Exploring root causes of a lack of competition in federal procurement

March 17, 2026

Office of the Procurement Ombud

The Office of the Procurement Ombud (OPO) is a neutral and independent organization of the Government of Canada that works collaboratively with federal departments and Canadian businesses (suppliers) to promote fairness, openness, and transparency in federal procurement. OPO delivers on this mandate by connecting stakeholders, investigating complaints, resolving problems, reviewing procurement practices and making recommendations, and sharing best practices.

In 2018, OPO launched a knowledge deepening and sharing (KDS) initiative to better understand key issues in federal procurement. This study, Exploring Root Causes of a Lack of Competition in Federal Procurement, is the 15th study conducted under the KDS initiative, all of which are published on OPO’s website. Through the publication of KDS studies, OPO intends to share knowledge and provide helpful guidance for federal procurement stakeholders.

Enquiries

Enquiries should be directed to:

Address

Office of the Procurement Ombud
410 Laurier Ave. W., Suite 400
Ottawa, Ontario K1R 1B7
Canada

Telephone

1‑866‑734‑5169

Toll-free for hearing-impaired

1‑800‑926‑9105

Email

ombudsman@opo-boa.gc.ca

Cat. No.

P114-46/2026E-PDF

ISBN

978-0-660-98812-2

On this page

• Introduction
• Purpose and methodology
• Background
  • Issue 1: Only one bid received
  • Issue 2: Cancelled solicitations
• Analysis - Possible causes
  • Possible causes of situations where “only one bid” is received
  • Possible causes of cancelled solicitations
• Limitations of the study
• Conclusions and recommendations
  • Improved training on developing procurement requirements for business owners
  • Improved commodity training for contracting authorities
  • Payment of bid costs to suppliers for certain solicitation cancellations
  • Justification and approval for solicitation cancellations
  • Mandatory inclusion of the Certificate of Independent Bid Determination
  • Lack of competition and the Office of the Procurement Ombud’s top 5 foundational changes needed in federal procurement study

Introduction

Competition in federal procurement promotes fairness and transparency while ensuring best value for taxpayers by encouraging fair pricing among suppliers.^{Footnote 1} The need for competition is enshrined in the Government Contracts Regulations, which, with limited exceptions, require that Canada solicit bids before entering into any contract for the provision of goods, services, or construction.^{Footnote 2} The Directive on the Management of Procurement (DMP) reinforces this requirement by directing departments to give precedence to competition in their internal procurement management frameworks.^{Footnote i}.^{Footnote 3}

Despite its critical importance, the Office of the Procurement Ombud (OPO/the Office) has observed several trends in recent years that may impede the competitiveness of federal procurement processes. In particular, OPO has noted solicitations where only one bid was received, and solicitations that are cancelled without a contract being awarded. Both situations risk diminishing competition in federal procurement, which may adversely affect best value to Canada and taxpayers alike.

Purpose and methodology

The purpose of this study is to examine 2 issues that may undermine competition in federal procurement processes, their root causes, and potential solutions. Specifically, this study examines (1) solicitations where only one bid was received, and (2) cancelled solicitations.

In conducting this study, OPO relied on information obtained via concerns that were self-reported by stakeholders as well as its Procurement Practice Reviews (PPRs) conducted by the Office between 2018 and 2023. These PPRs assessed the procurement practices of 17 of the largest procuring federal departments (in terms of value and volume) using a standardized review methodology.

It is important to note that there are currently limitations to available public data on solicitations for which only one bid was received, as well as on cancelled solicitations. This constrained OPO’s ability to perform a comprehensive trend analysis, which accounts for the minimal quantitative data presented below to substantiate the root causes. A further analysis of the data limitations is also explored in the section titled “Limitations of the Study”.

Background

OPO is mandated to review the practices of federal departments for the procurement of goods and services in order to assess their fairness, openness, and transparency, which it accomplishes via its PPRs.^{Footnote 4} OPO also receives questions, concerns and complaints from stakeholders, such as the federal supplier community, about challenges they encounter with the federal procurement process.^{Footnote 5} OPO became aware of the issues explored in this study through observations in recently completed PPRs, as well as through input from stakeholders in the federal supplier community.

Issue 1: Only one bid received

Across the 17 standardized PPRs conducted between 2018 and 2023, OPO noted that only one bid had been received in 53 of 180 (29%) open competitive processes and in 106 of 303 (35%) of limited competitive processes reviewed.

In other words, in approximately one third of all procurements open to multiple bidders, only one bid was received.

Impact – Why does this matter?

The receipt of “only one bid” undermines the objective of obtaining best value for taxpayer dollars because Canada is put into a position where either they must accept the bid (assuming it is technically compliant), or need to consider cancelling and re-soliciting the requirement, potentially resulting in additional costs and time delays without a guarantee of a positive result. Canada may also elect to perform an assessment of the bid price to verify that it is fair and reasonable, given the normal comparative financial assessment between bids is not possible. While this process may provide some additional assurance of reasonable pricing, it may also result in further time delays.

Issue 2: Cancelled solicitations

OPO has both heard and received formal complaints from federal suppliers about an increasing number of solicitations which are cancelled either during the bidding process, or after bids are received (but before a contract is awarded). Between 2019 and 2025, stakeholders contacted OPO 36 times regarding issues related to bid cancellations.

Impact – Why does this matter?

Repeated solicitation cancellations may undermine best value, as the significant costs associated with bid preparation and submission may deter suppliers from future bidding and result in limiting competition to only those suppliers with the means to continue submitting bids, or worse yet receiving no bids because suppliers no longer trust Canada to successfully award a contract.

Analysis - Possible causes

To understand the potential correlation between receiving only one bid and cancelled solicitations, as well as whether they are systemic issues, it is important to analyze their possible root causes.

Possible causes of situations where “only one bid” is received

Overly restrictive evaluation criteria

This refers to a situation where a solicitation’s evaluation criteria are written in such a way as to allow only a very specific combination of technical specifications or resource experience to be accepted.

It can also refer to a situation where a solicitation contains too many – and oftentimes unnecessary – mandatory criteria. Mandatory criteria should represent only the truly essential minimum requirements to successfully complete the work.^{Footnote 6} Criteria intended to assess the relative merits of each bid are better placed as rated criteria. Incorporating an excessive number of mandatory criteria also results in an overly restrictive solicitation, as bidders must fully meet each and every mandatory criterion to be considered compliant. Furthermore, excessive mandatory criteria can discourage prospective suppliers from bidding due to the increased administrative burden associated with preparing a compliant bid. This could further result in higher bid prices to offset increased bid costs, or in amendments being sought post-award to offset the administrative costs associated with being the successful supplier against a highly restrictive solicitation.

In 8 of the 17 standard PPRs previously mentioned, OPO made recommendations to the departments reviewed to strengthen their procurement practices to avoid “restrictive mandatory criteria and/or favouring incumbent or particular suppliers.” This demonstrates that the use of overly restrictive criteria has been widespread in federal procurement, which could in turn lead suppliers to believe they are unable to meet the criteria and submit a bid, or that it is not worth the costs of submitting a bid when their proposals are unlikely to be accepted.

Although overly restrictive criteria may not be the “root cause” of the receipt of “only one bid”, OPO believes it is often a result of some combination of the other causes listed below.

Selection methodology does not align with the requirement

Historically, Canadian federal procurement has relied on a prescriptive approach in which Canada defines its requirements and specifies exactly how suppliers must meet them, including the steps they are expected to follow.  

As a result, federal departments may choose to use a selection methodology of “highest combined rating of technical merit and price”, which generally places more emphasis on the technical aspects of a bid.^{Footnote 7} However, this becomes problematic when the technical evaluation criteria focus on past performance (similar projects in size and scope) and award points based on the number of previous projects, rather than on whether a bidder’s proposed solution meets the current technical requirements of the project.

In recent years, there is increased emphasis on the use of innovative, solutions-based models, where Canada will identify an issue and invite bidders to propose their best solutions. In the solutions-based model, Canada identifies its desired outcome, and the bidder controls the methodology they use to arrive at that outcome. A greater emphasis on solutions focused models also has risks during the transition period, as most suppliers and buyers are not experienced in this type of solicitation process and revert back to aspects of task-based models throughout the procurement process.

A misalignment of selection methodology and the requirement disadvantages newer and innovative suppliers who may not have comparable previous experience, due to innovative solutions being inherently unique.

Overly complex procurement ruleset/process only navigable by “repeat players”

OPO has frequently heard from stakeholders, including both suppliers and federal procurement officials, that the federal procurement process is too complex. This high complexity requires a significant investment of time and money from suppliers in order to understand how to prepare and submit successful bids. This may then limit competition because suppliers with previous federal experience will have a better understanding of how to structure a bid that is favourable to government buyers. The complexity also serves as a barrier for new suppliers to enter the federal supply chain thus artificially suppressing the number of eligible and interested suppliers.

Collusion

Bid-rigging is a form of collusion, and 2 of the most common schemes are where competitors agree not to bid or withdraw a bid (bid suppression), or to take turns submitting bids (bid rotation) to increase the chances of a pre-selected supplier winning the contract.^{Footnote 8}

A trend of “only one bid” occurring in a specific commodity may be indicative of collusion within the industry.

The Competition Bureau has developed the Certificate of Independent Bid Determination to help deter bid rigging by requiring bidders to disclose all material facts about any communications or arrangements which the bidder has entered into with competitors regarding the Request for Proposal (RFP).^{Footnote 9} However, this clause is not part of the standard procurement clauses used by Public Services and Procurement Canada (PSPC), which may limit its visibility and uptake. PSPC is the central purchasing agent for the Government of Canada, and as such, its standard procurement clauses may be adopted and adapted by other federal departments for their own procurements.^{Footnote 10}

Possible causes of cancelled solicitations

Poorly defined requirements

Situations of poorly defined requirements may occur when Canada provides limited or contradictory specifications in the solicitation. This generally indicates a lack of understanding of the commodity and can result in Canada soliciting for a product which may not actually exist in the requested format.

Canada may become aware that a requirement was poorly defined from bidder questions, the price of bids received, or through the analysis of oversight bodies, for example:

• Bidder questions may note that the particular combination of experience requested would be unique for the resource category; or that a Commercial Off-the-Shelf (COTS) solution doesn’t contain the functionality requested; or that the product no longer exists on the market/cannot be obtained within the stipulated timeframes due to various supply chain issues.
• In a situation where Canada is seeking a COTS solution but has improperly defined the requirement such that industry believes a customized solution is being sought, all bids received may come in much higher than the standard price for that COTS solution.
• Poorly defined requirements result in unclear evaluation criteria. In all 17 of the standardized PPRs conducted from 2018 to 2023 in the largest procuring federal departments, OPO made observations related to a lack of clarity regarding evaluation criteria (mandatory criteria, rated criteria, and rating scales).

Errors or ambiguities in solicitations

Errors or ambiguities in solicitations may (1) make it impossible to evaluate bids fairly, (2) unfairly advantage certain bidders, or (3) increase the use of undisclosed evaluation criteria. Often, these situations cannot be corrected with a solicitation amendment because the necessary correction would fundamentally change the solicitation. When this occurs, cancelling the solicitation is often the only available course of action.

If there is a systemic issue of solicitations being cancelled due to administrative errors, this could demonstrate a broader issue of contracting authorities lacking appropriate training and experience.

Unreasonable bid pricing

If Canada believes that it has appropriately defined the requirement, yet all bids received are priced significantly higher than the government’s estimate, or if the pricing is deemed unrealistic or not competitive, this could be a valid reason to cancel a solicitation as it would not result in the best value to Canada.^{Footnote 11}

Shifting departmental priorities / cuts in funding

Solicitations may be cancelled because of changes that occur between publication and contract award, including situations where the associated project is no longer required, the scope has changed, budget allocations have shifted, or a different approach is preferred.

Cancellation to avoid a complaint

The procuring organization may have identified or been informed of an error in the solicitation or evaluation process that could result in a complaint, leading Canada to cancel the process. In this scenario, the solicitation may be cancelled in order to avoid the complaint from proceeding.

An alternate reason for cancelling a solicitation in the case of a complaint could be as a corrective action in response to a bid protest. If a bid protest reveals significant flaws in the solicitation or evaluation process, the procuring organization may choose to cancel the solicitation and proceed with an alternate method to address the complaint (such as issuing a Request for Information (RFI) or a re-designed RFP).

Preferred supplier

A cancellation may occur if a procuring organization had a particular company in mind and that company didn’t submit a bid; or alternately, the procuring organization is trying to avoid contracting with a particular company due to known poor performance.

The lack of a government-wide Vendor Performance Management (VPM) system means that contracting authorities may attempt to avoid awarding contracts to suppliers with a history of poor performance by creating overly restrictive criteria or finding other ways, including canceling a solicitation, to exclude such suppliers from the bid evaluation process. Contracting with poor performers can lead to the requirement not being met, delays in completing the work, and cost overruns, all of which can undermine best value. A government-wide VPM system would provide a transparent method to limit the risk of contracting with poor performers and provide an advantage to suppliers with a positive record of good performance, which could incentivize those companies to bid on more requirements.^{Footnote 12}

Limitations of the study

As mentioned at the outset, OPO relied on information obtained via its previous PPRs as well as through self-reporting by stakeholders. OPO was limited from a further exploration of the prevalence of the potential root causes by limitations to available data.

For instance, on CanadaBuys, which is the Government of Canada’s main online portal for federal procurement and the official source for federal tender and award notices, information on cancelled solicitations is inconsistent—it is available for solicitations from some time periods and absent from others.^{Footnote 13} The available datasets lack standardization, limiting the ability to analyze the data.^{Footnote 14} Additionally, CanadaBuys does not display the number of bids received for closed solicitations.

In order to undertake a trends analysis, departments would require comprehensive and standardized data on solicitation cancellations as well as tenders for which only one bid was received, disaggregated by commodity, department, and method of supply. This information would assist in determining whether the 2 issues explored in this report are systemic, as well as whether their root causes are related to fairness. If these issues are systemic, it may be due to the nature of the Canadian federal procurement system (for example, repeated solicitation cancellations due to user error in RFP drafting, or “only one bid” situations because Canada is using older technology that most suppliers no longer provide support for). Furthermore, the issues could also be related to fairness: for example, use of overly restrictive criteria, or efforts to avoid or favour particular suppliers.

Conclusions and recommendations

Through an analysis of issues related to “only one bid received” and cancelled solicitations, OPO identified several potential root causes and outlined the factors contributing to these outcomes. The following recommendations are provided to address the key areas of concern and support efforts to resolve these issues. OPO intends to continue its commitment to raising awareness of issues related to “only one bid received” and cancelled solicitations and promote sustainable improvements to address these issues.

Improved training on developing procurement requirements for business owners

According to the Directive on the Management of Procurement (DMP), business owners—the

government employees who oversee the business or program area—are responsible for clearly defining the operational requirements of the procurement.^{Footnote 15} This is generally accomplished via a Statement of Work (SOW) or Statement of Requirement (SOR). The requirements communicated in the SOW will inform the solicitation’s evaluation criteria, so it is critical that the SOW/SOR is well-written and requirements are well-defined to increase the probability of a successful procurement process.

While the Canada School of Public Service offers a one-day training course on developing a SOW for public servants, it is targeted at managers and functional specialists and the subject matter requires previous understanding of the procurement process.^{Footnote 16} PSPC also published a SOW guide; however, it appears to have been last updated in 2013.^{Footnote 17} Business owners are generally experts in their particular subject matter (and not in procurement generally), and may only be required to draft a SOW/SOR once every few years when an existing contract expires or when a new program requirement arises.

Guidance on writing a clear and effective SOW should be routinely communicated and centrally located so that business owners can have access to up-to-date guidance when the need for a new SOW arises. PSPC should ensure that the SOW guide is regularly reviewed and updated, especially due to the rapid pace of change in the commodities that Canada procures. Furthermore, federal departments should consider adopting and adapting PSPC’s SOW guide to reflect the specific commodities they procure.

Improved commodity training for contracting authorities

Improved training on the commodities they procure would better equip contracting authorities to play a challenge function in the procurement process. The DMP states that contracting authorities are responsible for providing advice and recommending options to business owners on procurement strategies that meet operational requirements.^{Footnote 18} The contracting authority plays a challenge function to the business owner by ensuring that the procurement strategy (including evaluation criteria) correspond to the operational requirements. Procuring departments should develop training on the specific commodities they procure, enabling contracting authorities to increase their understanding of the business owner’s requirements so as to better play this challenge function.

Payment of bid costs to suppliers for certain solicitation cancellations

For suppliers, the costs of preparing and submitting a bid can be significant, and if there is a repeated risk that the solicitation will be cancelled, suppliers may be deterred from participating. Repeated cancellations can result in reducing the number of suppliers interested in continuing to bid on federal tenders, which would then have effects on the level of competitiveness in the field and may impact the supply chain, increasing risk to Canada if no action is taken.

Competitiveness in federal procurement is important to ensuring best value for Canada, and therefore the federal government should create a system that enables any interested supplier to participate. OPO recommends that federal departments pay reasonable bid costs to suppliers in cases of cancellations after bid evaluation, where certain criteria are met:

• If the bidder submitted a compliant bid, and would have been the top ranked bidder
  • In this circumstance, Canada has cancelled a solicitation where the bidder could have reasonably expected to be awarded the contract, and would have realized a profit through performance of that contract.
• The solicitation process was cancelled after bid evaluation for reasons other than a change in the program associated with the procurement or available funding.
  • The cancellation of a solicitation process due to unforeseen changes in Canada’s federal programming or available budget is a valid justification. However, cancellation for reasons related to poor market research or to avoid a complaint unfairly disadvantages bidders, and could be avoided through better training and guidance for contracting authorities.

Justification and approval for solicitation cancellations

It is critical that an adequate justification of the reasons for the solicitation cancellation be retained on the procurement file. This justification should be prepared by the party that requested the cancellation – either the business owner or contracting authority. The justification should also be reviewed by the contracting authority’s supervisor to ensure it is adequately supported. This justification is necessary to ensure that a solicitation is not cancelled simply because Canada did not get the supplier they hoped for, or because they want to avoid doing business with a given supplier (due to poor performance, elevated costs, etc.)

Mandatory inclusion of the Certificate of Independent Bid Determination

The Competition Bureau has created the Certificate of Independent Bid Determination as a tool to help contracting authorities by requiring suppliers to sign a statement confirming they have not communicated with or made arrangements with other bidders, helping to deter bid rigging. It is recommended that the Certificate become a mandatory clause to be used in all federal solicitations.

Lack of competition and the Office of the Procurement Ombud’s top 5 foundational changes needed in federal procurement study

The observations in this study relating to a lack of competition in federal procurement have linkages to some of the critical issues identified in a previous study published by OPO in July 2025 titled Time for Solutions: Top 5 Foundational Changes Needed in Federal Procurement. These are described below.

Establishment of a Chief Procurement Officer position accountable for the federal procurement function

OPO has ranked the establishment of a federal Chief Procurement Officer (CPO) position as the most critical change required in federal procurement.^{Footnote 19} The creation of a federal CPO position could address a potential gap in capacity building and professionalization for contracting authorities by providing clear leadership and centralized accountability for federal procurement.^{Footnote 20} This increased professionalization could address issues related to solicitations being cancelled due to errors or ambiguities in the solicitation (i.e. administrative errors).

A potential underlying cause of cancelled solicitations is that an error or ambiguity in the solicitation (i.e. an administrative error) would make it impossible to fairly evaluate the bids or would unfairly advantage certain bidders. A systemic issue of solicitations being cancelled due to these administrative errors could be an indicator of a broader issue of contracting authorities lacking sufficient guidance, training and experience. OPO has heard from suppliers about these solicitation errors, for example: contradictory or missing specifications for requested goods, unclear pricing submission instructions (i.e. requiring pricing for all items in a list even though the requirement stated “X and/or Y”), and misclassification of security requirements (i.e. RFP states “Unclassified” while the attached Security Requirements Checklist states “Secret”). These types of administrative errors may be due to contracting authorities reusing old templates and failing to consistently update all sections of the document in order to reflect the new requirement.

Furthermore, the CPO would help to centralize responsibility and ensure more consistent enforcement of federal procurement rules across departments. This could reduce the use of overly prescriptive task-based requirements and restrictive criteria, which are linked to situations of no or “only one bid” being received for a given solicitation.

Establish a government-wide framework for procurement data collection

A centralized, easily navigable source of federal procurement data containing comprehensive metadata for analysis would enable departments to identify procurement trends, which could in turn inform responsive policymaking.

Currently, there are issues with the quality of publicly available procurement data, which limit the ability of departments to identify potential trends of reduced competition for federal tenders. While all data related to tenders is hosted on CanadaBuys, there are dataset quality limitations and limited ability to refine searches. For example, it is not possible to use multiple search filters on CanadaBuys, meaning if one was to search for “cancelled solicitations” they would be unable to additionally refine the data by procuring organization, an issue which is compounded by the fact that CanadaBuys also hosts tenders for provinces and municipalities, academic institutions, schools and hospitals (MASH) sectors^{Footnote 21}.

Creation of a government-wide Vendor Performance Management system

As explored above, a potential underlying cause of cancelled solicitations is that Canada may wish to avoid awarding a contract to a known poor performer. In these situations, the time and financial costs associated with cancelling and re-soliciting a requirement may be lower than those associated with a poor performance situation, which could include delivery delays, holdbacks or financial penalties, and ultimately a low quality deliverable for which subsequent remedial procurements could be required.

A government-wide VPM framework would enable Canada to take a vendor performance assessment into consideration in the contractor selection process and potentially avoid repeated solicitation cancellations.