For immediate release
Ottawa, July 5, 2006 Public Works and Government Services Canada today issued details regarding the procurement methods it will use for the purchase of the Defence Department's Medium- to Heavy-Lift Helicopters and Strategic and Tactical Aircraft announced last week by the Government of Canada.
Information regarding these purchases is now available on MERX, the government's electronic tendering system.
"The procurement of military aircraft for Canada's armed forces will be fair, open and transparent, in line with this Government's commitment under the Federal Accountability Act," said the Honourable Michael M. Fortier, Minister of Public Works and Government Services (PWGSC). "And to make sure of this, we have actually doubled the usual 15-day period to 30 days for interested suppliers to have sufficient time to respond to these government's notices."
The Minister explained that rigorous requirements for each procurement process have been put in place to ensure openness and transparency while also enabling the government to meet the urgent operational requirements of Canada's armed forces.
For the Medium- to Heavy-Lift Helicopters, preliminary industry research indicates that the Boeing CH-47 Chinook helicopter is likely the only known aircraft currently capable of delivering a suitable off-the-shelf aircraft in a timely manner. However, it is possible that some other supplier might be capable of demonstrating it too can meet the government's requirements. Therefore PWGSC has issued an Advance Contract Award Notice (ACAN) inviting interested suppliers to submit notification as to whether they can meet the government's stated requirements.
Similarly, for the strategic airlift requirement, preliminary industry research also indicates that the Boeing C-17 Globemaster is likely the only aircraft capable of meeting the government's urgent requirements in a timely manner. The government will issue an ACAN to further verify this is the case.
"Although preliminary industry research indicates that there might only be one type of aircraft that suits the Canadian Forces requirements, I want to make sure, by issuing an ACAN, that the Government of Canada asks the market about other options that might be out there," Minister Fortier emphasized. "We welcome competition and manufacturers are invited to submit proposals."
For the tactical airlift requirement, a two-phased competitive approach will be employed. PWGSC will publicly advertise this opportunity to industry through a Solicitation of Interest and Qualification (SOIQ) document (draft copy now posted on MERX), and industry will have to demonstrate their ability to meet mandatory high level performance criteria before being invited to submit a formal proposal.
PWGSC will ensure proposed suppliers for each of the procurements put in place the best possible package of industrial benefits for Canada.
"Each acquisition contract will have 100% industrial benefits right here in Canada, meaning that for every dollar the Government of Canada pays a contractor, the contractor must spend an equivalent amount inside Canada," Minister Fortier added.
Details regarding these specific procurement projects are available in the attached backgrounder.
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For further information, please contact:
Jean-Luc Benoît
Director of Communications
Office of Minister Fortier
(819) 997-5421
Media Relations
Public Works and Government Services Canada
(819) 956-2315
PWGSC news releases are also available on our Internet site at www.pwgsc.gc.ca/text/generic/media-e.html
Backgrounder
Procurement Methods for DND's helicopters and aircrafts
Following is a description of the procurement methods being used by Public Works and Government Services Canada to acquire the medium-to heavy-lift helicopters and the strategic and tactical aircrafts for DND:
1. Medium- to Heavy-Lift Helicopters ACAN process
PWGSC will issue an Advance Contract Award Notice (ACAN) on the government electronic tendering service, known as MERX, for the purchase of these aircraft.
Although market research concluded that the Boeing CH-47 Chinook helicopter is likely the only known aircraft currently capable of delivering a suitable off-the-shelf aircraft in a timely manner, it is also possible that some other supplier might demonstrate that they meet the capabilities requirement identified in the ACAN.
This will be a fair, open and transparent process one that places the onus on industry to demonstrate that they can meet the aircrafts' specific requirements.
What is an ACAN?
An ACAN is an Advance Contract Award Notice. It is used when PWGSC publishes a notice on the MERX Internet site indicating its intention to issue a contract to one supplier, and outlining its reasons for doing so. Other suppliers then have the opportunity to submit a Statement of Capabilities that clearly demonstrate how the supplier meets all the advertised requirements.
Should there be any challenge to the ACAN, the evaluation of the supplier's statement of capabilities will be done in a fair and transparent manner, by a team that is separate from the project team.
Prospective suppliers do not have to prove that they can be the winning bidder only that they can submit a bid that meets the mandatory requirements. If the Statement of Capabilities is deemed valid, PWGSC will issue a full call for formal bids. However, if no other supplier files a valid Statement of Capabilities, PWGSC will then negotiate the necessary contract with the identified supplier.
In addition, the standard ACAN publication notice period will be doubled, from 15 to 30 days, in order to ensure that all potential bidders can dispose of the appropriate time to respond.
This method of procurement fosters industry competition, ensures fairness and transparency, and meets the government and suppliers' needs for an efficient and cost effective procurement system.
Schedule
Contract award is expected in the summer of 2007 (or sooner if possible). The first aircraft is to be delivered as soon as possible, but no later than 36 months following contract award. The last aircraft will be delivered within 60 months of contract award.
Trade agreements
This requirement is excluded both from the North American Free Trade Agreement (NAFTA) and from the World Trade Organization Agreement on Government Procurement (WTO AGP). It is also excluded from the Agreement on Internal Trade (AIT) as a National Security Exception (NSE) was invoked for the acquisition of the aircraft for the protection of Canada's national security interest.
The National Security Exception (NSE) is a formal mechanism that may be invoked by the Minister of Public Works and Government Services to ensure that Canada's military requirements, or other aspects of Canada's national security, can be met. An NSE may be invoked for a variety of valid reasons for matters of national security or, in this instance, to ensure that essential work is performed within Canada. The NSE is in full accordance with Canada's commitments and its rights as a government under the Agreement on Internal Trade and in accordance with Government Contracts Regulations.
2. Strategic Airlift ACAN process
PWGSC will issue an Advance Contract Award Notice (ACAN) on the government electronic tendering service, known as MERX, for the purchase of these four aircraft.
Another reason for using an ACAN is the urgency of the requirement. The ACAN process allows government to determine quickly if additional capable products and suppliers exist.
This ACAN will be fair, open and transparent one that places the onus on industry to demonstrate it is capable of meeting the needs of government.
In addition, the standard ACAN publication notice period will be doubled, from 15 to 30 days, in order to ensure that all potential bidders can dispose of the appropriate time to respond.
Schedule
Contract award is expected in the spring of 2007. The first aircraft is to be delivered as soon as possible, but no later than 18 months following contract award. The last aircraft will be delivered within 48 months of contract award.
Trade agreements
This requirement is excluded both from the North American Free Trade Agreement (NAFTA) and from the World Trade Organization Agreement on Government Procurement (WTO AGP). It is also excluded from the Agreement on Internal Trade (AIT) as a National Security Exception (NSE) was invoked for the acquisition of the aircraft for the protection of Canada's national security interests.
3. Tactical Airlift Two-phased procurement approach
A two-phased approach will be used to ensure that the contracting process remains fair, open and transparent, while at the same time, fostering a strong two-way relationship between stakeholder departments and industry.
PWGSC will publicly advertise this opportunity to industry through a Solicitation of Interest and Qualification (SOIQ) document that will be posted on the government electronic tendering service, also known as MERX. Potential bidders will be able to study the SOIQ and indicate their interest in competing for the requirement. At the same time, potential bidders would have to successfully demonstrate their ability to meet the mandatory, high-level performance criteria before being invited to submit a formal Request for Proposal (RFP) as the second stage in the process.
To further streamline the procurement process and reduce risk to the Government of Canada, the aircraft must be certified to aviation certification standards recognized by Canada by the contract award date, rather than being certified at the time the aircraft is delivered. This is consistent with the requirement used for the Maritime Helicopter Project.
What is a SOIQ?
A Solicitation of Interest and Qualification (SOIQ) is a pre-qualification process allowing industry to qualify as meeting mandatory operational and industrial benefits requirements for Canada. It significantly reduces the costs to industry, as potential suppliers do not have to invest time and money to develop a full proposal before being sure that they meet the mandatory requirements. Those that do qualify are then sent a Request for Proposal (RFP).
Schedule
Contract award is expected in the fall of 2007. The first aircraft is to be delivered as soon as possible, but no later than 36 months following contract award. The last aircraft will be delivered within 60 months of contract award.
Trade agreements
This requirement is excluded both from the North American Free Trade Agreement (NAFTA) and from the World Trade Organization Agreement on Government Procurement (WTO AGP). It is also excluded from the Agreement on Internal Trade (AIT) as a National Security Exception (NSE) was invoked for the acquisition of the aircraft to ensure that its in-service support is performed within Canada.
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