Understanding the Contract Modernization Initiative

Example of a first section in a new contractual document

1. Solicitation of Offers.
1.1. Introduction. Canada requests offers from Offerors to meet its requirements. For the convenience of Offerors, a brief description is set out below with detailed requirements in subsequent sections of this solicitation of offers. If interested and able to meet these requirements, Canada appreciates and welcomes an offer.
1.2. Offers. Canada is seeking offers from Offerors to provide office chairs to Public Services and Procurement Canada.
1.3. Term. The period of the Contract is from date of Contract to January 1, 2025 inclusive.
1.4. Delivery Date. All the deliverables must be received on or before January 1, 2025.
1.5. Delivery Points. Delivery of the requirement will be made to delivery point(s) specified at Annex Statement of Requirement of the contract.

Example of a full text clause in a new contractual document

1.6. Exchange Rate Fluctuation. Canada is not offering exchange rate fluctuation risk mitigation for this solicitation of offer. Canada will declare any offer non-compliant if there is any indication that offer is conditional on exchange rate fluctuation protection.

Simplifies and uses Plain language clauses

To help each party understand their roles and responsibilities, clause language has been redrafted to focus on simplification, using plain language and creating more white space.

Consolidated SACC Manual terminology

Original SACC Manual terminology has been consolidated across Request for Proposal (RFP), Standing Offer (SO) and Supply Arrangement (SA) documents by using unified terms to make them more consistent and concise. See the table below for examples of these changes.

Table 1: New common terms for SACC Manual terminology

Example of related terms that are grouped together in a new contractual document

 1. Payments

    1.1  Invoices

1. Invoice Submission. The Contractor must submit invoices for each delivery in accordance with the Contract. Each invoice must indicate whether it covers partial or final delivery.
2. Invoice Details. Invoices must show:
   1. the date, the name and address of the client department, item or reference numbers, deliverable or description of the Work, Contract ID, Client Reference Number, Business Number, and financial code(s);
   2. details of expenditures (such as item, quantity, unit of issue, unit price, fixed time labour rates and level of effort, subcontracts, as applicable) in accordance with the Basis of Payment, exclusive of Applicable Taxes;
   3. deduction for holdback, if applicable;
   4. the extension of the totals, if applicable;
   5. if applicable, the method of delivery together with date, case numbers and part or reference numbers, shipment charges and any other additional charges; and
   6. Applicable Taxes as a separate item along with corresponding registration numbers from the tax authorities. The Contractor must identify on all invoices all items that are zero-rated, exempt or to which Applicable Taxes do not apply.
3. Payment of Taxes. Canada will pay Applicable Taxes. It is the sole responsibility of the Contractor to charge Applicable Taxes at the correct rate. The Contractor must pay Applicable Taxes, ancillary taxes, and any commodity tax, on taxable goods or services used or consumed in the performance of the Contract (in accordance with applicable legislation), including for material incorporated into real property.
4. Exemptions. The Contractor is not entitled to use Canada’s exemptions from any tax, such as provincial sales taxes, unless otherwise specified by law.
5. Withholding for Non-Residents. Canada will withhold 15 percent of the amount to pay the Contractor in respect of services provided in Canada if the Contractor is not a resident of Canada unless the Contractor obtains a valid waiver from the Canada Revenue Agency.

 1.2  Invoicing Instructions.

1. Invoice Submission. The Contractor cannot submit any invoices until all Work identified in the invoice is completed.
2. Invoice Support. The Contractor must support each invoice with
   1. a copy of time sheets to support the time claimed,
   2. a copy of the release document and any other required documents,
   3. a copy of the invoices, receipts, and vouchers for all direct expenses, and all travel and living expenses, and
   4. a copy of the monthly progress report.
3. Invoice Distribution. The Contractor must forward:
   1. the invoice to the address shown on page 1 of the Contract for certification and payment.

1.3  Payment Period. Canada will pay the Contractor’s undisputed invoice amount within 30 days after receipt of invoice in acceptable form and content. In the event an invoice is not of an acceptable form and content, Canada will notify the Contractor within 15 days of receipt and the 30 day payment period will begin on receipt of a conforming invoice.