Exploring Open Government in Contracting and Procurement

  • January 10, 2018
  • Jordan Greenwood

The 2017 joint-OBA Section conference, held at the end of November in Toronto, was a fantastic opportunity for participants to get acquainted with the principles of ‘open government’, or pro-active information disclosure. Open Government refers to policies, activities and governance structures that improve openness, accountability, and public engagement. Open contracting in the procurement context refers to the norms and practices for increased disclosure of contracting information by public institutions. This paradigm shift in how information is managed and disclosed at all levels of government, will have an impact on lawyers representing private sector clients who wish to obtain procurement contracts from public sector institutions. The Public Sector Lawyers and Privacy and Access to Information Law Executives drew on a comprehensive line-up of expert speakers explaining how this trend will impact their development and strategy initiatives in the future.

The conference kicked off with Frank DeVries, Senior Adjudicator and Manager of Adjudication with the Office of the Information and Privacy Commissioner of Ontario (IPC). One of key the tensions arising in an “Open Government” and open contracting regime is the concern that privacy rights may not be as closely scrutinized and protected if and when information assets are publicly disclosed upon being received or generated by a government body. To that effect, Mr. DeVries focused on explaining how the existing legislation and the IPC addresses this tension in the context of third party exemption rules in the Municipal Freedom of Information and Protection of Privacy Act (MFIPPA) and the Freedom of Information and Protection of Privacy Act (FIPPA).



The third party exemption tests of MFIPPA and FIPPA are three prong tests involving classifying the type and distribution of information assets belonging to a private company in the custody or control of a government body, and then assessing whether disclosure of this information upon an access request being made will cause harm to the information asset holding party. The IPC official policy is that proactive disclosure of procurement documentation, or a ‘push process’ upon documents being generated and supplied, will improve transparency of government spending, and reduce resources required under the current ‘pull process’ paradigm of pulling information via freedom of information requests. Concerning procurement, the IPC recommends that government institutions routinely publish procurement records, including preliminary analyses, successful and unsuccessful bids, evaluation of bids, and full contracts, irrespective of specific requests made by specific parties for access.

Mr. DeVries looked at some of the recent case law on third party exemptions in his presentation, to demonstrate that positions advocated by the IPC on open contracting are consistent with the privacy legislation and privacy case law in judicial review scenarios. Notably, contracts for goods and services have not usually found to be ‘supplied’ by one party, rendering them disclosable (i.e. not exempt under third party exemption rules). On the other hand, Request for Proposals (RFPs) have generally been found to satisfy the first two prongs of the third party exemption rules and may be more prone to being withheld from parties seeking access to those documents.  A Supreme Court of Canada case where a different section of FIPPA was engaged outlines the how the phrase “reasonable expectation of harm” is interpreted for the third prong of the test. Harm must be well-beyond merely the possibility or speculative, although it need not prove on a balance of probabilities that disclosure will in fact result in such harm. The IPC, in one of its decisions rebuked the argument by a government contractor party seeking to block disclosure under sections 10 (a) and (c) of MFIPPA. The party argued that disclosure of bid information would have negative competitive effects on them, and this would translate into competitors placing lower bids in response to future Request for Proposals. Mr. DeVries stated that corporations can effectively navigate FIPPA and MFIPPA and fortify the privacy of their proprietary and confidential information assets by including them in a separate schedule or attachment of their procurement bid documents, and clearly indicate that they are of a proprietary and confidential nature. This makes it easier for privacy professionals (including adjudicators in litigious proceedings) to make clear distinctions in documentation that can be voluminous and complex in nature. 

Joanne Mitchell from York Region discussed the legislative process governing third party exemptions and notice provisions and exceptions to third party exemptions involved in making access determinations. Importantly, Ms. Mitchell stated a contract which was negotiated by a government body and a private entity will generally not be considered to be “supplied” information under the second prong of the MFIPPA third party exemption test. Ms. Mitchell opined on best practices for public sector institutions in the procurement process, suggesting that public sector procuring authorities should have a ‘robust’ MFIPPA (or FIPPA if they are provincial government institutions) clause in their contracts clearly informing prospective bidders and contract counterparties of their rights in the procurement process – namely that information assets are subject to MFIPPA legislation.

Elliot Smith, a partner at Osler Hoskin & Harcourt LLP specializing in construction law, presented the private sector view of Open Contracting principles. Mr. Smith stated that pro-active disclosure or routine disclosure may a create reluctance among private contracting parties to bid on procurements, for fear of losing a competitive advantage, or increase bid prices to compensate for increased risk in disclosing information assets. Mr. Smith says he believes a balance can be struck between transparency/good governance principles and protecting privacy rights of parties who choose to do business with government institutions. This may mean limiting the amount of information that is openly disclosed in the procurement process and making informed decisions that weigh the positives of transparency against the possibility of the procuring institution losing information advantages.

John Wunderlich, Chief Data Privacy Officer for JLINC Labs, looked at practical solutions to solve the tension of protecting informational asset privacy versus transparency from a technological perspective. Mr. Wunderlich opined that the current technology utilized for storing information is outdated. He stated that a potential solution for dissolving the aforementioned tension could be in the form of automated information sharing agreements and contracts. This scenario allows contracting parties to make an agreement outside the actual substantive contract concerning information sharing principles. These parties can enter into secure systems used in the procurement process to control data and information assets they have supplied or mutually generated.

Overall, the conference provided useful and practical insight for those looking to deepen their expertise in privacy and access law as it relates to the public sector, and procurement. Stay involved in our section’s activities, sign up for our eBlasts, and stay tuned for a possible ‘sequel’ outlining new developments in ‘Open Government’ and ‘Open Contracting’!


About the author

Jordan Greenwood, Deloitte Canada

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