Defence Procurement Canada: An Ambitious Government Initiative – Government, Public Sector

As part of its 2019 election platform, the federal Liberals
announced a plan for the creation of a new Crown agency that would
be responsible for conducting procurements on behalf of the
Department of National Defence and the Canadian Armed Forces,
dubbed “Defence Procurement Canada.”

Since the election, few details have been released about Defence
Procurement Canada although it may have a structure to a similar
Crown corporation: Defence Construction Canada. 

What We Know

Earlier this year, Prime Minister Justin Trudeau sent mandate
letters to the four ministers responsible for the creation of
Defence Procurement Canada:

• Minister of Public Services and
  Procurement, Anita Anand;




• Minister of National Defence, Harjit
  Sajjan;




• Minister of Fisheries, Oceans and the
  Canadian Coast Guard, Bernadette Jordan; and




• Minister of Innovation, Science and
  Industry, Navdeep Bains.

The Minister of Public Service and Procurement was instructed to
lead the project. Her mandate letter instructed her to ensure that
Canada’s biggest procurements were delivered on time and with
greater transparency. Specifically, Minister Anand was told
“This priority is to be developed concurrently with ongoing
procurement projects and existing timelines.” 

Specific timelines have yet to be released with respect to the
creation of Defence Procurement Canada. It is not entirely clear
whether the new agency would assume responsibility for procurements
that have already begun, namely the Future Fighter Capability
Project and the National Shipbuilding Strategy. 

What to Expect

The proposed Defence Procurement Canada is being created along
side the implementation of another important policy, the United
States-Mexico-Canada Agreement (USMCA). At the time of publishing,
the Government of Canada has introduced Bill C-4, An Act to
implement the Agreement between Canada, the United States of
America and the United Mexican States. Both the United States and
Mexico have already ratified the agreement.

Once the USMCA comes
into force, the trade agreements applicable to Canadian
procurements will change. Unlike NAFTA, the USMCA chapter
for government procurement does not apply to Canada. Instead,
Canada’s government procurement with the United States and
Mexico will fall under two trade agreements that are already in
force. Procurement between Canada and the United States will be
governed by the WTO Agreement on Government Procurement (AGP).
Procurement between Canada and Mexico will be governed by the
Comprehensive and Progressive Agreement for Trans-Pacific
Partnership (CPTPP), which came into force at the end of 2018.

With a view to conducting more streamlined procurement processes
for defence purposes, the Government of Canada may seek to conduct
Defence Procurement Canada’s procurements under the national
security exceptions of the AGP and
CPTPP. In 2019, the Government changed the regulations of
the Canadian International Trade Tribunal to require it to dismiss
complaints where a national security exception has been invoked by
the procuring entity. This change requires complaints to be
reviewed in the Federal Court where the timelines are considerably
longer and the remedy does not necessarily include the correction
of an unfair procurement practice. Rather, the Federal Court has
the remedies available to it under judicial review including the
ability to quash a contract award. 

Conclusion

A new procurement agency with specialization in defence
procurements could go a long way in improving the efficiency of
important purchases by the government. However, there are currently
few details. Gowling WLG will continue to provide updates on the
creation of this new Crown corporation.

Read the original article on
GowlingWLG.com

The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.

POPULAR ARTICLES ON: Government, Public Sector from Canada