The Quebec Government Tables a New Bill Promoting Quebec-sourced Procurement, Environmental Responsibility and Innovation

On February 3, 2022, the Quebec government (Government) tabled Bill-12, An Act mainly to promote Québec-sourced and responsible procurement by public bodies, to reinforce the integrity regime of enterprises and to increase the powers of the Autorité des marchés publics (Bill-12), before the Quebec National Assembly.

By amending the Act respecting contracting by public bodies (Act), among other things, Bill-12 aims to promote procurement sourced in Quebec and its regions by public bodies. It also seeks to strengthen the integrity regime of enterprises and increase the powers of the Autorité des marchés publics (AMP).

Described as “innovative” by the Government, Bill-12 is one of the key components of the new government strategy on public procurement, whose purpose is to use public contracts as an economic lever by giving priority to Quebec-sourced and environmentally responsible procurement.

PROMOTING QUEBEC-SOURCED PROCUREMENT AND GREATER ENVIRONMENTAL RESPONSIBILITY

Pursuant to Bill-12, the use of public contracts as a lever for economic development would become one of the core principles of public procurement. For procurement that is not subject to intergovernmental agreements, public bodies would be enabled to favour Quebec or Canadian small businesses. They would also be able to grant a premium in the form of a preferential margin not exceeding 10 per cent based on the Quebec, or otherwise Canadian, value added, as well as require Quebec or Canadian goods, services or construction work. Public bodies would also be required to make regionalized calls for tenders.

As part of their procurement process, public bodies would have to conduct an evaluation of their procurement requirements that furthers the pursuit of sustainable development, consistent with government policies and objectives. Their requirements would also have to be assessed through a lens of economically, socially and environmentally responsible procurement.

ESTABLISHING A PUBLIC PROCUREMENT INNOVATION SPACE

Without expressly foregoing the “lowest compliant bidder” rule, Bill-12 also provides for the establishment of a public procurement innovation space. Pursuant to the Act, the Government could therefore, upon the recommendation from the Conseil du trésor, waive traditional rules applicable to tendering and awarding contracts for the purposes of fighting climate change, improving the representation of Indigenous businesses or promoting innovation. For example, the Government could issue invitations to tender to acquire a prototype, use procurement modes involving competitive dialogue where there is a need to procure innovative goods, services or construction work, grant a premium in the form of a preferential margin to Indigenous businesses, or use tools or analysis grids relating to sustainable development, based on a life cycle approach.

REINFORCING THE INTEGRITY REGIME

The other key component of Bill-12 pertains to the integrity of public procurement systems governed by the Act, as well as those of municipal bodies and public transit authorities.

The AMP’s prior authorization regime would be maintained for certain public contracts and subcontracts, with their validity period being increased from three to five years. However, Bill-12 would reinforce the integrity regime by requiring all contractors and subcontractors to comply with high standards of integrity. A declaration of integrity would have to be submitted by all tenderers participating in a public procurement process or at the time a public contract is entered into by mutual agreement. The purpose of this declaration would be to confirm that neither the enterprise nor, where applicable, its directors, officers, partners and shareholders have committed any offences related to, for example, fraud, collusion, corruption, money laundering or tax evasion.

An enterprise that fails to meet the requisite high standards of integrity would be required to comply with oversight or monitoring measures imposed by the AMP and may also be required to implement corrective measures.

New monetary administrative penalties and penal provisions round out the proposed reinforcement of the integrity regime.

REINFORCING THE POWERS OF THE AMP

Given these new integrity measures, Bill-12 proposes to expand the mission, functions and powers of the AMP, namely with respect to its oversight functions, as well as its powers to conduct investigations and audits.

CONCLUSION

Long-awaited, Bill-12 appears to meet, at least in part, several expectations of Quebec businesses, including promoting the participation of small and medium-sized businesses, local procurement and environmental and innovation issues in public procurement processes. It will be interesting to follow its progress, and the amendments that could be made, to assess its impact on the public procurement process in Quebec.

For further information, please contact:

Zina El Amrani                        514-982-4074

or any other member of our Infrastructure group.