Annual Report March 31, 2011 - Chapter IV

Introduction

Potential suppliers that believe that they may have been unfairly treated during a procurement solicitation covered by NAFTA, the AIT, the AGP, the CCFTA or the CPFTA may file a complaint with the Tribunal. However, the scheme of the relevant provisions of the CITT Act favours the complainant first making an attempt to resolve the issue with the government institution responsible for the procurement.

The Tribunal's role is to determine whether the government institution followed the procurement procedures and other requirements specified in NAFTA, the AIT, the AGP, the CCFTA or the CPFTA.

When the Tribunal receives a complaint, it reviews it against the legislative criteria for filing. If there are deficiencies, the complainant is given an opportunity to correct them within the specified time limit. If the Tribunal decides to conduct an inquiry, the government institution and all other interested parties are sent a formal notification of the complaint and a copy of the complaint itself. An official notice of the complaint is also published on MERX, Canada's electronic tendering service, and in the Canada Gazette. If the contract in question has not been awarded, the Tribunal may order the government institution to postpone awarding any contract pending the disposition of the complaint by the Tribunal.

After receipt of its copy of the complaint, the relevant government institution files a response called the Government Institution Report. The complainant and any intervener are sent a copy of the response and given an opportunity to submit comments. Any comments made are forwarded to the government institution and other parties to the inquiry.

Copies of any other submissions or reports prepared during the inquiry are also circulated to all parties for their comments. Once this phase of the inquiry is completed, the Tribunal reviews the information on the record and decides if a public hearing is necessary or if the case can be decided on the basis of the information on the record.

The Tribunal then determines whether or not the complaint is valid. If it is, the Tribunal may make recommendations for remedies, such as re-tendering, re-evaluating or providing compensation to the complainant. The government institution, as well as all other parties and interested persons, is notified of the Tribunal's decision. Recommendations made by the Tribunal are, by statute, to be implemented to the greatest extent possible. The Tribunal may also award reasonable costs to the complainant or the responding government institution depending on the nature and circumstances of the case.

Procurement Complaints

Summary of Activities

In 2010-2011, the Department of Public Works and Government Services (PWGSC) issued approximately 16,132 contracts valued at between $25,000 and $2 billion each, for a total value of $13.4 billion. The 94 complaints that the Tribunal received in the fiscal year pertained to 89 different contracts, with a total value of $2.9 billion, representing about 0.6 percent of the total number, and 22 percent of the total value, of contracts issued by PWGSC in 2010-2011.

Summary of Selected Determinations

During the fiscal year, the Tribunal rendered decisions in 157 cases (63 decisions not to conduct an inquiry and 94 decisions in the context of inquiries). Four cases were still in progress at the end of the fiscal year. The table at the end of this chapter summarizes these activities.

Of the cases investigated by the Tribunal in carrying out its procurement review functions, certain decisions stand out because of their legal significance. Brief summaries of a representative sample of these cases are included below. These summaries have been prepared for general information purposes only and are not intended to be of any legal value.

PR-2009-130—Valcom Consulting Group Inc.

The Tribunal considered this case on the basis of written submissions. There were 3 participants in this inquiry. The official record consisted of 31 exhibits.

The complaint was filed by Valcom Consulting Group Inc. (Valcom) concerning a procurement by PWGSC on behalf of the Department of National Defence (DND) for the provision of informatics professional services to provide support to the Canadian Forces Supply System. Valcom alleged that PWGSC changed the evaluation criteria with regard to the addressing requirements for government references after the solicitation closed.

On June 4, 2010, the Tribunal found that PWGSC unilaterally changed the evaluation criteria after the solicitation closed by relaxing the addressing requirements for government references so as to eliminate the need for a street address while insisting on a street address from all non-government references, even though the Request for Proposal (RFP) was silent on the point. The procurement was therefore not carried out in accordance with Article 506(6) of the AIT, Articles 1013(1)(h) and 1015(4) of NAFTA, and the similar provisions in the AGP and the CCFTA. The Tribunal concluded that the complaint was valid.

The Tribunal recommended that PWGSC re-evaluate all proposals received using the original requirement of the RFP, without distinction between government and non-government addresses.

PR-2010-001—Promaxis Systems Inc.

The Tribunal considered this case on the basis of written submissions. There were 3 participants in this inquiry. The official record consisted of 25 exhibits.

The complaint was filed by Promaxis Systems Inc. (Promaxis) concerning a procurement by PWGSC on behalf of DND for the provision of publication maintenance services. Promaxis alleged that PWGSC improperly declared its bid non-compliant with two mandatory technical requirements of the RFP. Promaxis alleged in particular that PWGSC improperly determined that one of Promaxis' proposed translators did not have the requisite secret security clearance.

On August 30, 2010, the Tribunal found that PWGSC's decision to declare Promaxis' bid non-compliant was consistent with the provisions of the RFP when read as a whole, rather than individually. The Tribunal determined that PWGSC's actions were not a violation of Article 506(6) of the AIT. This decision reconfirmed previous decisions where the Tribunal had found that procuring entities must evaluate bidders' compliance with mandatory requirements thoroughly and strictly. The Tribunal concluded that the complaint was not valid.

PR-2010-012—BRC Business Enterprises Ltd.

The Tribunal considered this case on the basis of written submissions. There were 2 participants in this inquiry. The official record consisted of 25 exhibits.

The complaint was filed by BRC Business Enterprises Ltd. (BRC) concerning a procurement by PWGSC for the supply and delivery of freestanding furniture components for the Public Service Pension Centre in Shediac, New Brunswick. BRC submitted that PWGSC failed to evaluate its proposal in accordance with the express terms of the solicitation documents and that it ignored vital information provided by BRC in connection with its proposal. According to BRC, its proposal was compliant with the requirements of the solicitation and offered the lowest price, and it therefore should have been awarded the contract. Although its proposal did not specifically mention that its furniture components contained a top-mounted crank (a mandatory requirement of the solicitation), BRC contended that that fact was available in the product literature accompanying its proposal and that PWGSC should have asked for clarification if it had any doubts.

On September 27, 2010, the Tribunal found no basis upon which to conclude that PWGSC failed to make a reasonable evaluation of BRC's proposal or that it unfairly deemed the proposal non-compliant. The Tribunal reiterated its position that the onus is on the bidder to ensure that its proposal accurately states its intent. The Tribunal concluded that the complaint was not valid.

Judicial Review of Procurement Decisions

Decisions Appealed to the Federal Court of Appeal

Disposition of Procurement Complaints