Quebec: government tables a draft regulation on IT contracts with public bodies

Publication November 2015

On November 11, 2015, the Quebec government published a draft Regulation respecting contracting by public bodies in the field of information technologies (Draft Regulation) in the Gazette officielle du Québec.

This Draft Regulation is designed to give effect to measure 24 of the government IT strategy unveiled in June 2015, namely to “[translation] enact a regulation respecting IT contracts that provides public bodies with tools better tailored to the characteristics of that acquisition sector and based on accepted practices.”


IT contracts

Three types of public contracts are governed by the Act respecting contracting by public bodies (Act): supply contracts, construction contracts and service contracts.

The Draft Regulation introduces a new concept into the Act, “contracts in the field of information technology” (IT contracts), reflecting the government’s wish to subject such contracts to special rules. According to the Draft Regulation, an IT contract is a supply contract or service contract principally intended, with regard to the estimated expenditure of the contract, for the acquisition of IT goods or the provision of IT services.

A contract is for the acquisition of IT goods or the provision of IT services when it seeks to ensure or enable information processing and communication functions by electronic means, including the collection, transmission, display and storage of information.

Because IT contracts are supply or service contracts, the Draft Regulation largely mirrors the provisions of the regulations that are already in force for such types of contracts, but with the addition of some IT-specific characteristics.

New method for awarding contracts: the competitive dialogue

To adapt to the situation in the IT sector, the Draft Regulation proposes a new procedure for awarding contracts whereby a public body can hold a dialogue with selected service providers (a competitive dialogue) when its IT needs involve a high level of complexity. This method for awarding contracts is already being used in other jurisdictions, particularly France.

The main purpose of the competitive dialogue is to enable the public body to define or develop with each selected tenderer a solution likely to meet its needs.

Electronic transmission of tenders

The Draft Regulation proposes measures for electronic bid submissions. Under the Draft Regulations in their current form, bids can be submitted using the electronic submission system (SEAO) if this option is indicated in the contractual documents.  

Transmission of the quality evaluation results

Under the Draft Regulations, a tenderer can request the results of the quality evaluation of its bid in writing. The public body, after awarding the contract and upon receiving the request, must provide the tenderer with the quality evaluation results for each criterion used and briefly explain why the bid was not selected.

This is in line with the second pillar of the “Passeport Entreprises” program announced by the Quebec government on  October 30, 2015 – to provide tenders with better feedback on the strengths and weaknesses of their bids – and contrasts with current regulatory provisions under which unsuccessful tenderers receive only the quality score, adjusted price or ranking by adjusted price, as the case may be.  

Total acquisition cost

The concept of “total acquisition cost” introduced by the Draft Regulation enables additional costs not included in the  bid to be considered when the public body determines the lowest price or the lowest adjusted price.

The price adjustment must be based on quantifiable and measurable elements identified in the tender documents.  Additional costs are the costs borne by the public body during the useful life of the acquired goods and may include, in particular, installation, maintenance, support, configuration, licence, progress, interoperability and training costs.

Where additional costs are considered in determining the price, their value must be sent to each tenderer within
15 days after the contract is awarded.

Use of cloud computing

The Draft Regulation also includes provisions to facilitate the acquisition of cloud goods and services by allowing public  bodies to enter into contracts by mutual agreement with a supplier or service provider who has signed a framework agreement with the Centre de services partagés du Québec (Quebec shared services centre). Specific conditions will have to be met before contracts of this type may be considered.

Performance evaluation

Where the total amount paid for an IT contract is equal to or greater than $100,000, the evaluation of the supplier or  service provider must be recorded by the public body in a report.1 The same must be done when the amount is less than $100,000 if the supplier’s or service provider’s performance is considered unsatisfactory.

Conclusion

In conclusion, the Draft Regulation affirms the Quebec government’s desire to equip public entities with additional tools  to more effectively control the costs involved in acquiring IT goods and services, promote better adaptation to developments in the IT sector and streamline the bidding process.

The government has initiated a 45-day public consultation period (until December 28, 2015) during which interested  parties may submit written comments on the Draft Regulation.

Footnotes

1 In this context, the term “service provider” means the successful bidder on a service contract and the term “supplier” means a successful bidder on a supply contract.

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