A Joint Venture Authority (JVA) is the formal agreement that allows two or more firms to team up and bid on federal contracts under the Procurement Strategy for Indigenous Business. Here's the thing: it's not just any partnership. To qualify for PSIB set-asides, the joint venture must be at least 51% owned and controlled by Indigenous businesses, with that Indigenous partner having real authority over how the contract gets executed and how profits flow.
How It Works
When an Indigenous business wants to pursue a government contract but needs additional capacity or expertise, they can form a joint venture with another firm—Indigenous or non-Indigenous. The JVA formalizes this arrangement and establishes the ownership structure, management responsibilities, and profit-sharing agreements. According to the Supply Manual Chapter 7, which directs to PSIB guidelines for these requirements, the Indigenous partner must hold majority ownership and maintain control over contract performance.
In practice, this means the Indigenous business isn't just a name on the paperwork. They need to demonstrate active management of the work and decision-making authority. PSIB applies these joint venture provisions to set-aside contracts above $6,000 for goods and services, and above $25,000 for construction work. When you're preparing a bid under a PSIB set-aside, you'll need to provide documentation proving the 51% Indigenous ownership threshold and showing how control is exercised through the joint venture structure.
The JVA itself serves as evidence that your partnership meets Treasury Board contracting policy requirements. Public Services and Procurement Canada reviews these agreements during the procurement process to verify eligibility. The bottom line? You can't just claim the set-aside benefit without demonstrating genuine Indigenous control—the agreement needs to spell out governance structures, voting rights, and profit distribution in clear terms.
Key Considerations
- Control means more than ownership percentage. The Indigenous partner needs actual management authority, not just a majority stake on paper. Decision-making power and operational control matter when PSPC evaluates your JVA.
- Joint ventures aren't permanent entities. Many are formed specifically for a single contract or project, then dissolved once the work is complete. Your JVA should address the lifespan of the partnership and exit procedures.
- Profit distribution must align with the control requirement. If the Indigenous partner controls 51% and manages performance, but receives only a small fraction of profits, that raises red flags about whether the arrangement meets PSIB intent.
- Documentation requirements are specific. You'll need corporate documents, governance agreements, and evidence of Indigenous business certification. Some certifications take weeks to obtain, so don't wait until bid submission to gather this material.
Related Terms
Procurement Strategy for Indigenous Business (PSIB), Set-Aside, Indigenous Business
Sources
- Supply Manual - Chapter 7: Indigenous Procurement Strategy
- Procurement Strategy for Indigenous Business (PSIB) - Joint Ventures
- Indigenous Services Canada - Joint Venture Authority
If you're considering a joint venture for a PSIB set-aside, start by clarifying the control and management structure before you draft the agreement. The 51% threshold is just the starting point—you need to demonstrate genuine Indigenous leadership throughout the contract lifecycle.