NZTA had been firm on the carve out through our negotiations, so its removal – alongside other positive improvements – is a testament to the power of sustained engagement from both ACE and NZTA. The revised position has already enabled recent contracts to move swiftly through the tender clarification process, with a number of our member firms advising they are accepting the updated terms.
Updates to SMO30, in addition to the removal of the carve out to the limit of liability, create improved alignment with the AoG CCCS template in several areas. Notably, there have been refinements to the Personal Information clauses: the definition of Personal Information is now linked directly to the Privacy Act (where it was previously broader), the limitation on storing Personal Information outside New Zealand has been extended to include Australia (which we know is where a lot of members data storage is located), and the Personal Information indemnity has been removed.
We continue to remind all members to refer to their own internal risk management processes and insurance coverage when accepting any terms and conditions. There are two main areas that ACE will be continuing our conversations with NZTA in relation to the liability and insurance aspects of SMO30 and we expect many of our members will note them in reading the updated terms:
We note that the limit of lability (specifically clause 6.2) has had the fee multiplier reduced from 5x to 2x, but it is now tied to “anticipated contract value” – a term not defined in the contract – rather than “fee”. This may create uncertainty around what value the multiplier applies to (for example, current fee vs expected total fee including variations). In addition, the default liability ceiling has increased from $2 million to $10 million, which is a significant shift from previous SMO30 procurements. Members should carefully assess this clause and consider whether to tag it for clarification or amendment.
We also note that NZTA’s request for PI insurance “per occurrence,” which technically does not align with how PI policies typically are structured – these are typically written on a “per claim and in the aggregate” basis. We expect firms will continue to tag this for correction where appropriate.
This progress reflects the strength of our sector’s voice and the value of sustained engagement. We thank everyone who contributed to this outcome – your feedback and involvement have made a real difference, and we extend our true appreciation to NZTA for its willingness and openness in collaborating to address these concerns.