Game over for Canadian bid-riggers seeking Government work

Published On 03/12/2012 | By Kim de Kock | Cartels

The Department of Public Works and Government Services Canada has made a bold statement by amending its integrity policy to effectively prevent parties who have been found guilty of bid-rigging from submitting future tenders to the department. The change in policy was implemented on 9 November 2012 under Policy Notification PN-107 and will apply to all procurement and real property transactions.

The move confirms the Department’s commitment to doing business with companies that abide by the law and act with integrity, emphasising the Department’s view in relation to the significance of anti-competitive crimes on the integrity of its procurement process.

The revised integrity provisions remove an exemption that previously allowed companies and individuals who had been convicted of anti-competitive crimes to tender for business with the Department if they had participated in a leniency program (for example, the Canadian Competition Bureau’s leniency program). Going forward, the Department will not transact with or accept bids from entities convicted of certain offences (including criminal offences under the Canadian Competition Act) unless they have been pardoned or had their capacities restored by the Governor-in-Council.

There is one exception to this prohibition which may apply in circumstances where it is unavoidably necessary, for purposes of protecting the public interest, to do business with a convicted entity. Such circumstances include, for example, where no other person is able to provide the requisite services, in cases of emergency or national security, if required for health and safety reasons or in order to avoid economic harm.

As part of implementing the policy, existing contracts with entities currently participating in a leniency program will be honoured, subject to heightened scrutiny and oversight, and implementation of rigorous controls to protect taxpayers’ interests.

Similarly, in Australia, criminal convictions for contraventions of the cartel provisions of the Competition and Consumer Act can have implications for a corporation’s eligibility to tender for government licences and contracts. Many government departments, state and federal and local council, require parties to identify whether they have been convicted of criminal offences or exclude corporations with a criminal record from tender processes or, in some cases, require tenderers to attest to their ‘good character’.

Photo credit: Lars Plougmann / Foter / CC BY-SA

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About The Author

is a Senior Associate in the Sydney office of King & Wood Mallesons where she specialises in anti-trust law, with a focus on mergers and acquisitions, access matters as well as general competition issues. Outside of the office, Kim has recently taken up surfing... but is probably not going to be appearing on the ASP tour any time soon.

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