The Canada – UK Trade Continuity Agreement (TCA) – CETA Redux
What it is?
Following its decision to exit from the European Union, the UK needed to negotiate new trading relationships with its trading partners. For Canada, this meant replacing the Canada-European Union Comprehensive Economic and Trade Agreement (CETA). The Canada-United Kingdom Trade Continuity Agreement (the TCA) is the interim trade agreement that will remain in place until a final trade agreement is negotiated. Although the TCA is identified as a “new” trade agreement, for government procurement, the TCA reflects CETA and is intended to ensure that the rights and obligations of CETA will continue. The TCA provides guaranteed access for Canadian suppliers to the UK government procurement market, estimated to be worth approximately CDN $118 billion – including access to the regional and local government; bodies governed by public law (such as hospitals and universities); and a number of other entities operating in the utilities sector.
When Does it Come in to Effect?
Each Party must ratify the TCA under its own domestic legislation before it can come into effect. Canada did not ratify the TCA before the UK Brexit transition period expired on December 31, 2020. However, the Parties have signed a Memorandum of Understanding (MOU) providing that certain benefits of CETA will continue in effect pending the entry into effect or provisional application of the TCA. This will be followed by legislative work to ratify and implement the TCA when the Parliament of Canada resumes in late January. The Parties have agreed to start negotiations for a new trade agreement no later than the first anniversary of the coming into force of the TCA.
What are the Government Procurement Obligations?
All of the provisions of Chapter 19 – Government Procurement for Canada that existed under CETA will continue to apply once the TCA is ratified, subject to those modifications to ensure alignment to a two-Party arrangement (e.g. changing references to the EU to the appropriate UK references; retaining the Canada-UK Joint Committee formed under CETA and the continuing application of decisions made by the Canada-UK Joint Committee that were made under CETA). The EU Market Access schedules have been fully adopted, subject to those changes that reflect UK- specific regulations and purchasing entities. As was the case in CETA, the Parties have agreed to establish an individual electronic single point of access (SPA) for procurement notices, including at the sub-central level, by September 21, 2022. The UK’s new SPA, Find a Tender service, is described in more detail below. We have previously covered how Canada intends to implement its own SPA using the CanadaBuys website.
Other Modifications:
For additional information on other aspects of the TCA, please see our bulletins:
Tender Publication and the UK’s New Single Point of Access (SPA)
The Find a Tender service (FTS) replaces the Official Journal of the European Union’s Tenders Electronic Daily (OJEU/TED) as the UK’s SPA for public procurements. The FTS portal went live on December 31, 2020 and can be accessed here. As a UK only e-notification portal to publish, access and respond to procurement notices, the FTS acts as the UK’s one-stop-shop to retrieve information about all bid opportunities that were covered under the CETA and will be covered under the TCA. However, bidders should note the following:
- For UK public procurements commencing after January 1, 2021, contracting authorities are required to publish all notices for procurements in the FTS in place of the OJEU/TED.
- If a public procurement was commenced and not finalized before January 1, 2021, any notices for those procurements must still be published in the OJEU/TED. Contracting authorities must also continue to use OJEU/ TED to publish subsequent notices for the same tender.
Ontario-Maryland Strategic Investment and Procurement Agreement
On December 17, 2020, Ontario announced it had finalized a Strategic Investment and Procurement Agreement (SIPA) with the state of Maryland – the first SIPA to come out of the Ontario government’s strategy for trade with the United States. The legal text of the agreement has yet to be published. Ontario’s announcement identified that the Parties will aim to work collaboratively under the Ontario-Maryland SIPA to:
- Attract investment, promote job creation, and increase two-way trade in both jurisdictions, with a focus on manufacturing, infrastructure, and the agri-food sector.
- Mitigate the impacts of unforeseeable events such as natural disasters or public health emergencies by, for example, sharing best practices to support ongoing responses to the COVID-19 pandemic and securing PPE, etc.
- Create a Procurement Cooperation Council to improve transparency and engagement on government purchasing for businesses based in Ontario and Maryland, and to serve as a platform for the Parties to maintain an open dialogue about existing and future rules related to public procurement.
Trade Agreement Procurement Thresholds for 2021
The thresholds for government procurement coverage under Canada’s national and international trade agreements are provided in the downloadable PDF document.
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