Compliance Management, Government Regulations

Federal government erects “cyber perimeter”

Foreign companies need not apply.

That's the message the Canadian government relayed when it enacted a national security exception to bar foreign IT companies from bidding on the construction of its new telecommunications system. While the trade exception is sometimes used in relation to military procurements, it's rare to see it invoked in civil engineering projects.

The use of the clause, which overrides trade obligations under the North American Free Trade Act and the World Trade Organization agreements, reflects the government's belief that its communications networks have been “the target of hostile threats, which causes grave concerns about the implications of cyber threats on Canada's national security.”

In a statement circulated to IT suppliers, Public Works and Government Services Canada said it was creating a “cyber perimeter” by limiting bidding to build the new system to Canadian companies. In addition, preference will be given to suppliers who use equipment made in Canada.

The new telecommunications system is the first phase of a massive overhaul of the government's email, phone, networking and data center infrastructure.

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