RESTRICTED
WORLD TRADE S/WPGR/W/11/Add.7
4October 1996
ORGANIZATION
(96-4054)
Working Party onGATS Rules Original: English
COMMUNICATION FROM CANADA
Response totheQuestionnaire onGovernment Procurement ofServices
Thefollowing communication isbeing circulated attherequest ofthedelegation ofCanada
toMembers oftheWorking Party onGATS Rules.
Thedelegation hasindicated thatprinted copies ofrelated documents referred tointhisresponse
willshortly besubmitted totheSecretariat. These documents, which willbeavailable forreference,
are:
- TheFinancial Administration Act;
- Your Guide toDoing Business withPWGSC;
- TheOpen Bidding Service;
- Annual Contracting Activity Reports, fiscal years 91-92, 92-93, 93-94.
_____________
I. EXISTING PROCUREMENT REGIMES
Definition
1. What isthedefinition ofgovernment procurement employed incompleting this
questionnaire?
Government procurement isdefined asthedirect acquisition onthepartofCanadian federal
government departments andagencies ofmateriel andservices forthefulfilment oftheir
mandates.
Administrative structure
2. Howaregovernment procurement activities administered? Towhatextent areprocurement
activities centralized? Please specify theidentity ofanycentral procurement agencies and
theirrespective responsibilities.
Allgovernmentprocurementisdecentralizedtodepartmentsandagenciesexcepttheprocurement
ofgoods, which generally restswiththeDepartment ofPublic Works andGovernment Services
(PWGSC). Overall, 75percentofprocurement over$25,000 ishandled byPWGSC while
theremaining 25percentiscarried outdirectly byother departments andagencies. The
Treasury Board isresponsible fortheestablishment oftheprocurement policy ofthefederal
government departments andagencies. Crown corporations aregenerally responsible fortheir
ownsetofprocedures.S/WPGR/W/11/Add.7
Page2
Laws andregulations inforce
3.(a) Please specify thelaws, regulations, rules, guidelines, decrees, decisions andother measures
governing government procurement. What isthescope oftheirapplication? Inparticular,
please describe anyexemptions thatexist. Please provide abrief summary ofthecontent
ofeachofthese measures.
Financial Administration Act
Annual Appropriation Acts
Treasury Board Contracting Policy andGuidelines
Departmental enabling legislation
Departmental policies andpractices.
Each department andagency hasindividual spending authority. Individual departmental
authorities forcontracting aregenerally inthelegislation constituting eachdepartment and
conferring certain powers toitsMinister. These authorities arereinforced bytheAppropriation
Actspassed byParliament eachyearwhich provide funds tocarry outdepartmental mandates.
TheFinancial Administration Actprovides fortheestablishment offinancial limits above which
Governor inCouncil orTreasury Board approval isrequired.
(b) Does theprocurement regime distinguish between theprocurement ofgoods andservices?
Ifso,thenhowistheapplication ofrules determined incases ofjointprocurement involving
bothgoods andservices?
Yes, theprocurement ofservices isdecentralized todepartments andagencies while the
procurement ofgoods isgenerally centralized withPublic Works andGovernment Services
Canada, butissubject toTreasury Board contracting policy andguidelines. Amixed
procurement isdeemed tobeaservice procurement when theservice component accounts for
more than50percentofthetotalprojected cost.
Procurement procedures applied
4.(a) What procedures arefollowed intheprocurement process?
Theobjective offederal government procurement contracting istoacquire goods andservices
andtocarry outconstruction inamanner thatenhances access, competition andfairness and
results inbestvalue or,ifappropriate, theoptimal balance ofoverall benefits totheCrown
andtheCanadian people. Inherent inprocuring bestvalue istheconsideration ofallrelevant
costs overtheuseful lifeoftheacquisition, notsolely theinitial orbasic contractual cost.
Thestandard ruleistoacquire goods andservices through acompetitive process. However,
inspecific conditions suchaslowvalue purchases orwhen onlyonesupplier isavailable, single
tendering isallowed.S/WPGR/W/11/Add.7
Page3
(b) Under whatcircumstances aredifferent procedures used? Forinstance, ifthemethod used
depends onthevalue oftheprocurement, thethresholds should begiven.
Federal Contracting Regulations specify that,consistent withinternational agreements onall
procurement covered bythese agreements, departments arerequired toconduct mandatory
bidsforprocurements exceeding $25,000 except where exceptions arepermitted.
(c) What arethetimelimits forsubmission ofbids?
Consistent withinternational agreements, bidsareposted from7to40days, depending upon
therelevant legislation orpolicy.
Publicity forinviting tenders
5.(a) How areintended procurements publicised? Areinvitations totender published? Ifso,
where, andinwhat languages?
Procurement opportunities thatarepublicly advertised, arepublished ontheOpen Bidding
Service (OBS) andintheGovernment Business Opportunities (GBO). Notices ontheOBS
andintheGBO appear inCanada ’stwoofficial languages, French andEnglish, andcontain
bothintended procurement andinvitations totender.
(b) Dotheextent andform ofpublicity differ according totendering procedures applied and/or
onthevalue ofprocurement?
Lists ofregistered suppliers, contractors orconsultants maybeusedtosolicit competitive
proposals forrequirements below $10,000 forprinting, below $25,000 formost goods and
services, andbelow $60,000 forrealty, construction, architectural andengineering consulting,
leasing andconstruction andmaintenance services andforsome requirements ofgreater value.
Printing services estimated at$10,000 orabove, mostgoods andservices estimated at$25,000
orabove, andcommunications services worth $50,000 ormore arenormally advertised on
theOBS andintheGBO; asarerequirements estimated at$60,000 orabove forrealty,
construction, architectural andengineering consulting, leasing andmaintenance services.
(c) What details oftheintended procurement arenormally published? Isthere aminimum set
ofinformation thatisrequired tobepublished? Ifso,please specify.
Procurement notices include sufficient information toallow apotential bidder tomake an
informed decision onwhether toorder thebidsolicitation document. Notices forprocurement
thataresubject toNAFTA ortheWTO-AGP must alsoinclude information setoutinthe
respectiveagreement(s).Thiswouldincludeinformationsuchasthebidclosingtime,description
ofthenature andquantity ofthegoods orservices being procured, andthename andaddress
ofthecontracting authority.
(d) Arethere anycharges forobtaining thefullsetoftender documents? Ifso,please specify
anddescribe howthese charges areset?
Documents ordered through theOBSon-line andBidRequest Lineservices arepriced according
toarateschedule established inthecontract withtheservice provider. Documents costsrange
fromroughly $5to$55,depending onsizeandmethod ofdelivery. Most documents orderedS/WPGR/W/11/Add.7
Page4
areatthelowendoftherange. Subscribers haveseveral choices ofdelivery methods, such
asfacsimile, courier andmail.
(e) Areelectronic means usedtoadvertise procurement opportunities? What isthenature of
systems thatareinplace? Aredifferent tendering provisions applied tocontracts advertised
inthismanner? Ifso,please describe.
TheOpen Bidding Service (OBS) isauser-friendly automated bidding system designed togive
potential suppliers fast,equal access toinformation ongovernment contracting opportunities.
MostPWGSCbiddingopportunitiesforgoodsandservicesvaluedatover$25,000areadvertised
ontheOBS, aswellasconstruction, maintenance, architecture, engineering andleasing
opportunities over$60,000, communications professional services valued atover$50,000 and
printing requirements valued atover$10,000.
Further information ontheOBSisfound inthebrochures YourGuide toDoing Business with
PWGSC (refer topages 3,4and5)andTheOpen Bidding Service (provided totheSecretariat).
Inaddition, theOBSWebsiteaddress ontheInternet ishttp://www.obs.ism.ca.
Requirements laiddown forpossible suppliers
6.(a) Arethere registration, residence orother requirements forpotential suppliers?
Lists ofregistered suppliers, contractors orconsultants maybeusedtosolicit competitive
proposals forrequirements below $10,000 forprinting, below $25,000 formost goods and
services, andbelow $60,000 forrealestate services, construction, architectural andengineering
consulting, leasing andmaintenance services.
(b) What isthenature ofanyconditions forparticipation required from suppliers -such as
financial guarantees, commercial standing andtechnical qualifications? Dotheconditions
ofparticipation varyaccording tothenature ofthetender process and/or thevalue ofthe
intended procurement?
Contracting authorities haveadutytoprotect thefinancial interests ofthegovernment. When
thebidsolicitation requires thesubmission ofbidsecurity, theamount should bedetermined
bythecontracting authority inadvance. When abidder hassubmitted lessthanthefinancial
security stipulated, thebidwillgenerally beconsidered asnon-responsive. Usually, other
additional standards havetobemetbyCanadian firms, suchashealth andsafety oremployment
equity considerations.
(c) Dothere existlistsofapproved suppliers? Ifso,what aretheprocedures forchecking the
capability offirms applying forinclusion ontenderers 'mailing lists? Arelistsofapproved
suppliers, ifany,regularly reviewed/updated?
TheCanadian federal government usessource listsinfrequently except forlowdollar value
contracts.S/WPGR/W/11/Add.7
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Criteria forassessing bidsandawarding contracts
7.(a) What criteria aretaken intoaccount intheaward oftenders? Arecriteria foraward of
contracts made available inadvance topotential suppliers?
Awardoftendersisbasedoncriteriaspecifiedintenderdocument,suchasqualifications,follow-
onservice orexperience, which must bespecified inthetender documents.
(b) Isprocurement subject toanyoffset provisions, suchaslocal content, technology transfer
orcountertrade requirements?
Some procurements arenotcovered byinternational agreements oraresubject toexceptions
setoutininternational agreements, suchasset-asides forAboriginals. Forprocurements not
subject tointernational agreements, special provisions areallowed forregional andeconomic
development purposes, andapreference maybeaccorded forCanadian value-added benefits.
(c) Ispreference given toanyparticular enterprises orgroup ofenterprises? Ifso,please specify.
Generally, nopreference isgiven toanyenterprise orgroup ofenterprises.
(d) Dotheprocurement criteria differ according tosector orregion oftheeconomy?
Procurements thataresubject tointernational agreements cannot contain criteria thatdiffer
according tosector orregion oftheeconomy. Forprocurements over$2million thatarenot
subject tointernational agreements, butaresubject totheAgreement onInternal Trade,
evaluation criteria maybeusedtoachieve industrial andregional benefits, aslongasthebenefits
aresought inanon-discriminatory manner withrespect toregions forwhich there exists a
general framework ofregional development. Procurements over$2million, thatarenotcovered
byanyofthetradeagreements, areexamined onacase-by-case basisandmayinclude criteria
according toasector orregion oftheeconomy.
(e) What isthemargin ofchoice ordiscretion allowed tothepurchasing authority? What does
theextent, ifany,ofdiscretion allowed depend upon?
Thepurchasing authority isexpected tomake theappropriate choice among suppliers, taking
intoaccount bestvalue fortaxpayers andnational andinternational obligations, suchastrade
agreements.
Disclosure ofbidsreceived andcontracts awarded
8.(a) How aretenders received, registered andopened?
Procurements subject totrade agreements areconsistent withinternational trade obligations.
(b) Areentities required topublish details ofthecontracts awarded and/or notify unsuccessful
tenderers?
No,entities donothavetonotify unsuccessful tenders individually.S/WPGR/W/11/Add.7
Page6
(c) Areentities required topublish, orprovide tounsuccessful bidders, pertinent reasons why
theirbidwasrejected?
Contract awards subject tothetrade agreements arepublished.
Treatment granted todomestic andforeign services and/or suppliers
9. What laws, regulations, procedures orpractices accord domestic services and/or suppliers
treatment more favourable thanthataccorded toforeign services and/or suppliers, oraccord
services and/or suppliers ofaMember more favourable treatment thanthose ofanother
Member? Please specify how, ifatall,more favourable treatment isaccorded. Please also
specify theworking definition of"domestic" inrelation todomestic services andsuppliers.
Local Content Requirements: none.
Preference fordomestic suppliers: Anindustrial andregional benefits policy mayapply for
larger value procurements byallgovernment departments, when theprocurement isnotcovered
bytheinternational trade agreements. Under thispolicy, allprocurements overavalue of
$2million arereviewed toassess theopportunities forachieving socio-economic benefits in
Canada. However, thispolicy israrely applied tocontracts under $100 million.
Forprocurement handled byPublic Works andGovernment Services Canada andnotcovered
byinternational tradeagreements, PWGSC applies aCanadian Content Policy, which restricts
aprocurement opportunity tosuppliers ofCanadian goods andservices, provided there is
adequate competition, usually three ormore suppliers.
Preference forsmall ormedium-size enterprises: Canada doesmaintain anexception under
theWTO-AGP andNAFTA forsmall business. However, itdoesnotcurrently haveinplace
aprogram providing small business withpreferences.
Procedures forhearing andreviewing complaints/appeals
10. What, ifany,aretheprocedures available forparties, domestic andforeign, tolodge
complaints against theaward ofacontract? Please provide details.
Abidchallenge process allows anypotential supplier tocomplain toanimpartial reviewing
authority, atanytimethroughout theprocurement cycle, onhowagovernment procurement
isbeing handled.
TheCanadian International Trade Tribunal hasbeendesignated astheindependent bidchallenge
authority forCanadian federal government procurements thataresubject totheAgreement
onInternal Trade, theNorth American Free Trade Agreement, andtheWorld Trade
Organization -Agreement onGovernment Procurement.
Forprocurements outside thetrade agreements, eachpurchasing department usually hasits
ownappropriate procedures todealwithcomplaints.S/WPGR/W/11/Add.7
Page7
II. MEMBERSHIP OFPLURILATERAL, REGIONAL AND/OR BILATERAL AGREEMENTS
11. IstheMember party toanyplurilateral, regional and/or bilateral agreements withprovisions
ongovernment procurement? Ifso,please describe therelevant provisions.
Memberships: World Trade Organization -Agreement onGovernment Procurement, North
American FreeTrade Agreement, GATT Agreement onGovernment Procurement (1988) and
Agreement onInternal Trade.
III. ECONOMIC IMPORTANCE OFSERVICES PROCUREMENT
12.(a) Please provide statistics (ifavailable) onthenumber andvalue ofservices procurements
- onbothanaggregate andsectoral basis;
- byorigin ofservices andsuppliers.
(b) Please provide statistics (ifavailable) onthe
- share ofservices procurement intotalprocurement;
- share ofprocurement ofeachservice intotaldomestic output oftheservice;
- share ofprocurement ofeachservice intotaldomestic consumption oftheservice.
Total domestic consumption isdefined asthesumofpublic andprivate consumption orthe
sumofdomestic output andnetimports (i.e.imports minus exports) oftheservice inquestion.
Annual contracting activity reports showing services procurement, forfiscal years 1991-92
to1993-94, hasbeenprovided totheSecretariat.
Contact Points
Mr.N.B. (Bruce) Ballantyne
Client andSupplier Relations Officer
Public Works andGovernment Services Canada
Place duPortage, Phase III,Floor 3C1
11Laurier Street
Hull, Québec
Canada
K1A0S5
Tel.(1)(819) 956-0914
Fax.(1)(819) 956-6123
Internet: Ballantb@SOS.PWGSC.GC.CA
Additional information isalsoavailable onPWGSC 'shome page ataddress
http://w3.pwgsc.gc.ca/ orinthebrochure "Your Guide toDoing Business with
PWGSC".S/WPGR/W/11/Add.7
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Mr.R.J.Kelly
Group Chief
Contracting Management
Deputy Comptroller General
Treasury Board Secretariat
10thFloor, EastTower
140O'Connor Street
Ottawa, Ontario
Canada
K1A0R5
Tel.(1)(613) 957-2526
Fax.(1)(613) 952-1381
Internet: Kelly.RJ@tbs-sct.gc.ca