Awarding of public contracts: Increased oversight by the Autorité des marchés publics

18 July 2017

Québec's Bill 108, An Act to facilitate oversight of public bodies' contracts and to establish the Autorité des marchés publics ("the Bill"), tabled in June 2016, was introduced following a recommendation of the Commission of Inquiry on the Awarding and Management of Public Contracts in the Construction Industry, better known as the Charbonneau Commission. The Bill provides for the creation of the Autorité des marchés publics ("the Autorité") to ensure greater transparency in the management of public contracts. While there could be later amendments, below is a brief summary of the new elements introduced by the Bill.

The Autorité's creation as a neutral and independent body to oversee public contracts is undoubtedly the main achievement of the Bill. The Autorité will be responsible for applying the provisions of the Act respecting contracting by public bodies in determining the eligibility for public contracts, granting prior authorization to obtain such contracts, and evaluating contractors' performance when carrying out the contracts.[1] It may examine the conformity of the tendering or awarding process for a public contract in various situations - following a complaint by an interested person,[2] on its own initiative, or at the request of the Chair of the Conseil du trésor[3] or from a bidder.[4]

The Autorité will be vested with a wide range of powers.[5] In particular, it will have powers of investigation and verification, allowing it to access any material or information it considers relevant.[6] Following an investigation or audit, the Autorité may make recommendations,[7] but may also issue injunctions, suspend and even terminate a contract in the event of serious breaches.[8] The Autorité will consist of a chief executive officer and vice-presidents, all appointed by the government,[9] and must develop a strategic plan[10] and establish ethical rules, including measures to avoid conflicts of interest.[11]

In addition, the Bill amends the Act respecting contracting by public bodies. It requires public bodies to issue a notice of intention at least 15 days before entering into a contract by mutual agreement equal to or above the public tender threshold.[12] These bodies will also have to establish a procedure for dealing with complaints relating to the tendering or awarding of a contract and make this procedure available on their website.[13] In addition, by replacing the Autorité des marchés financiers for oversight of public contracts, the Autorité will be responsible for issuing the authorizations required to obtain a public contract. The Autorité may suspend an authorization or cancel an application for authorization if the company involved fails to provide certain information.[14]

Exceptions are provided for in the Bill and will allow the Conseil du trésor, in exceptional circumstances, to authorize a public body to continue performing a contract even if it is entered into with an ineligible company or is the subject of a decision by the Autorité, either because it is nonetheless in the public interest for the contract to continue, or because there are emergency and safety issues involved.[15]

Finally, the Bill provides that it is a penal offence for anyone who - in respect of a call for tenders - contacts a member of a selection committee for the purpose of influencing the member.[16] In addition, penal proceedings must be instituted within three years of knowledge of the offence and within seven years from the date the offence took place.[17]

The Bill is currently undergoing a detailed study by the Charbonneau Commission since May 2017. Once the study has been completed, the Commision's report will need to be adopted by the National Assembly and only then will the Bill be adopted. At this stage it is difficult to estimate when this step will be completed. Moreover, it is important to bear in mind that the Bill may potentially undergo substantial changes during its study by the Commission.

[1] Bill 108, An Act to facilitate oversight of public bodies' contracts and to establish the Autorité des marchés public, 1st sess, 41st leg, Quebec, 2016 sec 18.

[2] Ibid, sec 33, 35.

[3] Ibid, sec 50.

[4] Ibid, sec 51.

[5] Ibid, sec 21-32.

[6] Ibid, sec 22-26.

[7] Ibid, sec 29.

[8] Ibid, sec 27, 28.

[9] Ibid, sec 4 et seq.

[10] Ibid, sec 17.

[11] Ibid, sec 15.

[12] Ibid, sec 82.

[13] Ibid, sec 83.

[14] Supra, note 1, sec 111.

[15] Ibid, sec 117.

[16] Ibid, sec 126.

[17] Ibid, sec 127.

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