Government of Ontario Procurement Restriction Policy on U.S. Businesses
The Government of Ontario introduced a new policy: the Procurement Restriction Policy (U.S. Businesses) in response to U.S. tariffs on Canadian products and services. The policy will restrict public sector buyers from procuring goods from U.S. businesses. The policy will apply to all ministries, broader public sector organizations, agencies, OPG, and the IESO.
Definition of U.S. Business:
Under the policy, a U.S. business will be defined as a supplier, manufacturer, or distributor that has it’s headquarters or main office in the United States AND has fewer than 250 employees in Canada at the start of a procurement process. Subsidiaries or American companies are included in the definition of an American Business.
Application of Policy:
The new policy will apply to all new procurement of goods and services at any value, on a go forward basis from March 4th. This includes competitive and non-competitive procurements and could capture some procurements retroactively.
- Additionally, existing VOR arrangements will also be exempt from this policy.
Exemptions:
The policy does provide for an exemption if two conditions are met:
- If the U.S. business is the only viable source of the good or service; and,
- The procurement cannot be delayed
All entities are encouraged to reach out to Supply Ontario to seek guidance prior to approving an exemption.
The exemption would be at the discretion of a Deputy Minister, Deputy Minister equivalent, or CEO unless a higher level of procurement is required per the OPS procurement directive. Similar exemption rules would apply for the BPS requiring similar levels of signing authority for an exemption.
If an exemption is granted, the procuring entity must notify Supply Ontario of the decision.