10.7.1 Equal opportunity for all contractors. In accordance with the policy statement to reflect fairness in spending public funds and the requirements under the trade agreements, the method of procurement used for a particular acquisition must, within the limits of practicality, give all qualified firms an equal opportunity for access to government business. For all procurements, especially those subject to the North American Free Trade Agreement, the World Trade Organization - Agreement on Government Procurement, and the Agreement on Internal Trade, all parties must be given an equal opportunity to access government business. Therefore, contracting authorities should ensure that potential contractors are identified. Whenever projects are advertised, the area of coverage should not be so narrow that it inhibits free competition. If fewer than three respondents are reached by established advertising practices, the advertising coverage or bid solicitation should be increased. Contracting authorities that keep source lists from which bids are invited, may find it in their interests to establish a regular way to inform industry of this practice. This might take the form of periodic briefings to industry associations accompanied by adequate publicity, departmental public information brochures adequately circulated, newspaper and trade journal advertisements, electronic media advertisements, etc. For example, a contracting authority can use, inter alia, the electronic bidding system, and may supplement this by direct solicitation in order to maximize the involvement of the most qualified suppliers of goods and services.
10.7.2 Contracting authorities should note that when a combination of solicitation processes is used together, it is essential that they
1. commence and close on the same dates;
2. provide potential suppliers with the same information; and
3. impose identical obligations on these suppliers.
10.7.3 The following is a description of the various selection methods that may be used.
10.7.4 Advertisement in the public press. This method is appropriate:
1. when it is a custom generally followed by the trade involved; or
2. when the contracting department or agency considers it the most effective means of ensuring adequate competitive response.
10.7.5 Mailing lists. This method is appropriate:
1. to support national policies and objectives;
2. when it is customary in the trade for suppliers to be listed by potential buyers; or
3. when goods or services in common commercial supply are involved and it can be assumed that most firms in the business can meet the requirements.
10.7.6 Source lists. For procurements subject to the North American Free Trade Agreement and the World Trade Organization - Agreement on Government Procurement, source lists may be used for selective tendering. Contracting authorities may also establish source lists of competent suppliers that are representative of the suppliers of the required goods or services. When the source list contains many firms, they should be pre-selected in rotation through the list, from procurement to procurement, in an equitable manner. Electronic media may be used to advertise in order to develop an appropriate list of suppliers. In addition, rotational selection of qualified individuals or firms by computer may also be used.
10.7.6a Under the Agreement on Internal Trade, source lists shall:
1. include information in its policies, procedures and practices describing the circumstances and manner in which the source list is used and any qualification criteria that a supplier must meet to register on the source list;
2. provide written confirmation of registration to any supplier that requests registration on the source list or indicate the qualification criteria that were not met; and
3. on request by any Party of the AIT, provide that Party with the tenders notice and the list of suppliers that will be invited to bid on a specific tender.
10.7.7 Solicitation by electronic media. Electronic media may be used to solicit bids or to give public notice of (i) a call for bids in respect of a proposed contract or (ii) an intention to award a directed contract (using an Advance Contract Award Notice). The use of electronic media enables instantaneous notification of suppliers of the opportunity to bid and facilitates bid submission by those who are interested. This method is particularly suitable as an expeditious approach to competitive procurement. Depending on the circumstances, this sourcing method may be supplemented by the use of more traditional methods of calling for bids in newspapers or trade publications as well as source lists where, in the judgement of the contracting authority, they are necessary to ensure adequate competition.
10.7.8 Electronic Bidding. This methodology is appropriate:
1. to support the government's policy of enhanced access, competitive procurement and fairness;
2. for competitive procurements of both goods and services by the Department of Public Works and Government Services at a suggested threshold total value of at least $25,000;
3. for competitive procurements of services (and goods, where authority has been delegated by the Minister of Public Works and Government Services) by contracting authorities other than the Department of Public Works and Government Services at a suggested threshold total value of $100,000, and at lower values if appropriate;
4. to publish an Advance Contract Award Notice (ACAN). An ACAN allows departments and agencies to post a notice, for no less than fifteen calendar days, indicating to the supplier community that it intends to award a good, service or construction contract to a pre-identified contractor. If no other supplier submits, during the fifteen calendar day posting period, a statement of capabilities that meet the requirements set out in the ACAN, the competitive requirements of the government's contracting policy have been met. Following notification to suppliers not successful in demonstrating that their statement of capabilities meets the requirements set out in the ACAN, the contract may then be awarded using the Treasury Board's electronic bidding authorities.
If other potential suppliers submit statements of capabilities during the fifteen calendar day posting period, and meet the requirements set out in the ACAN, the department or agency must proceed to a full tendering process on either the government's electronic tendering service or through traditional means, in order to award the contract.
5. for procurements subject to the North American Free Trade Agreement, the World Trade Organization - Agreement on Government Procurement and the Agreement on Internal Trade.
10.7.9 For most contracting authorities, using electronic bidding methodology to solicit and invite bids for services means that both their contract entry and amending authorities are increased (refer to Appendix C for greater detail).
10.7.10 The approved national electronic bidding and information service is the Government Electronic Tendering System (GETS). GETS affords supplier subscribers access to government procurement opportunities. To advertise bid opportunities electronically, contracting authorities may give public notice by means of:
1. the Government Electronic Tendering System; or
2. such other departmental procurement methods as may be approved by the Treasury Board.
10.7.11 Electronic Bidding. The approved national electronic bidding and information service is the MERX system, provided by Cebra Inc. It is currently available through the Department of Public Works and Government Services, and is provided under contract to supplier subscribers, and affords them access to all government procurement opportunities.
10.7.11 Deleted.
10.7.12 Government Business Opportunities (GBO). GBO is currently available through the GETS. The GBO advertises domestic and international procurement opportunities.
10.7.13 Advance Contract Award Notice (ACAN). An Advance Contract Award Notice (ACAN) allows departments and agencies to post a notice, for no less than fifteen calendar days, indicating to the supplier that it intends to award a good, service or construction contract to a pre-identified contractor. This electronic bidding procedure can be advantageously used to fulfil the requirement of Section 5 of the Government Contracts Regulations to solicit bids and is appropriate:
1. when the contracting situation results from one of the five exceptions identified in section 6 of the Government Contracts Regulations, which permit the setting aside of the requirement to solicit bids; and
2. to inform the public that the contracting authority is proposing to award a contract to a pre-identified supplier, especially in situations involving the services of former public servants.
10.7.14 While an ACAN is always published using an approved electronic procurement information service, contracting authorities may supplement the electronic notice in order to inform the public by the traditional approaches, such as mailing lists, notification in trade publications and the public press, etc.
10.7.15 An ACAN is to:
1. define the requirements or the expected results of the contract, so that other potential suppliers can determine if they possess the capability to satisfy them;
2. identify the proposed contractor;
3. provide the reason for the proposed directed award; and
4. if possible, provide an estimate of the cost of the proposed contract, where this will not prejudice negotiations with the proposed contractor. (Further guidance on what should be included in an ACAN is available in the Guide for Managers - Using Advance Contract Award Notices (ACANs)).
10.7.16. If no other supplier submits, during the fifteen calendar day posting period, a statement of capabilities that meets the requirements set out in the ACAN, the competitive requirements of the contracting policy have been met. Following the notification of suppliers not successful in demonstrating that their statement of capabilities meets the requirements set out in the ACAN, the contract may then be awarded using the Treasury Board's electronic bidding authorities.
10.7.17 If other potential suppliers submit statements of capabilities during the fifteen calendar day posting period, and meet the requirements set out in the ACAN, the department or agency must proceed to a full tendering process on either the government's electronic tendering service or through an traditional means, in order to award the contract.
Advance Contract Award Notices shall be posted for no less than fifteen calendar days on the government's electronic tendering system. Statement of capabilities must be submitted within the same fifteen calendar days. Where the ACAN is subject to NAFTA or the WTO-AGP, the fifteen calendar days shall commence on the date the ACAN is published in the Government Business Opportunities.
With respect to statements of capabilities that are not accepted, the decision to reject will be impartial and independent in that it will not be made by the same official(s) who originally decided to proceed through an ACAN process.
For further information consult the Guide for Managers - Best Practices for Using Advance Contract Award Notices (ACANs).
10.7.18 Pre-selecting bidders. This method is appropriate:
1. when goods and services not in common commercial supply are involved and special government specifications apply;
2. when the cost of bidding is so significant that it would be unfair to present firms of unknown capability with the risk of disqualification after they have incurred the expense of bidding; or
3. when, owing to the special nature of the requirement, the competence of the low bidder must be verified before making the award and, for reasons of administrative cost, it is desirable to keep the number of such pre-award verifications to a minimum by inviting only firms with established reputations.
10.7.19 Pre-selection of bidders does not preclude a contracting authority from competitive contracting. In this situation, a contracting authority may implement the policy of competitive bidding by then seeking valid bids from the qualified bidders.
10.7.20 Pre-qualification of bidders. When the size or complexity of a project necessitates further special assurance of the contractor's ability, all necessary tests of the competence of prospective contractors may be made in advance. Bids are then invited only from the firms that have qualified. The possibility of disqualifying a firm after it has incurred a considerable expense in bidding on a large special project is thereby reduced or eliminated.
10.7.21 A version of this method, suitable for manufacturing certain items, is to pre-establish a list of qualified products which, through the testing of samples, have met the requisite standards of quality. A qualified products list is particularly suitable for selecting bidders for manufactured products when the quality requirements exceed the normal commercial standards.
10.7.22 Two-step proposal (including price competition). This method is used when, owing to the special nature of the requirement and the lack of a detailed definition of the specifications, the selection is to be based largely on the technical and managerial proposals submitted. Final selection among the firms that have submitted acceptable technical and managerial proposals is then made on the basis of price. One of the methods above may be used to choose firms to be invited. Pre-qualification is frequently the most appropriate in these circumstances.
10.7.23 Because of the infinite variety and complexity of contracting situations, it is difficult to dictate absolute norms. Each case should be examined on its own merit to determine whether price should play a dominant or secondary role in the selection process.
10.7.24 Proposal competition. Architectural, engineering, research, development and consulting services typify when a contractor should be selected for the level of performance offered rather than for price alone. Usually a very comprehensive proposal is requested to elicit all of the contractor information needed for an objective appraisal of the offers received.
10.7.25 The merits of each proposal should be compared using a weighted list of the criteria to be met. These criteria should identify accurately all the performance elements significant to the success of the project and should measure both the competence of the firm and the worth of its particular technical approach. Competence includes, for example, such factors as managerial structure, key personnel, prior industrial experience, facilities and financial strength. Technical worth includes the firm's proposed work breakdown structure, identification of key technical problems and outlines of solutions, proposed schedule of milestones, cost, quality and time control systems to be used, and the like, depending on the nature of the requirement. Any additional terms and conditions the bidder may demand should also be considered. Finally, the expected price could be weighted so that it carries the appropriate degree of importance relative to the other factors. Service contracts, where a best value selection is made based on the above, are subject to the higher competitive approval levels detailed in the Treasury Board Contracts Directive - see Appendix C. See also the definition of competitive service contracts in Appendix A.
10.7.26 If information on the economic life of the acquisition is obtainable, it is advantageous to include in the criteria a way of comparing operation, maintenance, installation and handling, consumable supplies and other in-use costs. This approach may permit an objective selection of the item most likely to be superior throughout its operating life.
10.7.27 Competing firms should be told the measurement criteria and the weighting assigned to them. Contracting authorities should be aware of successful legal challenges to the contractor selection process. The issue arises from the manner in which evaluation factors are to be used to determine the successful bid. The courts have ruled that the factors and their weighting must be established beforehand and adhered to strictly. They are to be recorded along with the requirements of the contract and included in the bid solicitation. The principle of applying bid criteria or requirements equally to all bidders is part of Canadian contract law and is applicable to both the public as well as the private sectors. Fairness to all prospective contractors and transparency in the award process are imperative.
10.7.28 Proposal competitions in which the price element is not included do not meet the definition of a valid bid. Consequently, the competitive authority dollar levels may not be used when the contract is awarded.
10.7.29 Design competition. For major public works, the architect and the design of the structure should be selected using a predetermined procedure. When the technical problems are within the state of the art, a design competition may be an appropriate preliminary step to selecting a contractor for a design/make or total package procurement.
10.7.30 Non-competitive contracts. When the contracting authority awards a contract under the provision of one or more of the exceptions to the requirement to solicit bids in Section 6 of the Government Contracts Regulations, this decision should be recorded, together with the justification.
10.7.31 In order to demonstrate the requirement for access and openness in government contracting, contracting authorities are encouraged to publish an Advance Contract Award Notice (ACAN) for contracts with pre-identified contractors using electronic bidding methodology. If no statements of capabilities meeting the requirements set out in the ACAN are received within fifteen calendar days, the contract is deemed to be competitive and the higher electronic bidding dollar levels apply.
10.7.32 If, as a consequence of a non-competitive contract award, the availability of specified commodities and services is inadequate or their price is deemed to be excessive, then competition needs to be stimulated. In this circumstance, contracting authorities should cultivate additional suppliers by ensuring that all likely firms have been made aware of and are adequately briefed on the extent and probability of continuing government requirements and given all possible help in the form of information and guidance on specifications, qualification approval, manufacturing technology, and the like. A useful technique is to inform the industry of an anticipated requirement and to request a statement of interest and capability through the use of electronic bidding methodology. If electronic bidding procedures are not feasible or if there is a need to supplement them, an expanded direct solicitation (such as an information letter mailed to a list of potential sources, advertisement of the opportunity in trade publications and the public press, etc.) could also be used.
10.7.33 Qualification of suppliers under the North American Free Trade Agreement and the World Trade Organization - Agreement on Government Procurement. Contracting authorities must ensure that there is no discrimination between foreign or between domestic suppliers when establishing the qualification criteria. The qualifications procedures shall be consistent with the following:
1. conditions for participation by suppliers in tendering procedures shall be published sufficiently in advance to provide the supplier adequate time to initiate and, to the extent that it is compatible with efficient operations of the procurement process, to complete the qualification procedures;
2. conditions for participation by suppliers in tendering procedures, including financial guarantees, technical qualifications and information necessary for establishing the financial, commercial and technical capacity of suppliers, as well as the verification of whether a supplier meets those conditions, shall be limited to those that are essential to ensure the fulfilment of the contract in question;
3. the financial, commercial and technical capacity of a supplier shall be judged both on the basis of that supplier's global business activity, including its activity in the territory of the Party of the supplier, and its activity, if any, in the territory of the Party of the contracting authority;
4. a contracting authority shall not misuse the process of, including the time required for, qualification to exclude suppliers of another Party from a supplier's list or from being considered for a particular procurement;
5. a contracting authority shall recognize as qualified suppliers those suppliers of another Party that meet the conditions for participation in a particular procurement;
6. a contracting authority shall consider for a particular procurement those suppliers of another Party that request to participate in the procurement and that are not yet qualified, provided there is sufficient time to complete the qualification procedure;
7. a contracting authority that maintains a permanent list of qualified suppliers shall ensure that suppliers may apply for qualification at any time, that all qualified suppliers so requesting are included in the list within a reasonable short period of time and that all qualified suppliers included in the list are notified of the termination of the list or of their removal from it;
8. where, after publication of the Notice of Proposed Procurement, a supplier that is not yet qualified requests to participate in a particular procurement, the contracting authority shall promptly start the qualification procedure;
9. a contracting authority shall advise any supplier who requests to become a qualified supplier of its decision as to whether that supplier has become qualified; and
10. where a contracting authority rejects a supplier's application to qualify or ceases to recognize a supplier as qualified, the contracting authority shall, on request of the supplier, promptly provide pertinent information concerning the contracting authority's reason for doing so.
10.7.34 For procurements subject to the North American Free Trade Agreement and the World Trade Organization - Agreement on Government Procurement, contracting authorities shall
1. ensure they use a single qualification procedure, except that a contracting authority may use additional qualification procedures where the contracting authority determines the need for a different procedure and is prepared, on request of another Party of the Agreements, to demonstrate that need; and
2. try to minimize differences in the qualification procedures from other contracting authorities.
10.7.35 Contracting authorities can exclude suppliers on grounds such as bankruptcy or false declarations.
10.7.36 Invitation to participate under the North American Free Trade Agreement and the World Trade Organization - Agreement on Government Procurement. Contracting authorities shall publish an invitation to participate in the appropriate publication for all procurements. The invitation to participate shall take the form of a Notice of Proposed Procurement (NPP) that shall contain the following information:
1. description of the nature and quantity of the goods or services to be procured, including options for further procurement and if possible:
1. an estimate of when such options may be exercised, and
2. in the case of recurring contracts, an estimate of when the subsequent notices will be issued;
2. a statement as to whether the procedure is open or selective and whether it will involve negotiation;
3. any date for starting or completing the delivery of the goods or services to be procured;
4. the address to which an application to be invited to tender or to qualify for the suppliers' lists must be submitted, the final date for receiving the application and the language or languages in which it may be submitted;
5. the address to which tenders must be submitted, the final date for receiving tenders and the language or languages in which tenders may be submitted;
6. the address of the contracting authority that will award the contract and that will provide any information necessary for obtaining specifications and other documents;
7. a statement of any economic or technical requirements and of any financial guarantees, information and documents required from suppliers;
8. the amount and terms of payment of any sum payable for the tender documentation; and
9. a statement as to whether the contracting authority is inviting offers for purchase, lease or rental, with or without an option to buy.
10.7.37 For procurement subject to NAFTA and WTO-AGP, in the case of selective tendering procedures, a contracting authority that maintains a permanent list of qualified suppliers shall publish annually, in the appropriate publication, a notice containing the following information:
1. an enumeration of any lists maintained, including their headings, in relation to the goods or services or categories of goods or services to be procured through the lists;
2. the conditions to be fulfilled by suppliers in view of their inscription on the lists and the methods according to which each of those conditions will be verified by the contracting authority concerned; and
3. the period of validity of the lists and the formalities for their renewal.
10.7.38 For procurements subject to NAFTA and WTO-AGP, after the publication of an invitation to participate, but before the time set for the opening or receipt of tenders as specified in the notices or the tender documentation, a contracting authority finds that it has become necessary to amend or reissue the notice or tender documentation, the contracting authority shall ensure that the amended or reissued notice or tender documentation is given the same circulation as the original. Any significant information given by a contracting authority to a supplier with respect to particular procurement shall be given simultaneously to all other interested suppliers and sufficiently in advance so as to provide all suppliers concerned adequate time to consider the information and to respond.
10.7.39 Under NAFTA and WTO-AGP, a contracting authority shall allow a supplier that requests to participate in a particular procurement to submit a tender and shall consider the tender. The number of additional suppliers permitted to participate shall be limited only by the efficient operation of the procurement system.
10.7.40 Under NAFTA and WTO-AGP, where a contracting authority does not invite or admit a supplier to tender, the contracting authority shall, on request of the supplier, promptly provide pertinent information concerning its reasons for not doing so.
10.7.41 Call for tenders under the Agreement on Internal Trade. A notice of a call for tenders shall contain at least the following information:
1. a brief description of the procurement contemplated;
2. the place where a person may obtain information and tender documents;
3. the conditions for obtaining the tender documents;
4. the place where the tenders are to be sent;
5. the date and time limit for submitting tenders;
6. the time and place of the opening of the tenders in the event of a public opening, and a statement that the procurement is subject to the AIT.
10.7.42 In evaluating tenders, subject to AIT, contracting authorities may take into account not only the submitted price but also quality, quantity, delivery, service, the capacity of the supplier to meet the requirements of the procurement and any other criteria directly related to the procurement. The tender documents shall clearly identify the requirements of the procurement, the criteria that will be used in evaluating bids and the methods of weighting and evaluating the criteria.