Government-to-government (G2G) sole-source contracting is a low-risk way for governments abroad to buy from Canadian exporters — but not every government is familiar with the approach. This blog series, Introducing G2G Contracting to Foreign Government Buyers, will help you answer some of the questions your potential government customers may have about this unique contracting approach.
CCC’s G2G approach appeals to foreign government buyers because it offers less risk and a Government of Canada guarantee of contract performance. Even so, sometimes your buyers will want assurances that the G2G option is a viable and established procurement mechanism — and not an end-run around competitive tendering or public procurement processes.
If your buyer is unsure or has questions about the G2G approach, here are four things you can tell them to put their minds at ease:
G2G contracting is perfectly legitimate.
Most countries’ procurement laws and legislation include exceptions to competitive procurement for urgent acquisitions or those related to national security. That allows them to acquire products or services on a G2G basis, which can help avoid the costly delays associated with an open call for proposals. As a Crown corporation, CCC respects all local procurement laws and practices in the countries where we do business — and we work only with exporters who will do the same.
G2G contracting has been used for more than 65 years.
CCC has been negotiating and overseeing G2G contracts since the end of the Second World War. That started with the 1956 Canada–U.S. Defence Production Sharing Agreement, which gives Canadians access to U.S. Department of Defense (DoD) procurement opportunities. We’ve continued to work closely with the DoD ever since to keep the market for military contracts open to Canadian companies.
In 2019–20, CCC was active in 81 countries, negotiating deals not only with national governments but also state/provincial and municipal governments as well as government-owned enterprises such as utilities. We signed $1.25 billion in new contracts that same year, working with 157 Canadian exporters across a broad range of projects and sectors: building airports in Bermuda and turbine engine testing facilities in Morocco, supplying computer-aided dispatch solutions to first responders in Panama, and much more.
Your buyer may already be using G2G contracts.
The best indication that a foreign government is open to a G2G contract is if they’ve used one before. If your buyer has ever purchased through the DoD’s Foreign Military Sales Program, it follows a similar state-to-state contracting mechanism as the G2G approach — just under a different name. That also means the country already has the legislative framework in place to allow for the use of G2G contracts.
Our G2G approach comes with added assurances.
G2G contracting isn’t unique to Canada, but how we do it is. When we sign a contract with a foreign government, we take on the role of the prime contractor. That means we assume all performance oversight and financial administration, handling payments and cash flows throughout the contract’s execution. We also remain fully engaged during the delivery and warranty period, working with the purchasing government to ensure the project is completed successfully.
In addition, our contracts have the legal effect of being signed in the name of the Government of Canada. That provides your foreign government buyer with the assurance and confidence that the contract will be delivered per the agreed terms and conditions, guaranteed.
For more advice on talking to buyers about G2G contracting, download our e-book, Winning