Digital Seller Underperformance Policy: Standard

Introduction

This Digital Seller Underperformance Policy: Standard (DSUP Standard) sets out key requirements under the DSUP. It should be read in conjunction with the DSUP to understand the policy’s context and intent and the Digital Seller Underperformance Policy: Guidance (DSUP Guidance) for practical guidance on how the DSUP operates.

In the DSUP documents, capitalised key terms have the meanings given in Appendix A: Glossary of the DSUP.

If you have questions about this document or the DSUP generally, please contact the DTA at DSUP@dta.gov.au. 

Scope and key concepts

This DSUP Standard applies to all:

  • Strategic Digital Contracts
  • Buyers that are parties to Strategic Digital Contracts
  • Buyers accessing information about a Seller’s history of Confirmed Serious Underperformance under the DSUP to evaluate a Seller’s past performance on applicable contracts when conducting Approaches to Market for Strategic Digital Contracts, or voluntarily as a due diligence measure
  • Sellers who are performing under Strategic Digital Contracts with Buyers.

Serious Underperformance

Serious Underperformance is defined in Appendix A: Glossary of the DSUP. If reported Seller underperformance does not meet at least one of the criteria set out in this definition, it is not considered Serious Underperformance under the DSUP. The DSUP Guidance contains examples of what may or may not constitute Serious Underperformance.

Confirmed Serious Underperformance

Reported Serious Underperformance is only confirmed when the DTA’s decision-maker makes a decision under the DSUP that Serious Underperformance by a Seller has occurred under a Strategic Digital Contract. The DTA decision is then included in the Confirmed Serious Underperformance (CSU) Register with a status of Confirmed Serious Underperformance. Only the DTA decision-maker can make this decision on behalf of the DTA, using the process detailed in the ‘DTA assessment and decision process’ section of this DSUP Standard.

Reporting Serious Underperformance

A Buyer party to a Strategic Digital Contract may Submit a Serious Underperformance Report to the DTA at any time during the contract lifecycle. Reporting is encouraged whenever the Buyer believes the criteria for Serious Underperformance are met.

Before reporting

  • Buyers are expected to have attempted to address underperformance issues with the Seller directly, using the contract’s performance management or dispute resolution provisions. Please refer to DSUP Guidance for best practice steps before reporting.
  • Buyers should not Submit a Serious Underperformance Report if the alleged underperformance is actively under investigation or subject to court proceedings, until proceedings are concluded. For example, during a fraud investigation or litigation. If an investigation or proceedings eventually provide an adverse finding, a Buyer may then report Serious Underperformance to the DTA under the DSUP, if the Buyer considers it may impact the Seller’s suitability for future work.

Submitting a Serious Underperformance Report

  • All reports of Serious Underperformance must be Submitted to the DTA through the approved process using the relevant Self-Assessment Tool (DSUP001) and Serious Underperformance Report (DSUP002) Forms at Reporting Serious Underperformance.
  • The Buyer must notify the Seller in writing when a Serious Underperformance Report is Submitted to the DTA, unless extraordinary circumstances prevent this, such as legal constraints. This ensures the Seller is aware of the Serious Underperformance Report.
  • Buyers may coordinate with other Buyers to Submit a joint Serious Underperformance Report if the alleged Serious Underperformance spans multiple Strategic Digital Contracts with the same Seller. If Buyers Submit a joint Serious Underperformance Report, each Buyer will still need to complete the relevant Forms, however they will Submit the Serious Underperformance Reports to the DTA together and the DTA will assess them jointly.

The DTA as a Buyer

When acting in the capacity of a Buyer on a Strategic Digital Contract, the DTA may Submit a Serious Underperformance Report regarding a Seller. To maintain fairness, the DTA will:

  • implement information barriers internally, so the team assessing the Serious Underperformance Report is segregated from the team that Submitted it
  • limit information flows to those with a need to know, through siloed work areas
  • provide DTA personnel with guidance to exercise caution in managing any conflicts of interest.

DTA assessment and decision process

Upon receiving a Serious Underperformance Report, the DTA will acknowledge receipt to the Buyer via Email within 5 business days. Before assessing a Serious Underperformance Report, the DTA will first verify that the contract in question is a Strategic Digital Contract. If the DTA determines the contract:

  • is not a Strategic Digital Contract, the DTA will notify the Buyer and Seller via Email that the Serious Underperformance Report will not proceed to assessment and no further action will be taken under the DSUP
  • is a Strategic Digital Contract, the DTA decision-maker will proceed to assess the Serious Underperformance Report to reach a decision. This includes reviewing the Serious Underperformance Report details and seeking additional information or documentation from the Buyer and Seller via Email, telephone or any other means as required.

Seller's right of reply

In all cases where the DTA proceeds to assess a Serious Underperformance Report, the DTA must give the Seller a fair opportunity to respond to the Serious Underperformance Report before making a decision. The DTA will inform the Seller via Email of the content of the Serious Underperformance Report and invite the Seller to provide their comments and evidence in response to the Serious Underperformance Report.

  • The Seller is afforded 15 business days from notification to Email a written response with any information it wants the DTA to consider. The DTA may grant a reasonable extension of time for the Seller’s response, if requested, and if the Seller shows justification for needing more time – for example, due to the complexity of issues.
  • If the Seller disagrees with the Serious Underperformance Report, it should provide a detailed rebuttal via Email, including any evidence of corrective actions or remediation undertaken to address the issues. For example, the Seller may supply progress reports, independent reviews, or correspondence showing how it resolved or is resolving the underperformance. Failure to respond or to provide supporting information may result in the DTA proceeding with the information at hand.
  • The DTA will share the Seller’s response with the reporting Buyer and give the Buyer an opportunity to review and comment on any new facts or perspectives the Seller has provided. The Buyer may Email the DTA additional input or clarification considering the Seller’s reply. The DTA may then engage in further consultation with the Seller for any clarification as required. This iterative consultation helps ensure all relevant facts are gathered.

Assessment and decision criteria

The decision-maker for the DTA will act fairly and impartially when assessing a Serious Underperformance Report. The decision whether to confirm an instance of Serious Underperformance will be based on careful consideration of relevant factors and evidence.

The decision-maker for the DTA will be the Branch Manager – Portfolio Assurance, or an equivalent position, or a person acting in that role. This senior official will review the evidence and recommendations. They will then determine if the alleged Serious Underperformance amounts to an instance of Confirmed Serious Underperformance under the DSUP.

The DTA decision-maker will assess:

  • whether the alleged underperformance meets the definition of Serious Underperformance under the DSUP
  • the quality and weight of the information provided. This includes determining what information is relevant and what is irrelevant. Relevant information will be assigned a weighting. Irrelevant information will not be considered further once determined to be irrelevant
  • any mitigating or external factors that may have contributed to the alleged Serious Underperformance – for example, issues caused by Buyer actions or third parties, if the contract terms make those the Buyer’s responsibility. However, the focus remains on the Seller’s obligations under the Strategic Digital Contract.

In making its decision, the DTA may consider whether there have been multiple Serious Underperformance Reports and/or Confirmed Serious Underperformance on the CSU Register concerning the same Seller in the preceding 12 months. If any earlier Serious Underperformance Reports did not individually result in a decision by the decision-maker of a Confirmed Serious Underperformance finding at the time, a pattern of repeated issues could influence the decision on a new Serious Underperformance Report.

Decision confirmation and notification

The DTA will communicate the decision of the DTA decision-maker in writing via Email to both the Buyer and Seller. If the DTA’s decision is that Serious Underperformance has occurred, the Seller and Buyer will be notified in writing via Email, and the necessary details about the Confirmed Serious Underperformance status will be included in the CSU Register.

Notifications of Confirmed Serious Underperformance will include:

  • the date of the decision
  • the name and position of the DTA decision-maker
  • the reasons for the decision, summarising the relevant considerations and evidence
  • information on the review rights, as outlined below.

If the DTA’s decision is that no Serious Underperformance has occurred, the Seller and Buyer will be informed of this decision via Email. This means that the Seller will not be included on the CSU Register if the decision is that no Serious Underperformance has occurred.

Review rights

Both the Buyer and the Seller have the right to request an internal review of a DTA decision under the DSUP, by lodging a request via Email to the DTA within 15 business days of being notified. During the review process of a Confirmed Serious Underperformance decision, the Seller’s status in the CSU Register will be noted as ‘Confirmed Serious Underperformance – decision under review’.

When the DTA receives a request for internal review, the reviewing official will be a senior official, a Branch Manager or equivalent, who was not involved in the original decision.

The reviewing official may decide to either:

  • affirm the decision. If the decision being reviewed is a Confirmed Serious Underperformance decision, this will affirm the Seller’s Confirmed Serious Underperformance status, and the decision date will be included in the CSU Register. Where the senior official makes a decision to affirm the decision that no Confirmed Serious Underperformance occurred, the Seller will not be included on the CSU Register
  • set aside the decision. If the decision being reviewed is a Confirmed Serious Underperformance decision, this will result in the Seller being removed from the CSU Register entirely.

The outcome of the review will be communicated by the DTA in writing via Email, typically within 15 business days of the review request.

Remediation plan option

A Seller included on the CSU Register with a Confirmed Serious Underperformance status may, after a minimum of 2 months under that status, request permission from the DTA via Email to submit a remediation plan for inclusion in the CSU Register. The purpose of the remediation plan is to document the actions the Seller will take to address the causes of its underperformance and prevent recurrence.

  • The Seller must obtain the DTA’s approval of the remediation plan contents. The DTA may decline to approve a plan if it is deemed insufficient to address the relevant issues.
  • If approved, the remediation plan will be made available to Buyers consulting the CSU Register in accordance with the ‘Buyer obligations regarding the CSU Register’ section of this DSUP Standard.

Sellers should consult the DSUP Guidance for what can be included in a remediation plan.

An approved remediation plan may assist the Seller’s case in future procurements, but it does not by itself remove a Confirmed Serious Underperformance status.

Buyer obligations regarding the CSU Register

Six months from the commencement of the DSUP, or later if an adjusted timeframe is announced by the DTA, a Buyer procuring a new contract that meets the Strategic Digital Contract definition is required to consult with the DTA via Email to check whether any Seller that has submitted a tender in that procurement is included on the CSU Register.

  • Consultation is required at the tender evaluation stage of the procurement before a decision is made on the award.
  • The Buyer should provide the DTA with the names of the tendering Sellers, and evidence that those Sellers have responded to its Approach to Market, such as a list of respondents.
  • The DTA will inform the Buyer via Email whether any of those Sellers have a Confirmed Serious Underperformance status on the CSU Register, including multiple instances of Confirmed Serious Underperformance.
  • Buyers may request information on multiple Sellers in the same enquiry to the DTA.
  • For procurements below the Strategic Digital Contract threshold, Buyers are not required to consult the CSU Register but may choose to do so voluntarily as a due diligence measure.

Information disclosed to Buyers

When a Buyer consults the CSU Register through the DTA, the DTA may disclose the following details for any Seller included on the CSU Register with a Confirmed Serious Underperformance status including multiple instances of Confirmed Serious Underperformance:

  • the identity of the Seller
  • the date the decision-maker made the Confirmed Serious Underperformance decision
  • the date the Seller’s Confirmed Serious Underperformance status was changed to a historical status by the DTA after review, if applicable
  • the category or categories of digital products or services in the Strategic Digital Contract in which Serious Underperformance occurred, to provide context on relevant capability areas
  • confirmation about whether the Seller has an approved remediation plan on the CSU Register, and a copy of that plan, if applicable
  • any other information in the CSU Register entry that the Seller has consented to share with Buyers – for example, a brief description of the issue.

No personal information will be disclosed from the CSU Register, such as individual staff names, unless appropriate consent is obtained in accordance with privacy requirements. This includes the Seller’s obligation to obtain consent from the relevant individual.

Buyer use of CSU Register information

Buyers should factor CSU Register information into overall value for money assessments in line with the Commonwealth Procurement Rules. The Commonwealth Procurement Rules explicitly include a Seller’s relevant performance history as an evaluation factor.

Buyers who receive information from the CSU Register must:

  • use it only for the purpose of evaluating the Seller’s performance history and risk as part of that specific procurement process
  • not use this information as the only source of due diligence about a Seller.

Buyers remain fully responsible for their own procurement decisions and contract management – the CSU Register information is only one input to consider, not a determinant of outcome.

  • A Seller’s inclusion on the CSU Register does not prohibit or prevent a Buyer from awarding a contract to that Seller. The DSUP is not a ban – it supports due diligence but the final decision rests with the Buyer after weighing all factors including the Seller’s tender response, any remediation efforts, and the procurement context.
  • Buyers must not use the existence of a Seller’s Confirmed Serious Underperformance status as leverage during contract negotiations – for example, to push for lower prices or additional contract terms unrelated to the underperformance issue.
  • CSU Register information must not be used as an escalation tool or threat to enforce contract issues outside normal contract remedies. It is intended solely to inform evaluation of bids, not to punish or demand concessions.
  • If a Seller is included on the CSU Register, Buyers may engage with that Seller during the tender process to seek more information about the circumstances and what the Seller has done to address the past underperformance. This allows the Seller to provide context or evidence of improvement, which the Buyer may consider.

Retention and removal of CSU Register information

A Seller’s Confirmed Serious Underperformance status will remain on the CSU Register for at least one year from the date it is recorded. After one year, the Seller may contact the DTA via Email to ask the DTA to change the Confirmed Serious Underperformance status to historical if they can demonstrate to the DTA that their performance has improved or been remediated. A Seller can request a review once per calendar year.

  • The Seller must provide evidence of improvement or remediation, such as successful performance on other contracts or action taken under a remediation plan.
  • The DTA will assess the request, including any new information from the Seller and input from the reporting Buyer, before deciding whether to change the status to historical.
  • Regardless of the Seller’s Confirmed Serious Underperformance status, information will remain on the CSU Register for three years from the date it was included.
  • If the DTA changes the status to historical, the CSU Register will note this as: ‘Confirmed Serious Underperformance – status updated to historical by the DTA on [date]’. During that three-year period, if the Seller participates in a Buyer’s procurement, the DTA will disclose the Seller’s historical Confirmed Serious Underperformance information, including the dates the status changed and evidence supporting the status change.
  • After three years, the Seller’s Confirmed Serious Underperformance record on the CSU Register will be archived and will no longer be disclosed to Buyers under the DSUP.

Integrity, confidentiality, and record-keeping

All Commonwealth officials administering or accessing information under the DSUP must act ethically, honestly, and in good faith.

DTA and Buyer personnel must:

Confidentiality requirements

All information submitted via Email, Submission or any other means by Buyers or Sellers in connection with the DSUP will be kept confidential by the DTA and Buyers, except as permitted by the disclosure obligations set out in the paragraphs below. The CSU Register is an internal government tool and information included in the CSU Register will not be made publicly available or published online except as required by law.

Legal disclosure required under law

All information or records produced under the DSUP are Commonwealth records for the purposes of the Archives Act 1983 (Cth) – notwithstanding the above confidentiality requirements, it is not immune from all forms of disclosure under law. The DTA or other Buyers may be required under law to disclose certain information in some circumstances, including:

  • in response to a lawful order of the Parliament or its committees – for example, an order to produce documents
  • under the Freedom of Information Act 1982 (Cth), if an FOI request is made and no exemption applies
  • under the Archives Act 1983 (Cth), for example, a transfer of records to the National Archives or public access under that Act’s provisions
  • as otherwise required or authorised by law, such as a court order or discovery process in litigation.

The DTA will use reasonable endeavours to consult with the impacted Seller as appropriate and will, at all times, follow applicable laws and policies when responding to such disclosure requests.

Record retention

All records created by the DTA and Buyers under the DSUP will be managed in accordance with the relevant information management and security policies and specific DTA and Buyer records authorities. Examples of records include:

  • Serious Underperformance Reports
  • correspondence (including all documents and information provided to the DTA by Buyers and Sellers)
  • file notes (e.g. records of telephone conversations and meetings)
  • decisions
  • information included on the CSU Register
  • records created by the DTA and Buyers during an Approach to Market for the purpose of accessing information to check if a prospective Seller has a history of Confirmed Serious Underperformance on the CSU Register.
     
Digital Seller Underperformance Policy: Guidance
Guidance that explains how the DSUP works in practice and provides advice on how Buyers and Sellers may ensure ongoing adherence to the DSUP.

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