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CFTA Gaps and Traps

Posted 10/3/2017

The CFTA Sets a minimum standard for procurement transparency

in the public sector. Just like a building code will get you a building that won’t fall down; conformance to the CFTA will get you a process that should (not will) keep the lawyers away. For those of us in Western Canada the terms of the New West Partnership Trade Agreement will also apply. Both agreements are similar in principles with slightly different thresholds.

Organizations can through implementation of revised policies and procedures improve upon that minimum standard as long as those policies and procedures are not contrary to the terms of the agreement (note that geographic bias within Canada is not allowed).

The trade agreements do not address using procurement to advance environmental responsibility, social and economic development. There are, however, references to these factors external to the chapter on Procurement. If or how those references could be applied to procurement is yet to be determined. These areas could be addressed through organizational policy and procedure as long as they do not run contrary to the applicable trade agreement(s).

Article 508 of the CFTA addresses pre-qualification of suppliers, limited tendering and the issue of standing orders to supply. This article defines how a list of pre-qualified suppliers is maintained, used and the frequency of posting notices concerning how suppliers could be added to the list. This article, however, does not address how long a standing order with a particular supplier could remain in effect.

Article 511 of the agreement provides some guidance to minimum times for the posting of requests to supply. Those times are open to interpretation and it is probable that interpretation will be made in specific cases in the courts. You do not want to go to court. I suggest that your procedures set appropriate rules for posting opportunities.

There are many more issues affecting procurements within Chapter 5 of the CFTA. I suggest that this chapter be reviewed on a continual basis. I will highlight several of those issues in next month’s edition of BVP.

As always, none of this article shall be interpreted as legal advice.