On Oct. 9, 2024, Bill 62, An Act mainly to diversify the acquisition strategies of public bodies and increase their agility in carrying out infrastructure projects ("Bill 62") was assented to, and will have a significant impact on the processes for awarding and managing major public infrastructure projects in Québec.

 

In summary, Bill 62 introduces a new type of partnership contract and removes numerous legislative constraints on the implementation of other alternate mode contracts for concerned public bodies, namely the Ministère des Transports et de la Mobilité durable and the Société québécoise des infrastructures ("SQI") or any other public body to the extent authorized by the minister responsible for the latter[1].

On this subject, we refer you to our previous article, in which we discuss in greater detail the broad outlines of the various alternate contractual approaches[2]. Bill 62 is part of a more global approach by the legislator to modernize the way public contracts are carried out.

However, it is important to note that these legislative changes do not currently apply to the province's municipal bodies or public transit authorities.

Changes to partnership contracts

The main changes included in Bill 62 for major public infrastructure projects concern the introduction of a new type of contract, the "partnership contract", into the Act respecting contracting by public bodies[3] (the "Act"). This type of contract has been used in other jurisdictions[4] for some time and will now be available in Québec for the concerned public bodies.

A partnership contract is any contract for a public infrastructure project whereby "a public body brings in a contractor to participate in designing and building the infrastructure and carry out other responsibilities related to the infrastructure such as its financing, maintenance or operation, and that involves a collaborative approach during or after the tendering process[5]."

The collaborative approach will be specified at a later date by a Conseil du trésor regulation, and may include bilateral workshops, pooling resources and information related to the infrastructure project as well as consensually sharing risks and, as applicable, savings generated or gains made and losses sustained during the term of the contract, while respecting the required quality[6].

Any public infrastructure contract implemented in an alternate mode or collaborative approach, such as design-build, design-build-finance, public-private partnership (or design-build-finance-operate-maintain) and integrated project delivery contracts[7], could therefore be qualified as a partnership contract[8]. This is a comprehensive, standardized approach to collaborative and alternate contracts, designed to offer the greatest possible flexibility to the concerned public bodies, so that they can adapt the delivery method to the nature, scale and constraints of their infrastructure projects.

In this regard, under Bill 62, for the execution of these alternate mode or collaborative approach contracts (or partnership contracts), the concerned public bodies now benefit from the same flexibilities as previously offered to public bodies for public-private partnership contracts. The concerned public bodies now have discretion in establishing the criteria and terms of their public call for tenders to include a collaborative approach allowing them to obtain the best value for the realization of their infrastructure project[9], provided they ensure that they comply with the principles of public confidence in the public procurement process, transparency and the fair and honest treatment of bidders set out in the Act[10].

In addition, the concerned public bodies will have to expressly include in their partnership contract a procedure for settling disputes arising from such contract, as well as an obligation for the private partner to forward to the public body any information and documents requested by the latter in connection with the contract[11]. The legislator's objective seems to be to ensure efficient management of public funds allocated to infrastructure projects, to try to minimize disputes and litigation that may arise during or as a result of a project, notably by promoting collaboration between stakeholders, and to take a proactive approach to resolving them quickly.

Bill 62 also introduces various legislative relaxations to facilitate the implementation of these partnership contracts:

  • The possibility of negotiating with the bidder(s) during and at the end of the procurement process, any provisions of the partnership contract required to execute the contract while preserving the fundamental elements of the bidding documents and the proposal[12].
  • The possibility of stipulating in the tender documents that the authorization to contract from the Autorité des marchés publics ("AMP") need only be held by the bidding consortium and the enterprises making up the consortium when the partnership contract is concluded, rather than when the proposal is submitted[13].
  • Notwithstanding the general prohibition for a public body to disclose the names of bidders prior to the awarding of a contract, the possibility for a public body to disclose information allowing to find out the identity of an enterprise participating in the call for tenders for the partnership contract, only when this company has expressly authorized the public body to disclose such information[14]. For example, this relaxation may be useful when a public body wishes to publicly disclose the names of consortia, and the enterprises making them up, invited to participate in the second stage of a partnership contract procurement process.
  • The deadlines for publishing information about the partnership contract on the Québec government electronic tendering system ("SEAO") have been extended as follows:
  1. The public body has 72 days following the date on which the partnership contract is concluded to publish the name of the private partner, a description of the object of the contract and the initial amount or estimated amount of the expenditure[15], as the case may be, or, if none of those amounts are known within this period, 72 days following the date on which such an amount is determined as part of the performance of the contract.
  2. The public body has 120 days after taking delivery of the infrastructure built under a partnership contract that confers to the partner the operation or maintenance of the infrastructure, to publish the total amount paid for its completion.
  3. The public body has 120 days following the end of the contract to publish the total amount paid over the entire term of the contract[16].

In addition, the Conseil du trésor now has increased audit powers under Bill 62 to ensure sound management of public funds under partnership contracts[17].

Other significant changes

Other significant legislative changes are included in Bill 62:

  • Notice of intention to enter into a mutual agreement contract: A public body within the meaning of the Act[18] will no longer be required to publish on SEAO a notice of intention to enter into a mutual agreement contract for which the amount of the associated expenditure is equal to or greater than the public call for tenders threshold following a public call for tenders for which no compliant tenders were submitted, when certain conditions are met[19].
  • Integrity audit by the AMP: Bill 62 specifies that anyone who is the subject of a request by the AMP in connection with an integrity audit of an enterprise subject to AMP oversight may not invoke against the AMP any obligation of confidentiality or loyalty that might bind the person to the enterprise under oversight. In return, this person who communicates information or a document at the request of the AMP incurs no civil liability for doing so[20]. However, the lifting of the obligation of confidentiality or loyalty provided for in this case does not apply to the professional secrecy between a lawyer or notary and a client[21].
  • Annulment of the third-person decider's decision – Dispute settlement with regard to construction work: the 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[22] introduced an accelerated dispute settlement mechanism for construction work into the Act, but it has not yet come into force[23]. Bill 62 specifies that a party to a public contract may apply to the court for the annulment of a decision rendered by a third-person decider at the end of this dispute settlement mechanism in certain specific circumstances[24].

    Expropriation powers for the SQI    : the SQI now has the power to acquire immovables through expropriation under the Public Infrastructure Act[25], for its own purposes or on behalf of a public body, as part of a public infrastructure project if the SQI manages and exercises control over the project or if it provides the public body with construction services for the carrying out of the project[26] (for example, a major project to build new high schools[27]). The SQI can also establish a land reserve for future public infrastructure projects.[28]

Finally, it should be noted that the legislative changes included in Bill 62 are part of the Québec public infrastructure strategy[29] and all came into force on Oct. 9, 2024, with a few exceptions[30].

It now remains to be seen how these changes will be incorporated in current and future public infrastructure projects, and whether the legislator will, in a second stage, extend these changes to municipal bodies and public transit authorities.

It is also important to note that we are closely following the progress of Bill 61, An Act enacting the Act respecting Mobilité Infra Québec and amending certain provisions relating to shared transportation[31] which, as of the date of this article, is still under detailed study by the Commission des transports et de l'environnement[32]. We will keep you informed of any developments in this area in the near future.

For more information on Bill 62 and general assistance on construction and infrastructure law, please contact the authors of this article.

Please note that at the time of drafting this article, the definitive English version of Bill 62 that has been assented to had not yet been published. As such, the use of certain terms in this article may differ from the definitive English version that will be published subsequently.

[4] In Canada, for example, the provinces of Ontario and British Columbia are currently exploring the use of collaborative contracts for infrastructure projects, such as in the case of the Union Station Enhancement Project and the Cowichan District Hospital Replacement Project. Internationally, Australia and the United Kingdom have been successfully using this contracting model for several years already.

[5] Bill 62, art. 1.

[6] Id., art. 1.

[7] For more details regarding each of these alternate mode or collaborative approach contract types, we refer you to section 2 "Contract awarding models in Québec" of our article "Bills 61 and 62 tabled in the Québec National Assembly: Substantive changes to legislation applicable to major public infrastructure projects in Québec", published on May 9, 2024.

[8] Bill 62, art. 1.

[9] Id., art. 4(1) and 18; the Act, chapter V.

[10] The Act, art. 2 and 18.

[11] Bill 62, art. 8.

[12] Id., art. 7; the Act, art. 21 (2).

[13] Bill 62, art. 9 (2). In the absence of a statement to this effect in the tender documents, the consortium and the enterprises making up the consortium must be authorized on the date the tender is submitted.

[14] Id., art. 17; the Act, art. 58.1.

[15] Article 16 of Bill 62 specifies that the Conseil du trésor may, by regulation, define the terms "expenditure" and "amount" or clarify their scope.

[16] Bill 62, art. 15.

[17] Id., art. 19.

[18] The Act, art. 4. Public bodies include government departments, budget-funded bodies listed in Schedule 1 of the Financial Administration Act (CQLR, c. A-6.001), bodies whose personnel is appointed under the Public Service Act (CQLR, c. F-3.1.1), school service centers and school boards, and health care institutions covered by the Act respecting health services and social services (CQLR, c. S-4.2), but do not include municipal bodies or public transit authorities.

[19] Bill 62, art. 2 and 45 to 48.

[20] Id., art. 10 and 11.

[21] Id., art. 11.

[23] Id., art. 111 and 152 (2).

[24] Bill 62, art. 12 and 13: A party may apply to the court for the annulment of a decision rendered by a third-person decider for any of the following reasons: (1) one of the parties did not have the capacity to participate in the dispute settlement process before the third-person decider; (2) the dispute arises from a public contract or subcontract that is not valid; (3) the decision pertains to a dispute that could not be submitted to a third-person decider or contains a conclusion entirely unrelated to the subject matter of the dispute that was pending before the third-person decider; (4) the dispute settlement process was led by a person who was not certified to act as a third-person decider; or (5) the rules applicable to the selection of the third-person decider or to the dispute settlement process before such a third person were not complied with.

[25] Bill 62, art. 23; CQLR, c. I-8.3, art. 27 (1).

[26] Bill 62, art. 28.

[27] Public Infrastructure Act, supra note 25, art. 31.

[28] Bill 62, art. 28.

[30] Bill 62, art. 55. Articles 12 and 13 of Bill 62 regarding the annulment of the third-person decider's decision will come into force at the same time as the other provisions of the Act regarding the settlement of construction disputes at a later date to be determined by the Government of Québec. In addition, article 16 of Bill 62, regarding the publication of a Conseil du trésor regulation to define the terms "amount" and "expenditure", will come into force on the date on which the first regulation made under article 24.1 of the Act comes into force.

[32] National Assembly of Quebec, Parliamentary Proceedings, Bill 61.