CITT: June 2007 Determinations
Re Trust Business Systems (CITT File No. PR-2007-021)
A complaint was submitted by Trust Business Systems (“Trust”), a supplier of non-Cisco switches, regarding a Request for Volume Discount (“RVD”) issued under the Department of Public works and Government Services (“PWGSC”) Network Equipment Support Services (“NESS”) Departmental Individual Standing Offer (“DISO”). Trust alleged that PWGSC prevented it from being able to bid appropriately by refusing to provide it with diagrams of the existing switches and installation.
Section 14 of the NESS DISO contained a procedure regarding the request, and a notice to bidders about specific requirements, placing the onus on them to show equivalency. The Tribunal is of the view that PWGSC followed the procedure found in the DISO and, further, that Trust missed the deadline for complaints under that procedure.
The Tribunal therefore considered that the complaint did not disclose a reasonable indication that the procurement had not been carried out in accordance with the applicable trade agreements and chose not to conduct an inquiry. (Date of Determination: June 12, 2007)
Re Chaussures Régence Inc. (CITT File No. PR-2006-044)
This was a complaint filed by Chaussures Régence Inc. (“Régence”) alleging that the Department of Public Works and Government Services (“PWGSC”) incorrectly awarded a contract for the provision of extreme cold winter boots and incorrectly applied a Canadian content provision. Régence requested that PWGSC terminate its contract with the successful bidder and issue a new solicitation without the Canadian content provision. Régence also requested its costs in preparation of the proposal and this complaint.
The RFP stated that the procurement was subject to a preference for Canadian Goods and/or Services only if there were three or more bids with valid certification. This was defined in clause K4000D, Canadian Content Definition, as being no less than 80 percent of the bid price.
Régence submitted that there were not three Canadian suppliers because the companies all used the same manufacturer. Régence relied on a letter from a PWGSC Supply Specialist stating that there were not three or more Canadian manufacturers who fulfilled the requirements to the best of his/her knowledge. Régence argued the that Canadian content provision should not have been applied to the process.
PWGSC contended that “supplier” is a broad term commonly used in procurement matters and should be restricted to the meaning of “manufacturer”. Article 518 of the Agreement on Internal Trade (“AIT”)contains such a broad definition. PWGSC also argued that it is not responsible for verification of the Canadian Content certification and has the right to rely on the certification of bidders as found in section 506(6) of the AIT. PWGSC further contended that Canadian content refers to the percentage of Goods and/or Services and not narrowly to the percentage of the cost of each individual good.
The Tribunal, in Régence's view, that a supplier must be a manufacturer was not supported by the usage of the term in the AIT. The Tribunal refused to make a determination on the question of whether the Canadian content provision was a reasonable requirement to include within the terms of the RFP on the basis that it was timed-out. However, assuming it was a reasonable requirement, the Tribunal found that PWGSC could accept the certification of bidders at face value. The Tribunal found that PWGSC did not violate the terms of the RFP and that the complaint was not valid. (Date of Determination: April 26, 2007)
Re Valcom Consulting Group Inc. (CITT File No. PR-2007-007)
This was a complaint by Valcom Consulting Group Inc. filed under subsection 30.11(1) of the Canadian International Trade Tribunal Act.
The Tribunal found that the case was not valid. The Tribunal awarded reasonable costs to the Department of Public Works and Government Services. A statement of reasons is to be issued at a later date (Date of Determination: June 20, 2007)
Re Mega-Technical Holdings Inc. (CITT File No. PR-2007-022)
Mega-Technical Holdings Inc. (“Mega-Tech”) alleged that the Department of Public Works and Governments Services Canada (“PWGSC”) improperly rejected its proposal because it did not include a statement of compliance with respect to SAE J595 from an accredited laboratory.
Section 1.1 of Part 4 of the Request for a Standing Offer (“RFSO”) informed bidders that offers not meeting all the mandatory requirements would be considered non-responsive. Mega-Tech submitted that it had demonstrated its proposal was compliant with the RFSO through reports included in the materials and its cover letter. It admits that it did not provide a statement from an accredited laboratory as required under Annex C of the RFSO.
The Tribunal was of the opinion that as PWGSC included mandatory compliance statements and informed bidders of the consequences of non-compliance, it was obligated to follow the terms when it considered and rejected Mega-Tech's proposal.
The Tribunal found no reasonable indication that the procurement was not carried out in accordance with the applicable trade agreements and so chose not to initiate an inquiry. (Date of Determination: June 25, 2007)
Re Quantum Marine Ltd. (CITT File No. PR-2007-023)
This was a complaint by Quantum Marine Ltd. (“Quantum”) regarding a procurement by the Department of Public Works and Government Services Canada (“PWGSC”) for “Short Range and Long Range Beacons” for operational and training units of the Canadian Forces.
Quantum alleged that PWGSC improperly rejected its proposal and, further, that there was a reasonable apprehension of bias.
At the time of filing Quantum did not yet know the reason why its proposal was not accepted and therefore the first allegation was premature. Quantum is free to file a new complaint subject to the timeline of subsection 6(1) of the Regulations.
Regarding the second complaint, the Tribunal was of the opinion that Quantum knew or ought reasonably to have known the basis of the complaint of bias on March 1, 2007. The June 22 nd filing of the complaint was beyond the time limit established by the Regulations . The Tribunal therefore decided not to initiate an inquiry. (Date of Determination: June 29, 2007)
Re Les Systèmes Equinox Inc. (CITT File No. PR-2006-045)
On February 5, 2007, Les Systèmes Equinox (“Equinox”) filed a complaint under subsection 30.11(1) of the Canadian Trade Tribunal Act. The complaint concerned a procurement by the Department of Public Works and Government Services (“PWGSC”) for the provision of a point of sale system on behalf of the Correctional Service of Canada (“CSC”).
Equinox alleged that:
- PWGSC awarded the contract to LGS, a bidder whose proposal was not compliant with the mandatory requirements of the RFP;
- PWGSC allowed LGS to change its proposal after the deadline; and
- PWGSC did not treat bidders equally, and therefore created a reasonable apprehension of bias in favour of LGS.
- PWGSC improperly declared its bid non-compliant
The Tribunal accepted the first three grounds of complaint, but did not accept Equinox's ground of complaint that its bid was improperly declared non-compliant because the Tribunal had previously dismissed this matter in a previous complaint on the basis that it was not filed within the time limits prescribed.
On the first ground, the Tribunal noted that LGS's proposal revealed confirmation, at the time of bid closing, that it complied with almost all 47 mandatory requirements and that PWGSC had contacted LGS to seek clarification or supporting information from the bidder on specific points. The Tribunal found that while the RFP allowed evaluators to obtain more info from bidders, PWGSC failed to follow the rules established in the RFP when it deemed LGS's proposal compliant. Thus, this ground of complaint was valid.
On the second ground, the Tribunal found that many of the responses sought by PWGSC went beyond clarification and amounted to substantive modifications to LGS's proposal that did in fact change its bid.
Because the Tribunal found PWGSC to be in violation of the first two grounds of complaint, it was not necessary to address the issue relating to reasonable apprehension of bias. However, the Tribunal commented that it did not agree with the position advanced by Equinox that acting contrary to the trade agreements is itself sufficient to show reasonable apprehension of bias.
While the Tribunal found the complaint to be valid with respect to two of the three grounds of complaint, the Tribunal had decided that it would not inquire into whether Equinox's proposal should have been found compliant. Thus, PWGSC received no compliant bids. However, since LGS was awarded the contract in December 2005, PWGSC and CSC were already over 18 months into the life of a 5-year contract and the Tribunal assumed that a substantial portion of the required work had been completed. Therefore, the Tribunal held that it was not reasonable to recommend that the current contract be terminated and the requirement re-competed immediately. Instead, the Tribunal recommended that PWGSC allow the current contract to continue, but that it not exercise any options and that it re-issue a competitive solicitation if the requirement for these services continue.
Other issues that were discussed included the filing and retention of documents and whether or not PWGSC had been prejudiced due to a limited amount of time it had to address some of Equinox's submissions.
On the issue of filing and retaining documents, Equinox claimed that PWGSC acted contrary to NAFTA in not maintaining all relevant documents and that it did not respond fully to the Tribunal's request for additional information. The Tribunal stressed that all documents associated with a procurement are critical components to ensuring that the competitive procurement system is functioning properly and transparently and that confidence in the system is maintained. The Tribunal also said that it is helpful to retain these documents so that the Tribunal will be able to perform a thorough review of the circumstances of a procurement. The Tribunal found that the government institution failed to meet this obligation.
PWGSC submitted documents late in the proceedings, which Equinox then made submissions upon. PWGSC then complained that it had only limited time to submit comments on Equinox's submissions. With respect to the limited amount of time to address submissions, the Tribunal did not consider that PWGSC suffered any prejudice or denial of natural justice since it was the late submissions of the PWGSC that resulted in its limited amount of time to address submissions. (Date of Determination: June 20, 2007)
Re BDMK Consultants Inc. (CITT File No. PR-2006-049)
On March 13, 2007, BDMK Consultants Inc. (“BDMK”) filed a complaint concerning the procurement by the Department of Public Works and Government Services (“PWGSC”), on behalf of the Department of National Defence (“DND”) for the provision of computer help desk support services.
BDMK alleged that PWGSC improperly evaluated rated requirement R3 of its proposal and that bidders were not made aware of the financial evaluation methodology used in awarding the contract. BDMK alleged that, regarding rated requirement R3, its proposal stated that its resource had “. . . 10+ years of experience in support of MS Access, MS Project, MS Powerpoint, MS Excel, MS Outlook, Visio, Adobe Acrobat applications. . . .” However, according to PWGSC, the résumé that BDMK had attached to demonstrate the experience did not support this claim.
BDMK sought:
• A re-evaluation;
• An additional 10 points awarded for having greater experience than required; and
• A fairly rated proposal against other bidders.
The Tribunal found that PWGSC, in conducting the evaluation, failed to take into account all the information provided in BDMK's proposal, which included the proposed resource's résumé. As a result, PWGSC failed to award BDMK points that it should have received regarding its proposed resource's experience for rated requirement R3.
The Tribunal held that PWGSC should have interpreted experience in “MS Office” as encompassing experience in one or more of the required software packages (i.e. MS Access, MS Project, MS PowerPoint, MS Excel, MS Outlook) given that it is general knowledge that such software is included in MS Office. The Tribunal also noted that, in its GIR, PWGSC acknowledged this mistake and agreed that BDMK should have been awarded full marks for this requirement. (Date of Determination: June 11, 2007)
