Navigating the public procurement landscape can be a daunting task. Between new court and tribunal decisions, law and policy updates, and announcements for new initiatives and projects at the federal and provincial levels, the sector continues to experience significant change.

To help guide you through this challenging environment, McCarthy Tétrault's Procurement Group has released its Public Procurement 2023 Year in Review. This practical guide provides an overview of key federal and provincial developments that can affect the procurement landscape moving forward, including recently introduced laws that can have an impact on your business, new provincial plans for procurement opportunities, and information on audits and court and administrative tribunal rulings.

Topics covered include the following:

  • Federal level: Overview of key developments, including the expansion of the Canadian International Trade Tribunal jurisdiction, the government's commitment to consultant review, and the ScaleUp social procurement initiative to support diversity, equity, and inclusion.
  • Ontario: Examination of the continuity of prior developments that confirmed and extended prior procurement jurisprudence, as well as the new unification of purchasing entities to provide for a true single point of access for most procurements.
  • British Columbia: A look at forthcoming opportunities, including major infrastructure projects outlined in the B.C. Major Infrastructure Projects Brochure and BC Hydro's call for power.
  • Alberta: A year-in-review breakdown of the Alberta government's Action Plan to reform procurement processes, the movement away from the preferred P3 approach to building schools, the increased emphasis on social procurement in Western Canada, and an audit update on Edmonton's Valley Line LRT projects.
  • Québec: A review of provincial case law and information on the AMP's report on the Contract Management Review.

Key Developments at the federal level: Expansion of CITT jurisdiction, consultant review, and DEI support in procurement

The federal procurement dispute area was relatively quiet in 2023. However, several major federal initiatives were announced that engage with the procurement arena and should be considered by interested parties moving forward.

There was a Federal Court of Appeal review of a decision of the Canadian International Trade Tribunal (the Tribunal), along with a key Tribunal decision emphasizing the importance of participation in the debriefing process and the necessity of gathering evidence supporting allegations of breach prior to initiating a complaint.

Terra Reproductions Inc. v. Canada (Attorney General)1– The Importance of Timing & Completeness

In a limited decision, the Federal Court of Appeal rejected an application for judicial review of the Tribunal's dismissal of Terra Reproductions' complaint. In the ordinary course, the Tribunal sets a very strict 10 business day limitations period for any complaint. Terra Reproductions had complained three days late.

The Court upheld the Tribunal's strict construction of the limitations period on the basis that it was founded upon the literal and defensible application of the Tribunal's regulations.

The Court also rebuffed attempts by Terra Reproductions to introduce new arguments regarding the limitations period that had not been made before the Tribunal. Importantly, the regulations provide for exceptions to the limitations period under exceptional circumstances, but the complainant had not raised those arguments before the Tribunal. When it attempted to do so for the first time on judicial review, the Court confirmed that parties are required to raise such matters at first instance and cannot introduce novel arguments for the first time on review, outside of very limited circumstances.

Chantier Davie Canada Inc. and Wärtsilä Canada Inc. v. Department of Public Works and Government Services2 – Ignore the debriefing process and fish for evidence at the Tribunal at your peril

The Tribunal reaffirmed that bidders are not entitled to their preferred means of debriefing, and that bidders are required to participate in the debriefing process rather than attempting to sidestep it by going straight to the Tribunal.

In their complaint, Chantier Davie and Wärtsilä alleged that Canada had not met its debriefing obligations by offering written debriefing rather than the in-person debriefing they had sought. Instead of proceeding with a debriefing in writing, they brought a complaint to the Tribunal arguing that their bid was evaluated incorrectly and that Canada should have declared the winning bid non-compliant on the basis of the complainants' belief (unsupported by evidence) that the winning bid did not comply with the invitation to tender. Chantier Davie and Wärtsilä then attempted to use the complaint process as a fishing expedition to obtain evidence that would make out their complaint.

The Tribunal rebuked the complainants, noting that it could not "allow this type of exercise to go on in a procurement review case because the bid challenge mechanism was not designed for [this] purpose." It emphasized that aggrieved bidders should not shy away from asking the government to explain and justify its decisions, and provide the relevant information and evidence, and should then use the access to information mechanism if they do not get satisfactory disclosure. The Tribunal mechanism is not to be used for evidence gathering — it examines only allegations that have demonstrated through evidence a reasonable indication of a breach of a trade obligation.

Consultant Review

Several major news stories regarding retaining consultants were front and centre in 2023, including the large contract awarded for developing ArriveCan, and the use of business management consultants. The federal government has committed to examining the use of consultants and the awarding of contracts to entities that subsequently subcontract all or nearly all of the actual performance of the contract, with specific measures to be announced.

Diversity, Equity and Inclusion Support in Procurement

Shared Services Canada has also announced a new initiative to encourage procurement awards to small- and medium-sized enterprises, as well as businesses led by women, visible minorities, and Indigenous Peoples in Canada.

The ScaleUp social procurement initiative, part of Shared Services Canada's Agile Procurement Process 3.0 initiative, has thus far awarded more than 15 contracts, ranging in value from C$10,000 to C$238,000. The majority of these contracts have been awarded to businesses owned or led by visible minorities and women.

This initiative provides an entry point for small businesses—especially for those from equity seeking groups—to the federal procurement market. These awards are only for small contracts that fall below the threshold for the application of Canada's trade agreement restrictions. Given the success of the program to date, it is likely that it will see continued salience and perhaps an expanded roll out.

About McCarthy Tétrault's Procurement Group

Our Procurement Group can help you avoid pitfalls in the purchasing or selling process. We provide end-to-end procurement advice and services from both a buyer and seller perspective. We represent the private sector and federal, provincial and municipal government entities in all aspects of procurement. Whether you are selling to the Canadian private sector or government entity at any level or you are a domestic or international organization buying goods, services or technology, we can help you achieve your objectives through our multidisciplinary approach. Learn how our team can help advance your business interests.

cAbout McCarthy Tétrault

McCarthy Tétrault LLP provides a broad range of legal services, providing strategic and industry-focused advice and solutions for Canadian and international interests. The Firm has a substantial presence in all of Canada's major commercial centres as well as in New York and London.

Built on an integrated approach to the practice of law and delivery of innovative client services, the Firm brings its legal talent, industry insight and practice experience to help clients achieve the results that are important to them.

Footnotes

1. 2023 FCA 214.

2. 2023 CanLII 6265.

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