Administrative Agreements

An administrative agreement is a negotiated agreement between a supplier or potential supplier and the Minister of Public Works and Government Services. It is made under Canada's Ineligibility and Suspension Policy. A federal procurement clause defines it in these terms in the standard instructions for goods and services non-competitive requirements.

The agreement is not an ordinary commercial contract. It is an integrity and eligibility arrangement tied to a supplier's status when contracting with Canada. It can allow Canada to suspend or avoid a period of ineligibility, or to enter into or continue a contract under specified integrity-related conditions.

Who negotiates and manages administrative agreements

According to the CanadaBuys buyer's guide on elements to consider at award, administrative agreements are negotiated between Public Works and Government Services Canada (PWGSC) and a current or potential contractor. They are managed by PWGSC's Departmental Oversight Branch.

The policy framework is PWGSC's Ineligibility and Suspension Policy. The agreement is the instrument that sets out how a supplier will deal with the integrity concerns that policy addresses. The documented use is federal, in PWGSC and CanadaBuys procurement.

Situations where a federal buyer may use one

The CanadaBuys guidance and the federal clause point to several uses:

• Suspending ineligibility: an agreement can suspend a supplier's period of ineligibility to contract with Canada.
• Avoiding a suspension: an agreement can be used so that a suspension does not take effect.
• Public Interest Exception: Canada can contract with an otherwise ineligible supplier where a Public Interest Exception is invoked and time is not of the essence. That contract is subject to the administrative agreement.
• Continuing an existing contract: an agreement can allow a contract to continue where the contracting authority has a right to terminate because of non-compliance with the Ineligibility and Suspension Policy.

Each of these ties the agreement to a specific eligibility problem. The agreement does not replace the policy. It operates within it.

Timing and supplier obligations

The federal clause states that an administrative agreement does not have to be concluded before the solicitation is issued. It may be concluded later. A supplier should therefore not assume that an open solicitation means eligibility questions have already been settled.

The clause also sets out what is asked of the supplier. The supplier must negotiate, and must comply with, the terms and conditions necessary to safeguard the integrity of the procurement process. The specific obligations depend on the agreement. Two suppliers in different circumstances can be bound by different terms.

What administrative agreements mean for a supplier bidding on Canadian public contracts

If your company faces an ineligibility or suspension issue under the Ineligibility and Suspension Policy, an administrative agreement is one route that PWGSC can use to keep contracting possible. It is negotiated with PWGSC, and the Departmental Oversight Branch manages it.

• Read the eligibility and integrity clauses in each federal solicitation, since they are where the agreement is referenced.
• Expect the terms to be specific to your situation and to require compliance on your part.
• Do not treat an agreement as automatic. It is negotiated, and it is tied to circumstances such as a Public Interest Exception or a termination right for non-compliance.
• Keep contract continuity in mind. An agreement can allow an existing contract to continue, but only on the conditions it sets.

Bid teams should raise any integrity or eligibility concern early, before submission, and confirm the current requirements in the solicitation documents and on CanadaBuys.