SUNNY JAURA O/A JAURA ENTERPRISES
SUNNY JAURA O/A JAURA ENTERPRISES
File No. PR-2012-043
Decision made
Thursday, February 21, 2013
Decision issued
Friday, February 22, 2013
Reasons issued
Tuesday, March 5, 2013
IN THE MATTER OF a complaint filed pursuant to subsection 30.11(1) of the Canadian International Trade Tribunal Act, R.S.C. 1985 (4th Supp.), c. 47.
BY
SUNNY JAURA O/A JAURA ENTERPRISES
AGAINST
THE DEPARTMENT OF PUBLIC WORKS AND GOVERNMENT SERVICES
Pursuant to subsection 30.13(1) of the Canadian International Trade Tribunal Act, the Canadian International Trade Tribunal has decided not to conduct an inquiry into the complaint.
Ann Penner
Ann Penner
Presiding Member
Eric Wildhaber
Eric Wildhaber
Secretary
The statement of reasons will be issued at a later date.
1. Subsection 30.11(1) of the Canadian International Trade Tribunal Act1 provides that, subject to the Canadian International Trade Tribunal Procurement Inquiry Regulations,2 a potential supplier may file a complaint with the Canadian International Trade Tribunal (the Tribunal) concerning any aspect of the procurement process that relates to a designated contract and request the Tribunal to conduct an inquiry into the complaint. Subsection 30.13(1) of the CITT Act provides that, subject to the Regulations, after the Tribunal determines that a complaint complies with subsection 30.11(2) of the CITT Act, it shall decide whether to conduct an inquiry into the complaint.
SUMMARY OF THE COMPLAINT
2. Sunny Jaura o/a Jaura Enterprises (Jaura) complained about a procurement (Solicitation No. W0102-136957/A) by the Department of Public Works and Government Services (PWGSC) on behalf of the Department of National Defence for the provision of accommodation services at the Naval Air Station Sigonella in Sicily, Italy. Specifically, Jaura complained that:
1) the successful bidder might not have the proper coverage and certification from an insurer licensed to do business in Canada, as stipulated in the Request for Proposal (RFP) mandatory insurance requirement (Ground 1); and
2) by allowing non-Canadian potential suppliers to bid for the contract without being listed on MERX,3 PWGSC put those Canadian potential suppliers listed on MERX at an unfair disadvantage because they were unable to see everyone they were competing against (Ground 2).
3. As a remedy, Jaura requested the cancellation of the contract, issuance of a new solicitation and full payment for the contract value as well as its bid preparation and complaint costs. Jaura also requested a postponement of award of contract order.
BACKGROUND
4. PWGSC published the solicitation for accommodation services on MERX on January 23, 2013. Jaura submitted its proposal on the bid closing date of February 1, 2013.
5. On February 12, 2013, the contract was awarded to NH Parco Degli Aragonesi (NH Parco).4 Jaura complained to PWGSC's Contracting Authority by telephone that same day on the two grounds set out above. This was not, however, the first time that Jaura had raised concerns about the process by which PWGSC awarded similar contracts.
6. According to the complaint, Jaura had been in contact with PWGSC about two other solicitations for hotel accommodations. The Supply Manager at PWGSC responded to Jaura's complaints by email on January 25, 2013, stating that, for future solicitations, PWGSC would publish on MERX the names of any potential suppliers invited directly by PWGSC, as well as those who requested the bid package through the electronic tendering system. Similarly, during a telephone call on February 1, 2013, the Supply Manager and PWGSC's Contracting Authority allegedly assured Jaura that the issue of listing all potential suppliers on MERX “would be fixed for future RFPs.”5 On February 8, 2013, the Supply Manager sent an email to Jaura referring to the mandatory insurance requirement of the RFP “as discussed last week.” The Supply Manager stated that changes would be made for the “next procurements to happen outside of Canada.”6
7. On February 14, 2013, Jaura sent an email to the Supply Manager complaining that no list of invited suppliers was posted on MERX for the solicitation at issue. Jaura also asked whether the contract would be cancelled or reissued if the winning bidder did not fulfill the mandatory insurance requirements of the RFP.
8. On February 15, 2013, the Supply Manager responded that the solicitation at issue was already published when Jaura first raised its concerns. He assured Jaura that for future solicitations, PWGSC would direct potential suppliers to download the bid package on MERX. Nevertheless, the Supply Manager also cautioned that there might still be potential suppliers that Jaura would not know because PWGSC would be unable to control indirect sharing of the bid package, a practice which is fully permissible.
9. On February 18, 2013, Jaura filed its complaint with the Tribunal.
TRIBUNAL'S ANALYSIS
Ground 1
10. The CITT Act and the Regulations allow a potential supplier to complain to the Tribunal about any aspect of a procurement process for a designated contract.7 When applying these provisions, the Tribunal has made an important distinction between the procurement process and contract administration. The procurement process begins after the government institution has decided on its procurement requirement and continues through to the awarding of the contract.8 Contract administration is a separate phase that takes place after the procurement process is completed. It deals with issues that arise as a contract is performed and managed. The Tribunal has been clear that matters of contract administration are beyond the scope of its jurisdiction.9
11. In this case, Jaura argued that the winning supplier must prove it was certified by an insurer licensed to do business in Canada within 10 days of the contract award. Since the contract was awarded to NH Parco, an Italian supplier, Jaura was skeptical that it could meet the insurance requirements like a Canadian firm could have done. Jaura, therefore, urged PWGSC to cancel and reissue the solicitation.
12. Part 6 of the RFP, Resulting Contract Clauses, states the following:
11. Insurance Requirements
The Contractor must comply with the insurance requirements specified in Annex D. The Contractor must maintain the required insurance coverage for the duration of the Contract. Compliance with the insurance requirements does not release the Contractor from or reduce its liability under the Contract.
. . .
The Contractor must forward to the Contracting Authority within ten (10) days after the date of award of the Contract, a Certificate of Insurance evidencing the insurance coverage and confirming that the insurance policy complying with the requirements is in force. Coverage must be placed with an Insurer licensed to carry out business in Canada. The Contractor must, if requested by the Contracting Authority, forward to Canada a certified true copy of all applicable insurance policies.
[Emphasis added]
13. The Tribunal finds this section of the RFP to be very clear. The requirement to produce a Certificate of Insurance does not need to be fulfilled by bidders at bid closing. Instead, the requirement applies to the successful bidder after the contract has been awarded. In other words, certification is not required during the procurement process itself, but required only as part of the contract administration once the procurement process is completed.
14. In light of subsection 30.11(1) of the CITT Act, Ground 1 of the complaint does not fall within the Tribunal's jurisdiction because it deals with contract administration, as opposed to the procurement process itself. As a result, the Tribunal cannot comment further on this ground of complaint.
Ground 2
15. Upon receipt of a timely complaint, the Tribunal must decide whether to conduct an inquiry by assessing if the complaint meets three conditions: (1) the complainant is a potential supplier; (2) the complaint is about a designated contract; and (3) the complaint discloses a reasonable indication that the procurement has not been carried out in accordance with an applicable trade agreement.10 In this case, the first two conditions appear to have been met, but the third condition was not.
16. Only the AIT and the Canada-Chile Free Trade Agreement11 apply to the procurement process at issue.12 Accordingly, the Tribunal must determine whether there is a reasonable indication that PWGSC conducted the procurement process in a manner that was in violation of one of those agreements.
17. In its complaint, Jaura did not point to any specific provision of the trade agreements that might have been breached. In fact, Jaura did not even claim that any trade agreements had been breached. It simply alleged that the process gave its foreign competitors an unfair advantage.
18. There do not appear to be any provisions in the AIT or CCFTA that could reasonably be construed as requiring a government institution to disclose the identities of all potential suppliers on MERX.
19. Article 506(2) of the AIT provides, in part, that “[a] call for tenders shall be made through one or more of the following methods: (a) the use of an electronic tendering system that is equally accessible to all Canadian suppliers; (b) publication in one or more predetermined daily newspapers that are easily accessible to all Canada suppliers; or (c) the use of source lists . . . .”
20. Article 506(4) of the AIT provides that a notice of a call for tenders shall contain at least the following information:
(a) a brief description of the procurement contemplated;
(b) the place where a person may obtain information and tender documents;
(c) the conditions for obtaining tender documents;
(d) the place where tenders are to be sent;
(e) the date and time limit for submitting tenders;
(f) the time and place of the opening of the tenders in the event of a public opening; and
(g) a statement that the procurement is subject to this Chapter.
21. Article 506(6) of the AIT provides that “[t]he tender documents shall clearly identify the requirements of the procurement, the criteria that will be used in the evaluation of bids and the methods of weighting and evaluating the criteria” [footnote omitted].
22. Article Kbis-04 of the CCFTA, Publication of Notice of Intended Procurement, provides as follows:
1. For each procurement covered by this Chapter, an entity shall publish in advance a notice inviting interested suppliers to submit tenders for that procurement (“notice of intended procurement”). Each such notice shall be accessible during the entire period established for tendering for the relevant procurement.
2. Each notice of intended procurement shall include a description of the intended procurement, any conditions that suppliers must fulfill to participate in the procurement, the name of the entity issuing the notice, the address where suppliers may obtain all documents relating to the procurement, the time limits for submission of tenders, and the dates for delivery of the goods or services to be procured.
[Emphasis added]
23. Article Kbis-06 of the CCFTA, Information on Intended Procurements, provides as follows:
1. An entity shall provide interested suppliers tender documentation that includes all the information necessary to permit suppliers to prepare and submit responsive tenders. The documentation shall include all criteria that the entity will consider in awarding the contract, including all cost factors, technical requirements and the weights or, where appropriate, the relative values, that the entity will assign to these criteria in evaluating tenders.
. . .
[Emphasis added]
24. Article Kbis-17 of the CCFTA, Public Information, provides as follows:
1. In order to facilitate access to information on commercial opportunities under this Chapter, each Party shall ensure that electronic databases that provide current information on all procurements covered by this Chapter that are conducted by entities listed in Annex Kbis-01, including information that can be disaggregated by detailed categories of goods and services, are made available to interested suppliers of the other Party, through the Internet or a comparable computer-based telecommunications network. Each Party shall, on request of the other Party, provide information on:
a. the classification system used to disaggregate information on procurement of different goods and services in such databases; and
b. the procedures for obtaining access to such databases.
2. For each covered procurement, a procuring entity shall publish a notice of intended procurement through the Internet or a comparable electronic network that is widely disseminated and readily accessible to the public. Each Party shall maintain a gateway electronic site that includes links to all notices of procuring entities.
. . .
[Emphasis added]
25. Taken together, these provisions of the AIT and CCFTA clearly indicate the type of information required in an open call for tenders or notice of intended procurement. They include the necessary information to enable suppliers to prepare and submit responsive tenders. They do not, however, require the government institution to disclose potential competitors or a list of potential suppliers to whom the bid documentation was sent. Furthermore, they do not require a government institution to provide such information on its electronic tendering system.
26. Even if the AIT and CCFTA did require government institutions to disclose a list of potential suppliers on electronic tendering systems, it is difficult to see how a potential supplier could gain a competitive advantage from knowing the identities of all the other prospective bidders. Bid-specific details, such as pricing or qualifications, would not be included. Similarly, it is difficult to appreciate how a government institution could reasonably be expected to know and control all those to whom bid packages may have been distributed without denying prospective bidders access to procurement opportunities. As the Supply Manager explained to Jaura, PWGSC “cannot control the sharing of the bid package behind the scene,” even if the names of those potential suppliers who received a bid package directly from PWGSC were listed on MERX in future RFPs.13
27. Consequently, there is no reasonable indication in the complaint that the procurement process was not conducted in accordance with the AIT or the CCFTA. The Tribunal cannot, therefore, proceed with an inquiry.
DECISION
28. Pursuant to subsection 30.13(1) of the CITT Act, the Tribunal has decided not to conduct an inquiry into the complaint.
1 . R.S.C. 1985 (4th Supp.), c. 47 [CITT Act].
2 . S.O.R./93-602 [Regulations].
3 . Canada's electronic tendering service.
4 . The Contract Award Notice was published on MERX on February 13, 2013. See Complaint, attachment “EX. ITA #3”.
5 . Complaint, attachment “EX. LET 1A”.
6 . Complaint, attachment “Gmail #2”.
7 . CITT Act, subs. 30.11(1); Regulations, subs. 7(1).
8 . See, for example, Article 514(2)(a) of the Agreement on Internal Trade, 18 July 1994, C. Gaz. 1995.I.1323, online: Internal Trade Secretariat <http://www.ait-aci.ca/index_en/ait.htm> [AIT].
9 . See, for example, Complaint Filed by Auto Light Atlantic Limited (20 January 2010), PR-2009-073 (CITT) at para. 17; Complaint Filed by Solartech Inc. (16 October 2007), PR-2007-058 (CITT).
10 . Regulations, subs. 7(1).
11 . Free Trade Agreement between the Government of Canada and the Government of the Republic of Chile, 1997 Can. T.S. No. 50 (entered into force 5 July 1997) [CCFTA]. Chapter Kbis, entitled “Government Procurement”, came into effect on September 5, 2008.
12 . The solicitation in question was tendered under Goods and Services Identification Number V502B – Hotels, Motels and Commercial Accommodation, which is included under the CCFTA and not excluded from coverage by the AIT. The procured services are excluded from coverage under the North American Free Trade Agreement between the Government of Canada, the Government of the United Mexican States and the Government of the United States of America (17 December 1992, 1994 Can. T.S. No. 2, entered into force 1 January 1994), the Free Trade Agreement between Canada and the Republic of Peru (online: Department of Foreign Affairs and International Trade <http://www.international.gc.ca/trade-agreements-accords-commerciaux/agr-... chapter-chapitre-14.aspx>, entered into force 1 August 2009) and the Free Trade Agreement between Canada and the Republic of Colombia (online: Department of Foreign Affairs and International Trade <http://www. international.gc.ca/trade-agreements-accords-commerciaux/agr-acc/colombia-colombie/anc-colombia-toc-tdm-can-colombie.aspz>, entered into force 15 August 2011). The estimated value of the procured services is below the monetary threshold for the Agreement on Government Procurement (15 April 1994, online: World Trade Organization <http://www.wto.org/english/docs_e/legal_e/final_e.htm>).
13 . Complaint, attachment “Gmail #3A”.