This article is an excerpt from The Art of Tendering: A Global Due Diligence Guide, which is available for purchase.
In the fall of 2014, the Canadian International Trade Tribunal issued a trilogy of interrelated determinations in CGI Information Systems and Management Consultants Inc. v. Canada Post Corporation. The complaint involved a Request for Proposals (RFP) issued by Canada Post for the award of master services agreements for the provision of data centre services. CGI Information Systems and Management Consultants Inc. (referred to as CGI below) was an unsuccessful proponent. It launched a series of legal challenges, taking issue with the debriefing process, with the failure of Canada Post Corporation to maintain its evaluation records, and with Canada Post’s use of information collected during site visits in its evaluation process.
In September 2014, the Tribunal released the first of the three interrelated determinations. It found that Canada Post failed to comply with its debriefing duties under the North American Free Trade Agreement (NAFTA). In its determination, the Tribunal provided the following overview of the debriefing duties under the NAFTA:
The procurement regulatory regime established by the CITT Act and the various trade agreements, including NAFTA, aims to create a framework in which government procurement takes place in a context of fairness, competition, efficiency and integrity. Transparent government procurement procedures further these goals and are mandated by various provisions of NAFTA regulating different aspects of the solicitation process. The requirement in Article 1015(6)(b) of NAFTA that a procuring entity explain to an unsuccessful bidder the reasons for not selecting its tender is a means towards reaching these goals.
Consistent with this context, the Tribunal has previously found that the primary purpose of the obligation to provide pertinent information on the reasons for not selecting a tender is as follows:
. . . to provide transparency as to the reasons for not selecting the proposal, while respecting the confidential nature of the content of all the bidders’ proposals. This requirement enables the unsuccessful bidder to determine, if need be, the nature of its rights in view of the requirements set out in NAFTA.
The precise nature of the information to be provided depends on what information can reasonably be expected to reveal, in a particular case, the reasons for not selecting a tender. In light of the purpose of Article 1015(6)(b) of NAFTA, the information should focus on the considerations of those involved in making the decision, which includes communicating the reasons for not selecting the proposal, the justification for taking those reasons into account and the approach used to examine them.
The Tribunal determined that Canada Post failed to meet its obligations in the debriefings it provided CGI:
The Tribunal finds that Canada Post failed to meet even the basic requirements of Article 1015(6)(b) of NAFTA by not disclosing to CGI, as an unsuccessful bidder, the detailed evaluation plan used by the evaluators, including the evaluation criteria, scales, weights and methodology as they were applied by the evaluators. Not only are the evaluation criteria and how they are applied obviously relevant to the reasons for not selecting a tender, the disclosure of such information also allows bidders to determine their rights under NAFTA, one of the central requirements of which is that procuring entities award contracts in accordance with the criteria specified in the tender documentation. Where government institutions withhold the contents of evaluation plans and evaluator guides used in a selection process, it becomes difficult for a bidder to satisfy itself that the evaluation was carried out in accordance with the requirements and methodology specified in the tender documents. Withholding such information not only is inconsistent with the transparency required by Article 1015(6)(b) but also undermines the efficiency of the procurement complaint process, as it is unlikely to facilitate the early resolution of bidder complaints.
In coming to this conclusion, the Tribunal rejected Canada Post’s assertion that disclosing more detailed information about its evaluation process would result in the disclosure of confidential and proprietary Canada Post information and would compromise the quality of future proposals. The Tribunal found that Canada Post failed to provide reasonable arguments to support these assertions. It also reiterated the obligation to maintain the individual notes of the different evaluators when using consensus scoring since the individual scoring sheets of the different evaluators should be provided to proponents during debriefings in order to satisfy the NAFTA debriefing duties:
Thus, information regarding the individual evaluators’ assessments of CGI’s proposal shows part of the reasons for or approach to establishing the final scores and outcome of this solicitation; as such, it is pertinent information for the purposes of Article 1015(6)(b) of NAFTA that can help provide transparency to an unsuccessful bidder seeking to understand how its tender was evaluated. Canada Post’s failure to provide this information is rendered more egregious by the fact that the Tribunal has found, in previous decisions, that, where consensus scoring is used, the debriefing must still include the communication of the considerations of each individual evaluator who contributed to the establishment of the consensus evaluation.
The Tribunal also found that the failure to provide a proper debriefing was a serious deficiency in the integrity of the procurement process:
The deficiency found is serious due to its broader impact on the integrity and efficiency of the competitive procurement system. Disregarding debriefing obligations risks significantly affecting the trust of bidders and the public in the integrity of the procurement system, as well as the efficiency of the system. As stated, the debriefing obligations contemplated by NAFTA are one means of ensuring the transparency of the procurement system, which underpins the objectives of the procurement regime under the CITT Act and the trade agreements. In particular, debriefings serve to demonstrate that the procurement has been conducted with integrity, they provide bidders with the necessary information to assert, if need be, their NAFTA rights, and they can facilitate an early resolution of disputes between the parties. All of these are essential for the system to function efficiently.
In light of these findings, the Tribunal directed Canada Post to align its debriefing policies and practices with its NAFTA obligations and ordered Canada Post to provide the required debriefing information to CGI.
In October 2014, the Tribunal released the second of its three interrelated determinations. This determination focused on the issue of the duty to maintain evaluation records during consensus scoring.
It noted that Canada Post had acknowledged that the destruction of the individual evaluator records during consensus scoring was a breach of its trade treaty duties and that it had initiated a review of its consensus scoring policies. As with the failures relating to the debriefing process, the Tribunal found that the failure to maintain evaluation records was a serious deficiency in the procurement process:
The Tribunal agrees with CGI that the destruction of documents relevant to the evaluation in a procurement process is serious due to its impact on the integrity and efficiency of the competitive procurement system. The destruction of relevant documents causes bidders and the public to view the whole procurement process with suspicion; however, confidence in that system is imperative, as it increases participation in the procurement system and increases the chances of the government getting quality goods and services at minimum expense. This inquiry is a case in point that the loss of part of the evaluation record creates additional difficulties, both procedural and substantive, in the Tribunal’s inquiry into a complaint. Although it was not the case here for reasons explained earlier, the loss of relevant documents and information can potentially prevent the procuring entity from reasonably justifying its decisions and the Tribunal from determining what has transpired in the procurement process; as such, the loss of pertinent documents and information can result in a procurement process being found unreasonable, even if it had otherwise been carried out in compliance with all applicable standards. Needless to say, this creates unnecessary inefficiencies, additional delays and extra costs of all kinds to the government, the bidders and, ultimately, the taxpayers.
The Tribunal therefore ordered Canada Post to change its practices in relation to the maintenance of evaluation records to comply with its trade treaty duties.
In October 2014, the Tribunal also released the third of its three interrelated determinations. It found that Canada Post had improperly used information obtained during site visits of proponent facilities to increase the score of one of the proponents, and that the RFP terms did not permit this type of adjustment. The Tribunal ordered Canada Post to conduct a re-evaluation with a new evaluation team once it had updated its record-keeping and debriefing practices in order to comply with the two prior determinations:
The deficiencies identified in this process bring into question the accuracy of all bidders’ evaluations, including the bidder that was not initially granted a site visit and those bidders that did not take part in this inquiry process. The process used to change the final scores was not consistent with the consensus scoring process used for evaluating and ranking the other bidders. The final ranking of the bidders was affected by changes to the scoring of technical proposals made as a result of the site visits. Once they are brought to the Tribunal’s attention, it cannot ignore these serious issues in connection with this procurement on the sole basis that CGI has not conclusively demonstrated that its score and ranking was directly affected. While considering all the circumstances relevant to this procurement, including the factors set out in subsection 30.15(3) of the CITT Act, the Tribunal comes to the conclusion that, on the facts of this matter, it must recommend a remedy that will ensure fairness to all bidders that took part in this process. For those reasons, the Tribunal finds that the appropriate remedy is to recommend that Canada Post re-evaluate the technical proposals of all six original bidders with a new team of evaluators and that Canada Post’s debriefing and document retention practices and procedures be amended.
In the event that the re-evaluation process resulted in a different ranking from the original process, the Tribunal ordered that Canada Post either cancel the original contract awards or award additional master service agreements to the top-ranking proponents in the new evaluation.
As this case illustrates, the failure to properly assess information collected during site visits can have a significant detrimental impact on the defensibility of an evaluation process. The inability to defend the outcome of a procurement process from legal challenge is compounded where institutions fail to maintain proper evaluation records or conduct proper debriefings. This trilogy of determinations therefore serves as a useful reminder to public institutions of the need to ensure that their procurement practices and procedures align with their trade treaty obligations.
