01-34 GENERALS SPRING25 PT - Flipbook - Page 12
ADVOCACY
NAVIGATING TARIFF IMPACTS
An open letter to public sector owners. By GIOVANNI CAUTILLO, OGCA President
Duties and tariffs in CCDC contracts
Open, clear communication
and cooperation between
owners, contractors, trades
and consultants will be key to
managing these obstacles.
12 the generals • SPRING 2025
Public sector owners and buyers
of construction play a vital role in
the sustainability of the construction
industry. The contractors delivering your
projects are not just businesses; they
are workers, taxpayers and property
owners, employing local workers
and strengthening our communities.
While the federal government is right
to respond in kind, we call for all
governments to consider economic
measures to support Canadian businesses
and stimulate our economy, in
consultation with industry.
In this everchanging situation, fairness and collaboration are essential to
maintaining stability and ensuring the
continued delivery of the public infrastructure we all rely on.
Best practices for public sector owners
To ensure fairness and stability in public
construction projects, we urge public
owners to:
ENGAGE IN OPEN DIALOGUE with their general
contractors, consultants and the trade
contractors to mitigate risks and explore
alternative solutions, where possible.
CLARIFY DOCUMENTATION REQUIREMENTS for
proving cost increases due to tari昀昀s, recognizing that precise cause-and-e昀昀ect
proof may not always be black and white,
or possible.
MAINTAIN A FAIR, TRANSPARENT AND REASONABLE
approach to procurement, using longstanding best practices to facilitate a
smooth process.
In procurement
Following best practices and norms in
public sector procurement is more critical than ever to ensure a fair, open, and
transparent process that supports industry
stability and delivers value to taxpayers. In
light of current economic challenges, we
encourage owners to consider the following
approaches:
1. BID CLOSING AS THE KEY DETERMINANT – Under
CCDC 2-2020 GC 10.1, the bid closing date
- not the contract award or execution - is
the determinant for whether a tari昀昀 change
quali昀椀es for a contract price adjustment.
2. ENCOURAGE CANADIAN-MADE SUBSTITUTIONS –
Include an explicit provision in procurement
documents that encourages general and
trade contractor bidders to propose Canadian- made and produced substitution items
through the tender’s RFI process, as long as
they meet the performance requirements of
the speci昀椀cations.
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D
EAR PUBLIC SECTOR Owners and Buyers
of Construction,
Recent tari昀昀s imposed by the
United States, along with Canada’s counter-tari昀昀s, are creating
signi昀椀cant cost pressures and
uncertainty within the entire construction industry and will directly a昀昀ect the
viability of projects moving forward.
The Ontario General Contractors Association (OGCA) is committed to providing
public sector owners with resources and
best practices to help navigate these challenges. This is an issue that a昀昀ects us all,
and by working together, we can 昀椀nd fair,
practical solutions that support project
success and industry stability. This letter
outlines key contractual considerations,
best practices, and procurement recommendations to help public sector owners
and buyers of construction navigate
the impacts of tari昀昀s on construction
projects.
CCDC contracts are the foundation of the
ICI construction sector in Canada, making
it critical to understand the contractual
obligations under CCDC 2 – 2020, General
Condition 10.1 (Taxes and Duties.)
This contractual obligation is not limited
to CCDC 2 – 2020: similar provisions exist
in other standard CCDC contracts, including CCDC 17 (2010), CCDC 5B Appendix
Stipulated Price Option (2010), and CCDC
14 (2013), all of which contain clauses addressing changes in taxes and duties in the
same manner. Owners using these contract
forms should ensure they are applying the
same principles when dealing with changes
due to tari昀昀s. For the CCDC 3 and 5B costplus contracts, tari昀昀 costs are incurred as
they arise.
Key Considerations Under CCDC 2 –
2020, GC 10.1 Taxes and Duties:
1. The bid closing date - not the contract
award or execution - is the determinant
for whether a tari昀昀 change quali昀椀es for a
contract price adjustment.
2. Contractors are entitled to adjustments in
the Contract Price when new taxes, duties, or
tari昀昀s are imposed and increase costs.
3. The clause equally applies whether tari昀昀s
are repealed or modi昀椀ed, impacting the
cost.
