Warranties

When a supplier promises their product will perform as expected, that's a warranty—and in Canadian government procurement, these guarantees come with very specific terms. Under the General Conditions for Higher Complexity Goods, contractors must stand behind their work for a defined period, typically twelve months from delivery or acceptance. This isn't just a handshake agreement; it's a legally binding obligation that protects Canada's interests when things go wrong.

How It Works

The standard warranty requires contractors to guarantee their work is free from defects in design, material, or workmanship and conforms to contract requirements. The clock starts ticking either on the delivery date or, if acceptance happens later, on that acceptance date. Here's the catch: this isn't a static timeline. If the goods become unavailable due to a defect, the warranty period automatically extends by however long they're out of service.

When defects surface, the contractor must repair, replace, or make good the defective work at their own expense within a reasonable timeframe. Any repaired or replaced items get a fresh warranty—either for the remainder of the original period (including any extensions) or ninety days, whichever is longer. The contractor also bears responsibility for updating all related data, reports, and documentation. No additional cost to Canada.

If a contractor fails to remedy defects promptly, PSPC or the contracting department can step in and fix the problem themselves, charging the contractor for the work. Alternatively, they might negotiate an equitable reduction in the contract price. According to the ProServices Supply Arrangement, contractors can be liable for breach of warranty up to the total amount Canada paid for the affected goods and services, including applicable taxes.

Key Considerations

• Contract-specific periods override the default: While twelve months is standard, your contract might specify something different. Always check the specific terms before assuming the standard applies.

• Warranty extensions can surprise contractors: Many suppliers don't realize the warranty clock stops when their product is down. A piece of equipment that's defective for three months during the warranty period? That's effectively a fifteen-month warranty.

• Documentation obligations persist: Contractors must update all technical manuals, drawings, and reports to reflect warranty repairs—at their expense. This often catches suppliers off guard when they budget warranty work.

• Provincial trade implications: Under CFTA Chapter Five, warranty requirements must be clearly stated in tender documentation, ensuring transparency across jurisdictions.

Related Terms

General Conditions, Acceptance, Quality Assurance, Defect Liability Period, Contract Remedies

Sources

• Government of Canada Supply Manual - Official federal procurement policy and procedures

• General Conditions - Higher Complexity - Goods - Part I, Section 2030 21 - Detailed warranty provisions for federal contracts

• ProServices Supply Arrangement - Warranty obligations and liability limits

In practice, treating warranties as a risk management tool rather than just a contractual checkbox helps both buyers and suppliers. Clear communication about warranty expectations during the procurement process prevents disputes down the road.