Exactly. Well put.
In addition, contracts of larger size can be set aside if the contract officer thinks there are at least two small businesses that can do the job, so the discussion is down at the contracting authority, and I don't know how that happens. Furthermore, larger contracts awarded to larger businesses must have small business subcontracting plans.
Those are the three ways in which the small businesses are scaled up in the U.S.
In Canada, there is no sweeping federal procurement program in place that's similar to that. I cannot speak for today and I don't want to, but I was involved way back in the Canada-U.S. Free Trade Agreement days. I think it's safe to say that our objective was to help more firms develop competitive scale and capacity. We were looking to blow open markets in the United States, and we weren't looking to show the Americans in any way that we were undermining Canadian firms' access at the time. We were never really looking to actually implement the small business set-aside; we were trying to get into their market. However, we're a much bigger economy today, so things could be different.
We also realized way back that a large Canadian business was actually equal to a small American business, so we didn't know what a small Canadian business was for purposes of procurement. That was back then.
To date, successive governments have chosen to implement a wide range of other measures and not a small business set-aside. In the NAFTA procurement chapter, there was the creation of a committee on small business with the United States, which was intended to promote government procurement opportunities for small businesses in a variety of ways. I would recommend reading that.
Small business set-asides have been attempted at the provincial level. As was noted earlier, article 504.13 of the CFTA allows for small business set-aside programs, provided the program is fair, open, transparent, and does not discriminate on the basis of the origin or location within Canada from where the goods or services are supplied. In other words, small versus large is okay, but not local versus others.
There is also a very interesting CETA annex that I recommend to the committee. It lays out the acceptable limits on local preferences supporting development in the non-urban areas of certain have-not provinces. It essentially says that—not Ontario, because I think Ontario has left that category again—the normal, the other have-not provinces, are allowed 10 procurements a year to develop outside the urban areas—that is, outside Halifax, Moncton, etc.—of less than $1 million. This is one to watch. I don't understand how that works in to the others. We'll have to wait and see.
We have much more explicit indigenous set-asides. In all, it's moved from “minority” set-asides, when we said that's what “minority” meant for Canada. Now there are quite clear, quite broad indigenous set-asides. Suffice it to say that because of those, the tribunal has ruled that when such provisions are invoked, the tribunal does not have jurisdiction and will not conduct an inquiry. Instead, as stated in the Government of Canada's supply manual, “Bid challenges [by suppliers for the procurement strategy for aboriginal businesses] should be dealt with according to established internal supplier complaint response procedures for procurements not subject to trade agreements”, so on the indigenous side, it's quite clear.
That concludes my remarks. I hope I caught everything without being too duplicative.