GOVERNMENT PROCUREMENT IN CANADA
According to the Organisation for Economic Cooperation and Development (the “OECD”), the government of Canada’s public procurement expenditures, for goods and services, accounts for close to 33% of federal government expenditures, or slightly more than 13% of Canada’s GDP.
CONTRACTING WITH FEDERAL GOVERNMENT
At the federal level, procurement opportunities are compiled and available at www.buyandsell.gc.ca
This website provides free information on all past and current bidding opportunities with the federal government of Canada. The portal informs whether a specific bid opportunity is available under a specific trade agreement, and if international companies are authorized to submit proposals.
Public Services and Procurement Canada (“PSPC”)  is the body responsible for administrating most of the federal purchase of goods and services. PSPC’s purpose is to serve the federal Government as its central purchasing agent, real property manager, treasurer, accountant, pay and
departments and agencies have the delegated authority to purchase their own goods and services valued at $25,000 or less.
In terms of process; there are several ways that PSPC can solicit bids and request proposals. The main methods are:
Invitation to tender (“ITT”):
This method is used for contracts valued at $25,000 or more. Pre-qualified suppliers that are considered capable of
supplying the requirements are invited to bid on a common pricing basis and the lowest-priced proposal wins without much further negotiation. It
is commonly used for construction, architectural and engineering services, maintenance and consulting services and also real property opportunities.
Request for proposal (“RFP”):
This method is used for complex contracts. This category is intended for bids that cannot be solely based on the Lowest price. The intent is to contract the most cost-effective solution based upon established evaluation criteria.
Request for Standing Offer (“RFSO”):
This method is used to solicit goods and services on an as-and-when required basis, at firm prices, under pre-established terms and conditions.
Request for Supply Arrangement (“RFSA”):
This option is used to solicit bids from a pool of pre-qualified suppliers for specific requirements, permitting an expedited bidding process.
The buyandsell.gc.ca portal provides companies with information and guidelines on how to contract with the federal government. Its main features are:
Monitoring and Searching:
The portal provides guidance on how to monitor and effectively search for opportunities matching a specific business. There is also the ability to subscribe to be notified by email when updates or new tender opportunities are posted.
Goods and Services Identification Number (“GSIN”):
The federal government maintains a Goods and Services Identification Number that facilitates the identification of procurement opportunities. An interested company can identify their corresponding GSIN and search for past and new opportunities and pre-qualified suppliers using the same code.
Identifying Competitors and Finding possible bidding partners:
Buyandsell.gc.ca provides a number of ways to help companies to understand their local competition and to help to find possible bidding partners.
List of Interested Suppliers (“LIS”):
A company can join a List of Interested Suppliers (“LIS”), allowing it to add it’s company information to a publicly available list of parties who have
expressed an interest in a particular tender published on Buyandsell.gc.ca.
Indicator of Market Interest:
Another tool available is access to data on anonymous web usage statistics. Each tender notice on Buyandsell.gc.ca lists the number of page views and notice document downloads, which can be helpful for companies as it provides an indicator of market interest in the opportunity.
THE PROCUREMENT PROCESS
The procurement process is initiated when a federal department or agency sends a requisition to PSPC. Depending on the requirements, the requisition can be fulfilled through a competitive procurement process, with the goal of obtaining the best value for Canadians with enhanced
access which emphasizes competition and fairness.
A non-competitive procurement process is only used in certain special circumstances where:
I) the need is one of pressing emergency in which delay would be injurious to the public interest;
II) the estimated expenditure does not exceed:
$25,000 for goods and services;
$100,000 for architectural, engineering and other services required in respect of the planning, design, preparation or supervision of the
construction, repair, renovation or restoration of a work;
$100,000 for the Canadian International Development Agency (CIDA) service contracts related to international development assistance programs or
III) only one person is capable of performing the work, such as when a supplier owns a copyright or a licence; or
IV) the nature of the work is such that it would not be in the public interest to solicit bids (for example, requirements dealing with national security, such as some military projects).
REGISTER AS A SUPPLIER
In order to contract with the federal government, EU companies are required to register in the Supplier Registration Information System (“SRI”) and obtain a 15-digit Procurement Business Number (“PBN”). Before it can register with SRI, a non-resident company needs to obtain a Business Number (“BN”) issued by the Canadian Revenue Agency (“CRA”). Registered in SRI makes the company's name and supply capabilities widely available to federal departments and agencies, who may use SRI to identify sources of supply for the goods and services they require.
PROMOTE THE BUSINESS
It is essential that a foreign company proactively promote its business as supplier by highlighting the goods and services it provides and emphasizing the reasons the government should choose their company to be its supplier.
When a company is preparing a proposal for a bid, it is essential to make sure that departments and agencies are aware of any special capabilities and differentiating features the company may have, that sets it apart from its competitors.
The Canadian government is looking for products or services that are environmentally friendly. It encourages its agencies and departments to buy green goods and services that help or at the very least do not harm the environment. This information should be mentioned in a proposal
to the prospective contracting authority.
SEARCH FOR OPPORTUNITIES
Federal departments and agencies are required to use the Buyandsell.gc.ca to advertise their requirements for bidding opportunities subject to any of Canada’s trade agreements. On Buyandsell.gc.ca suppliers can search for past and new opportunities and pre-qualified suppliers. Using the corresponding goods and services GSIN code, is another way to filter opportunities of interest and register to receive notifications once opportunities under a specific category is available.
SEARCH FOR OPPORTUNITIES
There are many ways the federal government can contract. PSPC uses several methods to solicit bids, such as RFQ, ITT, RFP, among others. Each method of contracting has its own requirements and suppliers should consult Buyandsell.gc.ca to keep track of the requirements that PSPC publicly
advertises in relation to a specific good, service or construction procurement.
Every bid solicitation is unique. For that reason international companies are encouraged to read the bid very carefully and respond to what is asked. If there is any questions regarding the opportunity being offered, it can be submitted in writing. Any amendments made to the solicitation document will be available on Buyandsell.gc.ca.
The solicitation document contains information on how to define an offer and how it will be evaluated. Companies may be asked to make an offer in several separate sections, such as technical, management and financial and provide certifications:
here companies have the opportunity to describe what and how they will perform the contract if awarded. The technical section normally starts with a short introduction with an evaluation of the current situation and the need for the project, the objectives of the proposed work, the reasons for carrying it out as proposed and the benefits that will be derived from it. It indicates the work plan, methodology, techniques, feasibility, the degree of success expected, identify any problems anticipated and contingency plan if problems arise, identifies specific tasks and deliverables and the schedule for completion or delivery.
here is where the team is introduced and explain how they meet the required qualifications, usually through resumes. If the work to be provided is under a subcontracting arrangement, even partially, the same information should be provided for each subcontractor.
this section is designed to provide a detailed breakdown of the quoted price and any cost elements. The solicitation document will explain the cost items that will be considered in the financial evaluation.
When preparing a bid proposal, companies should be aware of additional government requirements, such as security clearance. A security clearance may be necessary when a procurement contract requires a business to access classified or protected information, assets or sensitive federal work sites. The solicitation document will specify what level of security clearance is needed. Obtaining a security clearance can be a lengthy process, therefore companies are encouraged to speak to the contracting officer as soon as possible to get the process started.
In addition, companies should familiarize themselves with the Standard Acquisition Clauses and Conditions (“SACC”) and carefully review the standard terms, conditions and instructions that are normally included in each application document in full text or by reference.
Only bids that meet the mandatory technical criteria will be considered responsive. Price will the determining factor in a selection if the solicitation document makes it clear that the category is based on a lower price bid. However, the selection could also be based on the best value overall or the highest technical bid within a stipulated budget.