Non-Traded Other - Contract Request · BHP Billiton Case Management

You are now able to directly enquire your Payment Status and other Procurement related topics via the Chat bot located at the bottom right of the Supplying to BHP portal. Click here to access the chat bot.

You are now able to directly enquire your Inventory related topics via the Chat bot located at the bottom right of the Supplying to BHP portal. Click here to access the chat bot.

Case Title

Counterparty registration number ID

Case Description

Contract description

BHP share of contract value

Contract type

Region

Additional regions

BHP Entity

Asset / Function

Additional entity names

Additional asset / function

Multiple counterparties

Terms (months)

Counterparty name(s)

Is Spanish Requestor

Counterparty address

Related BHP Project

Contract Details

1.1. Contract name (and reference number if applicable)

1.2 1CMS or GCMS contract number (master agreement number, if available)

1.3. BHP Billiton entity(ies)
Is either BHP Billiton Limited or BHP Billiton Plc directly a party to the contract, or is it another BHP Group company?

Note: BHP Billiton Limited and BHP Billiton Plc should only be used in exceptional circumstances and will require Legal endorsement. In most cases you should use a subsidiary entity.

1.3A If Other BHP Group company, type in BHP entity/ies

1.4 Counterparty(ies)
If the counterparty is the BHP external auditor then refer to Our Requirements for Finance

Classification Questions

2.1 Is this a new contract/commitment OR a change to an existing contract/commitment?

*See the definition of contract change in the GLD glossary.
Note: for contract extensions, answer change to an existing contract/commitment.

New contract

2.2 What is the new contract value (rounded to closest dollar)?

* Determine the total value of a contract/commitment as follows:
- calculate all amounts payable, expected to be paid or received under the contract/commitment, including options that can be unilaterally exercised by or against BHP;
- if contract pricing is indexed, base price on current protocols/expected prices at the time of making the value assessment
- include the total impact (for example, the obligation created or the effective interest) over the full term of the contract/commitment.
Where no term is specified, use the expected term of the contract/commitment;
- calculate the value as the aggregate of all amounts expected to be received or payable by the BHP Group (including our JV partners) over the term of the initial contract/commitment and subsequent contract/commitments, where the contract/commitment:
• is a series of contract/commitments related to a transaction;
• allows several BHP entities to acquire or sell goods or services;
• permits or requires entry into subsequent contract/commitments at a later time or upon satisfaction of certain conditions without further approval; or
• is a framework agreement (eg which establishes key terms and conditions and then permits creation of separate contractual obligations by completing orders for particular packages of goods or services, or which separate Assets can sign up to for specific goods or services) .

Note: For a contract(s) which is part of a joint procurement with a Joint Venture which could be regarded as a competitor (eg BMA). Prepare a separate template for each entity, and the value inserted should be the stand-alone value for the entity in question (not the combined value).

2.3 Is the new contract a standard contract sourced from 1CMS or GCMS?

Note: A standard contract is a contract that has been approved for use as a standard contract on 1CMS or GCMS.

2.4 Have there been any changes to the standard contract legal terms and conditions?

Note: Changes includes adding any special conditions.

2.5 Is the non-standard contract on a BHP contract template that has been approved by BHP Legal?

Contract change

2.6 Does the contract change result in a negative change to the risk profile of the contract?

Examples of contract changes that might have this effect include:
(a) a change to the legal terms and conditions, a waiver of any rights or obligations, or release of liability;
(b) a material alteration to the nature of the goods or services being provided under the contract; or
(c) a change of parties (except where a company changes its name or there is a transfer to a related body corporate with an equivalent credit and risk profile).

2.7. Does the contract change potentially impact on:
(a) the risk profile of the whole contract (including for past actions); or
(b) only the future risk profile for the remainder of the contract.

An example of (a) would include a change to an indemnity clause under a part-completed construction contract, as it could impact on liability for all work to date.

An example of (b) would be a change to the terms on which a particular type of consumable will be supplied moving forward under the contract, and where the changes only apply to future supplies (not supplies made to date).

2.8. What was the original contract value authorised in 1CMS or GCMS (excluding all subsequent changes)?

2.9. What is the standalone value of the proposed contract change?

If contract change is not related to value, please enter “1” as the contract change value
If contract change will reduce the contract value, then state in the next question

2.9.1A – Does the contract change reduce the current contract value by more than 25% without the agreement of the counterparty?

e.g. If BHP issues a unilateral variation to scope, term or volume.

2.10. What is the current value of the estimated remaining spend (forward spend) under the contract (including the proposed contract change)?

2.11. What is the total value of the contract after this change?

Note: Value should be calculated to provide a reasonable estimate of the likely total based on current knowledge.
Eg:
- if there are actual figures for amounts already incurred/realised, use the actuals;
- including original authorised value and all subsequent contract changes, including this contract change
- for future amounts with index-linked contracts use current cost/price protocols to determine total value.

3 Section 3A – Non-standard contracts, amended standard contracts and contract changes
Particular contract types

3.2 Joint marketing arrangements-Is the contract a joint marketing arrangement?

Note: Joint marketing arrangements are those with one or more other parties for the marketing of commodities in conjunction with BHP but not the individual sales contracts that may be entered into under an approved joint marketing arrangement e.g.

- the establishment of a new marketing agency agreement with a competitor would be ‘yes’
- a sale contract pursuant to an existing joint marketing agreement would be ‘no’.

3.3 Merger and acquisition, joint venture documents - Is the contract an acquisition, divestment, joint venture or shareholder agreement? For a contract change, does it modify any commercial terms of such an agreement?

3.4 Merger and acquisition confidentiality agreements - Is the contract a confidentiality agreement relating to any potential acquisition or divestment?

3.5 Tax clauses – If contract value is >US$50 million, does the contract change or not use the tax clauses included in a standard contract from 1CMS or GCMS?

3.6 Commercially restrictive arrangements - Does the contract (or contract change) contain commercially restrictive arrangements other than BHP’s standard clauses that reduce future operational or managerial flexibility in implementing business strategy, including:
- exclusivity arrangements, whether geographic or non-geographic;
- non-complete clauses;
- pre-emption provisions (e.g. right of first refusal, right of last refusal or buy-back rights);
- restricting the ability of any party under the contract to resell purchased products by limiting the territories into, or downstream customers the customer may sell to, or influencing the reseller’s incentive to resell into or to particular territories or customers, (e.g. through a profit sharing mechanism);
- setting of resale prices, including minimum or maximum, for a reseller to follow, or influencing the reseller’s discretion in setting its own prices;
- limiting any party’s use of purchased products; or
- requiring any party to acquire another product or service from a third party supplier?

3.7 Restrictions on assignment/change in control - Does the contract (or contract change) contain:
(c) clauses other than BHP standard contract clauses that restrict BHP's ability to assign or transfer the contract; or
(d) provisions that are triggered by a change in ownership or management of any BHP entity (a “change in control” clause)?

3.8 Assumption of liability for third parties - Does the contract (or contract change) contain indemnities and other provisions that make BHP liable for the losses of the counterparty or other third parties, where those provisions:
- are broad, including because they extend to indirect or consequential losses or apply without any wrongful act or omission on the part of BHP;
- are ambiguous or so complex as to be unclear as to their scope; or
- relate to environmental liabilities?

Note: This does not apply to the indemnities in the BHP standard contracts, including Petroleum 'knock for knock' clauses.

3.9 Non-approved governing law - Does the contract (or contract change) have a governing law other than a recognised jurisdiction

i.e. State/province of Australia, Canada and the United States; England; Chile; Brazil; Singapore; and any other jurisdiction designated by the Chief External Affairs Officer.

3.11 Corruption risk: community development projects and donations or funds, commercial sponsorships – If the contract is for a community development project or donation or a payment to a fund intended to benefit the community (including in connection with the acquisition or performance of exploration, mineral or petroleum rights) or a commercial sponsorship, has BHP’s standard anti-corruption compliance clause been changed, modified or not used at all?

Note: See the GLD Glossary definition for 'community development project or donation' or ‘commercial sponsorship’

3.12 Corruption risk: Does the contract (or contract change) change or not use BHP's standard anti-corruption clauses?
Standard anti-corruption clauses include “Anti-corruption” and “Books and Records” in the clause title and have sub-headings which include:

- Anticorruption;
- Contractor not to offer anything of value;
- Acceptance of gifts and other advantages;
- Contractor to maintain books and records;
- Information to subcontractors.

Section 3B – Additional legal review triggers for new contracts (or contract changes)

3.13 Liability and indemnities - Does the contract (or contract change):
(a) change or not use BHP’s standard counterparty liability clause (eg in respect of caps on liability or consequential loss); or
(b) involve BHP giving indemnities to the counterparty?

Note: Answer no to (b) if the only indemnities are those included in BHP standard contracts, including Petroleum 'knock for knock' clauses.

3.14 Intellectual property - Does the contract (or contract change) change or not use BHP’s standard intellectual property clause?

3.15 HSE compliance and standards - If the contract relates to goods or services to be provided at (or delivered to) a BHP operated site, does the contract (or contract change) change, not use or contain equivalent terms relating to:
- compliance with HSE laws and BHP's HSE standards
- BHP's ability to give directions relating to safety;
- BHP's ability to suspend for unsafe acts by the counterparty; or
- BHP's ability to remove a subcontractor on HSE grounds.

3.16 Dispute resolution - Does the contract (or contract change) include a requirement (other than a BHP standard term) that parties follow a mandatory dispute resolution process involving third parties (e.g. mediation, arbitration, conciliation or expert determination) before being able to commence court proceedings in connection with a dispute?

3.17 Does the contract (or contract change):
- remove BHP's ability to terminate for convenience;
- require more than 90 days’ notice be given to terminate for convenience; or
- in a framework agreement, remove or restrict BHP's ability to cancel a work package instruction or purchase order?

3.18 Defects and warranties - Does the contract (or contract change) change, significantly modify or not use the BHP standard contract terms relating to defect cure obligations or warranties provided by or to a counterparty?

3.19 Has Legal determined that the contract (or contract change) should be treated as “non-standard” on the basis of their review?

Note: This should be answered ‘No’ until Legal has completed their review. If they do escalate the contract to non-standard then this question should be updated to ‘yes’.

4 – All contracts and material contract changes

4.1 Does the contract/commitment (or contract change) involve any of:
- the creation of joint production, joint purchasing, joint sale or joint logistics arrangements with one or more competitors?
- requiring a customer to acquire another product from a specific third party supplier (a third line forcing restriction)?
- the setting of technical or environmental standards with the competitor/s?

Fixed cost and financing risk

4.2 Does the contract/commitment (or contract change) include (please answer each of the follow (a)-(d)):
(a) a requirement for payment of exit costs in the event of early termination or termination for convenience by BHP (other than as provided for under BHP standard contract terms);

(b) a take or pay provision (an obligation upon BHP to either receive goods or services for the duration of the contract period or make full or partial payment in lieu thereof);

for example by:
- requiring payment of a non-refundable deposit, or (full or part) payment for goods or services in advance of the goods or services being provided?
- including a transfer of ownership of (or option to purchase) goods at the end of a hire or services contract.

(d) A fixed price ≥ 3 years (where market indexing is available).

Compliance risk (all contracts)

4.3 Does any counterparty have a GCMS supplier profile with
- an anti-corruption risk level greater than 6; or
- a sanctions risk level greater than 4?

Requestor

Created On

Modified By

Modified On

Non-Traded Other - Contract Request