Applying the Code of Conduct for Procurement

The Code of Conduct for Procurement (the code) is a statement of expectations for Government of Canada vendors. It is included by reference into all Government of Canada procurements:

• contracts resulting from standing offers or supply arrangements
• standing offers
• supply arrangements

The term “by reference” means that the code is not replicated in its entirety in the contract, but nevertheless is considered part of the contract’s terms and conditions.

The code applies to vendors who provide goods and services to the Government of Canada.

As per the Treasury Board of Canada Secretariat’s policy notice issued on March 27, 2023 to amend the Directive on the Management of Procurement, the code is mandatory for all Government of Canada procurements as of April 1, 2023.

Under Section 6.3 of the Directive on the Management of Procurement, the code is now mandatory for all departments listed in Schedules I, I.1 and II of the Financial Administration Act (with the exception of the Canada Revenue Agency) and to any commissions established pursuant to the Inquiries Act and designated as a department for the purposes of the Financial Administration Act.

The Directive on the Management of Procurement requires Public Services and Procurement Canada (PSPC) to develop and maintain updates to the code in consultation with the Treasury Board of Canada Secretariat. In addition, the directive requires contracting authorities to incorporate the code into procurements.

PSPC updated the code to reflect the amendments to the Directive on the Management of Procurement. No new expectations and/or obligations were included in the updated code.

A vendor is any person or other legal entity who has submitted a bid/offer/arrangement or who has been awarded a contract, a standing offer or a supply arrangement by the Government of Canada. This includes:

• subcontractors
• owners and directors
• officers
• employees
• agents
• any affiliated corporate body (as defined in the Canada Business Corporations Act), to the extent that any of these is responsible for the performance under a contract

Vendors are expected to apply the principles and expectations set forth in the code to their main operations and to all sub-contractors in their domestic and international supply chains. In addition, the Government of Canada expects vendors to share the expectations set forth in the code with their vendors.

The code does not apply to contracts already in place. The code that was in effect at the time of the signing of the contract continues to apply.

The following still apply for contracts dated:

• between August 13, 2021 and May 25, 2023
• before August 13, 2021

Compliance with the code will not be monitored by the Government of Canada. It is expected that vendors will follow the principles set out in the code in good faith.

If needed, Canada may seek to work with the vendor to address potential instances of non-compliance with the code. Overall, Canada will seek to work with vendors to ensure a sound understanding of expectations, and to address any apparent lack of compliance with the code.

If a vendor is unable or unwilling to comply with the code, Canada reserves the rights to investigate, to deem a bid-non-responsive, and to terminate a contract.

Prior to this update to the code, the 2021 revision to the code was informed by feedback from both internal government stakeholders and external stakeholders who were consulted to provide input.

Consultations were conducted with targeted PSPC groups and other federal departments and agencies. These partners play an active role and are experts in the field of human trafficking for labour exploitation and responsible business conduct/corporate social responsibility. External stakeholders included:

• vendors
• industry associations
• civil society organizations
• non-governmental organizations
• academia

In September 2019, the Government of Canada launched the National Strategy to Combat Human Trafficking 2019 to 2024 with a commitment for PSPC to address human trafficking in federal procurement.

Updating the Code of Conduct for Procurement to incorporate human and labour rights expectations for vendors and their sub-contractors was an important step toward accomplishing this goal. The updated code also includes new content on environmental protection, discriminatory practices, and protection of the rights of Indigenous Peoples.

Consultations were conducted in 2021 with targeted PSPC groups and other federal departments and agencies. The new content on human trafficking and human and labour rights was informed by 8 fundamental conventions of the International Labour Organization as well as the:

• United Nations Guiding Principles on Business and Human Rights
• Organization for Economic Co-operation and Development (OECD) Guidelines for Multinational Enterprises

The code was first announced as part of the 2006 Federal Accountability Act to reform federal procurement. The first version of the code was published in September 2007 and has since undergone three revisions, in September 2012, November 2014, and August 2021. It was designed to ensure that government contracting is conducted to the highest standards of integrity, in an open, fair and transparent way that complements existing acts and regulations, such as the Values and Ethics Code for the Public Sector, the Competition Act, and the Lobbying Act.

The code serves as a single point of reference, ensuring that public servants and vendors are working from the same statement of expectations that clearly outline acceptable conduct when contracting with the government.

New relevant provisions were included in the code to promote awareness of human rights and labour standards. This is a key step in delivering the Government of Canada’s commitments under the National Strategy to Combat Human Trafficking.

Vendors are expected to comply with the expectations set out in the code in good faith.

To comply with the human and labour rights expectations in the code, PSPC will assist vendors by:

• developing tools
• training and awareness materials
• communication products
• resources designed to assist them

Vendors will be able to develop strategies and approaches to identify, assess, and mitigate vulnerabilities in their operations and supply chains.

Working with procurement officers, relevant procurement tools (such as guidance, templates, standard clauses) will be updated and aligned with the revised code.

For questions about the code, please email: spac.paachatsethiques-apethicalprocurement.pspc@tpsgc-pwgsc.gc.ca.