Her Excellency the Governor General recommends to the House of Commons the appropriation of public revenue under the circumstances, in the manner and for the purposes set out in a measure entitled “An Act respecting production, procurement and investment in relation to national defence and national security”.

This enactment contains measures relating to production, procurement and investment in respect of national defence and national security.

Part 1 enacts the Canadian Corporation for Defence Investment Act. That Act establishes the Canadian Corporation for Defence Investment, a corporation whose mandate is to, among other things, carry out activities related to production, procurement and investment in respect of national defence for the benefit of the Canadian Forces or the Department of National Defence or for associated governments. Part 1 also makes related and consequential amendments to other Acts.

Part 2 amends the Defence Production Act to, among other things,

Part 2 also makes consequential amendments to the Access to Information Act and terminology changes to certain legislative texts.

Part 3 provides for a review of the operation of the Canadian Corporation for Defence Investment Act and the amendments to the Defence Production Act.

His Majesty, by and with the advice and consent of the Senate and House of Commons of Canada, enacts as follows:

Associate Minister — procurement

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  (j.‍1) the Associate Minister of National Defence for Procurement;

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An Act respecting production Insertion start and procurement in relation to Insertion end defence Insertion start and national security and respecting the control of certain goods Insertion end

Short title

1 This Act may be cited as the Defence Insertion start and National Security Insertion end Production Insertion start and Procurement Insertion end Act.

Définitions Insertion start et interprétation Insertion end

associated government means

• Insertion start (a) Insertion end Insertion start   Insertion end Insertion start His Insertion end Majesty’s Government in the United Kingdom or any other government of the Commonwealth,

• Insertion start (b) Insertion end  the government of a country that is a member of the North Atlantic Treaty Organisation,

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  (c) the government of a country, or an international organization of states, that is recognized by the North Atlantic Treaty Organisation as a partner in good standing of that Organisation,

• (d) the European Union or the government of any of its member states, and

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• Insertion start (e) Insertion end  the government of any other country designated by the Governor in Council as being a country the defence of which is vital to the defence of Canada; (gouvernement associé)

defence projects means

• Insertion start (a) Insertion end  military works, Insertion start including Insertion end buildings, aerodromes, airports, dockyards, roads Insertion start and Insertion end defence fortifications,

• Insertion start (b) Insertion end  works required for the production, maintenance or storage of defence supplies,

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  (c) works in relation to residential communities, including non-military residential communities, on federal real property or federal immovables under the administration of the Minister of National Defence, or

• (d) works required for the purposes of national security; (ouvrage de défense)

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government issue means machinery, machine tools, equipment or defence supplies Insertion start that are Insertion end furnished by the Minister or by an agent of Insertion start His Insertion end Majesty on behalf of Insertion start His Insertion end Majesty or of an associated government, or Insertion start that are Insertion end acquired on behalf of Insertion start His Insertion end Majesty or of an associated government with funds provided by the Minister, an agent of Insertion start His Insertion end Majesty or an associated government; (fournitures d’État)

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  (a.‍1) a contract with His Majesty or an agent of His Majesty, or with an associated government, that in any way relates to defence services, and

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• (a) to perform all or any part of the work or service or make or furnish Insertion start anything Insertion end for the purpose of any other defence contract,

• (c) under which any part of the services performed or to be performed consists of soliciting, attempting to negotiate or negotiating any other defence contract or soliciting or negotiating for the Insertion start acquisition Insertion end or Insertion start disposition Insertion end of Insertion start anything Insertion end , or Insertion start for the acquisition or provision of any Insertion end services, required to fulfill any other defence contract,

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  (a) anything — including any physical thing, animal, data or intangible or incorporeal property — that is required or used for the purposes of national defence or national security or for cooperative efforts for defence or security being carried on by the Government of Canada and an associated government,

• (b) a vessel of any kind, whether floating or submersible, other than a pleasure craft, and

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• (c)  Insertion start anything Insertion end used for the production or supply of anything Insertion start referred to Insertion end in paragraph (a) or (b) or for the construction of defence projects; (matériel de défense)

acquire includes to lease; (acquérir)

defence services means services that are required or provided for the purposes of national defence or national security, for cooperative efforts for defence or security being carried on by the Government of Canada and an associated government or for the construction of defence projects, but does not include legal services and services provided by an individual in their capacity as an officer or employee of His Majesty or as a member of the Canadian Forces; (service de défense)

dispose includes to consign and to lease; (disposer)

Multiple purposes permissible

PART 0.‍1 

General

Act prevails

Non-disclosure of information

• (a) to a government department, or any person authorized by a government department, requiring the information for the purpose of the discharge of the functions of that department; or

• (b) for the purposes of any prosecution for an offence under this Act or, with the consent of the Minister, for the purposes of any civil suit or other proceeding at law.

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Powers of specific government companies

PART 1 

Production, Procurement and Investment

Purpose

• (a) provide for the supply of things and services, and for the construction of works, in relation to national defence and national security, including by fostering the capabilities and capacities of persons and industries to supply those things and services; and

• (b) regulate procurement in relation to national defence and national security.

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Exclusive authority

10 (1)  Insertion start Subject to the Canadian Corporation for Defence Investment Act Insertion end , the Minister Insertion start has Insertion end the exclusive authority to

• (a) acquire defence supplies Insertion start and Insertion end defence Insertion start services Insertion end required for the purposes of a department, Insertion start board or agency of the Government of Canada Insertion end ; and

• (b) construct defence projects Insertion start required for Insertion end the Insertion start purposes Insertion end of any department, Insertion start board or agency referred to in paragraph (a) Insertion end , except for defence projects to be constructed by Insertion start individuals Insertion end in Insertion start their capacity Insertion end as Insertion start officers Insertion end or Insertion start employees Insertion end of Insertion start His Insertion end Majesty or as members of the Insertion start Canadian Forces. Insertion end

Exception — Shared Services Canada

(2) The exercise of the powers referred to in subsection (1) is subject to any specification made by the Governor in Council under paragraph 6(a) or (c) of the Shared Services Canada Act.

Acts on behalf of associated government

11 The Minister, if authorized by the Governor in Council to do so, may do or undertake, on behalf of an associated government, any act or thing that the Minister is authorized to do or undertake by this Insertion start Part Insertion end on behalf of Insertion start His Insertion end Majesty.

Delegation — other ministers

11.‍1 (1) The Minister may, subject to any terms that the Minister may specify, delegate any of the Minister’s powers, duties or functions under this Part to an appropriate minister, other than a power, duty or function set out in subsection 15.‍1(1), 17(1) or 26(2).

For greater certainty

(2) For greater certainty, nothing in subsection (1) is to be construed as preventing an appropriate minister from doing the activities described in subsection 15.‍1(1) under any other Act of Parliament or any other law.

Delegation — chief executive

(3) The Minister may, with respect to a department over which the Minister does not preside but for which the Minister is the appropriate minister, delegate any of the Minister’s powers, duties or functions under this Part, other than those set out in subsection 15.‍1(1), 17(1) or 26(2), to the chief executive of that department.

Subdelegation — chief executive

(4) The appropriate minister for a department may, subject to and in accordance with the delegation under subsection (1), subdelegate to the chief executive of that department any of the powers, duties or functions that were delegated to the appropriate minister under that subsection.

Subdelegation — other persons

(5) The chief executive of a department may, subject to and in accordance with the delegation under subsection (3) or the subdelegation under subsection (4), subdelegate to any person under their authority any of the powers, duties or functions that were delegated or subdelegated to them under subsection (3) or (4).

Definitions

(6) The following definitions apply in this section.

appropriate minister has the same meaning as in section 2 of the Financial Administration Act.‍ (ministre compétent)

chief executive means

• (a) with respect to a department named in Part I of Schedule VI to the Financial Administration Act, its deputy minister;

• (b) with respect to a department named in Part II or III of that Schedule, the person occupying the position set out opposite that name; and

• (c) with respect to a department that is not named in that Schedule, the chief executive officer, deputy head or the person who occupies any other similar position in that department.‍ (administrateur principal)

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Duties of Minister

12 The Minister shall

• Insertion start (a) Insertion end  examine into, organize, mobilize and conserve the resources of Canada that Insertion start contribute Insertion end to defence supplies and Insertion start their Insertion end sources of supply;

• Insertion start (b) Insertion end Insertion start   Insertion end Insertion start examine into, organize, mobilize Insertion end and Insertion start conserve Insertion end the Insertion start workforce Insertion end , agencies and facilities available for the supply Insertion start of defence supplies, the provision of defence services Insertion end and the construction of defence projects;

• Insertion start (c) Insertion end  explore, estimate and provide for the fulfillment of the present and Insertion start future Insertion end needs of the Government Insertion start of Canada Insertion end and the community with respect Insertion start to the supply of defence supplies, the provision of defence services and the construction of defence projects Insertion end ; and

• Insertion start (d) Insertion end  generally take steps to mobilize, conserve and coordinate all economic and industrial facilities in respect of defence supplies, Insertion start defence services Insertion end and defence projects and Insertion start their Insertion end supply, Insertion start provision Insertion end or construction.

Request for information

13 (1) The Minister may, by notice in writing, require Insertion start that a Insertion end person referred to in subsection (2) Insertion start provide Insertion end the Insertion start Minister Insertion end with any Insertion start information Insertion end with respect to

• Insertion start (a) Insertion end  defence supplies produced, dealt in or controlled by the person or that the person holds, has contracted for or contemplates acquiring, Insertion start as well as Insertion end the sources of supply Insertion start for them Insertion end ;

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  (b) defence services provided by the person or that the person has contracted to provide or contemplates providing, as well as the sources of supply for them; and

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• Insertion start (c) Insertion end  the facilities or accommodation that the person has available for or that are adaptable to the production or storage of defence supplies, Insertion start the provision of defence services Insertion end or the construction of defence projects.

Duty to provide

(1.‍1) The person referred to in the notice shall provide the requested information at the times, and in the form and manner, specified in the notice.

Persons providing information

(2) Subsection (1) Insertion start applies with respect Insertion end to any person who

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  (c) provides defence services or carries on a business that, in the opinion of the Minister, is suitable for providing defence services.

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Other departments to assist Minister in obtaining information

14  Insertion start If Insertion end a government department has, under any Act, Insertion start the Insertion end power to obtain, for any purpose, information Insertion start on Insertion end matters with respect to which the Minister is empowered to require Insertion start that information Insertion end be Insertion start provided under subsection 13(1) Insertion end , that department shall, if so required by the Minister, exercise that power for the purpose of assisting the Minister in obtaining Insertion start that Insertion end information.

Stockpiling

15  Insertion start (1) Insertion end  Subject to this Insertion start Part Insertion end , the Minister may, on behalf of Insertion start His Insertion end Majesty, acquire, store, maintain, transport or dispose of Insertion start anything Insertion end designated by the Governor in Council.

Designation

(2) For the purposes of subsection (1), the Governor in Council may designate anything that is essential to the needs of Canada, of a community in or outside of Canada or of an associated government for

• (a) the purposes of national defence, of national security, including economic security, or of the defence or security of an associated government or other state; or

• (b) the purpose of safeguarding against possible shortages of the thing.

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Financial assistance

15.‍1 (1) For a purpose related to production, procurement or investment in respect of national defence or national security, or for a purpose related to defence supplies, defence services or a defence project or to subsection 15(1), the Minister may

• (a) make loans to any person;

• (b) make advance payments to any person;

• (c) with the approval of the Minister of Finance, guarantee the repayment of any financial obligation undertaken by any person; and

• (d) where authorized by the Governor in Council on the recommendation of the Minister with the concurrence of the Minister of Finance, enter into any other financial agreement or arrangement.

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For greater certainty

(2) For greater certainty, the Minister’s powers set out in subsection (1) are in addition to the Minister’s other powers under this Part.

Ministerial powers

16 The Minister may, on behalf of Insertion start His Insertion end Majesty and subject to this Insertion start Part Insertion end ,

• (a) acquire, utilize, store, transport or dispose of defence supplies;

• (c) construct, acquire or dispose of defence projects;

• (d)  Insertion start acquire defence Insertion end services Insertion start or Insertion end professional or commercial Insertion start services other than defence services Insertion end ;

• (e) acquire or dispose of real or personal property or any interest in real or personal property, or an immovable or a movable or any right in an immovable or a movable, that, in the Insertion start Minister’s Insertion end opinion, is or is likely to be Insertion start useful Insertion end for any Insertion start purpose Insertion end mentioned in paragraph (a), (b) or (c); and

• (f) do all things Insertion start that, in Insertion end the Insertion start Minister’s opinion, are Insertion end incidental to or Insertion start useful Insertion end for Insertion start any of Insertion end the matters referred to in Insertion start paragraphs (a) to (e) Insertion end or Insertion start that Insertion end may be authorized by the Governor in Council with respect to the procurement, construction or Insertion start disposition Insertion end of defence supplies or defence projects Insertion start or the procurement of defence services Insertion end .

Dealings for other purposes

16.‍1 Anything that is acquired or produced, any service that is acquired, and any work that is acquired or constructed, under this Part may be dealt with under this Part for any purpose.

Expenditures from Consolidated Revenue Fund

17 (1) The Minister may pay out of the Consolidated Revenue Fund any amount payable in respect of the exercise of any power under any of subsection 15(1), paragraphs 15.‍1(1)‍(a) and (b) and section 16 or in respect of any other purpose prescribed by regulation.

Maximum amount

(2) The aggregate amount paid out under subsection (1) must not at any time exceed $1 billion.

Deductions

(3) The following amounts, if they are in respect of the same item for which a payment has been made under subsection (1), are to be deducted from the aggregate amount referred to in subsection (2):

• (a) any amount deposited in the Consolidated Revenue Fund that is received from the disposition of anything under this Part;

• (b) any amount deposited in the Consolidated Revenue Fund in repayment of the principal amount of a loan or in repayment of an advance payment;

• (c) any amount charged to another appropriation that is authorized by Parliament;

• (d) any amount deposited in the Consolidated Revenue Fund that is received from an associated government or an agent of His Majesty; and

• (e) any amount deposited in the Consolidated Revenue Fund in relation to an amount paid out in respect of a purpose prescribed by regulation under paragraph 33(2)‍(b).

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Limitation on deductions

(4) The total of the amounts deducted under subsection (3) in respect of any item must not exceed the total payments made under subsection (1) with respect to the same item.

Losses

(5) A loss sustained in the acquisition and subsequent disposition of anything, or on account of any loan or advance payment or otherwise, and in respect of which a payment has been made under subsection (1) may be deducted from the aggregate amount referred to in subsection (2) if Parliament authorizes the deduction in an appropriation Act.

Amendment

(6) The maximum amount set out in subsection (2) may be amended by an appropriation Act.

Definition of item

(7) In this section, item means

• (a) a thing referred to in paragraph (3)‍(a);

• (b) a loan or advance payment referred to in paragraph (3)‍(b);

• (c) the subject-matter of an appropriation referred to in paragraph (3)‍(c);

• (d) the subject-matter of an amount received that is referred to in paragraph (3)‍(d); or

• (e) the subject-matter of an amount referred to in paragraph (3)‍(e).

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Limitation

18 Subject to the regulations, the Minister is not authorized to make, in respect of the exercise of a power under paragraph 15.‍1(1)‍(a), a payment out of the Consolidated Revenue Fund under subsection 17(1) if the exercise of the power is for the purpose of

• (a) the construction, acquisition, extension or improvement of capital equipment or works by any person; or

• (b) research, development or innovation in relation to defence supplies or defence services.

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• (b) subject to any provisions in the contract, Insertion start His Insertion end Majesty or the associated government in whom the title is vested is entitled at any time to remove or dispose of the government issue or building.

Rules on Competitive Procurement

Application

Exclusive authority

Application of regulations — inconsistency or conflict

Competitive procurement process

Exceptions

• (a) the contract is for the purposes of addressing an urgent operational requirement;

• (b) the dispensation is necessary for the purposes of

  • (i) conducting military operations,

  • (ii) constructing, maintaining or operating critical defence projects, or

  • (iii) safeguarding national security;

• (c) the dispensation is warranted in order to support a sector of the Canadian economy that is important to national defence or to national security, including economic security;

• (d) the contract is for defence supplies or defence services that are interoperable with defence projects, defence supplies or defence services — or that are interchangeable with defence supplies or defence services — of the Government of Canada or of an associated government;

• (e) the contract is in relation to sensitive technology;

• (f) only one person is capable of performing the contract;

• (g) the purpose of the contract is, for operational reasons, to fulfill an interim requirement for defence supplies or defence services or to ensure defence logistical capabilities on an interim basis;

• (h) the contract is related to a contract referred to in paragraph (g);

• (i) the contract is for the purpose of research, development or innovation in relation to defence supplies or defence services;

• (j) the contract is for defence supplies or defence services that were the subject of funding provided by the Government of Canada for research, development or innovation;

• (k) the contract is to be entered into

  • (i) with a government entity,

  • (ii) under an agreement or arrangement with a government entity, or

  • (iii) under a procedure of an international organization of states of which Canada is a member;

• (l) any exception, set out in regulations made under section 41 of the Financial Administration Act, to a requirement to conduct a competitive procurement process applies, with any necessary modifications, in the circumstances; or

• (m) any other exception prescribed by regulation applies in the circumstances.

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Exclusion

Reasons not required

Regulations

33  Insertion start (1) Insertion end  The Governor in Council may make regulations to carry out the purposes and provisions of this Part, Insertion start including regulations Insertion end

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  (a) respecting the exercise of the Minister’s powers under section 15;

• (b) authorizing the Minister, for the purposes of national defence or national security or if faced with an emergency, to require that any person do anything, under the control and direction of the Minister, that the Minister may do under section 15;

• (c) fixing terms that are deemed to be expressly set out in contracts, or classes of contracts, entered into under this Part or in documents, or classes of documents, relating to such contracts and their formation;

• (d) respecting the provision of information in relation to the costing of contracts described in subsection 26(1);

• (e) respecting the procedure for conducting a competitive procurement process under section 27; and

• (f) respecting the meaning of “urgent operational requirement”, “sensitive technology” and “government entity” for the purposes of section 28.

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Regulations — certain provisions

(2) The Governor in Council may, on the recommendation of the Minister with the concurrence of the Minister of Finance, make regulations

• (a) respecting the loans that may be made under paragraph 15.‍1(1)‍(a) and the guarantees that may be given under paragraph 15.‍1(1)‍(c);

• (b) providing for any other purpose for which an amount may be paid out of the Consolidated Revenue Fund under subsection 17(1); and

• (c) respecting exceptions to the limitation set out in section 18.

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Orders

(3) The Governor in Council may make orders to carry out the purposes and provisions of this Part.

Inconsistency or conflict

(4) Nothing in paragraph (1)‍(c) precludes the application of regulations made under section 42 of the Financial Administration Act to contracts entered into under this Part. However, regulations made under paragraph (1)‍(c) prevail over regulations made under that section 42 to the extent of any inconsistency or conflict.

Regulations — administrative monetary penalties

33.‍1 (1) The Governor in Council may make regulations establishing an administrative monetary penalties scheme for the purpose of promoting compliance with respect to the regulations made under paragraph 33(1)‍(b) or (d), including regulations

• (a) respecting appeals of any orders or decisions in proceedings relating to the scheme; and

• (b) in relation to the recovery, as a debt, of unpaid penalties and any additional penalty to be paid in respect of those unpaid penalties.

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Request for review

(2) The regulations shall provide a right to request a review by the Minister of any acts or omissions that constitute an alleged violation or the amount of a penalty.

Maximum penalty

(3) The maximum penalty in respect of a violation is $2,000,000.

Offence or violation

(4) If an act or omission can be proceeded with as a violation under a regulation made under subsection (1) or as an offence under this Act, proceeding in one manner precludes proceeding in the other.

Other offences

(2) Every person who contravenes any other provision of this Act, Insertion start with the exception of section 27 Insertion end , or Insertion start any provision of Insertion end the regulations is guilty of an offence punishable on summary conviction and liable to a fine Insertion start of Insertion end not Insertion start more than Insertion end $25,000 or to imprisonment for a term Insertion start of Insertion end not Insertion start more than Insertion end 12 months, or to both.