File No. PR-2020-101 West Coast Tug & Barge Ltd.

Decision made Thursday, April 1, 2021 Decision issued Thursday, April 8, 2021 Reasons issued Thursday, April 22, 2021

IN THE MATTER OF a complaint filed pursuant to subsection 30.11(1) of the Canadian International Trade Tribunal Act, R.S.C., 1985, c. 47 (4th Supp.).

BY

WEST COAST TUG & BARGE LTD.

AGAINST

THE DEPARTMENT OF PUBLIC WORKS AND GOVERNMENT SERVICES

DECISION

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.

The statement of reasons will be issued at a later date.

 

STATEMENT OF REASONS

[1] Subsection 30.11(1) of the Canadian International Trade Tribunal Act [1] 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 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.

OVERVIEW OF THE COMPLAINT

[2] This complaint relates to two solicitations by the Department of Fisheries and Oceans (DFO) for the provision of tugboat and barge support services for a shipwreck off the coast of Bligh Island. The Second Solicitation (Solicitation No. F5211-200746) was a retender of the First Solicitation (Solicitation No. F1802-200076).

[3] West Coast Tug & Barge Ltd. (West Coast) argued that the successful bidder should not have been allowed to submit a bid for the First Solicitation, as it had not initially been invited to submit to the selective tendering process. West Coast also argued that the successful bidder had an unfair advantage in the Second Solicitation because it was the incumbent.

[4] For the reasons below, the Tribunal finds that West Coast’s complaint is untimely and has not disclosed a reasonable indication that a trade agreement has been breached. As such, the Tribunal will not conduct an inquiry.

BACKGROUND

[5] The First Solicitation was issued on December 31, 2020, with a deadline of January 3, 2021. It was a selective tendering process, and only four bidders were invited to submit a bid, including West Coast. The First Solicitation was only open to companies who had qualified to be a supplier for “Zone B” (Vancouver Island) under the Marine Infrastructure Standing Offer (FP802-174424).

[6] On the same day that the First Solicitation was issued, a fifth bidder, Wainwright Marine (Wainwright), was provided with a copy of the solicitation upon request. The initial four invitees were not informed of the possibility of a fifth bidder.

[7] West Coast submitted its bid for the First Solicitation on January 3, 2021.

[8] On January 7, 2021, West Coast was notified that the contract had been awarded to Wainwright. The same day, West Coast asked DFO how Wainwright had been allowed to bid, given that it was not among the invitees listed in the First Solicitation. West Coast also questioned whether Wainwright was qualified as a “Zone B” supplier under the Marine Infrastructure Standing Offer. DFO replied that the procurement had been in response to an emergency situation and it had therefore been unable to advise the other bidders of Wainwright’s addition before bid closing.

[9] On January 8, 2021, West Coast had a conference call with DFO, in which it alleged that DFO had breached its fairness obligations by failing to notify the other four invitees that Wainwright was also bidding. West Coast also argued that DFO had accepted a non-compliant bid, as Wainwright was not qualified to be a “Zone B” supplier under the Marine Infrastructure Standing Offer. West Coast told DFO that it would be submitting a formal complaint.

[10] On January 9, 2021, West Coast submitted a “formal Bid Challenge and Dispute” under the procedures in Part 2 of the First Solicitation, raising the same concerns as it had the previous day, and stating that it would file a complaint with the Tribunal.

[11] On January 29, 2021, West Coast followed up with DFO, indicating that it had prepared a complaint to the Tribunal but would prefer to resolve the dispute amicably.

[12] On January 29, 2021, DFO informed West Coast of its intention to cancel the First Solicitation and reissue it as a new solicitation. DFO acknowledged that it should not have used the Marine Infrastructure Standing Offer as a prequalification list, that it ought not have invited Wainwright without advising the other bidders, and that it awarded the contract to an ineligible bidder. DFO nevertheless stated that it would not issue a stop-work order against Wainwright, as it had an urgent requirement for the services that Wainwright was providing.

[13] On February 12, 2021, West Coast objected to DFO that there had still been no new contract issued, that the original contract award dispute continued to be unsolved, and that it was seeking financial relief for the wrongful bid award to Wainwright. West Coast stated that it would file a complaint with the Tribunal if it did not receive an answer by February 17, 2021.

[14] On February 16, 2021, DFO notified West Coast that it would reissue a call for tenders that week. The Second Solicitation was issued February 18, 2021, with a deadline of March 10, 2021.

[15] On March 2, 2021, West Coast told DFO that it would be submitting a formal complaint, based on DFO’s email of February 16, 2021. On March 3, 2021, DFO thanked West Coast for letting it know of its intentions.

[16] West Coast submitted its bid for the Second Solicitation on March 9, 2021.

[17] On March 26, 2021, West Coast was informed that Wainwright was the successful bidder in the Second Solicitation.

[18] West Coast filed its complaint with the Tribunal on March 29, 2021.

[19] On April 1, 2021, the Tribunal decided not to conduct an inquiry into the complaint.

ANALYSIS

[20] Pursuant to sections 6 and 7 of the Regulations, the Tribunal must determine whether the following four conditions are met before it launches an inquiry:

i. the complaint has been filed within the time limits prescribed by section 6 of the Regulations; [3]

ii. the complainant is a potential supplier; [4]

iii. the complaint is in respect of a designated contract; [5] and

iv. the information provided discloses a reasonable indication that the procurement has not been conducted in accordance with the relevant trade agreements. [6]

[21] For the reasons below, the Tribunal finds that West Coast’s complaint did not meet two of these conditions: it was not timely and did not raise a reasonable indication that the trade agreements have been breached.

Timeliness

The First Solicitation

[22] West Coast argued that awarding the contract to Wainwright under the First Solicitation was wrongful, because Wainwright was not one of the initial four invitees, it was not added through a proper amendment to the solicitation, the initial four invitees were not informed of its addition, and it did not meet all of the First Solicitation’s criteria (namely, that bidders were qualified to be a supplier for “Zone B”, Vancouver Island, under the Marine Infrastructure Standing Offer). West Coast argued that its bid would have been selected if Wainwright’s had not, and accordingly requested compensation.

[23] The Tribunal finds that these grounds of complaint are not timely. While West Coast’s objections to DFO were timely, [7] it did not complain to the Tribunal within 10 working days of the day on which it had actual or constructive knowledge of the denial of relief by DFO, as required by subsection 6(2) of the Regulations. At the very latest, West Coast would have known that DFO had denied relief on March 3, 2021, [8] when DFO acknowledged West Coast’s intentions to file a complaint with the Tribunal and did not offer further relief. However, despite West Coast’s repeated statements that it was going to file a complaint with the Tribunal, it did not do so until March 29, 2021, after it became aware that Wainwright won the Second Solicitation.

[24] As the Federal Court of Appeal has stated, “potential suppliers are required not to wait for the attribution of a contract before filing any complaint they might have with respect to the process. They are expected to keep a constant vigil and to react as soon as they become aware or reasonably should have become aware of a flaw in the process.” [9]

[25] As such, the Tribunal finds that West Coast’s grounds of complaint in respect of the First Solicitation are time-barred, and therefore the Tribunal will not inquire further.

The Second Solicitation

[26] West Coast argued that Wainwright had an unfair advantage on the Second Solicitation, because its mobilization costs were subsidized by the fact that it won the First Solicitation.

[27] Again, the Tribunal finds that this ground of complaint is not timely. West Coast would have been aware of the evaluation criteria in the Second Solicitation, including the financial criteria for mobilization costs, when the Second Solicitation was published on February 18, 2021. West Coast would have been required to object to or complain about these criteria within 10 working days of the solicitation’s publication, in order to meet the deadlines set out in subsection 6(2) of the Regulations. However, as West Coast did not file its complaint until March 29, 2021, these grounds of complaint were not timely.

Reasonable indication of a breach of the trade agreements

[28] Finally, even if West Coast’s complaint had been timely, the Tribunal finds that it did not raise a reasonable indication that a trade agreement [10] has been breached.

The First Solicitation

[29] While there were problems with the First Solicitation, DFO acknowledged these problems and retendered the solicitation. The Tribunal is satisfied that retendering was an appropriate response, and an appropriate remedy for West Coast, which had the opportunity to bid on the Second Solicitation.

The Second Solicitation

[30] Regarding the Second Solicitation, the Tribunal finds no evidence of bias or improper advantage to Wainwright. As the incumbent, Wainwright may have less start-up or mobilization costs than other bidders—however, based on the overall value of the tender, these costs were not enough to give Wainwright an advantage that other bidders could not overcome. Even if West Coast had zero mobilization costs, these costs were a small enough proportion of its bid that its overall price would likely still not have been low enough to win the contract.

[31] The Tribunal also notes that on March 1, 2021, DFO issued an addendum responding to questions from potential bidders, including a question about whether the incumbent would have a competitive advantage from having already mobilized to Bligh Island. DFO responded that it “took every measure possible to reduce any advantage of a current incumbent” by using an evaluation method that gave only 30% weight to price and 70% weight to technical merit. In other words, DFO acknowledged that the incumbent would not have the same mobilization costs and expressly attempted to mitigate this by amending the evaluation terms to reduce the weight of the financial aspect of the proposal.

[32] As such, West Coast’s grounds of complaint do not raise a reasonable indication that the procurements were not conducted in accordance with the CFTA.

DECISION

[33] Pursuant to subsection 30.13(1) of the CITT Act, the Tribunal has decided not to conduct an inquiry into the complaint.