Premature Award Disclosure Prompts Compensation Order

By: Anna Krol

In its April 2018 determination in Hawboldt Industries v. Department of Public Works Canada, the Canadian International Trade Tribunal ordered the payment of compensation to a complainant due to the premature disclosure of a contract award.  The case dealt with an RFP for the replacement of marine cranes for Royal Canadian Navy ships.

Prior to issuing an official contract award, the government improperly disclosed the contract award value in regret letters sent to other bidders. However, due to errors in the evaluation process, the contract was ultimately cancelled and retendered. The complainant alleged that the government failed to preserve the complainant’s confidential information until the close of the procurement process and ultimately prejudiced the complainant by allowing other bidders to infer the complainant’s bid price and adjust their pricing on the retender.

The Tribunal found that the improper disclosure prejudiced the complainant’s competitive position and ordered the government to compensate the complainant. The Tribunal cautioned that when government institutions fail to maintain safeguards in protecting bidder pricing information during the pre-award stage, they risk prejudicing competition in retenders and leave themselves exposed to challenge.