Today, April 8, 2025, the Ontario Minister of Energy and Mines issued a letter to the Ontario Energy Board and the Independent Electricity System Operator (IESO) requesting they apply the provincial government's Procurement Restriction Policy (Policy) to prohibit U.S. businesses from participating in invitational, open competitive and non-competitive energy procurements in Ontario. The Policy applies to all provincial ministries and agencies, as well as Ontario Power Generation and the IESO.
The letter comes in response to the tariffs imposed by the U.S. federal government on Canadian products, which are expected to negatively impact Ontario's economy.
A U.S. business is defined under the Policy to mean a supplier, manufacturer or distributor of any business structure (including a sole proprietorship, partnership, corporation or other relevant business structure) that:
- Has its headquarters or main office located in the U.S., and
- Has fewer than 250 full-time employees in Canada at the time of the applicable procurement process
Canadian subsidiaries of U.S. businesses are also captured under the Policy.
A public sector entity can rely on a business's representation that it does not meet the definition of a U.S. business. This means that a public sector entity does not need to independently verify that the bidder is not a U.S. business, but it can ask a bidder to attest that it does not meet that definition.
The Policy excludes procurements already in progress, i.e., where a procurement document has been issued before March 4, 2025. Clarity is required on if and to what extent the Policy applies where only design or draft procurement documents have been posted, e.g., the IESO's Long-Term 2 and Transmitter Selection Framework.
Other exceptions include unforeseen urgent situations, and if a U.S. business is the only viable source for the good or service in instances where the procurement cannot be delayed. In such instances, the decision to procure from a U.S. business must be set out in a business case and approved by the Deputy Minister (DM), DM equivalent or CEO.
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