Public Works and Government Services Canada

Public Works and Government Services Canada

August 11, 2006 19:38 ET

Public Works Announces Results of Challenges to ACANs for Military Aircraft

OTTAWA, ONTARIO--(CCNMatthews - Aug. 11, 2006) - The Honourable Michael M Fortier, Minister of Public Works and Government Services, today announced the results of the challenges to two Advance Contract Award Notices (ACANs) for the purchase of National Defence's Medium- to Heavy-Lift Helicopters and for the Strategic Aircraft.

On July 5, 2006, the government issued Advance Contract Award Notices (ACANs) on MERX for the Medium- to Heavy-Lift Helicopters and Strategic Airlift Aircraft. Preliminary research indicated that in each case there was only one supplier (Boeing), which could meet the requirement. The two ACANs closed on Friday August 4, 2006.

The ACANs resulted in Statements of Capabilities being submitted from one company for the Medium- to Heavy-Lift Helicopter Project and from two companies for the Strategic Airlift Project. The Statements of Capabilities were reviewed in accordance with government policy, to ensure objectivity and fairness to the challengers. The Statements did not demonstrate that the challengers could meet the mandatory requirements published in the ACANs. The companies have been notified of the results and the procurement process will continue.

The Minister explained that rigorous requirements for each procurement process have been put in place to ensure openness and transparency while also enabling the government to meet urgent operational requirements for Canada's military.

"I am pleased to see this process is moving forward in a fair, open and transparent manner. My government is delivering on its commitment to purchase the equipment needed by our Canadian Forces, at the best price for Canadians, while delivering significant benefits for Canadian industry," Minister Fortier said.

The next step in the procurement process for both the Medium- to Heavy-Lift Helicopters and Strategic Airlift projects will involve the preparation of statements of work and related documents by National Defence to allow the formal negotiations with Boeing to commence. The current schedule calls for contracts to be in place by March 2007 for the Strategic Airlift Project and by July 2007 for the Helicopter Project.

For the tactical airlift requirement, a draft Solicitation of Interest and Qualification (SOIQ) document was also posted on MERX from July 5, 2006, to Friday August 4, 2006.

The government has made some revisions to the draft SOIQ to reflect the feedback received from the supplier community, and the final Solicitation of Interest and Qualification for the Tactical Airlift Project will be posted on MERX by end of August 2006 and will close 30 days thereafter.

"This government is committed to building a stronger, more vibrant aerospace industry and defence industry in Canada," Minister Fortier said. "This is fundamental to Canada's national security and good for Canadian business."

Details regarding these specific procurement projects are available in the attached backgrounder.


Backgrounder


Procurement Methods for DND's helicopters and aircraft

Following is a description and progress report on the procurement methods being used by Public Works and Government Services Canada to acquire medium-to heavy-lift helicopters and strategic and tactical aircraft for DND:

1. Medium- to Heavy-Lift Helicopters - ACAN process

On July 5, 2006, PWGSC issued an Advance Contract Award Notice (ACAN) on the government electronic tendering service, known as MERX, for the purchase of the Medium- to Heavy-Lift Helicopter. This ACAN closed on Friday August 4, 2006.

The ACAN resulted in Statement of Capabilities being submitted from one company for the Medium- to Heavy-Lift Helicopter Project. The Statement of Capabilities was reviewed in accordance with government policy by an independent team, to ensure objectivity and fairness to the challenger.

This review concluded that the Statement of Capabilities did not demonstrate that the company could meet the mandatory requirements published in the ACAN. The company has been notified of the results.

Next steps

The procurement process for the Medium- to Heavy-Lift Helicopters will continue. This will involve the preparation of statements of work and related documents by National Defence to allow the formal negotiations with the identified supplier to commence.

Schedule

Contract award is expected in the summer of 2007 (or sooner if possible). The first aircraft is to be delivered as soon as possible, but no later than 36 months following contract award. The last aircraft will be delivered within 60 months of contract award.

Trade agreements

This requirement is excluded both from the North American Free Trade Agreement (NAFTA) and from the World Trade Organization - Agreement on Government Procurement (WTO - AGP). It is also excluded from the Agreement on Internal Trade (AIT) as a National Security Exception (NSE) was invoked for the acquisition of the aircraft for the protection of Canada's national security interest.

The National Security Exception (NSE) is a formal mechanism that may be invoked to ensure that Canada's military requirements, or other aspects of Canada's national security, can be met. An NSE may be invoked for a variety of valid reasons - in this case, to ensure that its in-service support is performed within Canada.

The NSE is in full accordance with Canada's commitments and its rights as a government under the Agreement on Internal Trade.

2. Strategic Airlift - ACAN process

On July 5, 2006, PWGSC issued an Advance Contract Award Notice (ACAN) on the government electronic tendering service, known as MERX, for the purchase of the Strategic Aircraft. This ACAN closed on Friday August 4, 2006.

The ACAN resulted in Statements of Capabilities being submitted from two companies for the Strategic Airlift Project. The Statements of Capabilities were reviewed in accordance with government policy by an independent team, to ensure objectivity and fairness to the challenger.

This review concluded that the Statement of Capabilities did not demonstrate that the company could meet the mandatory requirements published in the ACAN. The companies have been notified of the results.

Next steps

The procurement process for the Strategic Airlift will continue. This will involve the preparation of statements of work and related documents by National Defence to allow the formal negotiations with the identified supplier to commence.

Schedule

Contract award is expected in the spring of 2007. The first aircraft is to be delivered as soon as possible, but no later than 18 months following contract award. The last aircraft will be delivered within 48 months of contract award.

Trade agreements

This requirement is excluded both from the North American Free Trade Agreement (NAFTA) and from the World Trade Organization - Agreement on Government Procurement (WTO - AGP). It is also excluded from the Agreement on Internal Trade (AIT) as a National Security Exception (NSE) was invoked for the acquisition of the aircraft for the protection of Canada's national security interests.

3. Tactical Airlift -SOIQ procurement approach

For the tactical airlift requirement, a draft Solicitation of Interest and Qualification (SOIQ) document was also posted on MERX from July 5, 2006, to Friday August 4, 2006.

The government has made some revisions to the draft SOIQ to reflect the feedback received from the supplier community, and the final Solicitation of Interest and Qualification for the Tactical Airlift Project will be posted on MERX by end of August 2006 and will close 30 days thereafter.

The formal SOIQ will invite potential suppliers to indicate their interest in competing for this project and to demonstrate their ability to meet the mandatory, high-level performance criteria before being invited to submit a formal Proposal as the final stage in the process.

Schedule

Contract award is expected in the fall of 2007. The first aircraft is to be delivered as soon as possible, but no later than 36 months following contract award. The last aircraft will be delivered within 60 months of contract award.

Trade agreements

This requirement is excluded both from the North American Free Trade Agreement (NAFTA) and from the World Trade Organization - Agreement on Government Procurement (WTO - AGP). It is also excluded from the Agreement on Internal Trade (AIT) as a National Security Exception (NSE) was invoked for the acquisition of the aircraft. An NSE may be invoked for a variety of valid reasons - in this case, to ensure that its in-service support is performed within Canada.

PWGSC news releases are also available on our Internet site at www.pwgsc.gc.ca/text/generic/media-e.html

Contact Information

  • Office of Minister Fortier
    Nicole Babin
    Press Secretary
    (613) 868-1812
    or
    Public Works and Government Services Canada
    Media Relations
    (819) 956-2315