Ontario, Canada – Effective January 1, 2024, significant changes are coming to procurement regulations in Ontario, impacting both public buyers and suppliers. The Building Ontario Businesses Initiative (BOBI) and the updated trade agreement thresholds are set to reshape the procurement landscape. Here is a neutral overview of these developments:
Building Ontario Businesses Initiative (BOBI)
In 2024, the Building Ontario Businesses Initiative (BOBI) will be implemented in Ontario, affecting most public buyers in the province. BOBI, introduced through the Building Ontario Businesses Initiative Act, 2022 (BOBIA), is designed to direct procurement opportunities towards local businesses. Its objectives include promoting Ontario businesses, supporting economic and regional development, facilitating growth in the global market, and enhancing Ontario’s supply chain resilience.
BOBI applies to government entities, which encompass Ontario ministries, designated public bodies, the Independent Electricity System Operator, Ontario Power Generation Inc., and its subsidiaries. Additionally, designated broader public sector entities, such as hospitals, school boards, universities, colleges, children’s aid societies, shared services, group purchasing organizations, and publicly funded organizations with a minimum C$10-million revenue in the previous fiscal year, fall under its purview.
For public buyers, BOBI establishes specific procurement thresholds, necessitating procurement from Ontario or Canadian businesses for domestic and international trade agreements, respectively. Economic Benefits Submissions are required for procurements exceeding C$50-million. However, exemptions apply for procurement processes governed by international or domestic trade agreements necessitating non-discriminatory treatment.
Suppliers selling to Ontario public buyers should note that BOBI’s definition of an “Ontario business” requires a “permanent basis in Ontario” with either a headquarters or main office in Ontario or at least 250 full-time employees in Ontario.
Updated Trade Agreement Thresholds
Starting January 1, 2024, updated procurement thresholds have been implemented for covered federal government entities in Canada’s free trade agreements. Some thresholds have decreased, affecting both public buyers and suppliers. These thresholds are indexed for inflation and will remain valid until December 31, 2025. The thresholds vary by trade agreement, covering goods, services, and construction.
Fighting Against Forced Labour and Child Labour in Supply Chains Act
Effective January 1, 2024, the Fighting Against Forced Labour and Child Labour in Supply Chains Act aims to prevent and reduce the risk of forced and child labor in supply chains. This legislation applies to government institutions and entities meeting specific criteria.
Entities subject to the Act must file detailed public reports on measures taken to identify, address, and prevent forced labor, prison labor, and child labor in their supply chains. The first report deadline is May 31, 2024. Failure to comply with reporting obligations may result in fines, with directors or officers personally liable for offenses.
In summary, these changes introduce new requirements and reporting obligations in Ontario’s procurement landscape, affecting both public buyers and suppliers. Entities within the scope of these regulations should take proactive steps to ensure compliance and mitigate potential liabilities.
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