Manufacturing and Supply Agreement in Australia: Template, Key Clauses and Local Law (2026)

A manufacturing and supply agreement sets the terms on which one party makes and supplies goods to another over time. In Australia it is mostly a business-to-business contract, but national competition and consumer rules and state sale-of-goods laws still apply in the background. ## The local law that applies - State and territory Sale of Goods Acts. Each state has one, such as the Sale of Goods Act 1923 (NSW) or the Goods Act 1958 (Vic). They imply terms that goods match their description, are of merchantable quality, and are fit for purpose. In business contracts these can usually be limited by agreement.

• Competition and Consumer Act 2010 (Cth) (CCA) and the Australian Consumer Law (ACL) in Schedule 2. The ACL implies consumer guarantees that cannot be contracted out of where goods are supplied to a consumer, which includes many business purchases below a value threshold. The CCA also bans misuse of market power, exclusive dealing that substantially lessens competition, and unfair contract terms in standard-form small-business contracts. The unfair contract terms regime now carries civil penalties, so review standard-form terms carefully.
• Personal Property Securities Act 2009 (Cth) (PPSA). A retention-of-title supplier should register its interest on the Personal Property Securities Register to keep priority if the buyer becomes insolvent.
• Product safety and liability. The ACL contains product safety rules and a liability regime for goods with safety defects.
• Late payment has no single federal interest statute, so agree interest on overdue amounts in the contract. Confirm the current state and federal rules before you sign. This article is general information, not legal advice. ## Key clauses in an Australian manufacturing and supply agreement - Products and specification: a clear spec, with change control for variations.
• Forecasts and orders: forecasting, how orders are placed and accepted, and volume commitments.
• Price and payment: price, review mechanism, GST, currency, and interest on late payment.
• Delivery and Incoterms: delivery points, lead times, and the chosen Incoterms rule for risk and cost.
• Title, risk and PPSA: when ownership and risk pass, retention of title, and a PPSA registration clause.
• Quality, inspection and acceptance: standards, testing, rejection rights, and the remedy for defects.
• Warranties and consumer guarantees: product warranties, and how they sit with the non-excludable ACL guarantees.
• Intellectual property and tooling: who owns tooling, designs and product IP.
• Limitation of liability: caps and exclusion of indirect loss, drafted around the non-excludable guarantees.
• Recall, safety and compliance: who leads a recall and bears the cost.
• Supply continuity: capacity commitments and remedies for failure to supply.
• Term, termination and run-off supply.
• Governing law and dispute resolution. ## A simple manufacturing and supply skeleton 1. Parties and recitals

2. Definitions
3. Products and specification, change control
4. Forecasting, ordering and volumes
5. Price, GST and payment
6. Delivery, title, risk and PPSA
7. Quality, inspection and acceptance
8. Warranties, consumer guarantees and product liability
9. Intellectual property and tooling
10. Limitation of liability
11. Recall, compliance and continuity
12. Term and termination
13. Governing law and dispute resolution ## Common mistakes to avoid - Trying to exclude the Australian Consumer Law guarantees where they apply, which cannot be done.

• Forgetting to register a retention-of-title interest on the PPSR, which can cost the supplier priority on buyer insolvency.
• Ignoring the unfair contract terms rules for standard-form small-business contracts, which now carry penalties.
• A vague specification, which makes quality disputes hard to resolve.
• No contract interest term, since Australia has no single late-payment statute to fall back on. ## Doing this across many contracts Supply teams often run the same agreement with many suppliers and buyers. Keeping drafting, risk review, versioning and signing in one place keeps terms consistent and reduces errors. A single AI contract workspace such as Adira can hold approved templates, flag missing or risky clauses, and track every change, so each deal starts from a trusted base. Adira is built around Indian law first, and deeper Australian coverage is on its roadmap, so for Australia-governed contracts use it as a drafting and review aid alongside local counsel. This guide is general information and not legal advice. Confirm the current state and federal rules, and have a qualified Australian lawyer review any agreement before signing.