• Departments and Agencies Frequently Asked Questions

• What is a Standing Offer
• Advantages of Standing Offers
• Types of Standing Offers
• Limitations on Call-ups

• What are Supply Arrangements?
• Types of Supply Arrangements
• Issuing a contract against a Supply Arrangement
• Financial limitations

• NAFTA/WTO Applicability
• Security Requirements
• Sales Taxes
• How do I choose between several standing offers?
  
• Do I have to choose a standing offer result?
  
• How is a Standing Offer established?
  
• How do I make a call-up against a Standing Offer?
  
• How do I issue a contract against a supply arrangement?
  
• Is there a Standing Offer with a specific supplier?
  
• Must the Goods and Services Tax(GST) be included in call-up against a standing offer?
  

Departments and Agencies Frequently Asked Questions

Q. In what circumstances do departments have to use a standing offer for their purchases?

A. - As of April 1, 2005, to buy the goods and services listed below, if PWGSC has issued a standing offer that covers the requirement, departments must use the standing offer:

• ground effect vehicles, motor vehicles, trailers and cycles
• telecommunications equipment and accessories
• general purpose automatic nblue9 processing equipment (including firmware), software, supplies and support equipment
• furniture
• office machines, text processing systems and visible recording equipment
• office supplies and devices
• clothing, accessories and insignia
• fuels, lubricants, oils and waxes
• information processing and related telecommunications services, and
• professional, administrative and management support services

Q. Are there any exceptions to using a standing offer to purchase goods or services in these 10 categories?

A. - If no standing offer exists for a specific good or service that falls within these 10 categories, then departments can proceed using the same practices currently in use. Departments will be expected to inform PWGSC in these instances so that future Standing Offers may be put in place or adjusted accordingly.

Departments can seek an exception for any of the following reasons:

1. Product/service offered does not meet justifiable, specific requirements including specifications or delivery dates.
2. A lower price is available for a confirmed (by PWGSC) equivalent product or service, by means other than the mandatory standing offer, and that the standing offer in question has not been established as the "exclusive Supplier for the GoC".
3. The call-up limitation of a standing offer is exceeded by the value of the requirement.
4. An existing, open order contract is in place, which guarantees another supplier this work.
5. The purchaser's department has it's own standing offer in place which better meets needs/price. Note, however, that departments do not have the delegated authority to put new standing offers in place, for a commodity where a mandatory SO already exists.
6. If a department has access to the GoCM and the commodity is available upon it, use of the GoCM is mandatory.

Q. What is the process to seek an exception?

A. - The appropriate steps to follow before using an alternate purchasing method are:

1. Identify reason for exemption. Purchaser to confirm the exception rationale with the purchaser's departmental material manager.
2. Contact the PWGSC contracting officer responsible for the standing offer. The contracting officer will make the decision as to whether the exception rule applies.
3. If the exception is approved, proceed with alternate procurement means. If not approved, you must use the standing offer, or submit a formal requisition to PWGSC.
4. Should the Contracting Officers decision be disputed, call the SO Arbitrator for an immediate resolution.

Q. If a department has been using a supplier in the past, but the supplier does not have a standing offer, can the department continue to use that supplier?

A. - If no standing offer exists for the specific good or service being provided by a supplier, the department can proceed using the same practices currently in use.

However, if the good or service falls within the 10 categories, and a standing offer exists for the good or service, the department would need to seek an exception as outlined above.

Q. If a department has its own standing offer in place, such as a Departmental Individual Standing Offer (DISO), and it is in one of the 10 categories, can that department continue to use it as opposed to using a PWGSC-established standing offer?

A. - If a standing offer that a department has established for its own use represents better value, then the departments may use it.

Q. Will PWGSC offer support to departments to help them determine if a standing offer exists for their requirement?

A. - Yes, a range of new tools and services will be in place to help departments identify whether a Standing Offer exists for the product or service that they are seeking.

These tools include a web-enabled, searchable index of Standing Offers, a national help desk which can provide assistance from 07:00 - 19:00 each day, and a service call centre open 24 hours a day that will answer questions by the following business day.

Q. What percentage of all goods and services is covered by these 10 categories?

A. - These 10 categories represent the most commonly purchased goods and services, with an average annual procurement value of $5.7 billion.

Overall, PWGSC currently has standing offers in place for more than 95 percent of commonly procured goods and services. Studies have demonstrated that when Departments do not acquire goods and services from a Standing Offer, they fail to obtain the lowest cost more than 80 percent of the time and take more time to receive the commodity.

Q. What is a standing offer? Is it the same as a contract?

A. - A standing offer is not a contract. A standing offer is an offer from a potential supplier to provide goods and/or services at pre-arranged prices, under set terms and conditions, when and if required. No contract exists until the Government issues an order or "call-up" against the standing offer and there is no actual obligation by the Government to purchase until that time.

Q. Why is PWGSC making mandatory to use these standing offers?

A. - As announced in the 2005 federal budget, PWGSC is making major changes to deliver services smarter, faster and at a reduced cost. Achieving savings for taxpayers is good business; and delivering a simpler, more organized procurement system is good for business.

The changes include mandatory use by departments for these specific standing offers. This is an initial step to capture savings that are already available to the government and to help develop a better base of information for the government and suppliers for further decisions.

Overall, the changes to purchasing will result in:

• better prices for goods and services through consolidation of requirements and increased competition among suppliers;
• reduction of administrative costs;
• reduction in lead time;
• reduction in inventory investment; and,
• pre-arranged access to suppliers.

Q. Will PWGSC make more standing offers mandatory?

A. - Since making better use of existing standing offers allows the government to capture savings that are already available, other standing offers may be made mandatory. In the future, new tools developed for government-wide use will also be mandatory.

Q. Will departments still have a say in what supplier is chosen to meet their requirement?

A. - Departments will be consulted in establishing government-wide tools.

Q. Am I still allowed to use my acquisition card?

A. - Yes. If you use your acquisition card to buy goods and services from a standing offer holder (for example, a retail outlet of a standing offer holder for office supplies), make sure you are getting the standing offer price.

Use of an acquisition card is not a sufficient reason for not using a standing offer. However, if an exception has been granted, or if no standing offer exists, the same rules and provisions for use of acquisition cards still apply.

1. A Standing Offer is an arrangement to provide goods and services at prearranged prices with set terms and conditions, for specific periods of time on an "as requested" basis.
2. A Standing Offer is not a contract.
3. An order against a Standing Offer is a "call-up".
4. Each call-up is a separate contract between the Crown and the supplier.
5. A call-up does not involve any negotiations. Acceptance by the Crown of the supplier's offer is unconditional.
6. There are several  types of Standing Offers.

This method of supply offers the following advantages when applied to the acquisition of commercially available goods and services:

• Direct access to a supplier
• Better prices through consolidation of requirements and increased competition among suppliers
• Reduction of administrative costs
• Reduction in lead time
• Reduction in inventory investment
  

NOTE : PWGSC personnel can assist customers through the acquisition process when using Standing Offers.

• A National Master Standing Offer (NMSO) has no geographic limitations. It can be used by all federal departments and agencies.
• A Regional Master Standing Offer (RMSO) has geographical limitations for delivery. It can be used by all federal departments and agencies within the specified region.
• A National Individual Standing Offer (NISO) is national in scope and used by the specified client. NISOs are arranged by PWGSC upon receipt of a client's funded requisition.
• A Regional Individual Standing Offer (RISO) is regional in scope and used by the specified client. RISOs are arranged by PWGSC upon receipt of a client's funded requisition.
• A Departmental Individual Standing Offer (DISO) can only be accessed by PWGSC as a method of supply. Only PWGSC may issue call-ups against a DISO upon receipt of a funded requisition from a client department.

1. Each Standing Offer has a financial call-up (order) limitation. Clients are asked to honour such limitations.
2. Do not split a requirement into a number of call-ups to stay within the limits of the Standing Offer.
3. Sometimes, above a certain dollar amount or quantity level, better value can be achieved by treating a requirement as a separate acquisition, using form DSS-MAS 9200, and forwarding to PWGSC for contracting.

Supply arrangements are non-binding agreements between PWGSC and suppliers to provide a range of goods or, more commonly, services on an "as required" basis. They are lists of qualified suppliers identified as potential sources from which departments can obtain firm price quotations on specific requirements.

Supply arrangements include a set of predetermined terms and conditions that will apply to any subsequent contracts. Supply arrangements allow departments to solicit bids based on their specific scope of work and in this way they differ from standing offers which only allow departments to accept a portion of a requirement already defined and priced. Many supply arrangements include ceiling prices which allow customer departments to negotiate the price downward based on the actual requirement or scope of work.

Supply arrangements can be issued for national or regional use by departments. The geographic range and intended users are outlined in the supply arrangement.

Either PWGSC or user departments create contracts within the scope of the supply arrangement. For requirements that are not subject to the trade agreements bids are solicited only from qualified suppliers that have a supply arrangement. For requirements that are subject to the trade agreements a Notice of Proposed Procurement is published on MERX, to alert other potential suppliers to the opportunity to qualify and submit a proposal for the specified requirement. A Request for Proposal (RFP) is issued, proposals are evaluated and a supplier is selected. The pre-arranged terms and conditions and general requirements of the supply arrangement must form part of the RFP and any resulting contract. Only the specific departmental requirements and price must be agreed upon. Where a competitive bidding process is not used, and ceiling prices are established within the supply arrangement, departments generally negotiate a lower price or rate from the stated ceiling prices based on the actual work or commodity required.

Each Supply Arrangement has a maximum contract limitation.

Is there a particular time of year when supply arrangements are issued?
Just as for standing offers, there is no set rule as to when supply arrangements are issued. Generally, it is important to watch for opportunities which may be published several months before the anticipated effective date of a supply arrangement.

1. The total estimated value for a Standing Offer is determined prior to tendering by PWGSC. At that time, it is determined whether or not NAFTA and/or WTO will apply. If they do apply, bids are solicited in accordance with the agreements.
2. Subsequent individual call-ups/orders can be made from the Standing Offer without considering NAFTA/WTO applicability.

1. If the PWGSC Call-up Against a Standing Offer or amendment includes provisions for security, form TBS/SCT 350-103 "Security Requirements Check List (SRCL)" shall accompany each completed call-up.
   
2. In every case before the award of a call-up/order, a client must confirm with the PWGSC Industrial and Corporate Security Directorate, via the client's Security Office, that the proposed supplier(s) holds the required level of RELIABLE/SECURITY screening approval.
   
3. All security enquiries from departmental/agency security officers should be directed to:
   

                Industrial Security Requirements Section,
                Industrial and Corporate Security Directorate,
                PWGSC,
                phone (819) 956-3681.

Goods and Services Tax (GST)

Questions concerning the applicability of GST should be directed to the GST coordinator for each department.

Provincial Sales Tax

Since standing offers are not contracts and, since both federal departments and Crown corporations may use standing offers, all prices quoted in standing offers do not have to include provincial ad valorem sales taxes.

This exemption has been provided to federal government departments and agencies under the authority of the applicable provincial sales tax exemption licence number for the provinces listed below:

An exemption certification is required for Quebec, New Brunswick, Saskatchewan, the Yukon Territory and the Northwest Territories certifying that the property or services ordered are for the use of the federal government with Crown funds and are not subject to provincial and/or territorial sales taxes.

Double taxation could result from failure to quote the applicable licence number or appropriate certification.

Crown corporations are required to pay provincial sales taxes under the Federal-Provincial Fiscal Arrangements Established Programs Financing Act, 1977.

Note: Legislated exceptions exist where federal government departments and agencies may be required to pay ad valorem sales taxes levied by the province in which the taxable goods services are delivered. The following exceptions are examples and do not represent a complete list of all exceptions under the law:

         i.     tobacco products subject to tobacco taxes;  
         ii.    petroleum products subject to gasoline, automotive
                fuel taxes;
         iii.   vehicle registration fees;
         iv.    amusement/admission fees (Nova Scotia & New
                Brunswick)
         v.     insurance premiums (Quebec);
         vi.    tires/batteries subject to environmental levies
                (British Columbia for both, Alberta for tires
                only);
         vii.   transient living accommodation subject to hotel
                room taxes  (Prince Edward Island and British
                Columbia).

1. Choosing from Multiple Standing Offer Results

Some standing offers will present options to choose from multiple suppliers. On the SOI, the search results will return each individual supplier. However by clicking onto the Related SO field the master document will be displayed which will outline the selection process.

If the returned standing offers do not have a Related SO field, you may choose any that meet your needs. Recommended selection criteria include:

• Select those results that fit your requirement (product/service specifications);
  
  
• Of those selected, confirm delivery locations and time;
  
  
• Of those that remain, select the standing offer with the lowest price.
  
  

2. Do I have to use a Standing Offer Result?

Prior to conducting any procurement activity, a purchaser must determine whether Public Works and Government Services Canada (PWGSC) has already established a method of supply for that good or service.

Where PWGSC has put in place a method of supply such as a standing offer, for any commodity (good, service or construction), and identified that method of supply as being mandatory, the delegate shall use that method of supply to meet operational requirements.

Where there is such a mandatory method of supply in place, but the delegate cannot or does not wish to use it, exception procedures may be promulgated by Public Works and Government Services Canada. Unless such exception procedures are used, there is no delegation of authority to acquire it using other procurement approaches. Rather the requirement must be submitted to PWGSC for procurement action.

Inquiries regarding exception applicability are to be directed to:

PWGSC Help Desk at 1 866 664-6609.

3. How is a Standing Offer established?

Master Standing Offers (national/regional) are established by PWGSC without any requisitions from client departments and agencies.

To request an Individual Standing Offer, submit a requisition form PWGSC-TPSGC 9200 to PWGSC including the following information

• a. applicable period for the offer;
  
  
• b. estimated quantities;
  
  
• c. probable consignee locations and codes;
  
  
• d. inspection requirements (see Chapter 230 of PWGSC Customer Manual);
  
  
• e. the required distribution of the offer (i.e. the applicable ordering office within the department);
  
  
• f. a statement indicating if the estimated cost of individual call-ups is expected to frequently exceed the financial limits imposed by Treasury Board, if applicable. In such cases, if a Standing Offer is still the best method of supply, it will be submitted to Treasury Board for approval;
  
  
• g. a statement indicating whether an individual call-up or the sum of call-ups will exceed the NAFTA/GATT thresholds (see Chapter 210, article 210.22 of PWGSC Customer Manual);
  
  
• h. any special requirement such as security clearance of supplier personnel, transmission of confidential information, etc.
  
  

4. How do I make a call-up against a Standing Offer?

Order goods and services, unless otherwise specified, using one of the following forms:

• a. PWGSC-TPSGC 942 and PWGSC-TPSGC 942-2 (Multiple Delivery), "Call-up Against a Standing Offer" (bilingual) forms, are available in electronic format only. These forms can be used for each separate Standing Offer.
  
  
• b. PWGSC-TPSGC 944, "Call-up Against Multiple Standing Offers" (English) form, is available in electronic format only. This form can be used to order goods and services from different Standing Offers which have been issued to the same supplier. Note that in this case, the company will send one invoice to cover all items ordered using the 944. This form is also available in French PWGSC-TPSGC 945.
  
  

Each Standing Offer states where call-up documents are to be forwarded. Each call-up for goods or services should apply to one destination only, unless otherwise stated in the Standing Offer, and should be sent to the appropriate supplier's outlet. Each call-up must be funded.

Customers are responsible for ensuring that:

• a. sufficient funds are available for the items called-up;
  
  
• b. the maximum value for individual call-ups is not exceeded;
  
  
• c. the goods or services are for official government use;
  
  
• d. the appropriate provincial sales tax licence number, if applicable, is quoted in the call-up;
  
  
• e. where special requirements, such as security, are not specified in the Standing Offer, the responsible PWGSC contracting officer (whose name appears on the Standing Offer) is informed prior to placing a call-up. Since special requirements usually have an associated cost, the PWGSC contracting officer may either amend the Standing Offer or take alternate action, such as issuing a separate contract;
  
  
• f. the goods and services received are as specified in the Standing Offer;
  
  
• g. the invoiced prices are in accordance with the Standing Offer, unless otherwise stated by PWGSC.
  
  

5. How do I issue a contract against a supply arrangement?

Customers are responsible for ensuring that:

• a. sufficient funds are available for the call-up;
  
  
• b. the maximum value limit of the supply arrangement is not exceeded;
  
  
• c. bids are solicited only from suppliers listed in the supply arrangement. Suppliers should be selected from within the customer's region, unless no source is available within that region. The competitive process must be used in accordance with the Treasury Board Manual - Contracting, Appendix B;
  
  
• d. the service received are within the parameters of the services outlined in the supply arrangement;
  
  
• e. the invoiced prices are in accordance with the supply arrangement. In the case of a supply arrangement with ceiling prices, invoice prices must be less than or equal to the maximum allowable rates in the supply arrangement.
  
  

The contracting process for supply arrangements can be summarized as follows:

• a. preparation of a bid solicitation - Request for Proposal (RFP);
  
  
• b. evaluation of the proposals and selection of a supplier;
  
  
• c. preparation of the contract.

Note that the terms and conditions of a supply arrangement form part of RFP and any resulting contract.

Use form PWGSC-TPSGC 9200-11 (bilingual) (Supply Arrangement Solicitation/Contract for Non-consulting Services) for the RFP and subsequent contract.

6. Is there a Standing Offer with a specific supplier?

This type of question, is best answered with an inquiry to the database. Keep in mind that, in the "supplier" field, a manufacturer (versus a distributor) is the holder of the Standing offer.

7. Must the Goods and Services Tax (GST) be included in call-up against a Standing Offer?

Yes, the GST must be calculated and added to the value of the requirement indicated on the call-up. It is important to remember that the total value (requirement + GST) must not exceed the prescribed call-up limit of the Offer.