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International Restructuring Newswire
Welcome to the Q2 2024 edition of the Norton Rose Fulbright International Restructuring Newswire.
Canada | Publication | June 12, 2020
Canada has taken active steps as a digital services leader towards improving the procurement criteria for government use of cloud computing. The Government of Canada has adopted a cloud-first strategy in which the preferred option for delivering IT services is through cloud services and the preferred choice for cloud deployment is the public cloud.
Canadian government procurement, including technology procurement, is governed by the Standard Acquisition Clauses and Conditions (SACC) Manual which sets out the Government of Canada’s standard procurement clauses and contractual provisions. A federal government request for proposal (RFP) can further incorporate by reference specific provisions forming part of the SACC Manual. Similarly, in the US, the Federal Acquisition Regulation System, consisting of the Federal Acquisition Regulation (FAR) and agency regulations that supplement the FAR, are applicable to procurements by US government agencies. FAR clauses are similarly incorporated by reference into RFPs and related documents.
Technology vendors will want to be especially mindful about provisions related to intellectual property ownership which are oftentimes incorporated by reference into RFP documents. In addition, as cloud service security is a key concern, the RFP and related documents will often impose standards that vendors must abide by. The Canadian approach to security currently mirrors key standards set by the United States. For example, current information technology security risk management guidance has been taken through the Communication Security Establishment and the United States National Institute of Standards and Technology (NIST).
In addition, a number of government agencies both in Canada and the US are adopting agile procurement processes. Previously, pricing for the whole project was typically set at the outset, subject only to scope change. In contrast, agile procurements follow a less documented process whereby the government agency’s needs, rather than being known upfront (e.g., through a detailed specification), are generally explored and updated as the process progresses through iterative cycles.
While there is a clear desire for increased participation for cloud computing services, it is clear the technical requirements and complexity of the work can present challenges to ensuring a successful bid.
Competitive risks in the technology procurement process
The complexity of the work involved requires that vendors scrutinize both the procedural and technical aspects of the contracting relationship. An emerging risk, given the large dollar value of government technology contracts and the shift to agile (and faster) contracting processes, is that an unsuccessful bidder disputes the competitiveness of the successful bidder in the bid process.
From the government customer’s perspective, it needs to ensure a bid is compliant and thoroughly vetted. It also needs to ensure its own requirements for a service are clearly stated. If this is not ensured, Canada’s legal landscape for procurement may present risks of claims or challenges that competition was not properly established and non-compliant bids were overlooked.
In an arena of equal treatment for bidders and standardized requirements for cloud computing services, substantive detail in the early bidding stages does not only affect the competitiveness of a bid. Vendors need to ensure specificity and accuracy dominate their pricing and feasibility scenarios even at the early stage. Not doing so risks presenting a vendor’s bid as inferior (and therefore subject to an easier challenge) and a customer as offside the common law requirement of fair competition.
Publication
Welcome to the Q2 2024 edition of the Norton Rose Fulbright International Restructuring Newswire.
Publication
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Publication
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