Most authorities are getting treaty state supplier status backwards

Why this suddenly has consequences

Section 90 of the Act says a contracting authority may not discriminate against a treaty state supplier. Section 100 makes that duty enforceable in civil proceedings, and the guidance is explicit that treaty state suppliers have equivalent access to remedies as UK suppliers on covered procurements. A supplier that is neither a UK supplier nor a treaty state supplier does not have that route, though it can still complain to the authority or to the Procurement Review Unit.

So the practical exposure is asymmetric. Wrongly excluding a treaty state supplier gives someone a cause of action. Wrongly including a non treaty state supplier does not, in the same way. That asymmetry should shape how carefully you do the status check, and it usually does not.

The test itself is comparative. Section 90(2) asks whether the supplier was treated less favourably than a UK supplier or another treaty state supplier, because of its association with its treaty state or its lack of association with the UK, in circumstances which are not materially different. That is a question about what your records show, not about what your policy says.

What most organisations get wrong

The first mistake is the fixed attribute error. Teams tag a supplier in a system as a treaty state supplier and carry that tag across procurements. But a supplier can qualify for one competition and not the next, because the covered entity list differs between agreements, because the market access schedules cover different goods and services, and because exemptions exist in areas such as healthcare, research and development services and broadcasting content.

The second mistake is reaching for exclusion without doing the groundwork. The Act genuinely allows it. Section 19(3)(b) lets you disregard tenders from suppliers that are not treaty state suppliers, and section 20(5)(c) and (d) let you exclude them from a competitive flexible procedure, including where they propose to sub contract to suppliers outside the UK and treaty states. But the guidance puts a condition in front of that discretion: satisfy yourself first that the supplier is not a treaty state supplier and that the subject matter is not covered. The discretion is real, the shortcut is not.

The third mistake is silence in the documents. If sub contracting outside the UK and treaty states will disqualify a bid, bidders should know that when they decide whether to bid, not when they lose. A restriction that appears for the first time at evaluation looks like discrimination even when the underlying decision was sound.

The defence carve out is not a general licence

Defence teams sometimes read the treaty state material and conclude the rules do not apply to them. Partly true, and the boundary is precise. Procurements under section 7(1)(a) to (f) are not covered by the Schedule 9 agreements, so only UK suppliers and those from the Crown Dependencies and British Overseas Territories have guaranteed participation rights, and an authority may exclude treaty state suppliers or restrict sub contracting accordingly.

That is not the whole defence estate. For contracts under section 7(1)(g), and for other procurements run by defence authorities, the guidance tells you to check Schedule 9 coverage, because treaty state suppliers may have participation rights. A blanket policy applied across a defence organisation will therefore be wrong for part of its spend.

Where the concern is genuinely national security rather than trade policy, there is a proper route: the National Security Unit for Procurement in the Cabinet Office, which supports exclusion and debarment referrals. Using the treaty state provisions as a proxy for a security concern is the wrong instrument, and it is the one that gets challenged.

What to do about it

Move the status question into the define stage and make it a documented step rather than an assumption. One short note per above threshold procurement, naming the agreement considered, the covered entity position, the scope of the goods, services or works, and the conclusion, is enough. It takes minutes at the start and is the only thing that helps later.

Then be consistent. The section 90(2) comparison is about materially similar circumstances, which means the way you handle clarifications, deadlines and scoring across bidders is as important as the eligibility decision itself. Below threshold, remember the position relaxes: the guidance is clear that Part 7 does not generally prevent reserving below threshold procurements for UK suppliers or for a particular region, but that should be a deliberate policy choice you can point to, not an accident of habit.

The takeaways

• Treaty state supplier status is decided per procurement, not per company. Re check it every time.
• Section 90 non discrimination is enforceable in civil proceedings under section 100, so wrongful exclusion carries real remedy risk.
• You may disregard or exclude non treaty state suppliers under sections 19(3)(b) and 20(5), but only after confirming status and coverage.
• Section 7(1)(a) to (f) defence procurements sit outside Schedule 9, but section 7(1)(g) and other defence buying may not.
• State any restriction on suppliers or sub contracting in the tender documents from the start, and apply it consistently.

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