Services: Canadian Offsets and Export Controls 

What is Canadian Offsets

In Canada, contractor offset obligations are mandated through the Industrial and Technological Benefits (ITB) Policy, which compels companies awarded major defense and Canadian Coast Guard contracts to undertake business activities in Canada equal to the value of their contract. This policy aims to maximize economic, industrial, and social benefits by driving innovation, job creation, and sustainable growth within the Canadian defense sector

Who Governs Offsets

Offsets are governed by Canada’s Ministry of Industry called Innovation, Science, and Economic Development (ISED) Canada

What are the obligations of a Contractor doing business with the Canadian Ministry of Defense (MOD)

Under the Industrial and Technological Benefits (ITB) Policy, companies winning major Canadian defense contracts must reinvest an amount equal to 100% of the contract value back into Canada. This mandatory policy applies to procurements exceeding $100 million, while contracts between $20 million and $100 million may also be subject to review.

Offset Weight in Contractor’s Proposal

Since 2014, Canada has emphasized local participation by requiring a minimum 10% value proposition (VP) on major contracts rather than relying on previous pass/fail offset requirements.

How can SCM360 Help

SCM360 Canadian Industrial and Technological Benefits (ITB) offset expert manages the mandatory economic obligations for companies winning Canadian defense and security contracts, ensuring compliance with Innovation, Science and Economic Development Canada (ISED) policies. We develop "Value Proposition" bids, facilitate investment in Canadian SMEs and R&D, and manage stakeholder relationships, including reporting to government on contractual obligations.