
How to prepare a Compliance Report
The outcomes of each action/strategy in the AIP plan should be reported on in the
Compliance Report. Each outcome should contain the following key components:

What evidence is provided to demonstrate that the action/strategy was implemented

What outcome was achieved through the action/strategy implementation
An example of how to write up a Compliance Report statement of outcomes is outlined in
Table 1.
Table 1: An example Compliance Report that includes Action, Evidence and Outcome
Stage
How to write the Compliance Report outcome
AIP plan Action 1
Engagement with vendor identification agent:
The project proponent will engage with a vendor identification agent
to nominate potential suppliers of goods and services relevant to the
contract.
The project proponent will provide the vendor identification agent with
a list of goods and services which will be required to complete the
contract. These will be listed on the vendor identification agent website.
The project proponent will use the vendor identification agent’s
nominated suppliers to supplement our existing supplier database and
these will be invited to respond for the provision of goods and services
required to undertake the contract.
Compliance
Report Evidence
Attached are the following documents:

Letter confirming engagement with the vendor identification agent.

List of goods and services provided to the vendor identification
agent which were required to undertake the project.

Screenshot from vendor identification agent website showing the
list of goods and services required for the project.

List of potential Australian entities provided by vendor identification
agent.

Copy of a request for a quote sent to one of the new Australian
entities.
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Australian Industry Participation Authority
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Stage
Compliance
Report Outcome
How to write the Compliance Report outcome

List of successful new Australian entities supplying goods and
services and value of contracts.

12 companies were provided by the vendor identification agent of
whom nine new Australian entities were added to our supplier
database as three were already included.

25 relevant companies from our supplier database (depending on
good or service required) were approached and invited to provide a
quotation including all identified by the vendor identification agent.

10 current suppliers were awarded contracts valued at $15 million.

Five new companies awarded contracts valued at $2 million (see
attachments).
Submitting a Compliance Report
Compliance Reports must be developed on the approved Compliance Report template and
submitted to the AIP Authority through:
Email:
aip@industry.gov.au
Facsimile:
+61 2 6276 1948
Mail:
Grant Wilson
Acting AIP Authority
GPO Box 9839
CANBERRA ACT 2601
Evaluation of Compliance Reports
Submitted Compliance Reports will be reviewed by the AIP Authority to ensure that they
contain sufficient information to show that the AIP plan is being implemented to meet the
key objective of providing Australian entities with full, fair and reasonable opportunity to bid
for the supply of goods and services for the project. A Compliance Report will only be
acceptable if evidence is provided that the AIP plan has been implemented as agreed and all
essential elements of the Compliance Report are provided.
When a Compliance Report is incomplete or does not provide sufficient evidence that the
AIP plan has been implemented as agreed, advice will be provided to the project proponent
of any additional information required. This advice may be informal or through the
information-gathering powers of the AIP Authority. If the additional information is not
received the AIP Authority may undertake non-compliance actions.
Information-gathering powers
The AIP Authority has a range on information-gathering powers to ensure compliance with
the Act. These powers are able to be exercised in circumstances where the AIP Authority
believes on reasonable grounds that a project proponent has information or documents
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relevant to the operation of the Act. The powers are detailed in ‘Part 4 – Informationgathering powers’ of the Act.
Consequences of Non-compliance
There is a range of consequences of non-compliance which the AIP Authority can enforce
upon project proponents which it has determined have not adequately implemented their
AIP plan. These consequences are detailed in ‘Part 5 – Consequences of non-compliance’ of
the Act.
Annual Report
The AIP Authority will prepare and give to the Minister, for presentation to the Parliament,
an annual report on the operations of the AIP Authority.
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Australian Industry Participation Authority
Version 1.1 April 2014
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Detailed Compliance Report Outcomes
The following information will assist project proponents developing their Compliance Report
in relation to implementing Part B of their AIP plan.
Project Proponent Details
Provide details of the designated project proponent responsible for developing the
Compliance Report for the project and the contact details of the relevant contact officer.
The details of this contact officer are for the AIP Authority’s use only. The project contact
person must be an employee of the project proponent and not an external person or agent.
Project proponents should also include:

their AIP plan reference number;

an update of the estimated project value;

the project name; and

the project location.
In the case of a project with multiple project proponents the designated project proponent
is the project proponent with overall responsibility for developing the Compliance Report for
the project on-behalf-of all project proponents.
Compliance Report Declaration
The Compliance Report Declaration will need to be signed by an authorised person within
the project proponent prior to the submission of the Compliance Report.
Project Update
Please provide an update on the project for the reporting period. For example, this could
cover an update on construction; the number of workers involved or if there have been any
delays. Project proponents may also provide an indication of the expected progression over
the next six months.
Australian Industry Participation
AIP Activities Undertaken by Project Proponent
This outcome should detail the steps taken by the project proponent towards the fulfilment
of the objectives set out in subsection 36(1) of the Act. This should cover the following parts
from your AIP plan:
Contact Details

Details of the project proponent contact officer details published – AIP plan question
B.1 Q1

Provided contact details of person responsible for implementing the AIP plan – AIP plan
question B.1 Q2
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
Where you are acting as a procurement entity, describe how you appointed a contact
officer and promoted their details – AIP plan question B.1 Q3
Key Goods and Services

Where you are acting as a procurement entity, describe how you obtained and
maintained a current understanding of the broad capability and capacity of Australian
entities to supply key goods and services to carry out the project – AIP plan question
B.2 Q3

For the project phase, where you have acted as a procurement entity detail:
o
how you required Australian or international standards for goods and services; and
o
how you ensured that the standards you specified where achieved – AIP plan
question B.2 Q4
Publication of Opportunities

Provide evidence of the project proponent and/or project website – AIP plan question
B.3 Q1

Provide evidence of the website were the project opportunities are being published –
AIP plan question B.3 Q2

Where you are acting as a procurement entity, describe how you ensured that you
maintained a publically accessible website which detailed:
o
Requirements potential bidders must satisfy in order to bid to supply key goods and
services;
o
Standards for key goods and services; and
o
Contact details for a procurement officer for Australian entities to approach with
enquiries – AIP plan question B.3 Q3
Communicating and Providing Opportunities

Describe the activities you undertook to conduct awareness programs about
opportunities for Australian entities to supply key goods and services for the project –
AIP plan question B.4 Q1

Describe how you trained procurement entities to ensure procurement entities achieved
your AIP plan obligations. Where you acted as a procurement entity provide details of
the internal training provided to staff to achieve your AIP plan obligations – AIP plan
question B.4 Q2

Where you acted as a procurement entity, describe how you ensured you published
pre-qualification requirements at a reasonable time prior to approaching the market and
included the requirements that potential bidders had to satisfy in order to bid for key
goods and services – AIP plan question B.4 Q3

Where you acted as a procurement entity, detail how you provided equal timeframes to
Australian entities in relation to responding to requests for bids to supply key goods and
services – AIP plan question B.4 Q4
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Australian Industry Participation Authority
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Facilitating Future Opportunities

Describe how you encouraged capability development for Australian entities – AIP plan
question B.5 Q1

Describe how you encouraged the integration of Australian entities into global supply
chains – AIP plan question B.5 Q2

Where you acted as a procurement entity, describe how you ensured feedback was
provided to Australian entities who were unsuccessful in their bid to supply key goods
and services to the project and that the feedback provided identified, and made
recommendations about, relevant training or skills capability and capacity development
activities – AIP plan questions B.5 Q3
Implementation Resources

Detail what procedures/resources you utilised to ensure that the AIP plan was
implemented – AIP plan question B.6 Q2

Detail what specified steps, beyond the provision of training, you undertook to ensure
each procurement entity achieved the objectives required in the AIP plan – AIP plan
question B.6 Q3
AIP Activities Undertaken by Procurement Entities
This outcome details the steps taken by the project proponent towards ensuring that the
objectives set out in subsection 35(1) of the Act are achieved by each procurement entity for
the project. This should cover the following parts from your AIP plan:
Contact Details

Details on how you ensured procurement entities appointed a contact officer and
promoted their details – AIP plan question B.1 Q3
Key Goods and Services

Describe how you ensured all procurement entities obtained and maintained a current
understanding of the broad capability and capacity of Australian entities to supply key
goods and services to carry out the project – AIP plan question B.2 Q3

For the project phase detail:
o
how you ensured procurement entities required Australian or international
standards for goods and services; and
o
how you ensured that the standards specified where achieved – AIP plan question
B.2 Q4
Publication of Opportunities

Describe how you ensured that your procurement entities maintained a publically
accessible website which detailed:
o
Requirements potential bidders must satisfy in order to bid to supply key goods and
services;
o
Standards for key goods and services; and
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Australian Industry Participation Authority
Version 1.1 April 2014
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o
Contact details for a procurement officer for Australian entities to approach with
enquiries – AIP plan question B.3 Q3
Communicating and Providing Opportunities

Describe how you ensured procurement entities published pre-qualification
requirements at a reasonable time prior to approaching the market and included the
requirements that potential bidders had to satisfy in order to bid for key goods and
services – AIP plan question B.4 Q3

Detail how you ensured that procurement entities provided equal timeframes to
Australian entities in relation to responding to requests for bids to supply key goods and
services – AIP plan question B.4 Q4
Facilitating Future Opportunities

Describe how you ensured your procurement entities provided feedback to Australian
entities who were unsuccessful in their bid to supply key goods and services to the
project and the feedback identified, and made recommendations about, relevant
training or skills capability and capacity development activities – AIP plan question B.5
Q3
Promotion of AIP plan and/or local suppliers
If, during the reporting period, you and/or your procurement entities have prepared any
case studies, press releases or publications that support the information provided in
achieving your AIP plan obligations details should be provided.
Upcoming AIP Activities
Project proponents may provide details on any upcoming AIP activities that you and/or your
procurement entities may undertake during the next six months. This may include any
upcoming supplier briefings, newsletters, seminars, overseas supplier visits etc.
Procurement of Key Goods and Services
Sourcing decisions during the period
This outcome examines the key goods and services that were sourced during the reporting
period above the low-value contract threshold of $1 million. Project Proponents should list
the key goods and services including:

a description of the goods or services acquired; and

the Australian or international standards (if any) that apply to the goods or services
acquired; and

the name of the procurement entity (if any) responsible for acquiring the goods or
services; and

the contract category that applies to the contract used to acquire the goods and
services; and

the name and location of the entity whose bid to supply the goods or services was
successful; and
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
the percentage of Australian content of the goods or services acquired (if any);and

if the entity was not an Australian entity—the reason why an Australian entity was not
successful.
Table 2 provides an example of the information to be provided on the procurement of key
goods and services during the reporting period.
Table 2: Sourcing decisions for key goods and services during the reporting period
Contract
description &
standard used
Name and
Location of
winning
bidder
Procurement
entity
Category
of
contract*
Per cent
Comment on
Australian why an
content
Australian
entity was not
successful
Design services
(Australian
standards)
XC Design
Services,
South
Australia
Mega Project
Pty Ltd
A
60
N/A
Construction
services
(Australian
standards)
Big Dig Pty
Ltd, South
Australia
Mega Project
Pty Ltd
C
85
N/A
Supply of
stainless steel to
standard AISI
420
FG Steel,
China
Mega Project
Pty Ltd
B
0
Stainless steel
is not made in
Australia & it
was a direct
purchase by
Mega Project
Steel Fabrication XY
Engineering,
NSW
Mega Project
Pty Ltd
A
100
Mega Project
supplied the
stainless steel
to XY
Engineering
Mobile mining
equipment –
trucks GVW
greater than
200t
Mine
Development
Services Pty
Ltd
D
30
Purchased
through the
Australian
subsidiary
Mining
Equipment
Inc, USA
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Australian Industry Participation Authority
Version 1.1 April 2014
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* Category of contract
Category
Contract size
A
Contracts >=$1 million <=$5 million
B
Contracts >$5 million <=$25 million
C
Contracts >$25 million <=$100 million
D
Contracts >$100 million <=$500 million
E
Contracts >$500 million
Supplier Performance
Provide details of any strengths and weaknesses of Australian entities’ capability and/or
capacity and general competitiveness you have identified through the undertaking of your
project.
Project proponents should provide details on the capability, capacity and general
competitiveness of Australian entities identified through the implementation of their AIP
plan during the reporting period. This information will help the AIP Authority to work with
Government agencies and Australian entities to improve the capability and competitiveness
of Australian entities.
The information that project proponents could provide includes:

responding to pre-qualification requirements

quality of tender responses

Pricing issues

Delivery timeframes

Quality of product

Lack of capacity
Ongoing Commitment Summary
Project proponents should provide details of the cumulative contracts awarded to Australian
entities and non-Australian entities during the reporting period. Outlined below are
examples of how an Ongoing Commitment Summary table can be completed.
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Australian Industry Participation Authority
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Table 3: Completing the initial Commitment Summary table
Commitments $AUD
Million
Period
Total
Australian entities
Non-Australian
entities
0
0
0
Reporting period
Commitments
245
90
155
Cumulative to
31 June 2014
245
90
155
Cumulative to
1 January 2014
Table 4: Completing subsequent Commitment Summary tables
Commitments $AUD
Million
Period
Total
Australian entities
Non-Australian
entities
Cumulative to
31 June 2014
245
90
155
Reporting period
Commitments
879
365
514
Cumulative to
31 December 2014
1124
455
669
Adjustments to Previously Reported Project Commitments
If there have been revisions to previously reported cumulative totals, project proponents
can provide details of the revisions. This could include the anticipated contract value and the
likely supplier location
Forecast Major Contracts
Project proponents may provide details on any major contracts that may be released within
the next six months.
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Australian Industry Participation Authority
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Other
Project proponents may provide any additional information that will support the claims that
the AIP plan is being implemented as agreed.
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Australian Industry Participation Authority
Version 1.1 April 2014
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Attachments
Abbreviations and Acronyms
List of Abbreviations and acronyms
Abbreviation/Acronym
Definition
Act
Australian Jobs Act 2013
AIP
Australian Industry Participation
AIP Authority
Australian Industry Participation Authority
AIP National Framework
Australian Industry Participation National Framework
AIP plan
Australian Industry Participation plan
ISO
International Organisation for Standardisation
OHS
Occupational Health and Safety
SME
Small and medium enterprise
Key Concepts and Definitions
In the definitions below ‘person’ refers to a ‘company’ or ‘organisation’ as defined by the
Corporations Act 2001.
Approved AIP plan
Means an approved AIP plan under section 18, 19 or 20 of the Australian Jobs Act 2013.
Australian entity
Any entity with an ABN or an ACN
Entity
Has the same meaning as in the A New Tax System (Australian Business Number) Act 1999.
Key goods or services
Means goods or services other than goods or services supplied, or to be supplied, under a
low value-contract. Goods and services are key goods and services if, and only if, the goods
or services are for use, wholly or partly, in connection with carrying out the project of the
operation of a new facility during the two year initial operation phase.
Low-value contract threshold amount
Means a contract under $1 million.
Non-Australian entity
Means an entity other than an Australian entity
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Operator
A person who has day to day management and control of the facility and its activities.
Procurement entity
Could include an Engineering, Procurement and Construction Management company or
equivalent tier 1 contractor making procurement decisions on behalf of the project or
facility. A procurement entity does not include sub-contractors which are responsible for
supplying goods and services to a project or facility rather than purchasing goods or services.
Project proponent
Is the person ultimately responsible for the project
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Version 1.1 April 2014
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