On 30 June 2025, Standards Australia released the long-awaited update to the AS 4000 General Conditions of Contract. The updated AS 4000:2025 keeps the core structure that has made it one of the most widely used contracts in Australian construction, while introducing important changes to reflect current legislation, industry practice and drafting standards.
For principals, contractors and financiers, it’s a welcome step forward and a sign that the “off-the-shelf” baseline is finally catching up with modern project delivery.
Why did it need updating?
Construction has moved on since 1997. We now have the Personal Property Securities Act 2009 (Cth) (PPSA), a more complex GST regime, harmonised Work Health and Safety (WHS) laws and digital communication as the norm. At the same time, contract users are demanding clarity and consistency to reduce disputes.
AS 4000:2025 responds to this shift. It simplifies, clarifies and aligns better with today’s legal and commercial environment.
What’s changed?
Formal instrument of agreement
An optional formal instrument of agreement now sits alongside the conditions of contract, which previously required bespoke drafting on a case-by-case basis. The formal instrument of agreement captures key terms such as the parties, project and price and incorporates the AS 4000:2025 and relevant schedules and attachments. It simplifies execution, but parties still need to think carefully about order of precedence and any bespoke drafting.
Legislative alignment
The following clauses have now been introduced into the contract:
GST – a new clause addressing liability and recipient-created tax invoices.
Insolvency – updated to reflect current law.
PPSA – clause clarifying how security interests apply to goods and materials on site.
WHS – allows the contractor to be appointed ‘Principal Contractor’ under WHS laws, aligning risk allocation with statutory duties.
Modern drafting
The contract is shorter, cleaner and more consistent. Archaic language is gone. Definitions are aligned. Key obligations are expressed in plain English, making it easier to administer and less prone to dispute.
Timeframes and notices
Prescriptive deadlines are often replaced with obligations to act “as soon as practicable” or “as soon as reasonably practicable”. While this adds flexibility, it may introduce uncertainty and parties may want to incorporate specific timeframes for performance in special conditions.
Practical completion
Practical completion can now occur before a certificate is issued, this aligns with case law and industry practice. This shifts the dynamics around risk, insurance and liquidated damages.
Dispute resolution
The new form gives parties a choice: litigation (the default), arbitration, mediation, expert determination or a Dispute Avoidance Board (DAB). DABs, commonly used overseas, offer a proactive forum to manage issues early and potentially avoiding lengthy and expensive litigation or arbitration.
Other modernisations
Other notable amendments in the contract include:
Security can be retained post-termination, pending dispute resolution.
Bills of quantities and provisional sums are now expressly linked to the variation regime.
Electronic communication (including email) is expressly recognised.
Confidentiality provisions include standard exceptions.
What hasn’t changed
The contract’s core risk allocation remains – a balanced, fair and reasonable risk allocation that is not unduly onerous on contractors. However, this risk allocation may require some adjustment where project finance is involved to ensure the contract documents satisfy the ‘bankability’ threshold that financiers often impose on project documents.
How might this affect you
AS 4000:2025 is clearer, better aligned with law and easier to use. But it won’t stop the market from negotiating key terms. We expect to continue to see:
Principals amending notice obligations and imposing time bars.
Risk allocation is likely to continue to be amended, particularly around site risk, extensions of time and delay costs.
Contractors using the cleaner drafting to push back on overreach.
Increased use of alternative dispute resolution, especially on major projects.
What’s next
Standards Australia is preparing updates to related documents, including the HB 140 Administration Manual and the AS 4902 Design and Construct form. We can expect similar modernisation across the suite.
For now, AS 4000:2025 is a practical step forward. It retains what works, removes what doesn’t and reflects how projects are delivered today. However, as always, it's a starting point for negotiation, not a final word.