The Act respecting contracting by public bodies (the “Act”) provides a framework for the awarding of contracts by public bodies in Quebec. Assented to on December 7, 2012, the Act sets out various obligations with which enterprises wishing to do business with public bodies must comply, including the obligation to hold an authorization to contract for certain types of contracts involving an expenditure equal to or greater than the monetary thresholds set out in the Act.
In recent years, cases of non-compliance with the obligations imposed by the Act have received increasing attention from the media and, more generally, from Quebecers. For example, the Charbonneau Commission and the recent events surrounding long-term care facilities (“CHSLDs”).
It is in this context and in order to “strengthen the integrity regime of enterprises provided for by the Act” that the President of the Conseil du trésor, Me Sonia Lebel, introduced Bill 12 on February 3, 2022: An Act mainly to promote Québec-sourced and responsible procurement by public bodies, to reinforce the integrity regime of enterprises and to increase the powers of the Autorité des marchés publics (“Bill 12”).
Bill 12 also aims to stimulate innovation and promote local businesses by imposing requirements for regionalized public tenders and the acquisition of Quebec goods and services.
In the table below, we have summarized the major changes that are included in the current draft of Bill 12; although this is not an exhaustive review, we believe these changes could have significant impacts for any company doing business with public bodies.
It should be noted that Bill 12 and its dispositions may be amended once they are reviewed by the Quebec National Assembly, which is currently underway at the time of publication of this bulletin.
Regionalized public tendering procedure and acquisition of Quebec goods and services
• When entering into mutual agreement contracts, public bodies will be required to rotate among the enterprises in the concerned region.
• From now on, public bodies will have to give preference to the use of a regionalized procedure as well as to the acquisition of Quebec goods, services or construction work.
• Any enterprise interested in entering into a public contract will now be required to declare its compliance with the integrity requirements by means of a form to be determined by regulation.
|Review of the integrity of an enterprise
• The Autorité des marchés publics (“AMP”) will be able to conduct an integrity review of an enterprise to assess whether or not it meets the applicable integrity requirements.
• Such a procedure may be initiated by the AMP under its oversight authority or at the request of an enterprise (e.g., prior to its registration in the Register of Companies not Eligible for Public Contracts (“RENA”)).
• The AMP may impose such remedies as it deems necessary to enable an enterprise to meet these integrity requirements and may also require follow-up actions.
|Duration of authorizations
• Authorizations will now be valid for five years, and those already issued will be extended for two years.
• The minimum threshold for penalties resulting from changes to the information previously submitted with the AMP will increase to $5,000, while the maximum threshold will increase to $30,000.
• A new offence is created for enterprises that interfere with the oversight function of the AMP, with fines ranging from $5,000 to $30,000 for individuals and from $15,000 to $100,000 in other cases.
Administrative monetary penalties
• An administrative monetary penalty regime will now be introduced into the Act.
• Administrative monetary penalties may be imposed within two years of the commission of a non-compliance.
• The amount of the monetary penalties will be determined by regulation, but the maximal penalty shall be og $10,000 per day. Tthe commission of a non-compliancewill constitute a separate breach for each day during which it continues. The AMP will develop a publicly available general enforcement framework to guide those responsible for enforcing these penalties.
• The AMP will develop a publicly available general enforcement framework to guide those responsible for enforcing these penalties.
• An enterprise subject to a penalty may contest it within 30 days of receiving the notice of claim imposing such penalty, and the decision rendered by the AMP may be subsequently contested before the Tribunal administratif du Québec.
• Bill 12 provides for the creation of a public registry that will list the enterprises that have been imposed such administrative monetary penalties.
|Information provided with the AMP
• Authorization holders will now have 30 days to notify the AMP of a change in the information previously submitted.
• In addition, authorization holders will be required to update the information submitted to the AMP on an annual basis.
|Breaches of the integrity requirements
• The fact that an enterprise has, within the last five years, been subject to an order from the Ministry of the Environment and the Fight Against Climate Change is now taken into consideration by the AMP as part of its analysis of the integrity of an enterprise.
Bill 12 provides for a phased-in implementation of its provisions. Some of these will come into force within 6 or 12 months of the date it receives assent, while a number of others will come into effect only after a regulation specifically designed to implement certain provisions of Bill 12 has come into force.
Bill 12 will definitely have a significant impact on the activities of any enterprise doing business with public bodies in Québec; we will keep you informed of all relevant developments.