On 30 June 2025, Standards Australia announced the AS 4000 underwent its first significant revision in almost 30 years. The revised standard boasts improved clarity, usability and alignment with laws, whilst maintaining the familiar risk allocation provisions.

What has changed?

Some of the key changes to the AS 4000 include:

1. New Formal Instrument of Agreement: There is now an optional template (short form) Formal Instrument of Agreement to accompany the standard form, setting out the details of the parties, the project, the contract and the contract sum and incorporating the AS 4000:2025, Specifications, Drawings and other documents (notably without an order of precedence). This may simplify contract execution and save the parties (or their legal representatives) from having to find or prepare one themselves – although we expect parties may seek to introduce more comprehensive drafting into the FIA form as has become customary in the industry;
2. Legislative changes: The contract has been updated for changes in the Goods and Services Tax (GST) regime, insolvency laws, Personal Property Security Act 2009 (Cth) (PPSA), and Work Health and Safety (WHS) laws, reducing legal ambiguity and ensuring the contract reflects the current regulatory environment for construction projects. In relation to:

1. 1. GST, there is a new clause 6 (GST) which replaces the previous clause 6 (Evidence of Contract) and sets out when GST is payable and the issue of Recipient Created Tax Invoices in respect of relevant supplies;
   2. Insolvency, the list of insolvency events in clause 39.11(insolvency) has been updated for compliance with insolvency laws, including the Bankruptcy Act 1966 (Cth);
   3. PPSA, the contract now includes a PPSA regime in clause 44 (PPSA requirements), which covers such topics as the provision of further assurances, waiver of the right to receive notices, PPSA confidentiality and continuity of security interests despite the happening of a disposal or dealing. It also covers the treatment of security interests in goods and materials supplied to site – an area that has historically generated uncertainty; and
   4. WHS, the contract reinforces compliance with applicable WHS laws by both parties with a new definition for “Principal Contractor” and operative clause 12 (Principal contractor) that allows users to appoint the Contractor to the role of Principal Contractor under the relevant WHS legislation. These changes align the Contractor’s contractual responsibilities with statutory duties and modern safety standards.
   5. Given the different regimes across the country, jurisdiction specific amendments to align the payment regime with the relevant Security of Payment legislation should still be considered separately;

3. Improved language and structure: The readability and useability of the Australian Standard has improved significantly, with the following noteworthy changes:

1. 1. clause 1 has been revised with new definitions (capitalised and without italics) and interpretation principles added;
   2. contract requirements or obligations have been expressed in a clearer and less ambiguous way, for example words like “shall” or “may” have been replaced with words like “is”, “will” or “must” which have a more certain legal meaning;
   3. outdated words such as “forthwith”, “thereof” and “thereon” have been deleted, and overly technical phrasing has been simplified throughout. For example, clause 36.1 (Directing variations) has been reduced in length, making it clear that Variations are only effective where directed in writing by the Superintendent and before the Date of Practical Completion;

4. Timeframes: Certain time periods have been relaxed and replaced with “as soon as practicable” in many instances (for example, the timeframe for the notification of Latent Conditions under clause 25 is now “as soon as practicable” after the Contractor “becomes aware” and the timeframe for the initial notice for delay has changed from “promptly” to as soon as reasonable practicable under clause 34);
5. Achievement of Practical Completion: Clause 34 (Practical completion) now makes it possible for the Date of Practical Completion to occur before the date a Certificate of Practical Completion has been given. This can have significant implications for liability, risk transfer, and the calculation of liquidated damages. It also brings the standard form into better alignment with industry practice;
6. Dispute resolution methods: As with the AS4000-1997, the dispute resolution process commences by notice of dispute. However, the parties now have a broader range of additional dispute resolution methods to choose from, including:

1. 1. Default procedure in clause 42.2, being negotiation (clause 42.3) and final dispute resolution (clause 42.4) comprising either arbitration or litigation;
   2. Mediation without expert determination (clause 42.5), if selected;
   3. Expert determination without mediation (clause 42.6), if selected;
   4. Mediation and expert determination (clause 42.7), if selected;
   5. Dispute Avoidance Board (DAB) (clauses 42.8), if selected and the parties have executed a Dispute Avoidance Agreement. While this is a new dispute resolution method for the AS 4000, it is not so new for the industry. DABs are a common feature of construction contracts in other jurisdictions, offering a way to resolve disputes quickly and without the need to engage consultants and lawyers. Further, decisions of the DABs can be binding or non-binding (as the parties so elect), careful consideration should be given to which dispute resolution method suits, taking into account the size and complexity of the project; and

7. Confidentiality exceptions: Clause 8.5 (Confidential information) now contains a list of common exceptions to the mutual obligation of confidentiality. For example, where the party has the written consent of the other party or where the disclosure is required by law, again aligning the Australian Standard to common industry practice.

Below is a quick summary of the key differences between the AS 4000:1997 and the new AS 4000:2025.

Comparison of AS 4000:1997 and AS 4000:2025

Conclusion and what is next?

Overall, the AS 4000 form remains in familiar style and form which will be easy for parties to adopt and modify as required. The changes to the AS 4000 template do not fundamentally change the existing risk allocation but are a welcome modernisation of the standard form.

Standards Australia has indicated that it will be reviewing and updating documents related to the AS 4000, including the HB 140:12000 Administration Manual for AS 4000 and the AS 4902:2000 General Conditions of Contract for Design and Construct. We expect similar improvements will be made to those documents.

Do not hesitate to contact the authors to discuss the above changes to the AS 4000, or to seek assistance with preparing an AS 4000 or any Australian Standard contract.

This article was written by Kate Morrow, Partner, Caitlin Newland, Associate and Elizabeth Lester, Solicitor.