CITT: April 2007 Determinations
Re TPG Technology Consulting Ltd. (CITT File No. PR-2006-050)
TPG Technology Consulting Ltd. ("TPG") filed a complaint with the Canadian International Trade Tribunal, in which it alleged two grounds of complaint. TPG's first complaint alleged that the bids were not evaluated fairly and in accordance with the published criteria in the RFP. TPG also alleged a conflict of interest on the part of the Department of Public Works and Government Services ("PWGSC") because an individual who had connections to both TPG and another bidder, CGI Group Inc ("CGI") was appointed to an executive position within PWGSC.
In respect of the first complaint, TPG stated that it had been advised verbally by PWGSC that it, not CGI, would be awarded the contract at issue. However, after a re-confirmation exercise, TPG was advised that CGI, not TPG, would be awarded the contract. The CITT held that TPG knew of the basis for this complaint at the time TPG was advised that a re-confirmation exercise was taking place, and that TPG did not file its complaint within 10 working days of that date, as required by section 6 of the Canadian International Trade Tribunal Procurement Inquiry Regulations. With respect to TPG's second complaint regarding an allegation of a conflict of interest, TPG had expressed its concern to PWGSC some months before, who replied and advised TPG that it should have no concerns regarding a conflict of interest. The CITT interpreted PWGSC's reply as a denial of relief to TPG, and noted that TPG did not file its complaint within 10 working days of the denial as required. Accordingly, the CITT decided not to initiate an inquiry into either ground of complaint. (Date of Determination: 2007/04/03)
Re Evripos Janitorial Services Limited (CITT File No. PR-2006-051)
The CITT decided not to initiate an inquiry into the complaint by Evripos Janitorial Services Limited ("Evripos"). Evripos submitted a complaint with respect to a Request for Proposal ("RFP") by the Department of Public Works and Government Services ("PWGSC"). Evripos alleged that: 1) the RFP did not clearly state the requirements of the procurement; 2) the PWGSC had incorrectly evaluated their proposal by not using the evaluation criteria set out in the RFP; 3) criteria from the RFP was interpreted incorrectly; and 4) PWGSC incorrectly decided that the Evripos proposal did not meet the mandatory criteria, ss. 2.2 and 2.8, in the RFP.
The CITT first stated that para. 7(1)( c ) of the Canadian International Trade Tribunal Procurement Inquiry Regulations requires that the CITT determine whether the information provided by the complainant discloses a reasonable indication that the procurement has not been carried out in accordance with the applicable trade agreement (namely Chapter Ten of the North American Free Trade Agreement, Agreement of Government Procurement, or Chapter Five of the Agreement on Internal Trade ). The CITT stated that all three agreements applied.
The CITT then reviewed section 2.8 of the RFP and stated that it requires that a bidder provide evidence of 3 full years of experience in the past 10 years. The CITT found that this criterion was not unreasonable and that Evripos could not fulfill this requirement. The CITT found that even if s. 2.2 of the RFP was unreasonable, the fact that Evripos could not fulfill the requirement in s. 2.8 prevents Evripos from receiving the contract so it is an irrelevant consideration. Accordingly, the CITT refused to conduct an inquiry and the matter was closed. (Date of Determination: 2007/04/05)
Re Human Resources Systems Group Ltd. (CITT File No. PR-2006-052)
Human Resource Systems Group Ltd. ("HRSG") submitted a complaint to the Canadian International Trade Tribunal alleging that the Immigration Refugee Board breached a signed contract awarded to it following a competitive procurement process by failing to pay for HRSG's travel time incurred under the contract.
The CITT reviewed relevant legislation. Subsection 30.11(1) of the Canadian International Trade Tribunal authorizes the CITT to conduct an inquiry into a contract arising out of a procurement process. In both Article 514(2)(a) of the Agreement on Internal Trade, and Article 1017(1)(a) of the North American Free Trade Agreement, the procurement process is deemed to begin after the requirements for the procurement is decided. The procurement process continues through the contract award. General Note 2 of the Agreement on Government Procurement stipulates that the procurement process includes the contract award.
After reviewing the legislation, the CITT held that a dispute with respect to payment and invoices under a contract are part of contract administration and outside the CITT's jurisdiction. The CITT held that there would be no inquiry into the complaint. (Date of determination: 2007/04/10)
Re PowerWright Atlantic Inc. (CITT File No. PR-2006-053)
PowerWright Atlantic Inc. ("PowerWright") submitted a complaint against the Department of Public Works and Government Services ("PWGSC") alleging that PWGSC erroneously failed to award PowerWright a contract.
PowerWright had objected to the inclusion of the "no substitute" specification in the original RFP and proposal of an equivalent product. PWGSC thus refused to award a contract because there was insufficient time to issue a revised Request for Proposal ("RFP"), receive and evaluate proposals, and obtain delivery of the goods by March 31, 2007. The CITT accepted PWGSC's assertion stating that the elimination of the specification was a significant modification and required new timelines for potential suppliers to comply with the specification.
The CITT thus held that it was reasonable for the PWGSC to cancel the procurement due to insufficient time for a competitive process to occur before the delivery of goods. The CITT held that there was no breach of Chapter Five of the Agreement on Internal Trade ("AIT"). The CITT would not conduct an inquiry into the complaint and closed the matter. (Date of Determination: 2007/04/13)
Re BSI Management Systems Canada Inc. (File No. PR-2007-002)
This was a complaint to the Canadian International Trade Tribunal by BSI Management Systems Canada Inc. ("BSI") in which BSI alleged that Environment Canada ("EC") used ambiguous terms in the Request for Proposal ("RFP"). BSI also alleged that EC did not apply the evaluation criteria that was set out in the RFP. The CITT decided not to initiate an inquiry into the complaint.
With respect to the first complaint that the terms in the RFP were ambiguous, the CITT examined subsection 6(1) of the Canadian International Trade Tribunal Procurement Inquiry Regulations. Subsection 6(1) states that a complaint must be filed "not later than 10 working days after the day on which the basis of the complaint became known or reasonably should have become known to the potential supplier." The CITT held that the time limit expired in this case and there would be no inquiry into this particular complaint.
In the second complaint, BSI claimed that EC unfairly applied the evaluation criteria. BSI alleged that: 1) EC required each person on the project to have government experience but this was not made clear in the RFP; 2) EC communicated with a reference on BSI that was not given by BSI and conversed about a BSI employee; 3) EC contacted a reference provided by BSI and discussed an ex-BSI employee as well as the winning bidder.
The CITT held that there was insufficient evidence to find in favour of BSI's second complaint. The CITT held that the RFP did specifically state that past experience would be taken into account, specifically in the public sector. The CITT also held that the EC had received unsolicited information from references but had properly characterized the information as hearsay. The CITT thus refused to initiate an inquiry. (Date of Determination: 2007/04/16)
Re: Zenix Engineering Ltd. (CITT File No. PR-2006-035)
This was a complaint by Zenix Engineering Ltd. ("Zenix") with respect to a procurement by Defence Construction Canada ("DCC") on behalf of the Department of National Defence ("DND") for modular quarters life-safety assessment and remediation analysis. Zenix alleged that DCC did not enter into negotiations with it, as stipulated within the Request For Abbreviated Proposal ("RFAP"), even though it was the proponent with the highest overall score.
Jurisdiction objection
DCC filed a motion seeking dismissal of the complaint on the grounds that the CITT had no jurisdiction to hear the complaint because DCC was not a federal entity covered under Annex 502.1A of the Agreement on Internal Trade ("AIT"). DCC also argued that the RFAP was for the procurement of architect and engineering services, which had to be provided by a license professional and were excluded from coverage under AIT Annex 502.1B and under NAFTA as ‘goods pertaining to real property'.
The CITT found that DND is a federal entity listened in Annex 502.1A of the AIT and that the RFAP stated that the solicitation is made by DCC "on behalf of the Department of National Defence." It further found that the operational requirements, budget limitations and the completion dates for the project were all determined by DND and that the actual contracting agent was DND. The CITT also found that the services required were not required to be completed by licensed engineers. In addition, the CITT noted that within Annex 502.1B of the AIT there was no exclusion of inspection services and that the RFAP would therefore be covered by the AIT on that basis alone. The CITT also stated that this RFAP clearly fell within the NAFTA guidelines.
Complaint
Zenix alleged that even though it obtained the highest overall score based on the technical proposal and financial offer, it was not provided a fair opportunity to negotiate with DCC and DND and that DCC did not undertake "good faith negotiations". DCC claimed that negotiations broke down because the two parties could not agree upon a ceiling price and therefore they entered into negotiations with the bidder with the second highest overall score. In response, Zenix submitted that they were never given the opportunity to perform the work within the available budget as the RFAP did not contain a set budget.
The CITT reviewed the RFAP, which established that the negotiations were to take place "with a view to reaching an agreement on the terms of the contract, including an agreement on a maximum amount for services authorized by DCC." The CITT thus had to determine whether the negotiations had reached such a point as to be considered to have ‘failed'. The CITT found that DND's "maximum upset amount" allowable within DND's budget for the procurement was never clearly communicated to Zenix until after Zenix had been informed that DCC was entering into negotiations with the second-ranked bidder. The CITT found that the appropriate time to communicate the nature of any budget limitation would have been when the negotiations reached an impasse on price. However, DND never asked Zenix to meet a price, nor were any budget limitations ever communicated to Zenix. The CITT also found there was nothing within the RFP to allow DCC to unilaterally determine when the negotiations had failed.
The CITT concluded that DCC acted contrary to the RFAP by unilaterally concluding that the negotiations had failed and by entering into negotiations with the second-ranked proponent. In acting in that manner, DCC violated Article 506(6) of the AIT and Article 10115(4)(d) of NAFTA. The CITT recommended that Zenix be compensated in an amount equal to its lost profit and its reasonable costs incurred in preparing and proceeding with its complaint.
Chaussures Régence Inc. (CITT File No. PR-2007-001)
Following a review of the complaint submitted on behalf of Chaussures Régence Inc. on April 4, 2007, the Canadian International Trade Tribunal ("the CITT") will not conduct an inquiry into the complaint.
Subsection 7(1) of the Canadian International Trade Tribunal Procurement Inquiry Regulations (the Regulations ) identifies three conditions which must be satisfied prior to the CITT conducting an inquiry into a complaint. One of these conditions is that the complaint be in respect of a designated contract.
To qualify as a designated contract, the value of the contract for the supply of goods and services must be equal to or greater than the minimum monetary thresholds prescribed by the trade agreements. The minimum monetary thresholds for goods are the following: $25,000 under the Agreement on Internal Trade, $245,000 under the Agreement on Government Procurement and $32,400 under the North American Free Trade Agreement.
According to the complaint, the estimated value of the contract is $18,000. Given that the value falls below all three monetary thresholds, the contract does not qualify as a designated contract as defined by subsection 7(1) of the Regulations and cannot be the subject of a CITT complaint inquiry. The CITT considers the matter closed. (Date of Determination: 2007/04/19)
Ready John Inc. (CITT File No. PR-2007-003)
Having reviewed the complaint submitted on behalf of Ready John Inc. on April 5, 2007 and the additional information received on April 17, 2007, the Canadian International Trade Tribunal ("the CITT") decided not to initiate an inquiry into the complaint.
Ready John alleged that a contract was awarded to a non-qualified bidder. Specifically, Ready John alleged that Hoyt's Septic Services Ltd. could not qualify as a bidder because it did not have 250 units available to it at all times as required by clause 18.1.1 of the Request for a Standing Offer (RFSO). Clause 18.1.1 of the General Instructions of the RFSO stated:
Number of Toilets: For the purpose of this Standing Offer the Contractor must have available to them at all times a minimum of 250 units.
On February 9, 2007, amendment No. 001 to the RFSO was issued and defined the meaning of "available to them at all times" as "[a]ccessible, obtainable".
In its complaint, Ready John submitted that the term "available" meant that the units must be in the Contractor's possession or must be readily available to meet the requirements of the Request and alleged that Hoyt had "considerably less than 250 chemi cal toilets in its possession".
The CITT was of the view that the wording, as provided in the RFSO and as further clarified by PWGSC, was clear in that to "have available at all times" does not mean that the bidder would have to have 250 units "in its possession" or have the toilets "readily available". Rather, the contractor must be able to access and obtain the units if needed.
The CITT further noted that the terms "Standing Offer" and "Contractor" were used in clause 18.1.1. Generally, a "Standing Offer" is issued in response to an RFSO and a contract is formed when a call-up is made, and the "Contractor" is the entity authorized to perform the services under that call-up. Considering the reference to the term "Contractor", in this case the CITT was of the opinion that there was no requirement, as a condition of bidding, that the bidder had to have 250 units in its possession pr ior to submitting an offer in response to the RFSO. Rather, the contractor was to be able to access the toilets when needed.
For these reasons the CITT found that there was insufficient evidence to substantiate Ready John's claim that PWGSC issued a standing offer to a non-qualified bidder. (Date of Determination: 2007/04/24)
Re: Archidata Inc . (CITT File No. PR-2007-005);
The CITT decided not to initiate an inquiry into this compliant by ArchiDATA Inc. ("ArchiDATA").
ArchiDATA alleged that the Department of Foreign Affairs and International Trade ("DFAIT") incorrectly awarded a contract to a non-qualified competitor. ArchiDATA alleged that the contract was awarded to a company that did not have a product to meet the requirements of the proposal. The complainant further claimed that the successful bidder would now have access to its "product description, framework and product specifications." Additionally, the complainant claimed that DFAIT did not inform it of the contract award in a timely manner.
The CITT found that ArchiDATA's allegations were based upon "public knowledge" and that it had failed to provide evidence that the product proposed by the competitor did not meet the requirements of the SOW. There was insufficient evidence presented to enable them not to defer to DFAIT on the specific question. In addition, the CITT held it could find no indication that the competitor would gain access to any of ArchiDATA's information, and even if the competitor could, this would not indicate that DFAIT had violated the procurement provisions of the trade agreements. With respect to being notified of contract award in a timely way, the CITT found that NAFTA allows contracting entities 72 days after a contract award to publish a notice regarding the award. There was no evidence that the procurement was not conducted in accordance with NAFTA. (Date of Determination: April 26, 2007)
Re: The Public Sector Company Limited (CITT File No. PR-2007-006);
The CITT decided not to initiate an inquiry into this compliant by the Public Sector Company Limited ("PSC").
PSC alleged that the Department of Public Works and Government Services ("PWGSC") included mandatory criteria not essential to the performance of the services being sought and that PWGSC had released information too close to the end of the solicitation process for it to properly react to the new information.
The RFP had two requirements – that the successful bidder have 5 years of experience in providing briefing to senior management and 10 years experience in consulting/working with any number of levels of government. PSC claimed that the criteria had never appeared in any similar solicitations and that PWGSC had acted unfairly in taking only six days to respond to questions.
The CITT did not think that the requirements that PWGSC had outlined within the bid documents were contrary to NAFTA and the AIT. Further, they found no evidence that the criteria was placed within the bid to prohibit certain suppliers from bidding. With respect to the timeliness of the information provided to bidders, the CITT found that the PSC failed to provide sufficient evidence that the final amendment was not posted before a certain date.
The CITT was of the opinion that PSC's complaint did not demonstrate a reasonable indication that the procurement was not conducted in accordance with NAFTA and AIT.
(Date of Determination: April 26, 2007)
Canadian North Inc. v. Department of Indian Affairs and Northern Development
(File No. PR-2006-026R)
This determination related to the complaint filed by Canadian North Inc. (File No. PR-2006-026).
During the complaint process, the Department of Indian Affairs and Northern Development ("DIAND") brought a motion for an order dismissing the complaint for want of jurisdiction by the CITT, which the CITT dismissed on November 9, 2006. DIAND filed an application for judicial review seeking to quash the CITT's order dismissing DIAND's motion.
The Federal Court of Appeal allowed the application, quashing the CITT Order dated November 9, 2006, and referred the matter back to the CITT with the direction that it grant the motion and dismiss the complaint of Canadian North Inc. for want of jurisdiction. (Date of Determination: 2007/04/05)
