Canada: Procurement Complaints Against The Government: More Than Just Bid Challenges

In the context of government procurement, the term "bid challenge" is often used to describe the ability of potential suppliers to government to challenge a government procurement. "Bid challenge" is even the title of Article 1017 of the North American Free Trade Agreement. That article is one of the most important reasons that private parties in Canada have the right to challenge a government procurement .

The expression "bid challenge" can do a disservice to aggrieved potential suppliers, because potential suppliers can challenge government procurements in more ways than just in the evaluation of their bid. Two recent procurement challenge cases where McMillan was successful counsel (Knowledge Circle1 and CGI v Canada Post2 ) demonstrate that bid challenges are not the only, and may not even be the easiest, way to challenge a government procurement.

The bid challenge in CGI v Canada Post

CGI v Canada Post was largely an example of a traditional "bid challenge" to the Canadian International Trade Tribunal (CITT). CGI bid on a Canada Post procurement for data centre services. The contract was estimated to be worth over $100M. Based on Canada Post's evaluation, another bidder, Wipro, scored higher and was awarded the contract. CGI had a number of complaints, but the core of its substantive case was that Canada Post had improperly evaluated its bid, particularly by deviating from its published evaluation scheme and applying undisclosed evaluation criteria. Bid challenges are often also based on allegations that evaluators unreasonably ignored or misinterpreted information in a bid, that evaluators misapplied particular evaluation criteria, or that the evaluation was otherwise fundamentally unfair.

A bid challenge is usually an uphill battle; strong facts and good counsel are important parts of a winning recipe. In determining whether a bid evaluation has been properly conducted, the CITT will generally give deference to evaluators because of their familiarity with the evaluation and subject matter. Parties who fault the CITT's decision can in turn ask the Federal Court of Appeal to judicially review the CITT's decision. In doing so, the Federal Court of Appeal will generally give deference to the CITT's special expertise in the area of the procurement.

Because of this, a party wishing to launch a bid challenge (a "complainant") generally needs to identify evaluation errors that are more than merely inaccurate in the bidder's opinion. The alleged errors should be of such a nature that they undermine the fairness of the evaluation process in a way that has a material impact on the final result. Experienced counsel can be of great assistance in marshalling evidence and characterizing evaluation errors in a way that emphasizes their severity, rather than them being relegated to the realm of an evaluator's judgment call, which the CITT will not second-guess.

Ability of contract awardees to defend their contract

While the odds are generally against a complainant in a bid challenge, a successful bid challenge can have seriously detrimental effects for the supplier who was awarded a contract pursuant to the evaluation. The CITT recognizes this and generally lets contract awardees participate in a bid challenge proceeding as an intervenor. A contract awardee can play an important role in defending the award of the contract for at least two reasons.

First, given that the contract awardee's hard won contract may be on the line, they may wish to ensure that the government's lawyers (usually Department of Justice lawyers) are presenting the strongest case possible in defense of both the evaluation, and the contract award. The government may not have the same level of engagement in defending a contract award as a private supplier. A contract awardee will need to retain independent counsel to make full arguments based on all the confidential information on the CITT record.

Second, even if a bid challenge is successful, there are a variety of remedies the CITT can recommend3, some of which prejudice the contract awardee while others do not. Possible remedies include measures that disrupt the contract, such as awarding the contract to the complainant or starting a whole new solicitation process. Towards the other end of the remedy spectrum, the CITT may only compensate the complainant for their lost profits. Compensation affects the government because it has to pay out, but does not directly affect the contract awardee. One of the factors the CITT considers in recommending a remedy is the "extent to which the contract was performed".4 Timing can, therefore, play a crucial role in the end result depending upon how quickly the contract terms are being implemented and how fast the complaint process is moving. The contract awardee can provide important evidence that may not even be available to the government about this factor, which can help protect the awarded contract.

CGI v Canada Post proceedings at both the CITT and the Federal Court of Appeal

In CGI v Canada Post, McMillan acted on behalf the contract awardee, and pursued both of the above strategies. Ultimately, between the arguments from Canada Post's lawyers and McMillan, the CITT found that the evaluation was properly conducted, so the issue of remedy was moot. Because submissions regarding the correctness of the evaluation and any appropriate remedy are all made at the same time, a prudent contract awardee should likely make extensive remedy submissions, along with submissions as to the correctness of the evaluation.

After CGI received the CITT decision upholding the contract award to Wipro, CGI asked the Federal Court of Appeal to reverse the CITT's decision. After a full judicial review proceeding,5 in which the contract awardee was able to participate by virtue of being an intervenor in the CITT proceeding, the Federal Court of Appeal upheld the CITT's decision that the evaluation was proper, giving substantial deference to the CITT's findings of fact. McMillan's client, kept the contract it was awarded pursuant to the evaluation and continued to perform it.

As a side note, CGI filed a similar second bid challenge against Canada Post for application development services in which McMillan did not participate.5 CGI was successful in that complaint. The CITT recommended that the technical proposals be re-evaluated by a new team to the extent possible, and that if the rankings changed, new contracts be awarded.

A successful procurement challenge that was not a "bid challenge"

Knowledge Circle is an example of how successful procurement challenges can happen well after the bid evaluation or contract award stages.

Pursuant to a competition in 2007, Health Canada awarded Standing Offer Agreements (SOAs) to a number of language training suppliers. Based on the terms of the competition, the SOAs would expire after a maximum of five years.

After these five years, one supplier, Knowledge Circle, heard through informal challenges that many of the other suppliers were still getting work through the SOAs that should have expired. Knowledge Circle retained McMillan to investigate further. Through an Access to Information request and government information published through Proactive Disclosure mechanisms, it was learned that Health Canada had repeatedly extended the SOAs to certain suppliers beyond the initially stipulated five year maximum.

After a complex CITT proceeding, the CITT accepted Knowledge Circle's complaint and found that the government was in breach of its NAFTA obligations when it awarded contract extensions to suppliers without engaging the mandatory competitive process.

The CITT has many remedies that it may then consider following a determination of a successful complaint. A successful complainant usually wants some financial results so mild remedies that simply admonish the government for breach of its obligations ring hollow in the minds of aggrieved parties.

Knowledge Circle pushed for an award of financial compensation and was awarded damages for the lost opportunity that it suffered. Expert accounting evidence was proferred and resulted in an award of compensation for the lost profit on work Knowledge Circle ought to have been allowed to compete for. Knowledge Circle convinced the CITT to award lost profit calculated based on a gross profit margin of 45% of revenue, which was significantly in excess of the range of 10-15 % that the CITT often awarded in prior cases. The expert evidence carried the day in this case. Health Canada also stopped using the contracting vehicles the should have expired.

This all happened long after bids had been evaluated. It only came to light because based on informal sources, Knowledge Circle suspected that certain contracting vehicles were being improperly used. The CITT held the government accountable and compensated Knowledge Circle accordingly, which included an extraordinary cost award as well.

What potential suppliers should keep in mind

The bid evaluation process is an obvious opportunity to challenge government procurement decisions. By no means is it the only time when the government's procurement practices can be scrutinized. The government procurement process is complex and there are many places and ways where the government may misstep, to the detriment of potential suppliers. Suppliers need to be alert to ensure their rights to fairly compete for potentially large, lucrative, government contracts are respected. Suppliers need to act promptly, because they are usually required to act within 10 days of learning of a problem. Where a supplier's rights are not respected, a case before the CITT may offer a remedy to assist an injured supplier .


1. Knowledge Circle Learning Services, PR-2013-014, reasons on liability dated January 13, 2014; reasons on compensation dated June 24, 2014; and reasons on costs dated September 11, 2014 (McMillan acted for successful complainant).

2. CGI Information Systems and Management Consultants Inc., PR-2014-015 and PR‑2014-020, Reasons issued October 24, 2014, affirmed by CGI Information Systems and Management Consultants Inc. v. Canada Post Corporation and Wipro Technologies Canada Ltd., 2015 FCA 272 (McMillan acted as intervener for Wipro, the successful supplier).

3. Canadian International Trade Tribunal Act, [CITT Act] s. 30.15(2).

4. CITT Act, s. 30.15(3)(e).

5. CGI Information Systems and Management Consultants Inc., PR-2014-016 and PR‑2014-021, Reasons issued October 30, 2014.

The foregoing provides only an overview and does not constitute legal advice. Readers are cautioned against making any decisions based on this material alone. Rather, specific legal advice should be obtained.

© McMillan LLP 2016

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Jonathan O'Hara
In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:
  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.
  • Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.
    If you do not want us to provide your name and email address you may opt out by clicking here
    If you do not wish to receive any future announcements of products and services offered by Mondaq you may opt out by clicking here

    Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

    Use of

    You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


    Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

    The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


    Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

    • To allow you to personalize the Mondaq websites you are visiting.
    • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
    • To produce demographic feedback for our information providers who provide information free for your use.

    Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

    Information Collection and Use

    We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

    We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

    Mondaq News Alerts

    In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


    A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

    Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

    Log Files

    We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


    This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

    Surveys & Contests

    From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


    If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


    From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

    *** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


    This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

    Correcting/Updating Personal Information

    If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

    Notification of Changes

    If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

    How to contact Mondaq

    You can contact us with comments or queries at

    If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.

    By clicking Register you state you have read and agree to our Terms and Conditions