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Public Works and Government Services Canada

4.21.3. Contracting with Subcontractors

  1. When contracting with the Government of Canada, contractors understand that they cannot enter into a contract with first tier subcontractors that have been determined to be ineligible or suspended under the Ineligibility and Suspension Policy. A first tier contractor is defined in the Policy as “a subcontractor with whom a supplier has a direct contractual relationship to perform a portion of the work pursuant to a contract or real property agreement between the supplier and Canada, unless the subcontractor merely supplies commercial-off-the-shelf goods to the supplier”.
  2. Bidders are responsible for verifying the status of first tier subcontractors prior to submitting a bid that identifies first tier subcontractors and before entering into a contractual relationship with first tier subcontractors.
  3. If a contractor must enter into a first tier subcontract with an ineligible or suspended subcontractor, they must first obtain written approval of the appropriate deputy head or delegate by forwarding this request to the contracting authority. Contractors who enter into a first tier subcontract with an ineligible or suspended first tier subcontractor without the prior written consent from the relevant deputy head can be declared ineligible for a period of five years from the date of Public Works and Government Services Canada (PWGSC)’s determination.
  4. If a successful bidder wishes to replace a first tier subcontractor that has been determined ineligible or suspended prior to contract award, a rigorous re-evaluation process that ensures that all bidders are treated fairly and equally must be followed. This process will be tailored, as appropriate, to individual situations and the specific procurement circumstances at hand.
  5. Any request from successful bidders wishing to replace a now ineligible or suspended first tier subcontractor, or from contractors wishing to enter into a first tier subcontract with an ineligible or suspended subcontractor must be sent to the Acquisition Program Integrity Secretariat (APIS) by email at TPSGC.DGAIntegrite-ABIntegrity.PWGSC@tpsgc-pwgsc.gc.ca.
  6. In situations where there is a prolonged bid evaluation period, contracting officers must remind the successful bidder, using the template provided by APIS, that:
    1. they are obligated to obtain PWGSC approval prior to entering into a contractual relationship with an ineligible or suspended first tier subcontractor; or
    2. they can replace a now ineligible or suspended first tier subcontractor, whose eligibility standing has changed since the bid was originally submitted, as long as the subcontractor suggested as a replacement is accepted by Canada.
  7. Additional information regarding contracting with ineligible or suspended subcontractors can be found in Section 16. Subcontractors of the Ineligibility and Suspension Policy.