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Bulletin

The Times They Are a Changin’ - What We Know (and Still Don’t Know) About the New Federal Procurement Processes

Fasken
Reading Time 9 minute read
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Procurement Bulletin

Public Services and Procurement Canada (PSPC) and Shared Services Canada (SSC), the two federal departments responsible for the large majority of government purchasing, have been working on procurement modernization for several years.

This bulletin provides an update on the status of the following initiatives:

  • SSC Procure-to-Pay (P2P) Portal
  • PSPC Electronic Procurement Solution (EPS) and the CanadaBuys website
  • PSPC's modification of the Standard Acquisition Clauses and Conditions (SACC)

Shared Services Canada (SSC)

Procure-to-Pay Portal 

Launched in 2016, the SSC P2P Portal system electronically manages the 'procurement to payment' process for selected SSC procurements. 

How it Works Now:

  • SSC continues to post its procurement opportunities on Buyandsell.gc.ca (Buyandsell)
  • Suppliers are directed from Buyandsell to the SSC P2P Portal for selected procurement opportunities run through the P2P Portal
  • Suppliers must register for access to the P2P Portal to submit bids on new solicitations and  any invoices for existing contracts

SSC does not operate exclusively through the P2P Portal. Bidders continue, for example, to be required to submit email questions and bid submissions to the specified Contracting Authority via email for certain procurements.

What the Future Holds:

Although SSC is currently using two systems for bid opportunities (P2P Portal and Buyandsell), and can continue to use its P2P Portal to manage the tendering process, SSC will be required to use the new CanadaBuys site as its first point of contact for bid opportunities to ensure compliance with Canada's obligations under the Comprehensive Economic and Trade Agreement between Canada and the European Union (CETA).

SSC has not indicated when and how it will transition to the CanadaBuys site. 

Public Services and Procurement Canada (PSPC)

PSPC has two initiatives underway - the implementation of the EPS (which includes the transition from Buyandsell to the new CanadaBuys website) and the upcoming modifications of the SACC content and approach.

PSPC's Electronic Procurement Solution (EPS) and CanadaBuys website:

In 2018, PSPC began its development of the EPS, with the goal to provide a user-friendly cloud-based platform, that will automate and streamline the procurement process, to provide the following advantages:

  • Facilitate more intuitive and robust contract authoring 
  • Strengthen management capability, using data analytics and reporting 
  • Integrate online catalogues, to provide  buyers and suppliers with more convenient and rapid access to doing business 
  • Provide a contact support system and various procurement resources

PSPC has included requirements in its Requests for Standing Offers and Requests for Supply Arrangements since 2018 to enable it to migrate suppliers with multi-year standing offers and supply arrangements to the new EPS.

How it Will Work (so far):

The transition to CanadaBuys will occur in a phased approach by commodity group, and is  estimated to be completed by the summer of 2021. 

The EPS will operate as the platform for the new CanadaBuys website (the Government Electronic Tendering System will also migrate from Buyandsell to CanadaBuys).

Tender opportunities will continue to be available on Buyandsell, with bidders being redirected to the CanadaBuys site for certain tender opportunities. Bidders must be registered in SAP Ariba to view tender opportunities and bid online at the CanadaBuys site (registration is free and is now open).

Goods and services will no longer be classified under the GSIN codes, and will move to the universally-recognized United Nations Standard Products and Services Code (UNSPSC).

Once PSPC has fully migrated its procurements to CanadaBuys, other federal government departments and agencies will be moving to this new platform and it will become the single point of access for federal procurement.

In addition, CanadaBuys is ultimately destined to become the single point of access in Canada for federal and sub-central government procurement opportunities in order to fulfill Canada's commitment for a national single point of access under CETA (estimated completion is 2022). Tender notices will be posted to CanadaBuys, with bidders then linking out to the procuring entity's own electronic procurement management system.

What Suppliers Need to do:

Remember that it's up to you to make sure you understand the system before you have to bid.

  • Review your existing standing offers and supply arrangements to ensure you understand your obligations  to migrate to the EPS.
  • PSPC recently provided a helpful webinar explaining the CanadaBuys initiative. As of the date of publication, no additional webinars are scheduled.  Keep checking PSPC’s Events calendar for details on future webinars.
  • Register for a free SAP Ariba account (if a you have multiple subsidiaries that may bid, they all need to register).
  • If planning on bidding as a joint venture, contact PSPC now to find out how to manage the joint venture and register it properly before it is time to bid.
  • Take advantage of the opportunity to test-run a 'practice procurement' bid through the new system, so that you are familiar with the new process before you have to submit a real bid. Ensure that the entire bid response team participates in this process so that they clearly understand how it works (and to determine if your organization faces any challenges using the new system).
  • Continue to monitor both SSC and PSPC's information releases on transitioning activities.[1]

PSPC Changing How it Uses Standard Acquisition Clauses and Conditions 

On July 24, 2020, PSPC released an overview document - "Rethinking Government Contracts: A Conceptual Model". This high level document provides a conceptual overview of how efforts to modernize and simplify procurement practices may change the structure of government contracts managed by PSPC. One of the possible modifications is the integration of the SACC directly in to the body of the solicitation document. 

How it Works Now:

In an open, competitive procurement process, PSPC will invoke Standard Acquisition Clauses and Conditions (SACC) by reference and not set them out in the solicitation document in full. The number of SACC provisions that apply to a contract can range from clauses of one to two paragraphs, to pages and pages of terms and conditions. Each set of terms, and each section within those terms, is identified by a reference code. The reference codes identify when any section was last amended by the government. 

All SACC provisions are currently publicly accessible in the on-line version of the SACC Manual. When SACC provisions are amended, the amendment is identified by the reference code for each provision (whether singularly or for an amendment to a full set of terms). If SACC provisions are being amended for a particular procurement, PSPC's current practice is to specifically identify which clauses are amended and set out the amended clause within the solicitation documents. Historical information on all SACC Manual modifications for the past 2 decades are available online.

This approach allows bidders to quickly determine if any SACC provisions identified in a solicitation by reference or as set out in full have been modified and, if so, when and, more importantly, how they have been modified.

This approach is neither unique to Canada nor revolutionary. Many governments, including the United States (Federal Acquisition Regulations (FAR) and Defence Federal Acquisition Regulations Supplement (DFARS)) and the United Kingdom (Public Contracts Regulations 2015, Utilities Contracts Regulations, Concession Contracts Regulations and Defence and Security Public Contracts Regulations) manage procurement in this way.

The practice of governments making their contracting terms publicly available achieves three significant objectives: efficiency, openness and transparency. 

Government contracting, particularly in the competitive bidding environment, is one-sided and heavily weighted in favour of the government. Negotiation of terms in a competitive procurement process is rare. Making terms publicly available ensures suppliers are aware of the terms that will or are likely to be imposed during the bidding process or as part of the eventual contract. While a particular procurement may modify standard terms to suit a specific situation, for the most part, the terms remain generally the same as those made publicly available. Because the terms are 'standard terms', bidders who have conducted a review of the SACC provisions  for prior bidding opportunities to understand their impact, do not need to re-review pages and pages of legal terms for each subsequent bid - they need only check the reference code to determine if any amendments have occurred since their last review and, if the clause has been updated, they can quickly check the archived terms to determine what has changed.

How it Will Change (We Think) and Concerns We Have:

Currently, a publicly available SACC Manual and the use of reference codes provide suppliers with assurance that any permanent SACC Manual modifications are disclosed publicly and any amendments to the SACC provisions for a particular solicitation or resulting contract are expressly identified in the solicitation itself.  It isn't clear if this approach will survive the "rethinking" of the procurement model.

Thus far, PSPC has only indicated that in the new model, the SACC provisions will be integrated directly in to the solicitation document and that reference codes will no longer be used.  It isn't clear whether the terms will remain publicly available within a SACC Manual or if the information provided with the reference codes  will still be available in some other form.

What is troubling is if PSPC follows the approach being used by SSC.  SSC has implemented this type of integrated model over the past few years but, to date, has not provided any publicly available "standard" terms and conditions. Bidders in SSC procurements have no way of knowing what terms they will be subjected to until it is time to bid. So, in addition to the effort needed to prepare a responsive bid, bidders must now review all terms and conditions of the bid for every bid. There is no certainty, and industry has noted that SSC does, indeed, vary terms on a solicitation-by-solicitation basis.

Removing open access to government contracting terms means that suppliers must treat each and every solicitation as a unique procurement; they must review every solicitation, in its entirety, to discern whether changes have been made to clauses that, in general, are already heavily weighted in favour of the government's interests. 

While lawyers might find it easier to review terms in one document, as opposed to having to fetch the terms from a publicly available website, for the average supplier trying to control bid preparation time and costs, this doesn't streamline the process or achieve any greater efficiency.

In competitive procurements, terms are locked in place before the solicitation hits the street. A supplier has only one "option" - accept the terms as is, or do not bid. Advance awareness of terms is important for suppliers (and arguably, the broader public) in this already unbalanced contracting process.

We will continue to follow the progress of this conceptual model.

Reference Links:

Below are links to the information mentioned in this bulletin. We note that linking to Government of Canada websites through Internet Explorer can be problematic and suggest you access the links through an alternative browser.

 

Marcia Mills is co-leader of the Fasken National Security Group and counsel for procurement, government contracts, trade and information technology in Fasken's Ottawa office. With over 20 years of private and public sector experience, she provides clients with legal and strategic advice for all aspects of government contracting and security issues, including the federal Contract Security Program and the Controlled Goods Program.

Shannon Kristjanson is an associate with the Fasken Ottawa office. She is engaged in a diverse business law practice, focusing on procurement, corporate/commercial, and national security law.


 


 

[1] PSPC has a specific site for the transition (a link is included at the end of this bulletin). SSC does not have a specific site dedicated to the transition as yet. Suppliers should continue to check SSC announcements.

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