Conditional Set-Aside Under PSIB

A conditional set-aside under PSIB is a procurement that starts open to both Indigenous and non-Indigenous businesses. It becomes restricted to eligible Indigenous businesses if at least two compliant bids are received from Indigenous businesses. PSIB stands for the Procurement Strategy for Indigenous Business, the Government of Canada program that supports Indigenous participation in federal contracting.

The term appears in Government of Canada solicitation documents published through CanadaBuys. It differs from an unconditional PSIB set-aside, which is restricted to qualified Indigenous businesses from the outset. In a conditional set-aside, the restriction depends on what bidders submit by the closing date. You can read the program background on the CanadaBuys page on the Procurement Strategy for Indigenous Business.

How the two-bid threshold works

The condition is a count of compliant bids from Indigenous businesses. If two or more Indigenous businesses submit compliant bids, the contracting authority limits evaluation and award eligibility to those Indigenous bidders. Compliant bids from non-Indigenous businesses are not considered for award. This wording appears in notices such as this Notice of Proposed Procurement.

Until the closing date, the competition is open to everyone. A non-Indigenous supplier can bid, but its bid is set aside if the threshold is met.

What happens when fewer than two Indigenous bids qualify

The restriction does not apply if fewer than two eligible Indigenous bids remain. This can happen because too few Indigenous bids were received, or because bids were found non-compliant or non-responsive, or were withdrawn. In that case the procurement may proceed as an ordinary competition, and non-Indigenous bids may be considered. The Vessel Charter – Salish Sea Moorings award notice includes language of this kind.

Because compliance findings and withdrawals can change the count, the outcome is not always known when bids close.

Certification and verification of Indigenous business status

A bidder seeking consideration as an Indigenous business must certify that it qualifies as an Indigenous business under PSIB and that it will comply with PSIB requirements. The certification requirement is stated in solicitations such as the CFIA request for proposals 2024-00132.

Solicitation language commonly refers to Indigenous businesses certified under PSIB criteria and to the Government of Canada's Indigenous Business Directory. Check each solicitation for the exact verification wording that applies.

Where conditional set-asides appear on CanadaBuys

Federal departments and agencies use the mechanism in competitive solicitations issued through CanadaBuys. It has appeared across goods, services, construction and professional services requirements. Examples include CFIA requirements, an informatics services requirement under TBIPS, a television services solicitation and a vessel charter.

What a conditional set-aside means for your bid

• Indigenous businesses: Certify your PSIB status in your bid and make sure your bid is fully compliant. A non-compliant bid does not count toward the two-bid threshold.
• Non-Indigenous businesses: You may bid, but your bid is not considered if two or more compliant Indigenous bids are received. Read the solicitation to see how the condition is worded before you invest in a response.
• All bidders: Look for the conditional set-aside clause in the notice or solicitation, and follow any amendments, since the clause governs who can receive the award.