Annual Report March 31, 2015 - 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, the CPFTA, the CCOFTA, the CPAFTA, the CHFTA or the CKFTA, or any other applicable trade agreement, may file a complaint with the Tribunal. The relevant provisions of the Canadian International Trade Tribunal Procurement Inquiry Regulations allow a complainant to first make an attempt to resolve the issue with the government institution responsible for the procurement before filing a complaint.

The Tribunal’s role is to determine whether the government institution followed the procurement procedures and other requirements specified in the applicable trade agreements.

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 is sent a formal notification of the complaint and a copy of the complaint itself. If the contract has been awarded, the government institution, in its acknowledgement of receipt of complaint letter, provides the Tribunal with the name and address of the contract awardee. The Tribunal then sends a notification of the complaint to the contract awardee as a possible interested party. An official notice of the complaint is published in the Canada Gazette. If the contract in question has not been awarded, the Tribunal may order the government institution to postpone the award of 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 received 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 should, by statute, 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, circumstances and outcome of the case.

Procurement Complaints

Summary of Activities

Summary of Selected Determinations

During the fiscal year, the Tribunal issued 67 decisions on whether to accept complaints for inquiry and 31 final decisions on complaints that were accepted for inquiry, for a total of 98 decisions. Thirteen cases were still in progress at the end of the fiscal year, 3 of which were still under consideration for being accepted for inquiry.

Of the complaints 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.

PR-2014-006, PR-2014-015 and PR-2014-020, and PR-2014-016 and PR-2014-021—CGI Information Systems and Management Consultants Inc.

As part of a multi-year information technology transformation initiative aimed at achieving operational efficiencies in the delivery of some of its services, Innovapost Inc., on behalf of the Canada Post Group of Companies (Canada Post), initiated two separate solicitations. The Tribunal received, and ultimately decided to inquire into, five complaints related to these solicitations, which were for data centre services and application development services.

All the complaints involved the adequacy of Canada Post’s post-contract award debriefing of CGI Information Systems and Management Consultants Inc. (CGI), in light of Canada Post’s disclosure obligations as set out in NAFTA.

– PR-2014-006

CGI’s first complaint was that Canada Post failed to disclose pertinent information on the reasons for not selecting CGI’s tender, including a detailed evaluation plan, and the evaluators’ consensus and individual scoring sheets. CGI also argued that Canada Post failed to provide sufficient information on the relevant characteristics and advantages of the winning bid. Canada Post argued that the only pertinent information that it was obligated to provide was that CGI’s proposal had not been selected because it had not met the 70 percent scoring threshold, and that the only relevant information with respect to the winning bid was that it had met the 70 percent threshold. Further, Canada Post argued that its confidentiality obligations towards the winning bidder prevented it from disclosing further information regarding its bid. With respect to the detailed evaluation plan, Canada Post submitted that this was confidential commercial and proprietary information belonging to Canada Post that could not be disclosed in order to ensure the fairness and efficiency of future potential procurements for the same or similar services.

After filing its complaint, CGI also filed a motion for production of the documents that it had requested from Canada Post during the debriefing. The Tribunal granted the motion in part and ordered Canada Post to produce certain documents, including the detailed evaluation plan and the individual evaluators’ scoring sheets. However, Canada Post informed the Tribunal that it could not provide the individual evaluators’ scoring sheets, as it was Canada Post’s policy to destroy them after the consensus scores are finalized.

Recalling its decision in File No. PR-2007-004 (Ecosfera Inc. v. Department of the Environment), where the Tribunal held that the “primary purpose” of a debriefing is to “. . . provide transparency as to the reasons for not selecting the proposal . . .” so as to enable unsuccessful bidders to determine the nature of their rights in view of the requirements set out in NAFTA, the Tribunal reiterated that the disclosure obligations under NAFTA are broad. The Tribunal found that Canada Post had breached this obligation by not providing the detailed evaluation plan used by the evaluators, including the evaluation criteria, scales, weights and methodology, to CGI as part of the debriefing process. It commented that the evaluation criteria and how they were applied were relevant to the reasons for not selecting a tender. The disclosure of such information also allows bidders to determine their rights under NAFTA, one of the central requirements of which is that procuring entities award contracts in accordance with the criteria specified in the tender documentation. Similarly, the Tribunal found that Canada Post was obligated to provide the individual evaluators’ scores, even though consensus scoring was ultimately used by the evaluators to render a decision.

The Tribunal rejected Canada Post’s argument that the detailed evaluation plan should not be disclosed because it may have a negative impact on future procurement processes, finding that administrative convenience is not a justification for ignoring the transparency obligations imposed by NAFTA. Nonetheless, the Tribunal found that Canada Post did have an explicit obligation under NAFTA to protect the confidential information provided to it by the successful bidder and, therefore, ruled that Canada Post’s debriefing with respect to the relative strengths of the successful tender was sufficient.

The Tribunal therefore ordered Canada Post to provide the detailed evaluation plan to CGI and recommended that Canada Post amend its debriefing policies and procedures to ensure that they are consistent with NAFTA disclosure obligations.

– PR-2014-015 and PR-2014-020

CGI’s subsequent complaints involved the same solicitation process as in File No. PR-2014-006. CGI alleged further perceived deficiencies in the level of post-contract award disclosure, as well as issues with the bid evaluation process itself.

As set out above, during these proceedings, CGI and the Tribunal became aware that it was Canada Post’s policy to destroy individual evaluators’ scoring sheets after the evaluators arrived at a consensus score. In these cases, CGI submitted that Canada Post’s destruction of the individual scoring sheets met the test of the evidentiary doctrine of spoliation. If it is shown that a party disposed of evidence to affect ongoing or contemplated litigation, the doctrine of spoliation establishes a rebuttable presumption that the destroyed evidence would not have assisted the party that destroyed it. CGI also submitted that the failure to disclose certain documents to CGI in the context of the debriefing process amounted to a breach of Article 1015(6) of NAFTA and that destruction of the individual scoring sheets was a violation of Article 1017(1)(p) of NAFTA.

Ultimately, the Tribunal found that the evidence on the record of these proceedings did not establish that the individual scoring sheets had been destroyed in contemplation of litigation, as they were destroyed before CGI filed its first complaint and in accordance with Canada Post’s policy to remove information that it perceived as peripheral or transient from the file. Accordingly, the Tribunal determined that the test of the evidentiary doctrine of spoliation had not been met.

In addition, although Canada Post informed the Tribunal during the course of these proceedings that it would be changing its policy with respect to the retention of individual evaluators’ scoring sheets, the Tribunal found that the failure to retain these documents was a violation of Article 1017(1)(p) of NAFTA. It again recommended that Canada Post amend its debriefing and document retention policies and procedures in order to ensure conformity with its NAFTA obligations.

In addition to its allegations regarding the destruction of documents, CGI alleged that Canada Post’s evaluation of the bids was deficient in several ways. Specifically, CGI alleged that the rating scale used by the evaluators was inconsistent with the terms of the RFP, that the evaluators had preferences for certain characteristics over others that had not been disclosed in the RFP and that several specific aspects of CGI’s proposal were unreasonably evaluated because the evaluation was tainted by improper considerations, including bias. None of these grounds of complaint were found to be valid. Ultimately, the Tribunal found that Canada Post’s evaluation was conducted in a reasonable manner, that there were no criteria applied that were not at least related to and discernible from the RFP and that there was no reasonable apprehension of bias in the conduct of the evaluations. This decision is currently the subject of judicial review by the Federal Court of Appeal.

– PR-2014-016 and PR-2014-021

These two complaints involved a different solicitation from File Nos. PR-2014-006, PR-2014-015 and PR-2014-020, but raised many of the same issues with respect to the debriefing process and the destruction of the individual evaluators’ scoring sheets. The Tribunal’s findings on those issues were consistent with those detailed above. CGI also claimed that the bid evaluation process had not been conducted in a reasonable manner because certain adjustments that were made to the scores of other bidders’ technical proposals after site visits had been conducted were contrary to what was permitted by the RFP.

The Tribunal found that, while the RFP did allow for adjustments to be made if information that contradicted any information contained in the bid was discovered during a site visit, in certain cases, the evaluators had instead adjusted a score because the information discovered during the site visit had confirmed information that was in the bid, but that the evaluators had improperly discredited in their initial review of the technical proposal. Further, in some cases, the change in scoring was based on discussions between individual evaluators and did not engage the consensus scoring process. While the Tribunal did not find that this amounted to improper bid repair, it did find that this practice was based on an unreasonable interpretation of a provision in the RFP. Furthermore, it found that the fact that the evaluators ignored vital information in their initial evaluation of the technical proposals brought into question the integrity of the entire evaluation process. Despite the fact that CGI had not conclusively demonstrated that the changes to other bidders’ scores directly impacted its success in the procurements at issue, the Tribunal nevertheless ordered Canada Post to re-evaluate all bidders’ technical proposals with a new team of evaluators.

Disposition of Procurement Complaints

Judicial Review of Procurement Decisions

Decisions Appealed to the Federal Court of Appeal