Ontario has implemented a new Procurement Restriction Policy, effective immediately, barring U.S. businesses from participating in provincial energy procurements. This directive, communicated by the Ontario Minister of Energy and Mines to the Ontario Energy Board and the Independent Electricity System Operator (IESO), follows the imposition of U.S. tariffs impacting Ontario’s economy.

The policy applies broadly to all provincial ministries, agencies, Ontario Power Generation, and the IESO. A U.S. business is defined as any entity, regardless of its structure, with headquarters or a main office in the U.S., and employing fewer than 250 full-time Canadian employees during the procurement process. This definition also encompasses Canadian subsidiaries of U.S. companies.

Public sector entities are permitted to accept a business’s assertion that it doesn’t qualify as a U.S. business, alleviating the need for independent verification. While bidders can be asked to confirm they do not meet the definition of a U.S. business, it remains the business’s responsibility to accurately represent their status.

Existing procurements, specifically those with issued documentation prior to March 2025, are exempt. The applicability of the policy to procurement documents that are in draft or design phases requires further clarification, impacting processes like the IESO’s Long-Term 2 and Transmitter Selection Framework.

Exceptions exist for situations involving urgent needs where a U.S. business is the only feasible option. Procuring from a U.S. business under these circumstances necessitates a documented business case and approval from a designated authority.