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May 14, 2024


ARTICLE


MAJOR PUBLIC INFRASTRUCTURE PROJECTS IN QUÉBEC: A MAJOR REFORM OF THE
LEGISLATIVE FRAMEWORK

On May 9, 2024, Bill 62, An Act mainly to diversify the acquisition strategies
of public bodies and increase their agility in carrying out infrastructure
projects (Bill 62), was introduced before the National Assembly of Québec.1


BILL 62 – BACKGROUND

Québec’s major public infrastructure sector has come under pressure in recent
years. Specifically, industry stakeholders’ waning interest in traditional
contract award methods due to associated risks and market disruptions like
inflation and supply chain issues have made submitting a competitive bid
difficult to impossible. 

The government of Québec is introducing Bill 62 in response to the sector’s
growing interest in a “collaborative approach” as an alternative project
delivery method. Without this reform of the legislative and regulatory
framework, this delivery method has been broadly unfeasible in Québec.

Bill 62 reflects the Québec government’s desire2 to equip itself with
competitive tools for major public infrastructure projects. As a result, Bill 62
aims to make these projects more effective and attractive by proposing changes
to the current legislative and regulatory framework. This is reflected by
Bill 62’s introduction of a new type of contract called the “partnership
contract” in the Act respecting contracting by public bodies (ARCPB). This
article discusses the key changes proposed by Bill 62 and their implications.


WITHDRAWING THE CONCEPT OF PPPS AND INTRODUCING THE CONCEPT OF PARTNERSHIP
CONTRACTS


PARTNERSHIP CONTRACTS 

Bill 62 permanently removes the concept of traditional public-private
partnerships (PPPs), wherein bodies are called upon to design, build and operate
public infrastructure,3 and replaces it with the concept of partnership
contracts. Under Bill 62, partnership contracts are contracts entered into for
the purposes of an infrastructure project for which a public body brings in a
contractor to participate in designing and building the infrastructure. They
also carry out “other responsibilities” related to the infrastructure.
Partnership contracts involve a collaborative approach during or after the
tendering process. Mixed construction work and professional services
contracts—as well as contracts determined by a regulation of the Conseil
du trésor—under which a public body brings in a contractor to participate in
designing or building an infrastructure if they involve a collaborative approach
as specified in the regulation are considered to be partnership contracts.4

Partnership contracts may be entered into by the Minister of Transport, the
Société québécoise des infrastructures or any other public body provided that
the minister responsible for the public body authorizes it. This said,
ministerial authorization does not relieve the public body from the obligation
to obtain any other authorization relating to the partnership contract concerned
that would otherwise be required under an Act, a regulation or a directive.5
Given the establishment of Mobilité Infra Québec pursuant to Bill 61, An Act
enacting the Act respecting Mobilité Infra Québec and amending certain
provisions relating to shared transportation (Bill 61), and the role that the
government intends to give to this entity, we can only assume that it will be
authorized to enter into such partnership contracts, or work with the entities
that have entered into them.


WHAT IS A COLLABORATIVE APPROACH? 

In accordance with Bill 62, a collaborative approach may, in particular, include
holding bilateral workshops, pooling resources and information related to the
infrastructure project, consensually sharing risks and, as applicable, savings
generated or gains made and losses sustained during the term of the contract.6
It is important to note that this definition is non-comprehensive and subject to
interpretation. As a result, multiple projects may qualify as partnerships
within the meaning of Bill 62, regardless of their size.

This definition, or rather this description of the “collaborative approach,”
provides no guidance about the main provisions that may be contained in the
partnership contracts, such as an open-book approach or a full or partial waiver
of recourse between the parties. The government’s choice to broadly define the
concept of partnership suggests that a range of contractual solutions may be
considered and subject to change in accordance with market trends.


PRACTICAL IMPLICATIONS 

The current ARCPB includes a chapter dedicated exclusively to PPP contracts:
Chapter V.7 In accordance with the changes proposed by Bill 62, this chapter
would now be applicable to partnership contracts. As such, more projects will
likely be able to avail themselves of the partnership contract regime as amended
under the terms of Bill 62. Their procurement process will therefore be governed
by Chapter V of the ARCPB.

As Chapter V stipulates, the nature of the projects entered into under a
partnership contract will require discussions between the client and potential
private partners to define the project and enter into the contract.  The ARCPB
also expressly allows practices for selecting the partner and entering into a
partnership contract that depart from the generally applicable rules for
awarding contracts following public calls for tenders.

In addition, Bill 62 increases the latitude given to public bodies in connection
with a partnership contract. More specifically, Chapter V would expressly
authorize:

 * a public body to undertake discussions with the selected tenderer or each of
   the selected tenderers, as applicable, after the first stage of the selection
   process, to further define the technical, financial or contractual aspects of
   the project and give each of the selected tenders the opportunity to submit a
   proposal (currently, the ARCPB only allows such discussions with each of the
   selected tenderers);
 * a public body to negotiate, during and at the end of the selection process,
   with the selected tenderer or tenderers the provisions needed to finalize the
   contract while preserving the basic elements of the tender documents and the
   proposal (currently, the ARCPB only allows such negotiations to be held at
   the end of the selection process and only with the selected tenderer).

Accordingly, Bill 62 provides public bodies with greater flexibility to conduct
tenders for projects carried out under the partnership contract regime. These
changes suggest that public bodies could work more closely with tenderers at all
stages of the selection process, including at the end of the same.


ELIMINATION OF THE REQUIREMENT TO PUBLISH A NOTICE OF INTENTION FOR PROJECTS
THAT RECEIVED NO COMPLIANT BIDS

Bill 62 proposes relaxing existing measures to speed up tendering processes by
allowing a public body, following an unsuccessful call for tenders, to enter
into a contract by mutual agreement without it being necessary to publish a
notice of intention on the electronic tendering system, under certain
conditions.8

In particular, Bill 62 requires the conditions of the contract awarded by mutual
agreement to be the same as those set out in the documents of the public call
for tenders for which no compliant bids were submitted, except as regards the
period of time allotted for carrying out the contract. This interval may not be
postponed longer than the time elapsed between the tender closing date and the
date the contract is entered into.

In our view, some potential pitfalls limit the usefulness of this provision. For
example:

 * If no compliant bids are received at the end of the call for tenders, it
   seems unlikely that a third party will be able to meet the requirements of
   the proposed contract. Instead, the bill could have enabled a public body and
   the successful bidder to negotiate any such provision as may be required to
   enter into the contract while preserving the basic elements of the tender
   documents.
 * The postponement period as currently stipulated does not take into account
   the seasonality of the work or the availability of the potential successor
   bidder.

It is also not provided that public bodies using this approach would be
permitted to enter into agreements for preliminary work, which agreements are
regularly used to secure the project schedule by carrying out certain critical
path activities in advance.


AUDITING POWERS OF THE AUTORITÉ DES MARCHÉS PUBLICS (AMP)

Bill 62 also expands the AMP’s powers to conduct an investigation to include any
person who has previously been a director, partner, officer or shareholder of an
enterprise subject to the oversight of the Autorité des marchés publics and any
other person or entity bound or previously bound, directly or indirectly, by
contract to the enterprise.9

Furthermore, Bill 62 sets out certain immunities for persons who collaborate
with the Autorité des marchés publics in investigations to verify whether a
person meets the integrity criteria. Bill 62 also bars asserting any form of
duty of confidentiality or loyalty to refuse to disclose any such documents or
information as may be required for the purposes of these investigations.10 Only
professional secrecy between a lawyer or a notary and a client is not covered by
this exception to professional secrecy.

Bill 62 further provides that any person who communicates information or a
document under the ARCPB incurs no civil liability for doing so.11


EXPROPRIATION AND LAND RESERVE

Under Bill 62 and for the purposes of developing, maintaining and managing the
immovable assets of public bodies, the Société québécoise des infrastructures
may now acquire by expropriation, on its own behalf or on behalf of a public
body, any immovable in whole or in part, or any real right.12 This expropriation
power is much greater than that set forth in current legislation, which limits
this right to acquisitions by agreement. A similar power is also granted under
Bill 61 in favour of Mobilité Infra Québec, which is required, upon request by
the government of Québec, to work with the Société québécoise des
infrastructures to carry out a major transport infrastructure project.

Lastly, Bill 62 stipulates that the Société québécoise des infrastructures may,
on the conditions determined by the government, establish a land reserve for the
carrying out of future public infrastructure projects.13


CONCLUSION

Bill 62 is a major development in Québec legislation governing major public
infrastructure projects. The bill as tabled now needs to be studied before it
can be passed. We will keep you informed of any developments tied to Bill 62 in
the coming months.

In the meantime, we invite you to check out our related article on Bill 61.

If you have any questions about the above, please reach out to BLG’s
Infrastructure and Construction groups.

Footnotes

1 Bill 62, An Act mainly to diversify the acquisition strategies of public
bodies and increase their agility in carrying out infrastructure projects –
National Assembly of Québec (assnat.qc.ca).

2 See, in particular, (i) Bill 61 (2024), An Act enacting the Act respecting
Mobilité Infra Québec and amending certain provisions relating to shared
transportation; and (ii) Bill 12 (2022, chapter 18), An Act mainly to promote
Québec-sourced and responsible procurement by public bodies, to reinforce the
integrity regime of enterprises and to increase the powers of the Autorité
des marchés publics.

3 Ss. 1 and 18, Bill 62.

4 S. 1, Bill 62.

5 S. 4, Bill 62.

6 S. 1, Bill 62.

7 Chapter V, ss. 18–21, ARCPB.

8 S. 2, Bill 62.

9 S. 11, Bill 62.

10 Ibid.

11 Ibid.

12 S. 28, Bill 62.

13 Ibid.

 * By: Pascale Dionne, Patrice Morin, François Nolet-Lévesque, Sharlie
   Gaudette-Richard


 * Services: Construction, Infrastructure


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