Reasonable Grounds

Reasonable grounds is a sufficient, objectively supportable basis for taking a specified action or making a determination. In Canadian federal procurement, the expression sets the point at which an authority is entitled to act: credible information must support the conclusion before a review is opened, an offer is set aside or a contract is ended.

The phrase appears in two main places. The Procurement Ombudsman relies on it when deciding whether to review a department's procurement practices. Public Services and Procurement Canada (PSPC) relies on the related wording "reasonable grounds to believe" in its anti-forced-labour and anti-human-trafficking requirements for standing offers, supply arrangements and contracts.

Reasonable grounds in Procurement Ombudsman reviews

The Procurement Ombudsman may review a department's procurement practices where there are reasonable grounds to do so. This authority comes from the Department of Public Works and Government Services Act and the Procurement Ombudsman Regulations. The Office of the Procurement Ombudsman describes this review authority in its 2012-2013 annual report.

The Ombudsman has used the expression when launching reviews. A review of bid-evaluation processes opened on this basis. More recently, the Ombudsman determined that there were reasonable grounds to launch a review of procurement activities associated with ArriveCAN, as noted in PSPC briefing materials for the Standing Committee on Public Accounts. These reviews assess fairness, openness and transparency in how departments run procurements.

Reasonable grounds to believe in PSPC forced labour clauses

PSPC applies the standard to supply chain integrity. Under Policy Notification 150U1, PSPC may set aside a standing offer if it has reasonable grounds to believe that the offered goods or services were produced using forced labour or are linked to human trafficking.

The same test applies to contracts. Under the task-based supply arrangement, a Canada contract may be terminated for default if Canada has reasonable grounds to believe that the work was mined, manufactured, produced or carried out using forced labour, or was linked to human trafficking.

What counts as credible evidence

PSPC states that a forced-labour determination must be based on credible information. The standard is not a suspicion or an allegation on its own. Policy Notification 150U1 identifies credible evidence from reliable sources as the basis for finding that reasonable grounds exist.

• Findings or Withhold Release Orders issued by U.S. Customs and Border Protection are examples of relevant evidence.
• Credible evidence from reliable sources, including non-governmental organizations, can also support a determination.
• For task-based supply arrangement contracts, the determination must be grounded in credible evidence from a reliable source.

What reasonable grounds means for suppliers

Suppliers should treat the standard as a real exposure, not a formality. A determination that reasonable grounds exist can lead to a set-aside, suspension, cancellation, notice of concern or contract termination, depending on the instrument and clause involved.

• Know where your goods and services come from, including subcontractors and upstream producers.
• Watch for public findings, such as U.S. Customs and Border Protection orders, that name your products, materials or supply chain.
• Keep records that let you respond quickly if a department raises a concern.
• Read the anti-forced-labour clauses in each standing offer, supply arrangement and contract you hold, because the consequence differs by instrument.

Suppliers who believe a department's procurement process was unfair can also note that the Procurement Ombudsman's review power rests on the same threshold. Concerns raised with specific, supportable facts are the ones most likely to meet it.