Things to know
The Standard Acquisition Clauses and Conditions (SACC) Manual sets out the Government of Canada’s standard procurement clauses and contractual provisions. Specific provisions forming part of the SACC Manual are incorporated by reference into procurement documents (e.g., RFPs) or resulting contracts.
Typically, the government will not agree to incorporate into a procurement contract a supplier’s standard terms or conditions, including, for example, terms relating to commercial-off-the-shelf products. To the extent any changes to the proposed government contract are considered (and available changes are quite limited), it is generally done by selecting alternatives among the standard clauses set out in the SACC Manual. Liability terms and pricing terms are of particular significance.
The Directive on the Management of Procurement sets out the policy framework for addressing supplier liability. Suppliers are responsible for managing risks under their control and must retain responsibility for risks that they can manage or mitigate. Some delegated authority exists to allow for limits on supplier liability to apply, such as when a procurement involves a good that falls within a commodity grouping established by Public Services and Procurements Canada or Shared Services Canada. In most other cases, Treasury Board approval to limit first- and third-party vendor liability is required.
As a matter of government policy, suppliers must retain financial responsibility for losses arising as a result of the work they perform under contract, and in particular for liabilities from third-party claims. The Attorney General of Canada must have the regulation and conduct of all litigation for or against the Crown, but the Attorney General may request that the supplier defend the Crown against the claim. With limited exceptions, the government will not agree to limit a supplier’s liability.
Most-favoured customer pricing clauses are often incorporated by reference from the SACC Manual. For example, SACC C0001T requires a bidder to certify that the price proposed is not in excess of the lowest price charged anyone else, including the bidder's most favoured customer, for the like quality and quantity of the goods, services or both.
Things to do
- Review procurement documents carefully for all SACC Manual references. Remember that such references are as much a part of the contract as the actual wording presented in full in the procurement document.