Revised Eligibility Requirement for CIDA Contracts and Bilateral Unsolicited Proposals Effective as of January 1, 2001

In order to be eligible to enter into a contract or bilateral unsolicited proposal agreement with CIDA, a for-profit organization currently has to have its head office located in Canada and be at least 51 per cent beneficially owned and controlled by Canadian citizens or landed immigrants. If the organization is not-for-profit, it currently must be registered in Canada, and the board of directors has to be composed of at least 51 per cent Canadian citizens or landed immigrants. CIDA is the only department with this Canadian ownership requirement.

With globalization and free trade agreements, Canadian companies are often the object of mergers, sometimes as the lead in such mergers, in order to better compete on the international stage. The original rationale for CIDA's ownership requirement has been overtaken by the modern global business context. It is time for CIDA to harmonize its eligibility requirements with the reality of the current Canadian context and with other Canadian government departments.

Therefore, effective January 1, 2001, CIDA will drop the Canadian "ownership and control" concept as an eligibility requirement to enter into a contract or into a contribution agreement. In conformity with the Agreement on Internal Trade definition (Canadian Supplier - article 518), only Canadian suppliers "having a place of business in Canada" will be eligible to compete for contracts and bilateral unsolicited proposals. This requirement does not apply to contribution agreements with organizations outside the unsolicited mechanism, the existing requirements remaining unchanged. For not-for-profit organizations, these must be legal entities registered in Canada. CIDA continues to maintain that only Canadians, landed immigrants, or nationals of the recipient country (or countries in the case of regional projects) are eligible to participate in the implementation of the contract or contribution agreement resulting from the bilateral responsive mechanism unless a specific expertise is not available in Canada or the recipient country. When evaluating proposals, only experience of the Consultant arising from its place of business in Canada will be assessed.

This notice has precedence over the existing documentation relating to eligibility requirements that currently appears in CIDA contracting documents. These will be modified in the coming weeks to reflect the revised eligibility requirements.