Archived - Code of Conduct for Procurement

This information has been archived and replaced by the Code of Conduct for Procurement (2012-09-12).

Context and Purpose of the Code

The Government of Canada spends billions of dollars a year on the procurement of goods and services. The government has a responsibility to maintain the confidence of the vendor community and the Canadian public in the procurement system, by conducting procurement in an accountable, ethical and transparent manner.

The Code of Conduct for Procurement provides all those involved in the procurement process – public servants and vendors alike – with a clear statement of mutual expectations to ensure a common basic understanding among all participants in procurement.

The Code reflects the policy of the Government of Canada and is framed by the principles set out in the Financial Administration Act and the Federal Accountability Act. It consolidates the federal government's measures on conflict of interest and anti-corruption as well as other legislative and policy requirements relating specifically to procurement. This Code is intended to summarize existing law and does not change the law or its interpretation.

By providing a single point of reference to key responsibilities and obligations, the government is making the measures easier to find and understand in light of an overall commitment to the highest standards of ethical conduct. The Code will be reviewed as necessary to ensure it continues to meet this objective.

The government expects that all those involved in the procurement process will abide by the provisions of this Code.

The Procurement Process: Openness, Fairness and Transparency

In Canada, fairness, openness and transparency are assured through compliance with the Financial Administration Act and the Government Contracts Regulations and Canada's international and domestic trade agreements (World Trade Organization (www), Agreement on Government Procurement (www), the North American Free Trade Agreement, the Federal/Provincial Agreement on Internal Trade). In addition, the government's procurement activities are also governed by land claims agreements with Canada's Aboriginal peoples.

In addition to the legal provisions, the tenets of fairness, openness and transparency are amplified in Treasury Board policy, Public Works and Government Services Canada (PWGSC) procurement policies and the internal procedures adopted by individual government departments and agencies.

A list of key relevant legislation and policies is included at the end of this Code.

Application

The Code of Conduct for Procurement applies to all transactions covered by the Treasury Board Contracting Policy.

Responsibilities

Public servants and vendors each have responsibilities in the contracting process.

Responsibilities of Public Servants

Public servants serve the Canadian public by acquiring goods and services, including construction services, required to achieve the objectives approved by the government. In performing these activities, including defining requirements and evaluating bids, they adhere to the laws, regulations and policies established by the government. As public servants, they commit to uphold the democratic, professional, ethical and people values of the Values and Ethics Code for the Public Service. At the time of signing their letter of offer, public servants acknowledge that compliance with the Values and Ethics Code for the Public Service is a condition of employment.

Public servants connected with the collection, management or disbursement of public money are required, under the Financial Administration Act, to report in writing to a superior officer any knowledge or information related to 1) the contravention of, or 2) fraud committed by any person against Her Majesty, under the Financial Administration Act or the regulations or any revenue law.

Public servants must perform their duties and arrange their private affairs so that public confidence and trust in the integrity, objectivity and impartiality of government are conserved and enhanced. Public servants must comply with the requirements of the Values and Ethics Code for the Public Service and with any additional departmental guidelines. The following elements of the Values and Ethics Code for the Public Service are of particular relevance in procurement.

Conflict of Interest Measures

(see Chapter 2 of the Values and Ethics Code for the Public Service)

Public servants must arrange their private affairs in a manner that will prevent conflicts of interest between their private interests and their public duties.

Public servants:

• Must not solicit gifts, hospitality, other benefits or transfers of economic value from a person, group or organization in the private sector who has dealings with the government. Fundraising for charitable organizations must be authorized in accordance with the Values and Ethics Code for the Public Service;
• Must not accept gifts, hospitality or other benefits that may have a real or apparent influence on their objectivity in carrying out their official duties or that may place them under obligation to the donor. This includes free or discounted admission to sporting and cultural events arising out of an actual or potential business relationship directly related to the public servants' official duties;
• Must not step outside their official roles to assist private entities or persons in their dealings with the government where this would result in preferential treatment to the entities or persons;
• Must avoid or withdraw from activities or situations, including procurement actions, that would place the public servant in real, potential or apparent conflict of interest with his or her official duties due to ownership of assets, liabilities, family relationships or other such circumstance;
• Must avoid outside employment or other activities which might subject public servants to demands incompatible with their official duties or cast doubt on their ability to perform their duties objectively.

Post-employment Measures

(see Chapter 3 of the Values and Ethics Code for the Public Service)

After leaving the public service, former public servants undertake to minimize the possibility of real, apparent or potential conflicts of interest between their new employment and their most recent responsibilities. Public servants in executive positions or equivalent and two levels below, and others where specified, for a period of one year after leaving office, shall not:

• accept appointment to a board of directors of, or employment with, entities with which they had significant official dealings during the period of one year immediately prior to the termination of their service;
• make representations on behalf of persons to any department or organization with which they had significant official dealings during the period of one year immediately prior to the termination of their service; or
• give advice to their clients using information that is not available to the public concerning the programs or policies of the departments or organizations with which they were employed or with which they had a direct and substantial relationship.

Responsibilities of Vendors¹

Vendors must respond to the government's bid solicitations in an honest, fair and comprehensive manner, accurately reflect their capacity to satisfy the requirements stipulated in the bid or contract documents, and submit bids and enter into contracts only if they will fulfill all obligations of the contract.

Vendors are obliged to alert the contracting authority to any factual errors that they discover in bid solicitations.

Solicitation and Contract Provisions

All contracts subject to the requirements of this Code, and all solicitation and other documents relating to the formation of those contracts will incorporate clauses:

• Prohibiting payment of a contingency fee by any party to the contract to a person to whom the Lobbyists Registration Act applies;
• Prohibiting corruption and collusion in the bidding process for contracts for the performance of work, the supply of goods or the rendering of services;
• Requiring that a bidder on a contract for the performance of work, the supply of goods or the rendering of services make a declaration that the bidder has not committed an offence under section 121 ("Frauds on the government" and "Contractor subscribing to election fund"), section 124 ("Selling or Purchasing Office"), section 380 (Fraud) committed against Her Majesty or section 418 ("Selling defective stores to Her Majesty") of the Criminal Code of Canada, or under paragraph 80(1)(d) (False entry, certificate or return) subsection 80(2) (Fraud against Her Majesty) or section 154.01 (Fraud against Her Majesty) of the Financial Administration Act.

A vendor bidding on a competitive tender or awarded a non-competitive contract must certify that it meets the requirements of the above provisions. After contract award, these tender conditions are carried forward as a contractual obligation.

Respect for Responsibilities of Public Servants

To help ensure that the entire procurement process conforms to the highest standards of ethical conduct, vendors should avoid any action that would jeopardize current or former public servants' ability to respect their obligations under the Values and Ethics Code for the Public Service.

Vendors will not offer or give public servants gifts, hospitality or other benefits that may have a real or apparent influence on their objectivity in carrying out their official duties or that may place them under obligation to the donor. This includes free or discounted admission to sporting and cultural events arising out of an actual or potential business relationship directly related to the public servants' official duties.

Vendors will not employ public servants in activities that might subject public servants to demands incompatible with their official duties or cast doubt on their ability to perform their duties objectively.

Vendors will not hire directly, or through a third party, former public servants during their one-year cooling-off period where this would constitute a violation of post-employment measures under the Values and Ethics Code for the Public Service.

It will be a condition of all contracts that the vendor has read and agrees to be bound by the terms of this Code of Conduct for Procurement.

Safeguards and Consequences

Vendor Complaints and Procedural Safeguards

The Canadian International Trade Tribunal has jurisdiction to conduct inquiries into complaints by potential vendors concerning procurement by the federal government that is covered by the Trade Agreements. Vendors may challenge federal government procurement decisions that they believe have not been made in accordance with the requirements of the Trade Agreements. Any potential vendors who believe they may have been unfairly treated during the solicitation or evaluation of bids, or in the awarding of contracts subject to the Trade Agreements, may lodge a formal complaint with the Canadian International Trade Tribunal. The Canadian International Trade Tribunal, which has the powers of a Court of Record, may review all aspects of a procurement action up to and including contract award.

The Federal Accountability Act, which received Royal Assent on December 12, 2006, contains provision for the appointment of a Procurement Ombudsman. Once the Procurement Ombudsman has been appointed, vendors will be able to complain and seek a review concerning compliance with regulations under the Financial Administration Act arising out of contracts awarded for procurements below the monetary thresholds of the Federal Provincial Agreement on Internal Trade, that would otherwise have been subject to that Agreement. The Procurement Ombudsman, who will report to the Minister of Public Works and Government Services Canada, may make findings and recommendations in respect of the complaint.

At present, Public Works and Government Services Canada provides for resolution of contract disputes through various means such as the Contracts Settlement Board for goods and services and through dispute resolution clauses in construction contracts.

For many complex procurements, the government engages an independent fairness monitor to monitor the procurement process for fairness, to ensure that the bids are evaluated in accordance with the evaluation procedures specified in the bid solicitation documentation.

Under the Public Servants Disclosure Protection Act, any public servant who witnesses or has knowledge of wrongdoing in the public sector workplace may refer the matter for review, investigation and for recommendation of corrective action to the Public Sector Integrity Commissioner. Public servants may also report the matter in confidence and without fear of reprisal to the Senior Officer in their organization designated for this purpose. A member of the public may also bring a public sector wrongdoing to the attention of the Public Sector Integrity Commissioner who would then decide whether to investigate. Public servants are prohibited from retaliating against contractors because they reported government wrongdoing to the Commissioner.

Consequences

Failure to comply with any of the legislation or policies referred to in this Code is subject to the penalties provided for in the applicable legislation or policy.

Responsibility for the Code of Conduct for Procurement

Public Works and Government Services Canada will maintain an advisory support service in implementing this Code.

For information about this Code, please contact the Director of Acquisition Policy and Process Directorate, Public Works and Government Services Canada through the general enquiries line at 1-800-622-6232; TTY 1-800-465-7735.

References and Enquiries

To ensure that up-to-date information can be obtained on relevant legislation and policies as well as the appropriate organizations and offices, this section will contain a link to a website maintained by Public Works and Government Services Canada. This website will provide relevant information, including web-links and contact information, such as:

Key Legislation and Policies

• Financial Administration Act (including the Government Contracts Regulations)
• Federal Accountability Act
• Criminal Code
• Competition Act
• Lobbyists Registration Act
• World Trade Organization, Agreement Implementation Act
  • World Trade Organization – Agreement on Government Procurement (www)
• North American Free Trade Agreement Implementation Act
• Agreement on Internal Trade Implementation Act
• Public Servants Disclosure Protection Act
• Relevant Land Claims Agreements
• Values and Ethics Code for the Public Service
• Treasury Board Policy on Contracting/Managing Procurement

Key Contacts

Arti Bhal
Acquisition Policy and Process Directorate
819-956-0464
Arti.Bhal@pwgsc-tpsgc.gc.ca

• Contacts for specific enquiries
  • Values & Ethics officers and counsellors
  • Public Works and Government Services Canada's Chief Risk Officer (Fairness Monitoring and Conflict Management)
  • Procurement Ombudsman

¹ "vendor" means any person or other legal entity who has submitted an offer or may submit an offer to contract or who has been awarded a contract: (Back)

1. by a "department" as defined in section 2 of the Financial Administration Act, or
2. under which Public Works and Government Services Canada  or an individual representing Public Works and Government Services Canada is specified to be the Contracting Authority.

This includes subcontractors, owners, directors, officers, employees, agents, or any affiliated body corporate (as defined in the Canada Business Corporations Act), to the extent that any of these is responsible for the performance under a contract.

"may submit an offer" means taking any steps to submit an offer in response to a bid solicitation, including making inquiries in respect of it to a public servant or other government official who has official dealings with that bid solicitation.