The new definition
An Indigenous Enterprise is 51% or more First Nations owned and controlled, or registered with ORIC. The previous test was 50% ownership alone.
Reference paper
Two rulebooks. Different definitions. The same supplier can pass one and fail the other.
Most participation problems begin with someone applying the wrong test. This paper sets out, in plain English, what applies on a Victorian state project and what applies on a Commonwealth contract.
Prepared by Hadyn Lugosi, Managing Director, CIRV Indigenous Authority Pty Ltd. Published September 2026. Reviewed against published Commonwealth and Victorian Government sources at the date of publication.
Side by side
The comparison in one table.
| Victorian state projects | Commonwealth contracts | |
|---|---|---|
| Who sets the rules | Victorian Government — Social Procurement Framework and Local Jobs First | National Indigenous Australians Agency — Indigenous Procurement Policy |
| Definition of an Aboriginal or Indigenous business | At least 51% Aboriginal and/or Torres Strait Islander owned, engaged in commercial activity, operating from Victorian premises, and certified by Kinaway or Supply Nation | From 1 July 2026, 51% or more First Nations owned and controlled, or registered with the Office of the Registrar of Indigenous Corporations |
| Does certification matter | Yes. Certification by Kinaway or Supply Nation is part of the definition for counting purposes | Not strictly. An unregistered business can be counted where the buyer takes steps to satisfy itself the business qualifies |
| Enforcement | Local Jobs First Commissioner — strengthened compliance and enforcement powers from 1 July 2026, a contingent payment mechanism in agency contracts, and a deprioritisation regime that can affect tender evaluation | Contractual. Performance is reported and assessed, and reported performance follows a supplier into future evaluations |
| Skills requirement | Major Projects Skills Guarantee — at least 10% of labour hours from apprentices, trainees and cadets on projects at or above $20 million | Not a direct equivalent |
| Participation thresholds | Set project by project through social procurement commitments and Local Industry Development Plans | Mandatory Minimum Requirements attach to contracts at or above $7.5 million in specified industry categories |
Commonwealth — what changed on 1 July 2026
Ownership alone is no longer the test. Control now counts.
Transition
Transition arrangements apply through 2026–27, during which a business may be eligible under either the original or the strengthened criteria.
The verification service
The NIAA went to market in August 2026 for a national Indigenous business verification service and registry. Tenders closed 18 September 2026. At the time of writing the outcome has not been announced.
What this means for a supplier list
Suppliers accepted onto a list on ownership evidence alone have not been assessed against the control limb. Until they are, spend reported against them rests on a test that is being retired. This is a live exposure on any Commonwealth contract with reporting periods spanning the transition.
Victoria — what changed on 1 July 2026
Local Jobs First gained enforcement powers.
What the reforms did
- Clarified compliance requirements for suppliers on reporting and meeting their commitments
- Strengthened compliance processes for agencies, including a new contingent payment mechanism in contracts
- Gave the Local Jobs First Commissioner stronger compliance and enforcement powers
- Established a deprioritisation regime, which can affect how a supplier is treated at tender evaluation
Why that changes the calculation
- Records that were never examined may now be formally requested
- Participation compliance sits closer to payment than it did before
- Commitments made in a bid become commitments capable of being tested during delivery
- A deprioritisation determination carries into the next tender, not just this project
Practical
What to do, and what not to do.
Worth doing
- Establish which rulebook each of your projects sits under, and write it down
- Identify every supplier counted toward Indigenous spend in the last two reporting periods
- Establish which were accepted on ownership evidence alone
- Record the basis and date of each assessment, so the position is defensible later
- Flag any supplier whose status cannot be supported before it is reported again
Worth avoiding
- Assuming a directory listing settles the question — it confirms a test at a point in time
- Relying on a supplier’s own attestation as evidence of control
- Applying the Commonwealth definition to a Victorian project, or the reverse
- Quietly dropping a supplier without recording why, which creates a different reporting problem
- Waiting until a request arrives, when the options narrow considerably
This page is a plain-English summary prepared by CIRV for general information. It is not legal advice. Requirements differ by jurisdiction, by agency and by contract, and policies change. Always confirm the criteria written into your own contract, and check the relevant government source before relying on any summary, including this one.
Sources: NIAA — The Indigenous Procurement Policy is changing · NIAA — Indigenous Procurement Policy · ANAO — Auditor-General Report No. 40 of 2024–25 · Local Jobs First — Act reforms · Buying for Victoria — Victorian Aboriginal people social procurement guide
Not sure which rulebook applies to your project?
Send us the contract type and the client, and we will tell you which definition and which reporting obligations apply. There is no charge for that answer.