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Text of the Canada–Ukraine Free trade agreement – Chapter 10: Government procurement

Article10.1: Definitions

For the purposes of this Chapter:

commercial goods or services means goods or services of a type generally sold or offered for sale in the commercial marketplace to, and customarily purchased by, non-governmental buyers for non-governmental purposes;

construction service means a service that has as its objective the realization by whatever means of civil or building works, based on Division51 of the United Nations Provisional Central Product Classification (CPC);

days means calendar days;

electronic auction means an iterative process that involves the use of electronic means for the presentation by suppliers of either new prices, or new values for quantifiable non-price elements of the tender related to the evaluation criteria, or both, resulting in a ranking or re-ranking of tenders;

in writing or written means any worded or numbered expression that can be read, reproduced and later communicated. It may include electronically transmitted and stored information;

limited tendering means a procurement method whereby the procuring entity contacts a supplier or suppliers of its choice;

measure means any law, regulation, procedure, administrative guidance or practice, or any action of a procuring entity relating to a covered procurement;

multi-use list means a list of suppliers that a procuring entity has determined satisfy the conditions for participation in that list, and that the procuring entity intends to use more than once;

notice of intended procurement means a notice published by a procuring entity inviting interested suppliers to submit a request for participation, a tender, or both;

offset means any condition or undertaking that encourages local development or improves a Party’s balance-of-payments accounts, such as the use of domestic content, the licensing of technology, investment, counter-trade and similar action or requirement;

open tendering means a procurement method whereby all interested suppliers may submit a tender;

procuring entity means an entity covered under Annex10-1 or10-2 of a Party’s Market Access Schedule for this Chapter;

qualified supplier means a supplier that a procuring entity recognizes as having satisfied the conditions for participation;

selective tendering means a procurement method whereby only qualified suppliers are invited by the procuring entity to submit a tender;

services includes construction services, unless otherwise specified;

standard means a document approved by a recognized body that provides for common and repeated use, rules, guidelines or characteristics for goods or services, or related processes and production methods, with which compliance is not mandatory. It may also include or deal exclusively with terminology, symbols, packaging, marking or labelling requirements as they apply to a good, service, process or production method;

supplier means a person or group of persons that provides or could provide goods or services; and

technical specification means a requirement that:

Article10.2: Scope and Coverage

Application of this Chapter

1. This Chapter applies to any measure regarding covered procurement, whether or not it is conducted exclusively or partially by electronic means.

2. For the purposes of this Chapter, covered procurement means procurement for governmental purposes:

3. Unless otherwise provided in a Party’s Annexes to its Market Access Schedule for this Chapter, this Chapter does not apply to:

4. Each Party shall specify the following information in its Annexes to its Market Access Schedule for this Chapter:

5. If a procuring entity, in the context of covered procurement, requires a person not covered under a Party’s Annexes to its Market Access Schedule for this Chapter to procure in accordance with particular requirements, Article 10.5 shall apply, as applicable and with such changes as may be necessary, to such requirements.

Valuation

6. In estimating the value of a procurement for the purpose of ascertaining whether it is a covered procurement, a procuring entity shall:

7. If an individual requirement for a procurement results in the award of more than one contract, or in the award of contracts in separate parts (recurring contracts), the calculation of the estimated maximum total value shall be based on:

8. In the case of procurement by lease, rental or hire purchase of a good or a service, or procurement for which a total price is not specified, the basis for valuation shall be:

Article10.3: Relationship with the Revised Agreement on Government Procurement

1. At any time during which both Parties to this Agreement are also Party to the Annex to the Protocol Amending the Agreement on Government Procurement (GPA), the operation of Articles 10.1, 10.2 and 10.4 to 10.18 is suspended and the GPA, with the exception of Articles V, XVI(4) to XVI(6), XIX, XX, XXI, XXII, is hereby incorporated into and made part of this Agreement, as applicable and with such changes as may be necessaryas long as the Parties are also Parties to the GPA.The provisions of the GPA incorporated into this Chapter shall apply to the Parties’ Annexes to their Market Access Schedule for this Chapter.

2. Any amendments to the provisions of the GPA that are incorporated into this Chapter pursuant to paragraph 1 are incorporated into this Agreement, except as agreed by the Parties.

Article10.4: Security and General Exceptions

1. Nothing in this Chapter shall be construed to prevent a Party from taking any action or from not disclosing any information that it considers necessary for the protection of its essential security interests relating to procurement:

2. Subject to the requirement that these measures are not applied in a manner that would constitute a means of arbitrary or unjustifiable discrimination between Parties where the same conditions prevail or a disguised restriction on international trade, nothing in this Chapter shall be construed to prevent a Party fromimposing or enforcing measures:

Article 10.5: General Principles

Non-Discrimination

1. With respect to any measure regarding covered procurement, each Party, including its procuring entities, shall accord immediately and unconditionally to the goods and services of the other Party and to the suppliers of the other Party offering these goods or services, treatment no less favourable than the treatment the Party, including its procuring entities, accords to its own goods, services and suppliers.

2. With respect to any measure regarding covered procurement, a Party, including its procuring entities, shall not:

Use of Electronic Means

3. If conducting covered procurement by electronic means, a procuring entity shall:

Conduct of Procurement

4. A procuring entity shall conduct covered procurement in a transparent and impartial manner that:

Rules of Origin

5. For the purposes of covered procurement, a Party shall not apply rules of origin to goods or services imported from or supplied from the other Party that are different from the rules of origin the Party applies at the same time in the normal course of trade to imports or supplies of the same goods or services from the same Party.

Offsets

6. With regard to covered procurement, a Party, including its procuring entities, shall not seek, take account of, impose or enforce any offset.

Measures Not Specific to Procurement

7. Paragraphs1and2 shall not apply to: customs duties and charges of any kind imposed on, or in connection with, importation; the method of levying such duties and charges; other import regulations or formalities and measures affecting trade in services other than measures governing covered procurement.

Article10.6: Information on the Procurement System

1. Each Party shall:

2. Each Party shall list, in Annex 10-9 of its Market Access Schedule:

3. Each Party shall promptly notify the Joint Commission of any modification to the Party’s information listed in Annex 10-9.

Article10.7: Notices

Notice of Intended Procurement

1. For each covered procurement, a procuring entity shall publish a notice of intended procurement in the appropriate paper or electronic medium listed in Annex10-9, except in the circumstances described in Article10.13. This medium shall be widely disseminated and those notices shall remain readily accessible to the public, at least until expiration of the time-period indicated in the notice.

2. The notices of intended procurement shall:

Parties, including their procuring entities covered under Annex 10-2, are encouraged to publish their notices by electronic means free of charge through a single point of access.

3. Except as otherwise provided in this Chapter, each notice of intended procurement shall include:

Summary Notice

4. For each case of intended procurement, a procuring entity shall publish a summary notice that is readily accessible, at the same time as the publication of the notice of intended procurement, in one or more of the following languages: Ukrainian, English or French. The summary notice shall contain at least the following information:

Notice of Planned Procurement

5. Procuring entities are encouraged to publish in the appropriate paper or electronic medium listed in Annex 10-9 as early as possible in each fiscal year a notice regarding their future procurement plans (notice of planned procurement). The notice of planned procurement should include the subject-matter of the procurement and the planned date of the publication of the notice of intended procurement.

6. A procuring entity covered under Annex 10-2 may use a notice of planned procurement as a notice of intended procurement provided that the notice of planned procurement includes as much of the information referred to in paragraph3 as is available to the entity and a statement that interested suppliers should express their interest in the procurement to the procuring entity.

Article10.8: Conditions for Participation

1. A procuring entity shall limit any conditions for participation in a procurement to those that are essential to ensure that a supplier has the legal and financial capacities and the commercial and technical abilities to undertake the relevant procurement.

2. In establishing the conditions for participation, a procuring entity:

3. In assessing whether a supplier satisfies the conditions for participation, a procuring entity:

4. If there is supporting evidence, a procuring entity may exclude a supplier from participating in a procurement on grounds such as:

Article 10.9: Qualification of Suppliers

Registration Systems and Qualification Procedures

1.A procuring entity may maintain a supplier registration system under which interested suppliers are required to register and provide certain information.

2. Each Party shall ensure that:

3. A procuring entity shall not adopt or apply a registration system or qualification procedure with the purpose or the effect of creating unnecessary obstacles to the participation of suppliers of the other Party in its procurement.

Selective Tendering

4. If a procuring entityintends to use selective tendering, the entity shall:

5. A procuring entity shall allow all qualified suppliers to participate in a particular procurement, unless the procuring entity states in the notice of intended procurement any limitation on the number of suppliers that will be permitted to tender and the criteria for selecting the limited number of suppliers.

6. If the tender documentation is not made publicly available from the date of publication of the notice referred to in paragraph4, a procuring entity shall ensure that those documents are made available at the same time to all the qualified suppliers selected in accordance with paragraph5.

Multi-Use Lists

7. A procuring entity may maintain a multi-use list of suppliers, provided that a notice inviting interested suppliers to apply for inclusion on the list is:

8. The notice provided for in paragraph7 shall include:

9. Notwithstanding paragraph7, if a multi-use list will be valid for three years or less, a procuring entity may publish the notice referred to in paragraph7 only once, at the beginning of the period of validity of the list, provided that the notice:

10. A procuring entity shall allow suppliers to apply at any time for inclusion on a multi-use list and shall include on the list all qualified suppliers within a reasonably short time.

11. If a supplier that is not included on a multi-use list submits a request for participation in a procurement based on a multi-use list and all required documents, within the time-period provided for in Article10.11.2, a procuring entity shall examine the request. The procuring entity shall not exclude the supplier from consideration in respect of the procurement on the grounds that the entity has insufficient time to examine the request, unless, in exceptional cases, due to the complexity of the procurement, the entity is not able to complete the examination of the request within the time-period allowed for the submission of tenders.

Procuring Entities of Annex10-2

12. A procuring entity covered under Annex 10-2 may use a notice inviting suppliers to apply for inclusion on a multi-use list as a notice of intended procurement, provided that:

13. A procuring entity covered under Annex 10-2may allow a supplier that has applied for inclusion on a multi-use list in accordance with paragraph10 to tender in a given procurement, if there is sufficient time for the procuring entity to examine whether the supplier satisfies the conditions for participation.

Information on Procuring Entity Decisions

14. A procuring entity shall promptly inform any supplier that submits a request for participation in a procurement or application for inclusion on a multi-use list of the procuring entity’s decision with respect to the request or application.

15. If a procuring entity rejects a supplier’s request for participation in a procurement or application for inclusion on a multi-use list, ceases to recognize a supplier as qualified, or removes a supplier from a multi-use list, the entity shall promptly inform the supplier and, on request of the supplier, promptly provide the supplier with a written explanation of the reasons for its decision.

Article10.10: Technical Specifications and Tender Documentation

Technical Specifications

1. A procuring entity shall not prepare, adopt or apply any technical specification or prescribe any conformity assessment procedure with the purpose or the effect of creating unnecessary obstacles to international trade.

2. In prescribing the technical specifications for the goods or services being procured, a procuring entity shall, if appropriate:

3. Where design or descriptive characteristics are used in the technical specifications, a procuring entity should indicate, if appropriate, that it will consider tenders of equivalent goods or services that demonstrably fulfil the requirements of the procurement by including words such as “or equivalent” in the tender documentation.

4. A procuring entity shall not prescribe technical specifications that require or refer to a particular trademark or trade name, patent, copyright, design, type, specific origin, producer or supplier, unless there is no other sufficiently precise or intelligible way of describing the procurement requirements and provided that, in such cases, the entity includes words such as “or equivalent” in the tender documentation.

5. A procuring entity shall not seek or accept, in a manner that would have the effect of precluding competition, advice that may be used in the preparation or adoption of any technical specification for a specific procurement from a person that may have a commercial interest in the procurement.

6. For greater certainty, a Party, including its procuring entities, may prepare, adopt or apply technical specifications to promote the conservation of natural resources or protect the environment, provided that it does so in accordance with this Article.

Tender Documentation

7. A procuring entity shall make available to suppliers tender documentation that includes all information necessary to permit suppliers to prepare and submit responsive tenders. Unless already provided in the notice of intended procurement, this documentation shall include a complete description of:

8. In establishing any date for the delivery of goods or the supply of services being procured, a procuring entity shall take into account such factors as the complexity of the procurement, the extent of subcontracting anticipated and the realistic time required for production, de-stocking and transport of goods from the point of supply or for supply of services.

9. The evaluation criteria set out in the notice of intended procurement or tender documentation may include, among others, price and other cost factors, quality, technical merit, environmental characteristics and terms of delivery.

10. A procuring entity shall promptly:

Modifications

11. If, prior to the award of a contract, a procuring entity modifies the criteria or requirements set out in the notice of intended procurement or tender documentation provided to participating suppliers, or amends or re-issues a notice or tender documentation, it shall transmit in writing all such modifications, or the amended or re-issued notice or tender documentation:

Article10.11: Time-Periods

General

1. A procuring entity shall, consistent with its own reasonable needs, provide sufficient time for suppliers to prepare and submit requests for participation and responsive tenders, taking into account such factors as:

These time-periods, including any extension of the time-periods, shall be the same for all interested or participating suppliers.

Deadlines

2. A procuring entity that uses selective tendering shall establish that the final date for the submission of requests for participation shall not, in principle, be less than 25days from the date of publication of the notice of intended procurement. If a state of urgency duly substantiated by the procuring entity renders this time-period impracticable, the time-period may be reduced to not less than 10days.

3. Except as provided for in paragraphs4,5, 7 and 8 a procuring entity shall establish that the final date for the submission of tenders shall not be less than 40days from the date on which:

4. A procuring entity may reduce the time-period for tendering established in accordance with paragraph3 to not less than 10days where:

5. A procuring entity may reduce the time-period for tendering established in accordance with paragraph3 by five days for each one of the following circumstances:

6. The use of paragraph5, in conjunction with paragraph4, shall in no case result in the reduction of the time-period for tendering established in accordance with paragraph 3 to less than 10days from the date on which the notice of intended procurement is published.

7. Notwithstanding any other provision in this Article, if a procuring entity purchases commercial goods or services, or any combination thereof, it may reduce the time-period for tendering established in accordance with paragraph3 to not less than 13days, provided that it publishes by electronic means, at the same time, both the notice of intended procurement and the tender documentation. In addition, if the entity accepts tenders for commercial goods or services by electronic means, it may reduce the time-period established in accordance with paragraph3 to not less than 10days.

8. If a procuring entity covered under Annex 10-2 has selected all or a limited number of qualified suppliers, the time-period for tendering may be fixed by mutual agreement between the procuring entity and the selected suppliers. In the absence of agreement, the period shall not be less than 10days.

Article10.12: Negotiation

1. A Party may provide for its procuring entities to conduct negotiations:

2. A procuring entity shall:

Article10.13: Limited Tendering

1. Provided that it does not use this provision for the purpose of avoiding competition among suppliers or in a manner that discriminates against suppliers of the other Party or protects domestic suppliers, a procuring entity may use limited tendering and may choose not to apply Articles10.7 through 10.9, paragraphs 7 through 11 of Article 10.10, Articles 10.11, 10.12, 10.14 and 10.15 only under any of the following circumstances:

2. A procuring entity shall prepare a report in writing on each contract awarded under paragraph1. The report shall include the name of the procuring entity, the value and kind of goods or services procured and a statement indicating the circumstances and conditions described in paragraph1 that justified the use of limited tendering.

Article10.14: Electronic Auctions

If a procuring entity intends to conduct a covered procurement using an electronic auction, the entity shall provide each participant, before commencing the electronic auction, with:

Article10.15: Treatment of Tenders and Awarding of Contracts

Treatment of Tenders

1. A procuring entity shall receive, open and treat all tenders under procedures that guarantee the fairness and impartiality of the procurement process, and the confidentiality of tenders.

2. A procuring entity shall not penalize any supplier whose tender is received after the time specified for receiving tenders if the delay is due solely to mishandling on the part of the procuring entity.

3. If a procuring entity provides a supplier with an opportunity to correct unintentional errors of form between the opening of tenders and the awarding of the contract, the procuring entity shall provide the same opportunity to all participating suppliers.

Awarding of Contracts

4. To be considered for an award, a tender shall be submitted in writing and shall, at the time of opening, comply with the essential requirements set out in the notices and tender documentation and be from a supplier that satisfies the conditions for participation.

5. Unless a procuring entity determines that it is not in the public interest to award a contract, the entity shall award the contract to the supplier that the entity has determined to be capable of fulfilling the terms of the contract and that, based solely on the evaluation criteria specified in the notices and tender documentation, has submitted:

6. If a procuring entity receives a tender with a price that is abnormally lower than the prices in other tenders submitted, it may verify with the supplier that it satisfies the conditions for participation and is capable of fulfilling the terms of the contract.

7. A procuring entity shall not use options, cancel a procurement or modify awarded contracts in a manner that circumvents the obligations under this Chapter.

Article10.16: Transparency of Procurement Information

Information Provided to Suppliers

1. A procuring entity shall promptly inform participating suppliers of the entity’s contract award decisions and, on the request of a supplier, shall do so in writing. Subject to paragraphs 2 and 3 of Articles10.17, a procuring entity shall, on request, provide an unsuccessful supplier with an explanation of the reasons why the entity did not select its tender and the relative advantages of the successful supplier’s tender.

Publication of Award Information

2. In accordance with domestic legislation, a procuring entity shall publish a notice in the appropriate paper or electronic medium listed in Annex 10-9 promptly after the award of each contract covered by this Chapter. If the entity publishes the notice only in an electronic medium, the information shall remain readily accessible for a reasonable period of time. The notice shall include at least the following information:

Maintenance of Documentation, Reports and Electronic Traceability

3. Each procuring entity shall, for a period of at least threeyears from the date it awards a contract, maintain:

Article10.17: Disclosure of Information

Provision of Information to Parties

1. On request of the other Party, a Party shall provide promptly any information necessary to determine whether a procurement was conducted fairly, impartially and in accordance with this Chapter, including information on the characteristics and relative advantages of the successful tender. In cases where release of the information would prejudice competition in future tenders, the Party that receives the information shall not disclose it to any supplier, except after consulting with, and obtaining the consent of, the Party that provided the information.

Non-Disclosure of Information

2. Notwithstanding any other provision of this Chapter, a Party, including its procuring entities, shall not provide to any particular supplier information that might prejudice fair competition between suppliers.

3. Nothing in this Chapter shall be construed to require a Party, including its procuring entities, authorities and review bodies, to disclose confidential information if disclosure:

Article10.18: Domestic Review Procedures

1. Each Party shall provide a timely, effective, transparent and non-discriminatory administrative or judicial review procedure through which a supplier maychallenge:

arising in the context of a covered procurement, in which the supplier has, or has had, an interest. The procedural rules for allchallenges shall be in writing and made generally available.

2. In the event of a complaintby a supplier, arising in the context of covered procurement in which the supplier has, or has had, an interest, that there has been a breach or a failure as referred to in paragraph1, the Party of the procuring entity conducting the procurement shall encourage the entity and the supplier to seek resolution of the complaint through consultations. The entity shall accord impartial and timely consideration to any such complaint in a manner that is not prejudicial to the supplier’s participation in ongoing or future procurement or its right to seek corrective measures under the administrative or judicial review procedure.

3. Each supplier shall be allowed a sufficient period of time to prepare and submit a challenge, which in no case shall be less than 10days from the time when the basis of the challenge became known or reasonably should have become known to the supplier.

4. Each Party shall establish or designate at least one impartial administrative or judicial authority that is independent of its procuring entities to receive and review a challengeby a supplier arising in the context of a covered procurement.

5. If a body other than an authority referred to in paragraph4 initially reviews a challenge, the Party shall ensure that the supplier may appeal the initial decision to an impartial administrative or judicial authority that is independent of the procuring entity whose procurement is the subject of the challenge.

6. Each Party shall ensure that a review body that is not a court shall have its decision subject to judicial review or have procedures that provide that:

7. Each Party shall adopt or maintain procedures that provide for:

Article10.19: Modifications and rectifications to coverage

1. A Party may modify an Annex to this Chapter.

2. When a Party modifies an Annex to this Chapter, the Party shall:

3. Notwithstanding paragraph 2(b), a Party is not required to provide compensatory adjustments if:

4. If the other Party disputes that:

it shall object in writing within 30 days of receipt of the notification referred to in paragraph 2(a) or be deemed to have accepted the adjustment or proposed modification, including for the purposes of Chapter 17 (Dispute Settlement).

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