With infrastructure spending by government on the rise, this first note on bid disputes, sometimes called ‘bid protests’, will focus on disputing federal government contracts.

Billions of dollars of goods and services are purchased by the Federal Government every year, making it a vital customer for many manufacturers.   But many companies are unaware of how to protect their rights when bidding on contracts.   Substantial amounts of time and money may have been expended in preparing and submitting bids only for a bid to be disqualified, or for the Government to act unfairly when awarding the contract to a less qualified or perhaps even non-compliant bidder.

So where do you go with these complaints?   And what are the common mistakes made when making objections?

The Canadian International Trade Tribunal (the “CITT”) is the independent bid challenge authority that has been established to hear complaints regarding procurement by entities of the Federal Government.   Approximately 80 protests a year are heard by the CITT, and approximately 25% of those complaints are found to be valid.   More significant are the countless number of potential complaints that are not brought forth because the company has run afoul of CITT requirements.

Perhaps the most common mistake made by companies is to allow the time limit for bringing a claim to elapse.   Any complaint regarding the procurement process must be brought within 10 working days.   Errors occur in determining when that time limit begins to run.   A common approach is for a company to wait until it has been notified that it has not been awarded a contract, or that its bid has been disqualified, before lodging its complaint about the process; Why talk to the lawyers before you have to, right?   However, at this point it is usually too late.  

The 10 working day limit begins to run as soon as the supplier knows, or reasonably ought to know, that the grounds for the complaint exist.   This means that complaints must be lodged immediately, even where the bidding process is still taking place.  

The clock for bringing an objection to the CITT can be stopped by lodging a formal complaint with the Government entity that is controlling the bidding process within 10 working days, rather than going directly to the CITT.   If this approach is taken, then the company may turn to the CITT within 10 working days after getting actual or constructive knowledge that the entity is denying the relief requested in the complaint.  

The problem with this approach is that complaint letters are often drafted rapidly in order to stop the clock, but without a true understanding of the effects of the letter.   One significant effect is that the complaint letter only stops the time limit with respect to the specific issues raised.   The time limit continues to run for every other possible ground for complaint.   The 10 working day time limit is strictly enforced and will preclude the company from subsequently raising any issue before the CITT that was not included in the initial complaint and are now time-barred.

So what should be kept in mind while bidding on Federal Government contracts?   You must always be alert for areas of complaint, and not be content to sit on your rights in the hopes that you may be awarded a contract.   You should be prepared to act quickly as there are a lot of options to consider and draft a complaint within the 10 working day time limit.   And you should remember that it is not enough to simply complain – the complaint must be carefully considered so that it includes all possible grounds of objections from the outset.

To learn more about the law applicable to government procurement, visit our website at www.governmentcontracting.ca.

If you have any thoughts about the above or any questions about bidding on Federal Government contracts, we’d love to hear from you.   You can reach the writer at gary.graham@gowlings.com or you can visit our website at www.gowlings.com/industry/md.asp.