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New Tecumseth Council considers changing Procurement Policy to ‘Buy Canadian’

April 3, 2025   ·   0 Comments

By Brian Lockhart

As a response to the US government’s tariffs and proposed tariffs on Canadian goods, New Tecumseth Town Council is considering a by-law to amend the Town Procurement Policy to implement a more flexible ‘Buy Canadian’ and ‘Buy Ontario’ policy.

This will align with federal and provincial efforts to address tariffs and trade disruption between the two countries while ensuring compliance with existing trade agreements.

The US has imposed tariffs on Canadian goods causing disruptions to local businesses and economies leading to anticipated supply chain disruption and increased procurement costs.

In response, Canada and its provincial governments have implemented retaliatory measures against the US and are seeking support from municipalities.

While municipalities are encouraged to back these higher levels of government, they must still comply with various free trade agreements signed by the Province of Ontario as well as the Discriminatory Business Practices Act, all of which carry specific legal implications for municipal procurement.

Determining if a product is ‘made in Canada’, can be complex and open to interpretation.

The Town primarily procures from Canadian suppliers. In 2024, only seven suppliers invoiced the Town from US addresses as their main business location.

Although some suppliers are headquartered in the US, the Town usually deals with their Canadian satellite offices.

Competition Bureau Guidelines contain a distinction between ‘Product of Canada’ and ‘Made in Canada’ claims.

A ‘Product of Canada’ claim is subject to a higher threshold of Canadian content, at 98 per cent. ‘Made in Canada’ claims are subject to a 51 per cent threshold of Canadian content.

The Canadian Food Inspection Agency sets the criteria for food products. A corporation is considered to be American if its head office or registered head office is in a US state, or is directly or indirectly controlled by persons or entities located, or who ordinarily reside in a US state. 

The Building Ontario Business Initiatives Act defines an ‘Ontario Business’ as a business that is a supplier, manufacturer or distributor of any business structure that conducts its activities permanently in Ontario, has its headquarters or main office in Ontario, or has at least 250 full-time employees in Ontario at the time of the applicable procurement process.

The Town’s procurement processes are regulated by several key trade agreements, including the Canadian Free Trade Agreement, the Comprehensive Economic and Trade Agreement, and the Trade and Cooperation Agreement between Quebec and Ontario.

The Town must comply with trade agreements when establishing the open competition procurement threshold. 

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