Procurement practice review of the Canada Border Services Agency

November 2021

I. Background

1. The Office of the Procurement Ombudsman (OPO) conducted a review of procurement activities at the Canada Border Services Agency (CBSA).

2. In accordance with paragraph 22.1(3)(a) of the Department of Public Works and Government Services Act, the Procurement Ombudsman has the authority to review the procurement practices of departments to assess their fairness, openness and transparency.

3. OPO’s procurement practice reviews are based on issues and complaints brought to OPO’s attention by stakeholders, both in general and in regard to specific solicitations by various federal organizations. Based on this information, OPO has identified the 3 highest-risk procurement elements as: (1) the establishment of evaluation criteria and selection plans; (2) the bid solicitation process; and (3) the evaluation of bids and contract award. For the purposes of this review, these elements are defined as follows:

1. Evaluation criteria and selection plans—the development of mandatory and point-rated evaluation criteria, and the identification of the selection method to determine the successful bid
2. Solicitation—the design and execution of the solicitation process, including the clarity and completeness of solicitation documents
3. Evaluation of bids and contract award—the establishment of a process to ensure the consistent evaluation of bids in accordance with the planned approach, including an evaluation plan and instructions to evaluators, and the adequacy of documentation to support the selection of the successful bidder

4. CBSA was selected for review as one of the top 20 federal departments and agencies in terms of the value and volume of its annual procurement activity. OPO is in the process of conducting similar reviews of the other top 20 departments and agencies over a five-year period ending in 2022-23.

5. CBSA is responsible for providing integrated border services that support national security and public safety priorities and facilitate the free flow of persons and goods (including animals and plants), that meet all requirements under its legislation. CBSA also enforces more than 90 acts and regulations that keep our country and Canadians safe.

6. CBSA procures over $200 million worth of goods and services each year. CBSA’s Strategic Procurement Division (SPD) provides national expertise and guidance to all CBSA branches across Canada and procures goods (up to $25,000) and services (up to $2 million) for its internal clients. SPD is part of the Agency Comptroller Directorate within the Finance and Corporate Management Branch, which defines CBSA’s internal financial control framework and monitors financial processes and practices to ensure compliance with legislation, regulations, policies and directives. This Directorate is responsible for developing and implementing CBSA’s financial systems, policies, procedures, controls and practices. In December 2020, CBSA indicated that SPD is currently undergoing a nationalization initiative that aims to bring both headquarters and regional employees under the same management umbrella.

II. Objective and scope

7. This review was undertaken to determine whether CBSA’s procurement practices pertaining to evaluation criteria and selection plans, solicitation, and evaluations of bids and contract award, supported the principles of fairness, openness and transparency. To make this determination OPO examined whether CBSA’s procurement practices were consistent with Canada’s obligations under applicable sections of national and international trade agreements, the Financial Administration Act and regulations made under it, the Treasury Board Contracting Policy (TBCP), and, when present, departmental guidelines.

8. The following 3 lines of enquiry (LOE) were used to assess the highest-risk procurement elements identified in paragraph 3 above:

1. LOE 1: Evaluation criteria and selection plans were established in accordance with applicable laws, regulations and policies
2. LOE 2: Solicitation documents and organizational practices during the bid solicitation period were consistent with applicable laws, regulations and policies
3. LOE 3: Evaluation of bids and contract award were conducted in accordance with the solicitation

9. This report also includes a section on other observations identified by OPO through the analysis of the above LOEs.

10. OPO’s review consisted of an assessment of procurement files for contracts awarded by CBSA between October 1, 2018 and September 30, 2020. This review did not include construction contracts, non-competitive contracts, acquisition card activity, contracts awarded through Public Services and Procurement Canada (PSPC) or Shared Services Canada (SSC) standing offers or procurement activity for which CBSA was not the contracting authority.

11. Based on contracting data provided by CBSA, OPO selected 40 competitive procurement files for assessment from a population of 97 contracts, after excluding the above mentioned categories. The judgmental sample was developed with consideration to factors including materiality and risk. The risk of selection bias was minimized through random selection of individual files meeting these pre-established factors.

12. The reviewed files included 7 requests for proposals (RFP), 8 requests for quotations (RFQ), 10 task authorizations (TAs)^{footnote i}, 10 contracts issued against Supply Arrangements (SAs), 4 call-ups against Standing Offers (SOs) and the establishment of 1 request for standing offer (RFSO). As the RFSO was identified as a competitive procurement process in CBSA’s contracting data, this contract remained in the sample.

III. Results

13. CBSA’s procurement practices pertaining to evaluation criteria and selection plans, solicitation documents, and evaluation of bids and contract award were assessed against the 3 LOEs noted above. OPO made 5 recommendations to address the issues identified in the review, which are summarized in Annex I of this report. The recommendations are based on the analysis of information and documentation provided to OPO by CBSA during the course of the review.

LOE 1: To determine whether evaluation criteria and selection plans were established in accordance with applicable laws, regulations and policies

14. Section 10.7.27 of the TBCP states that “[c]ompeting firms should be told the measurement criteria and the weighting assigned to them. […] The courts have ruled that the factors and their weighting must be established beforehand and adhered to strictly. […] Fairness to all prospective contractors and transparency in the award process are imperative”. Using clear and precise language to define the evaluation criteria and selection methodology helps bidders prepare a responsive bid and evaluators to apply the same criteria equally to all bidders.

15. This LOE applied to 27 files where evaluation criteria were developed and included in solicitation documentation. Of these, 11 contained only mandatory criteria and 12 contained both mandatory and point-rated evaluation criteria. There were 4 files where CBSA could not confirm whether any mandatory or point rated criterion existed as it could not locate the original solicitation documents. All files were examined to determine if the evaluation criteria and selection methodologies were clearly communicated in the solicitation, were not overly restrictive, and were aligned with the requirement. The method of allocating points to weighted criteria was also assessed to determine whether instructions were clearly communicated and reflected the relative importance of the criteria.

Mandatory criteria were sometimes not defined in a clear, precise and measurable manner

16. Of the 23 files that contained mandatory criteria, these criteria were generally well-defined, not overly restrictive and did not unnecessarily favour or penalize any particular bidder or group of bidders. However, in 3 files, the mandatory criteria were not communicated in a clear, precise or measurable manner. Details from OPO’s review of mandatory criteria are presented below.

1. There were 2 files where the mandatory criteria could not be evaluated on a pass or fail basis.
   1. In 1 file for dog boarding services, the solicitation contained 2 mandatory criteria that could not be evaluated on a pass or fail basis at the time of bid close. The solicitation contained a mandatory criterion requiring the bidder to “let the dogs out 3x a day”, and another mandatory criterion requiring the bidder to “[…] within 120 minutes notice, give CBSA staff access to the dogs”. Requirements such as these belong in the contract awarded to the successful bidder as they relate to the performance of required services in the future, whereas mandatory criteria are more suitable to determine skills or experience held by the supplier at bid close.
   2. In a different file regarding kennel maintenance and canine worker services, the solicitation again contained 2 mandatory criteria that created challenges for evaluation on a pass or fail basis. The solicitation contained a mandatory criterion stating the “Bidder must demonstrate that they are capable of providing the required resources to deliver continuous similar services as set out in Annex A, Statement of Work." Another mandatory criterion stated the “Bidder must have experience providing care to animals where housekeeping had to be done. To demonstrate experience, the Bidder must describe the circumstances in which the care was provided. The Bidder must also explain the scope of their housekeeping experience." While the requirements themselves are not necessarily problematic, the mandatory criteria did not require suppliers to provide any documentation which could be assessed on a pass or fail basis to prove the resource had the necessary certification/experience. The way in which criteria are framed may create challenges for bidders to demonstrate their compliance and for evaluators to assess that the criteria have been satisfied by the bidder. CBSA should ensure that mandatory criteria are drafted in a clear, precise and measurable manner to ensure compliance can be determined by evaluators.
2. In 1 file, CBSA should have been clearer in defining the mandatory criteria. For example, in a file for transportation services between Rigaud College and Montreal-Pierre Elliott Trudeau International Airport, one of the mandatory criteria required that “the contractor must have supplied transportation services as part of a similar project in the past five (5) years”. The first issue is that it is unclear as to what “similar” entails in this specific case (for example would shuttling people back and forth from Rigaud to another airport meet this requirement, would shuttling people in general, such as a taxi service, meet this requirement, etc.). The second issue is that it is also unclear as to how much experience is required within the past five years, as the criterion did not specify how much experience was required during that time frame. As a result, any amount of experience, including 1 day, could have resulted in the criteria being met. It cannot be left up to bidders to guess what is acceptable nor for evaluators to determine if the response noted in the bid crosses each evaluator’s individual, subjective threshold to be considered “acceptable”.

17. When mandatory criteria are unclear and/or unnecessarily restrictive, this can undermine the transparency and openness of the bid solicitation process and can cause bidders to submit non compliant proposals. It also limits CBSA’s ability to effectively assess a supplier’s ability to meet an essential element of the work to be performed.

Point-rated criteria and rating scales were not overly restrictive, were appropriate to the requirement, and reflected the relative importance of the criteria

18. Section 10.7.25 of the TBCP states that “criteria should identify accurately all the performance elements significant to the success of the project and should measure both the competence of the firm and the worth of its particular technical approach.”

19. In all 12 files that contained point-rated criteria, these were clearly communicated, not overly restrictive, and were appropriate to the requirement. However, in 1 file, the weighting factors did not reflect the relative importance of the rated criteria.

20. In 1 file for an organizational development consultant, one of the rated criterion stated that the Bidder “should demonstrate that the proposed resource has five (5) years of experience within the last ten (10) years, in providing organizational development and change management”. However, the rating scale stated that points were allocated for experience of >1-<3 years (5 points), >3-<5 years (10 points), >5-<7 years (15 points), and greater than 7 years’ experience (20 points [maximum point allocation]). The language used in this criterion is confusing, as it clearly stated the Bidder should have 5 years of experience yet the rating scale is not reflective of that and awards points for less than 5 years. The rated criterion should have indicated “a minimum of 5 years” so that less than 5 years of experience would score 0 points. The rating scale is also confusing as there is no allocation of points for experience of exactly 3 years, 5 years and 7 years. As indicated, it appears that only experience less than (<) or greater than (>) 3 years, 5 years and 7 years will score points. To ensure that experience equating to exactly 3 years, 5 years and 7 years is captured, CBSA should have used the less than or equal to (≤) or the greater than or equal to (≥) symbols in its rating scale.

21. When evaluation criteria are communicated in a clear, precise and measurable manner, it enables bidders to know the requirements and the methods by which their proposals will be evaluated. Failure to adequately define evaluation criteria at the outset carries the additional risk that evaluators may struggle to interpret these criteria during the evaluation process. It can also be difficult to defend against external challenges, as it is more difficult to demonstrate that criteria have been strictly adhered to when the criteria are unclear and open to multiple interpretations.

Bidders were consistently advised of the manner in which the contract would be awarded

22. In almost all files, common selection methodologies were used, mainly lowest priced responsive bid and highest responsive combined rating of technical merit and price; however, there were 3 files that did not explain the selection methodology in the solicitation.

23. In 3 files, there was no mention in the solicitation documents what the selection methodology would entail. For example, in 1 file for the provision of services for a workplace investigation, the solicitation email did not inform suppliers how the winning bidder would be chosen. The email provided brief context around the two workplace violence complaints and asked the bidders “to identify what information you would need from us in order to provide a quote”. These 3 files contained multiple deficiencies including the lack of a well-defined procurement strategy at the outset of the process, and further lacked information on key factors such as delivery requirements and methods of selection.

24. Deficiencies such as these can make it difficult for bidders to know how to construct their bids, and for evaluators to understand the basis upon which the contract will be awarded. Furthermore, these deficiencies may undermine the principles of fairness and openness as outlined in the TBCP.

LOE 2: To determine whether solicitation documents and organizational practices during the bid solicitation period were consistent with applicable laws, regulations and policies

25. The TBCP sets out detailed procedures to ensure that government contracting is carried out in a manner that enhances access, competition and fairness and results in best value. Section 10.7 of the TBCP includes the minimum requirements to be included in the solicitation document as well as mandatory elements related to the design and execution of the process.

26. Solicitation documents must contain work descriptions or specifications defined in terms of clear outputs or performance requirements, the objectives to be attained and time frame for delivery, in the case of service contracts, and the assessment and award criteria. CBSA procurement guidance establishes a process for developing a SOW in its Guide to developing a Statement of Work (SOW). These procedures were developed to provide Project Authorities and SPD a clear description of the structural requirements, as well as the level and quality of content, expected when creating a SOW.

27. This LOE applied to 30 files reviewed. For these files, solicitation documents (excluding evaluation criteria and selection plans which were assessed under LOE 1) were assessed to determine whether they, among other things, contained a clear description of the requirement and instructions necessary to prepare a compliant bid. The review of organizational practices included an assessment of whether CBSA established a framework to ensure that procurement practices are consistent with laws, regulations and policies and support fair, open and transparent procurements. The review also assessed whether the solicitation was open to the appropriate number of suppliers and for the required duration; and whether communications with suppliers supported the preparation of responsive bids. The 4 call-ups against SOs were assessed to determine whether the call-up was clear and contained complete information, including a clear description of the requirement and delivery schedule, and whether the specified contracting procedures were adhered to. The results of this assessment are presented below.

Solicitation documentation was in many instances complete; however, several significant issues were noted regarding providing clear instructions for submitting bids

28. In 21 of the 30 applicable files, solicitations reviewed included a clear description of the requirement, although as noted in paragraph 15, there were 4 files for which CBSA could not produce most, if not all, of the solicitation documents. Of the remaining 26 files, many met the process requirements; however, there were some files which were found lacking in this area. Details from OPO’s review of solicitation documents are presented below.

29. In 10 files, CBSA did not provide clear instructions in its solicitation documents for submitting bids. Some examples include:

1. In 3 files, CBSA did not provide any instructions whatsoever for bid submission in its solicitation documents. In these same 3 files, CBSA also did not provide a firm date for the bid submission period.
2. In 1 file, CBSA provided incomplete instructions for bid submission in its solicitation documents. The bid format, as well as the Q&A format and Q&A submission information (including the deadline) was not included.
3. In 2 files, CBSA provided contradictory information with regard to where the bid should be submitted. The solicitation documents indicated that bids must be submitted only to the CBSA Bid Receiving Unit by the date, time and place indicated on page one (1) of the bid solicitation, which states that they should be [physically] sent to the Bid Receiving Unit. However, Page 8 of the RFP Part 3 Bid Preparation Instructions states that documents are to be submitted by email, and make no reference to Bid Receiving Unit.

30. Deficiencies such as the failure to identify a bid closing date, lack of clarity regarding the submission of questions, and contradictory information on where to submit bids make it difficult for suppliers to respond to solicitations. Such deficiencies are also inconsistent with the requirement set forth in Section 2(a) of the TBCP, which requires that government contracting be conducted in a manner that will stand the test of public scrutiny in matters of prudence and probity.

Most solicitations were open to the appropriate number of suppliers, respectful of the required bid solicitation periods, with only a few exceptions

31. As defined by PSPC, ProServices is a federal government-wide mandatory procurement tool for the provision of professional services below the Canada-Korea Free Trade Agreement (CKFTA) threshold. For direct requirements valued below $40,000 (including taxes, travel and living, amendments, etc.), a search must be conducted in the Centralized Professional Services System (CPSS) to select a supplier, provided that the federal department using ProServices meets all required internal approvals specific to their department.

32. In 2 files for the provision of professional services, CBSA could not provide evidence that it had conducted the CPSS search to ensure that the supplier was qualified under the ProServices supply arrangement. Although both contracts were below $40,000 including taxes, the mandatory tool requires that such a search be conducted. Additionally, in 1 file for the provision of professional services, the SOW was finalized on July 11, 2019 after the proposal dated June 12, 2019 was submitted by the supplier. Furthermore, the ProServices search results were dated July 15, 2019. It therefore appears the supplier’s proposal was submitted a month before the SOW was finalized, and that the ProServices search list was completed after CBSA was in contract negotiations with the supplier, which was signed on July 22, 2019. By proceeding in this manner, CBSA has exposed itself to several significant risks, including creating the perception that the Statement of Work was tailored to align with the proposal previously submitted by the supplier. This practice must not be repeated in the future as it raises significant issues around fairness, and could have negative consequences to future CBSA processes where suppliers may be unwilling to participate.

33. In 1 file for shuttle services in the National Capital Region, the RFP indicated that the requirement is subject to the provisions of the World Trade Organization Agreement on Government Procurement (WTO-AGP), the North American Free Trade Agreement (NAFTA), the Canada-European Union Comprehensive Economic and Trade Agreement (CETA), and the Canadian Free Trade Agreement (CFTA). The RFP was only posted for 22 days, which is less than the number of days required by the trade agreements listed in the RFP. In reviewing this file, OPO determined that the only applicable trade agreement was the CFTA, which does not specify a minimum number of days. It appears that CBSA had mistakenly included the other trade agreements in the RFP. However, since CBSA had notified potential suppliers that the other trade agreements applied to the solicitation, it should have respected the minimum number of days specified in those agreements (40 days).

34. In 1 file, it appears that trade agreements should have been applicable to the procurement. The signed contract for dog boarding services from Oct 1, 2019 to March 31, 2022 was valued at $121,400.00. This exceeds thresholds for the CFTA and (at the time) NAFTA, meaning that these agreements would have likely applied to this procurement. An email from the contracting officer on the file noted that “it does not fall under any of the trade agreements”. There were no estimates provided in the contract file, nor any explanation as to how the contracting officer arrived at that conclusion. As noted above, under NAFTA, the open tender period must be no less than 40 days. Therefore, by CBSA inaccurately identifying trade agreement requirements, bidders were denied the full open tender period and may have been deterred from submitting a bid due to the short timeframe.

Some communications with suppliers raised issues regarding fairness, and did not support the preparation of responsive bids

35. Section 2.a of the TBCP states government contracting shall be conducted in a manner which will “…stand the test of public scrutiny in matters of prudence and probity, facilitate access, encourage competition, and reflect fairness in the spending of public funds”. Section 12.3.1 further states procurement files “…shall be established and structured to facilitate management oversight with a complete audit trail that contains contracting details related to relevant communications and decisions…”.

36. These requirements apply to all aspects of the procurement process, including interactions with suppliers. During the bid solicitation process, suppliers may communicate with contracting authorities to obtain clarifications or explanations of the content of the solicitation. For procurements subject to the CFTA and the World Trade Organization’s Agreement on Government Procurement, section 12.3.2 of the TBCP requires contracting authorities to ensure all communications with bidders are supported by complete documentation and records to demonstrate that the procurement process was carried out in accordance with the agreements. Section 10.7.38 of the TBCP further states that “[a]ny significant information given by a contracting authority to a supplier with respect to a particular procurement shall be given simultaneously to all other interested suppliers […]”.

37. In 8 of 18 applicable files (for which there were communications with suppliers during the solicitation period), communications with suppliers did not support the preparation of responsive bids. Details of OPO’s review are presented below.

1. In 2 files it appears that CBSA spoke on the phone with bidders during the solicitation period and did not document the content of this conversation. Phone calls with bidders during the solicitation period should be avoided and, at the very least, well documented to ensure transparency and that fairness among bidders is respected.
2. In 2 files, bidders asked questions via email and received individual responses that were not shared with all bidders. For example, in 1 file for the provision of workplace investigation services, Bidder A sent a question via email asking whether the incidents had been reported to police because this could impact the nature of the investigation. An answer was provided only to Bidder A via email. This information should have been shared with all bidders. As noted in the Supply Manual, technical questions and answers, together with questions and answers that can be addressed by the contracting officer, should be accumulated and posted as an addendum/amendment to the solicitation, in the case of public advertisement, or issued directly as an addendum/amendment to the suppliers.
3. In 1 file for transportation services in the National Capital Region, an amendment (003) to the RFP was issued on BuyandSell.gc.ca just 1 day before bid closing that answered 5 questions. An extension to the bid closing date was not provided. The failure to provide an extension may have impacted the fairness of the procurement process as insufficient time was provided to allow the preparation of responsive bids.

Regret Letters

38. After the solicitation process is completed and bids evaluated, CBSA informs bidders of the evaluation results via either a regret letter, advising the bidder it was not the successful bidder, or an award letter advising the bidder it won. “Regret” letters are sent to unsuccessful bidders and should offer an explanation of why their bids were not selected. Of the 13 applicable solicitation processes reviewed, there were 5 instances where a record notifying the unsuccessful bidder(s) of the results of the evaluation was missing. When regret letters were issued, they provided a detailed account of why the bidder had not been awarded the contract, and included the results of the technical evaluation as well as the overall score of the winning bidder. Regret letters are an important tool as they alert bidders to the fact that the contract has been awarded to a competitor, should they wish to seek a detailed debriefing from the contracting department or avail themselves of potential recourse mechanisms such as OPO or the Canadian International Trade Tribunal (CITT).

LOE 3: To determine whether the evaluation of bids and contract award were conducted in accordance with the solicitation

39. In order to ensure the fairness and defensibility of evaluation processes, section 10.7.27 of the TBCP requires that evaluation criteria be adhered to strictly and applied equally to all bidders. Failure to ensure the consistent evaluation of proposals increases the risk that ambiguities in the selection process result in the contract being wrongly awarded. Inconsistent evaluations may also call into question the integrity of the procurement process.

40. 30 solicitation documents were examined to determine whether a process had been established complete with guidance for evaluators. This examination was performed to ensure: the consistent evaluation of bids; that the evaluation of bids had been carried out in accordance with the planned approach; and that files were adequately documented. Of these 30 solicitation documents, 22 included (or were supposed to include) a technical evaluation leading to contract award and 8 were for TAs under an already-awarded contract.

41. Evaluation documents were not provided by CBSA for 7 of the 30 files, and thus OPO was unable to provide any observations on these files. Lack of documentation directly affects the transparency of every bid evaluation process. When departments are unable to provide documentary evidence of actions taken and decisions made, suppliers may rightly question whether bid evaluations have been conducted in a fair manner. This uncertainty may dissuade suppliers from contracting with the federal government in the future, which in turn could limit the number of potential suppliers. In essence, a lack of documentation specifically related to the evaluation results significantly undermines the fairness of the competitive process and the objective of the TBCP, which is to carry out contracting “in a manner that enhances access, competition and fairness and to obtain best value.”

42. CBSA procurement guidance establishes detailed bid evaluation procedures. These procedures detail the methods, procedures and reporting structures to be employed during the evaluation process. The procedures also note that Contracting Officers must obtain signed copies of Annex A—Acceptance of Evaluation Directive, Conflict Of Interest And Non-Disclosure Certification in advance of releasing bids.

43. A good practice pertaining to bid evaluations was observed during the course of this review. In 1 file for an organizational development consultant, there were concerns around perceived favoritism toward the incumbent during the evaluation process. The Contracting Authority thought that the evaluators applied a subjective interpretation of a term in the first mandatory criterion and failed all bidders, other than the incumbent, based on this interpretation. As per an email from the Contracting Authority, it is a practice in CBSA SPD that “[i]n the instance where the incumbent is identified as the only responsive bidder, SPD performs an additional due diligence review on the evaluation of received proposals to eliminate any potential doubts and uncertainties.” This is a good practice to further ensure the fairness, openness and transparency of the procurement process.

44. Although CBSA established robust bid evaluation procedures, there were multiple instances in which the evaluation was not carried out in accordance with the solicitation.

Evaluation grid used was not identical to the criteria found in the solicitation document

45. In 3 files, the evaluation grid used was not identical to the criteria found in the solicitation document.

46. In 1 file for the provision of professional stunt-actors, the Technical Authority discovered during the evaluation process that the evaluation criteria for this solicitation were not identical in the English (EN) and French (FR) versions of the RFP posted on BuyandSell.gc.ca. The EN version of the solicitation contained 5 mandatory criteria, whereas the FR version only had 4. A decision was made by the evaluators to default to the EN version of the RFP for their respective evaluations. Having a significant discrepancy between the EN and FR versions of the RFP poses serious risks to the fairness of the process and can cause prospective bidders not to bid, or alternatively can result in non-compliant bids through no fault of the bidder.

47. In 1 file consisting of a TA for a senior-level Project Manager, the evaluation grid completed by CBSA was for an intermediate-level Project Manager, whereas the request was for a senior-level Project Manager. As per the contract, there were 4 mandatory and 9 rated criterion with a minimum pass score of 91/130 for the Project Manager- Senior Level. For the intermediate-level Project Manager, a minimum pass score of 78/130 was required. Although it did not appear to affect the outcome (as the resource met the minimum score for the senior resource), the proper grid as per the contract should have been used.

48. In 1 file seeking information management architects, there was a discrepancy in the total number of available points for a rated criterion. The solicitation contained 7 rated criteria and the total number of available points was 26. A rated criterion had a total score out of 5 points, yet in the consensus evaluation grid used by CBSA, the same criterion only had a total of 3 points, which changed the overall total number of available points to 24.

49. By not conducting the evaluation in the manner prescribed by the solicitation, CBSA exposed itself to several risks including awarding the contract to either a non-compliant bidder or the wrong compliant bidder. It also means CBSA cannot defend nor explain its decisions and actions and prove that they were made in accordance with the applicable laws, regulations, and policies.

Accepting non-compliant bids

50. CBSA solicitation documents typically state that bids must be submitted only to Canada Border Service Agency (CBSA) by the date, time and place indicated on page 1 of the bid solicitation. However, in 2 files, there were 3 instances where CBSA accepted bids in which the bidders did not follow the bid submission instructions noted above.

1. In 1 file for transportation services in the National Capital Region, emails between CBSA officials indicated that 2 bids were dropped off at the wrong physical location. However, it is unclear which 2 of the 5 bids received for this solicitation were dropped off at the wrong location—there is a possibility that it was the winning bid.
2. In 1 file for office furniture, emails between CBSA officials indicated that 1 bid (the eventual winning bid) was received in the Contracting Officer’s mailbox rather than the generic SPD mailbox as instructed in the solicitation document. The request by the Contracting Officer’s Team Lead to deem the bid compliant was accepted by the Manager and noted that “CBSA should accept the bid sent to us to avoid possible complaints”.

51. In the 3 instances noted above, CBSA should have deemed these bids non-compliant. The acceptance of non-compliant bids is problematic because it could lead CBSA to award a contract to a non-compliant bidder, which compromises the integrity and overall fairness of the procurement process. The CITT has ruled that “it is well established that the onus is on the bidder to demonstrate that it meets all essential requirements of a procurement, which includes the requirements regarding bid submission”. Furthermore, “it was incumbent on [the bidder] to exercise due diligence in the preparation and delivery of its bid to ensure that it understood and was compliant with all the instructions in the RFP”.

Call-up on Standing Offer should have been signed by Public Services and Procurement Canada

52. According to the terms of the standing offer and confirmed in an e-mail from PSPC, PSPC’s signature was required on 1 file for a call-up, yet it was instead signed by a CBSA Contracting Officer. Section 9 of the Standing Offer stated the following:

• For Goods: The Identified User is authorized to issue Individual call-ups against the Standing Offer up to $40,000.00 (Applicable Taxes included).
• For Services: The Identified User is authorized to issue Individual call-ups against the Standing Offer up to $100,000.00 (Applicable Taxes included).

53. Based on the quote provided by the supplier, it appears that the call-up was for a “Varex Repair” and awarded for a total value of $142,907.31 (taxes included). One particular item was worth just over $80,000, but it was unclear if it was good or service. Nonetheless, if that item was a service, the service cost of the call-up would have been $119,995 and if it was a good, then the goods total would have been $84,954. This total exceeds the terms listed above, so PSPC should have signed the call-up.

The procurement file documentation was incomplete and is of significant concern

54. Section 12.3.1 of the TBCP requires that procurement files facilitate management oversight with a complete audit trail containing details related to relevant communications and decisions, including the identification of the involved officials and contracting approval authorities. The requirement to ensure adequate file documentation extends to the actions undertaken during the solicitation period as well as the evaluation of bids.

55. File documentation was reviewed to determine whether a complete audit trail was retained to support consistent and transparent decision-making. In general, CBSA’s documentation was not complete, as 28 files were missing key documents.

56. In addition to the 4 files referenced in paragraph 15 above where CBSA could not confirm whether any mandatory or point rated criterion existed as it could not locate the original solicitation documents, OPO was unable to review another file because CBSA could not locate documents pertaining to how the contract was awarded—i.e. the file was missing the solicitation documents, proposals, evaluations and correspondence. The file only contained a contract amendment increasing the contract value from $448,564.80 to $672,847.20 and some emails regarding the re-profiling funds for the amendment.

57. OPO considers the inability to demonstrate and document decisions to be a significant concern, and a breach of the TBCP and Treasury Board Information Management Guidelines. Without proper records, CBSA cannot document its business decisions, leaving it unable to demonstrate good stewardship of Crown resources or that the procurements were conducted in a fair, open and transparent manner. Incomplete procurement files resulted in inadequately supported procurement actions that risk undermining the integrity, fairness and transparency of the procurement process. Keeping complete and detailed evaluation records is crucial for demonstrating that evaluation criteria have been applied equally to all competing bids, and demonstrating that the procurement has been carried out in a manner consistent with CBSA’s obligations under the TBCP and applicable trade agreements.

58. Documentation was especially problematic with regard to the evaluation process. Files often did not contain both individual and consensus evaluations or signed evaluation guidelines/instructions. For example, in 1 file for privacy impact assessment services, there were no individual evaluations nor any support for the consensus evaluation results on file. There were 2 unsigned MS Word documents in which each evaluator did not follow the evaluation instructions on how to document and justify their evaluations and simply wrote both proposed resources “Met” evaluation criterion MT1.

59. Upon bringing the documentation issues to the attention of CBSA officials during a review of the preliminary file-by-file observations, the response provided in each instance was that the “[o]riginal Contracting officer has left the Agency, unable to locate missing documents. Since January 2020, the Strategic Procurement Division has implemented a training program which develops the Purchasing and Supply Group (PG)s skills and procurement abilities to ensure proper procurement practices are met. The training covers proper information management practices and ensures that all information including received emails are up to date at all times. Proper information management practices have been added to all Performance Management Assessments for all staff under the Strategic Procurement Division.”

IV. Simplification

60. OPO regularly hears from both Canadian businesses and federal officials who believe the contracting process is unnecessarily complex. In reviewing CBSA’s procurement practices, OPO sought to identify opportunities to alleviate unnecessary administrative burdens placed on bidders and federal procurement officials, and draw attention to good practices for simplifying the procurement process.

61. CBSA generally used federal government “standard” solicitation documents and processes. This contributes to simplification by improving consistency and uniformity across procurement processes. Care should be taken when drafting solicitation documentation to ensure consistent alignment of all information provided in solicitations including bidder instructions, evaluation criteria, selection methodology, requirements and all related details.

Contracts frequently included option periods

62. CBSA frequently included options in the contract for requirements that involved recurring needs. Option periods (days, months or years) were utilized in at least 10 files. This practice supports the simplification of government procurement by reducing the number of solicitation processes and, consequently, reduces the cost to both government and suppliers. This practice also allows departments to continue working with well-performing suppliers, while being transparent about the amount and value of work associated with a contract during the initial solicitation process.

Pre-qualifying resources on contract with task authorizations

63. CBSA frequently utilized contracts with task authorizations to fulfill its procurement requirements. A notable good practice was observed in 1 task authorization file in which it was observed that the original contract (and all subsequent amendments) identifies each of the qualified resources individually by name and by category. This practice also supports the simplification of government procurement, as you can call up the pre-qualified people in their respective categories, eliminating the need for mandatory and rated criteria and evaluations for each task authorization.

V. Other observations

Non-contracting officials conducting contracting activities

64. In 3 files^{footnote ii}, it appears that non-contracting CBSA officials were engaging in contracting activities, up until the point of contract award. As a result of their (likely) lack of training in procurement and contracting, a number of avoidable errors were made during these solicitation processes that compromised the procurement principles of openness, fairness and transparency. An example of this was previously noted in paragraph 29 a), as CBSA did not provide any instructions whatsoever for bid submission in its solicitation documents and did not provide a firm date for the bid submission period. Additionally, there was almost no formal documentation on the files and in these cases, whatever documentation there was, was e-mailed to the Contracting Authority as a fait-accompli.

VI. Conclusion

65. CBSA’s procurement practices pertaining to evaluation criteria and selection plans, solicitation, and evaluation of bids and contract award were assessed for consistency with Canada’s obligations under applicable sections of national and international trade agreements, the Financial Administration Act and regulations made under it, the TBCP, departmental guidelines, and to determine if they supported the principles of fairness, openness and transparency.

66. Regarding LOE 1, OPO found that evaluation criteria and selection plans met requirements set out in applicable laws, regulations and policies and that for the most part, mandatory and point-rated criteria were clearly communicated. However, there were issues regarding unclear evaluation criteria, where mandatory or rated criteria had vague or poorly defined descriptions. Vague criteria can lead to incorrect bids and improper evaluations and too-specific criteria can lead to a lack of bids as suppliers will not expend resources on a contract they do not believe they have a fair chance of winning.

67. Regarding LOE 2, OPO found that solicitation documents and actions taken by CBSA during the solicitation process were, in most cases, consistent with applicable rules. Several issues were noted regarding some aspects of correspondence with suppliers, including providing clear instructions for bid submission, communications during the solicitation period and when advising bidders of the evaluation results via regret letters. Ensuring good communication with suppliers will allow for more transparent and efficient solicitation processes. Certain files also contained incomplete records and did not demonstrate relevant information had been shared with suppliers to ensure fairness and encourage competition.

68. Regarding LOE 3, OPO observed considerable deficiencies in bid evaluations and documentation. Certain evaluations were not consistently carried out in accordance with the planned approach or were not adequately documented. Furthermore, OPO observed instances where CBSA failed to disqualify non-compliant bids, and awarded at least 1 contract to a non-compliant bidder. File documentation was also found to be incomplete and of significant concern in several files. Maintaining well documented files enables departments to demonstrate fairness and transparency in their procurements and provides support for procurement decisions taken should those decisions be challenged.

69. In order to address issues identified, OPO made 5 recommendations. These recommendations can be found in Annex I of this report.

70. Through the analysis of this review’s LOEs, OPO also made 1 other observation and 1 recommendation regarding non-contracting officials engaging in contracting activities.

VII. Organizational response

71. In accordance with section 5 of the Procurement Ombudsman Regulations, the Procurement Ombudsman provided CBSA with the opportunity to comment on the proposed recommendations in this review and the reasons for them. CBSA was further given the opportunity to comment on the review’s findings. Many of these comments were taken into consideration and integrated into the final version of the report.

72. CBSA accepts the findings of this audit, and acknowledges the valuable support OPO has provided during the conduct of this audit. As demonstrated in our response, CBSA Procurement has been modernizing its function since late 2019, and is focused on training procurement staff, and improving its processes and systems. The findings of this audit offers confirmation that procurement modernization invested in the right areas of improvements.

VIII. Acknowledgment

73. OPO wishes to express its appreciation to the management and staff of CBSA’s SPD for the assistance and cooperation extended to the reviewers during this assessment.

Alexander Jeglic
Procurement Ombudsman

Annex I: Departmental response and action plan

Procurement practice review of evaluation criteria and selection plans, solicitation, and evaluation of bids and contract award at the Canada Border Services Agency (CBSA).

Date modified:

2021-12-16