Exceptionally Advantageous Conditions

Exceptionally advantageous conditions are unusually favourable purchasing opportunities that arise only for a very short time. They typically come from unusual disposals, liquidation, receivership or bankruptcy. They do not come from routine purchases from regular suppliers.

In Canadian procurement the phrase works as a limited-tendering reason. When the specified short-term, exceptional circumstances exist, a procuring entity may buy without running an ordinary competitive solicitation. The wording appears in federal contracting policy, in federal contract reporting and in the government-procurement chapters of Canada's trade agreements.

How the Treasury Board Contracting Policy words the exception

The archived Treasury Board Contracting Policy lists purchases made under exceptionally advantageous conditions as one of the cases where the contracting authority may set aside the requirement to solicit bids. The policy limits the exception to conditions that arise in the very short term.

It gives two examples: unusual disposals by enterprises that are not normally suppliers, and disposals of assets by businesses in liquidation or receivership. It also states that the exception does not cover routine purchases from regular suppliers. The concept sits alongside the section 6 exceptions to soliciting bids in the Government Contracts Regulations.

The PWGSC Supply Manual uses substantially the same wording and assigns the reason CAP Code 21.

Limited tendering reason code 21 in federal reporting

Federal procurement reporting treats the term as a coded reason. The Treasury Board reporting document identifies "Purchases Made Under Exceptionally Advantageous Conditions" as limited-tendering reason code 21.

The reason shows up in published contract data. A Department of National Defence contract record lists it as the limited-tendering reason for that award. The Immigration and Refugee Board of Canada has records that use it as well, and the Government of Canada's contracts database includes it among the standard limited-tendering reasons available for federal contract reporting.

How CETA and CUSMA use the wording

Canadian trade-agreement texts use the same idea to describe when a procuring entity may use procedures other than an open competitive solicitation. The CETA procurement chapter refers to purchases under exceptionally advantageous conditions that arise in the very short term from unusual disposals such as liquidation, receivership or bankruptcy. It excludes routine purchases from regular suppliers.

The CUSMA government procurement chapter carries the same limitation, applying it to unusual short-term disposals and excluding routine purchases from regular suppliers. Other Canadian free-trade agreements use similar language.

What it means for a supplier bidding on Canadian public contracts

The phrase is not a general entitlement to a direct award. The source wording limits it to a short-lived exceptional opportunity, and it expressly excludes routine purchases from established suppliers. A supplier whose normal business is selling to government cannot cite it to justify a sole-source award.

The exception is most relevant to a business that is liquidating assets, or to an enterprise that does not normally sell to government and is disposing of goods. In that case, a buyer may use it to act quickly. Suppliers should follow whatever the contracting authority's request or solicitation sets out.

Bid teams can also use the coded reason when reviewing past awards. Contract records tagged with code 21 on the Government of Canada's open contract data show where buyers have used the exception and for which kinds of purchases.