Federal contractors seeking work under Ottawa’s Buy Canadian procurement program must now certify they will not subcontract work to foreign companies or workers outside Canada in a way that reduces Canadian economic benefits, according to new rules introduced by the Department of Public Works.Blacklock's Reporter says the changes come after MPs raised concerns that the government’s Buy Canadian policy contained loopholes that could allow foreign firms to benefit from contracts intended to support Canadian jobs and businesses.“A new Declaration Form has been introduced requiring Canadian suppliers to certify they will not subcontract work to non-Canadian suppliers or to individuals located outside Canada in a manner that results in minimal value-added activities being performed within Canada,” the department wrote in a submission to the Commons government operations committee.“The form specifically asks the supplier to certify they will not structure subcontracting arrangements in a way that diminishes the level of Canadian value added.”The department said contracting authorities will be responsible for ensuring compliance with the new requirements, though officials provided few details on how enforcement will work.“Compliance and follow-up activities will be conducted by the contracting authority,” the department stated.Levent Ozmutlu, director general with Public Works, told MPs at a May 26 committee hearing that suppliers would initially be trusted to self-certify compliance, with audits conducted afterward when necessary.“This is done through self-attestations and we do have the ability to audit,” said Ozmutlu.Prime Minister Mark Carney unveiled the Buy Canadian initiative on Sept. 5 as part of a pledge to “build Canada strong.” However, department officials later acknowledged that companies do not need Canadian ownership to qualify as Canadian suppliers under the program.“The goal of the Buy Canadian policy is not to exclude foreign suppliers,” Dominic Laporte, senior assistant deputy minister of Public Works, told MPs. “The goal is to make sure we prioritize our Canadian suppliers.”.Under the government’s criteria, a Canadian supplier is any business with a GST number, a Canadian street address and at least one employee in Canada.“Most suppliers that have a Canadian address will be able to bid,” said Laporte.Conservative MP Tamara Jansen questioned whether foreign-owned firms could still qualify for preferential treatment under the policy.“If a company from a country without a trade agreement with Canada establishes a Canadian subsidiary, registers and files taxes here, maintains a Canadian address and conducts day-to-day business here, could it qualify as a Canadian supplier?” Jansen asked.“If they have enough employment in Canada,” Laporte replied.When asked whether the department distinguishes between Canadian-owned businesses and foreign-owned companies operating in Canada, Laporte said it does not.“We don’t,” he said.Public Works remains the federal government’s largest purchasing authority, acquiring an estimated $37.5 billion in goods and services last year.According to a 2025 departmental briefing note, Ottawa spent an average of approximately $1.3 billion annually over the past three years on contracts awarded directly to U.S.-based suppliers for both defence and civilian procurement.The figure does not include contracts awarded to Canadian subsidiaries of American companies or purchases made through the U.S. Foreign Military Sales program.
