A major defence contract is set to favour U.S. supplier, despite Carney's promise to diversify

The federal government is set to proceed with awarding a major defence contract despite industry concerns that its requirements are written in a way that all but assures a single American company is eligible.

A tender for night-vision binoculars — worth more than an estimated $100 million — is set to close on Tuesday at 2 p.m.

A competing company says the request includes a technical requirement that favours one American firm, at the exclusion of all others. The request requires a specific signal-to-noise ratio for the image intensifier tubes in the binoculars.

The European competitor says the requirement is unique to the Canadian military — not reflecting industry norms, nor the requirements of NATO allies.

The contract's posting comes at a time when Prime Minister Mark Carney has repeatedly said Canada is looking beyond the United States for defence spending.

"We stood shoulder to shoulder with the Americans throughout the Cold War and in the decades that followed, as the United States played a dominant role on the world stage. Today, that dominance is a thing of the past," said Carney last month.

In June, Carney signed a new defence and security agreement with the European Union, signalling his commitment to deepen Canada's partnership with the EU.

On Monday, Defence Minister David McGuinty said he was unaware of the specifics of the night-vision binoculars request for proposals, but said he would look into it.

WATCH | McGuinty says he'll look into request: 

Defence minister asked about contract terms that only U.S. companies could meet

23 hours ago

Duration 1:09

Defence Minister David McGuinty said he would look into the terms of a tender for night-vision binoculars, when asked if they align with the government’s goal of partnering with firms outside the U.S.

But in a statement, European competitor Photonis said it has "attempted to engage the Government of Canada on this issue a number of times to course-correct the terms" of the request for proposals.

"We have yet to receive an appropriate response," said Frédéric Guilhem, Photonis's chief commercial officer of its night-vision department. The company supplies night-vision products to other NATO allies.

"This approach is clearly contrary to Prime Minister Carney's directive to closer integrate defence procurement and production with Canada's allies in Europe," Guilhem said.

The tender was first posted before the federal election, but has been reposted six times since then.

In addition to limiting competition, buying from the U.S. suppliers would mean opting into regulations that allow the U.S. State Department to control arms exports.

Neither the Department of National Defence nor Public Services and Procurement Canada responded to questions about why the government chose the specific criteria for the night-vision binoculars.

A leading defence expert says it will take time to reorient Canadian military defence procurement away from the United States.

"We have not gotten to a space where we're investing 75 cents of every dollar in the U.S. market by accident," said Dave Perry, president of the Canadian Global Affairs Institute.

"There's a bunch of structural conditions that have led to us spending a lot of those dollars in those places."

Perry said those conditions include a longstanding policy direction from the federal government that the Canadian military work as closely as possible with the Americans.

Of Canada's allies, the United States has the largest defence industrial base.

The federal government is currently reviewing its planned purchases of F-35 fighter jets from the United States, with a goal to complete the review by the end of the summer.