Implications Of The Federal Debarment Policy For Government-Contracting Entities

The federal government's Integrity Framework (referred to as the Debarment Policy) has important implications for entities that are convicted of or plead guilty to certain offences under the Competition Act, most particularly conspiracy and bid-rigging (see earlier Antitrust Advisories regarding cartels and bid-rigging). In addition to the significant potential penalties (fines and imprisonment) and exposure to private actions for damages under the Competition Act, under the Debarment Policy guilty parties are prohibited from contracting with the federal government for 10 years (a similar regime also applies in the province of Québec). Accordingly, for parties that derive a significant portion of their revenues from federal government (or Québec) contracts, debarment may be even more economically damaging than the sanctions provided for under the Competition Act.