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.
QUEBEC'S PROCUREMENT PROCESS
In the province of Quebec procurement opportunities are available in the SEAO portal (“Seao”). Seao is the Quebec official tendering system that
provides access to government contracting opportunities coming from most of Quebec public agencies, such as administration departments and agencies, education, health and social services networks, as well as municipalities and their agencies and departments.
By subscribing to the Seao portal as a “Subscribed Supplier” and paying a monthly subscription fee in accordance with the applicable terms of payment, International companies may download tender documents and bid on opportunities. Seao also offers bid matching services, tender documents delivery outside of Canada, electronic tender submission, among other services. However, if International companies do not wish to subscribe they can still download tender documents by paying a fee in accordance with the Seao’s fee schedule list available on the portal.
IMPORTANT: International companies that are not incorporated in the province of Quebec or are not registered extra-provincially to do business in Quebec, must select an option that indicates that the business is outside Quebec. In that way they will not be required to provide information and registrations that are only required for Quebec enterprises.
International companies requiring assistance on how to bid for an opportunity, how to register as Subscribed Suppliers or any other enquiry may contact the Seao Customer Service by phone, email, fax or through the messaging system available on Seao portal.
Under the Seao portal, International companies can search for bids of interest to them and verify if the opportunity is covered by a specific trade agreement [see trade agreements].
To facilitate the search, Quebec has also adopted the UNSPSC classification, permitting International companies to easily search for their corresponding goods and services bidding procurement opportunities.
THE AUTORIZATION PROCESS WITH AMP
(Autorité de marchés publics)
The Autorité de marchés publics ("AMP") is a neutral and independent authority created to oversee and monitor public contracts in Quebec. AMP’s oversight power covers the public sector, the health and education networks, government corporations and municipal sector. AMP is responsible for granting, renewing and revoking authorizations for contracting with public agencies and departments in Quebec and also for maintaining a register of enterprises ineligible for public contracts ("REMA").
AMP has the authority to audit and investigate public contracts and may issue orders, make recommendations and suspend or cancel public contracts.
AMP is responsible for the register of business enterprises that are authorized to enter into public contracts with the government of Quebec. Any enterprise involved in a contract or subcontract tendering or awarding process with one of the levels of the government of Québec which involves an expenditure above certain thresholds must apply for an Authorization.
The thresholds are:
$5 million for construction contracts and subcontracts or public-private partnership agreements; and
$1 million for service contracts and subcontracts entered into pursuant to a call for tenders or by mutual agreement.
The thresholds include, when applicable, the amount of the expenditure that would be incurred if all renewal options were exercised.
Enterprises that are not constituted under the laws of Québec and do not have their head office or an establishment in Québec where they primarily conduct their activities are considered foreign enterprises and must complete a paper application to AMP.
AMP does not require most international companies to obtain a Quebec enterprise number (“NEQ”) prior to starting an application for authorization. Regardless, it is mandatory for an enterprise to provide AMP with a tax attestation. Foreign enterprises that do not pay taxes in the province of Quebec must provide a letter of attestation from the revenue agency of their respective countries.
There is a non-refundable fee applicable for the authorization process application and the processing times may vary depending on the application; for this reason International companies are encouraged to have this timing in mind when competing for a bid. Enterprises that are not required to obtain an authorization at this time can still file an application for authorization with the AMP. However, these applications are not processed on a priority basis.
An authorization granted by the AMP is valid for three years and can be renewed at least 90 days before the authorization expires. A Non-renewal authorization must also be requested.
AMP will have the discretionary power to allow or refuse an enterprise to contract with a public body in Quebec. If AMP refuses an application, it will notify the enterprise with a statement of the reasons for its intention to refuse to issue/revoke its authorization.
The enterprise will have an opportunity to respond to the notification with more information or its observations to the AMP that could lead to a different outcome. An AMP decision refusing or revoking an authorization may have serious consequences for enterprises. An enterprise could be added to RENA for a period of five (5) years. The AMP's decision is final and cannot be appealed, but is subject to review by the Superior Court.
Finally, it is important to note that all AMP decisions are issued only in French.