Exceptional Contracting Limits

Exceptional contracting limits are special contracting authorities granted to a Government of Canada department or agency when its ordinary, or basic, contracting limits cannot meet particular operational requirements. They allow specified contracts, and in many cases amendments, to proceed without a separate Treasury Board approval, subject to the conditions and limits attached to each authority.

The term comes from Treasury Board procurement policy, not from NATO terminology. Government of Canada guidance describes exceptional authorities as covering both entering into contracts and amending them, unless the applicable delegation table says otherwise. Each exceptional limit is tied to a named department, program, contract type or circumstance, so there is no single universal limit.

How exceptional limits sit alongside basic limits

Basic limits are the ordinary delegated limits a department uses for its contracting. Exceptional limits are layered on top for particular needs. Under the Treasury Board Directive on the Management of Procurement, where an exceptional limit is lower than the corresponding basic limit, the exceptional limit governs. Contracts above the specified departmental or activity-specific limit generally require Treasury Board approval unless an applicable authority or exception states otherwise.

The CanadaBuys buyer's guide on contracting limits and exceptional authorities adds that once a departmental exceptional authority limit is reached, later approvals require a Treasury Board submission, unless otherwise specified.

The Sustained Emergency of National Importance limit

One of the broadest exceptional limits is the one set for a Sustained Emergency of National Importance (SENI). It is available to Public Services and Procurement Canada (PSPC) and Shared Services Canada (SSC) as common service providers, and only when the President of the Treasury Board approves its use. Once activated, the SENI framework can permit contracting authorities to enter into contracts of unlimited value related to the emergency, to indemnify or limit contractor liability, and to issue advance payments that cross fiscal years. Any conditions set by the President of the Treasury Board continue to apply.

The CIRNAC Exceptional Contracting Limits Authority

Crown-Indigenous Relations and Northern Affairs Canada (CIRNAC) uses a named authority, the Exceptional Contracting Limits Authority (ECLA). The ECLA lets the responsible minister enter into or renew non-competitive contracts with contract federal negotiators for Indigenous negotiations, and with Crown deponents and expert witnesses needed for litigation.

A CIRNAC evaluation states that the ECLA threshold permitted up to $2 million for contract federal negotiators and $800,000 for expert witnesses and Crown deponents.

Defence, munitions and COVID-19 examples

Defence procurement offers several uses. A Treasury Board question period note describes an exceptional contracting limit for the Defence Investment Agency covering high-risk defence contracts and contractual arrangements of any dollar amount, provided Treasury Board approves the procurement and negotiating strategy before solicitation or negotiations begin. It applies exclusively to procurements directly supporting Canadian Armed Forces military acquisitions, not internal departmental IT equipment or systems.

The Office of the Procurement Ombudsman reports that exceptional limits can extend PSPC's authority beyond its basic departmental limits. One cited example is PSPC's authority to procure ammunition under the Munitions Supply Program up to $200 million.

During the pandemic, a Treasury Board policy notice converted specified emergency limits into exceptional contracting limits. These included $3 million for the ministers responsible for the Public Health Agency of Canada, Health Canada and the National Research Council, and $500 million for the Minister of Public Services and Procurement. The notice also described an expanded unlimited limit for medical countermeasures.

What it means for a supplier

• A buyer may hold authority to award or amend a contract above its ordinary limit, so contract size alone does not signal that Treasury Board approval is pending.
• Suppliers must still comply with the solicitation, the resulting contract, and applicable security and integrity requirements.
• Conditions attached to the exceptional authority, such as strategy approval before negotiations in the defence example, can shape the timing of a procurement.
• No single supplier action or standard clause applies to every exceptional contracting limit, so read each solicitation and contract on its own terms.