On July 30, 2025, the Regulation respecting prompt payments and the prompt settlement of disputes with regard to construction work (hereinafter the “Regulation”) was published in the Gazette officielle du Québec. Since September 8, 2025, the Regulation has been coming into force gradually,1 in response to requests from some involved the construction industry. The Regulation applies to the majority of construction contracts concluded with public bodies covered by the Act respecting contracting by public bodies (chapter C-65.1, r. 8.01) (hereinafter the “ACPB”). The Regulation aims to fix chronic payment delays in the construction industry by establishing binding standards to speed up the payment process for contractors and subcontractors involved in public contracts covered by the ACPB. It also introduces a rapid dispute resolution process. The Regulation thus complements An Act mainly to promote Québec-sourced and responsible procurement by public bodies, to reinforce the integrity regime of enterprises and to increase the powers of the Autorité des marchés publics.2 The following is a summary of some of the Regulation’s key provisions. Cases of application and exclusions The Regulation applies to all public construction contracts and subcontracts subject to the ACPB, with the following exceptions:3 contracts entered into in an emergency because of a threat to the safety of persons or property contracts entered into for the purpose of activities on foreign soil of a delegation general, a delegation or another form of representation of Québec abroad a monetary claim to compensate for a loss of profit, productivity or a business opportunity that a contractor considers it has suffered because of a change relating to the scope of the work specified in a public contract or public subcontract, or to the conditions for its performance Deadlines and schedule imposed by the Regulations The Regulation establishes a rigid payment request, refusal and payment schedule: Request for payment4 Sent by the general contractor to the public body: 1st day of the month Sent by the subcontractor to the general contractor: 25th day of the month Refusal to pay5 Sent by the general contractor to the subcontractor: 21st day of the month Sent by the public body to the general contractor: Last day of the month Payment deadline (if applicable)6 By the public body to the general contractor: Last day of the month By the general contractor to the subcontractor: 5th day of 2nd month From a subcontractor to another: 10th day of 2nd month If the subcontracting chain has more than two subcontracting levels, the payment deadline is extended by five days for each additional level. These deadlines are intended make the payment process uniform and predictable. It is possible for parties to amend their requests after they have been sent.7 Request for payment A request for payment must be in writing and contain the following information : the name and address of the contractor and the contact information of the representative of the contractor the number of the public contract a detailed description of the work carried out, the expenses incurred and any other element for which a sum of money is claimed the periods associated with elements claimed a breakdown of the total amount claimed8 If the public body requires the presentation of supporting documents with a request for payment from a contractor party to a contract, it must include such condition in the contract and specify which documents are required. The same principle applies to subcontracts between contractors and their subcontractors.9 Importantly, the public body may allow the contractor to amend the request for payment to correct any deficiency, except for requests rendered invalid by the date on which they were sent. If no question of invalidity has been raised with the contractor before the deadline to indicate a refusal to pay, the payment request will be deemed valid.10 Refusal to pay A refusal to pay must be expressed in a written notice containing the following information: the part of the total amount claimed that is refused a description of the work, expenses or elements of the request for payment to which the refusal applies the grounds for the refusal and the contractual or legal provisions on which they are based11 The refusal of a request for payment cannot be based solely on the fact that the work carried out is the result of a change to the contract and that, when the request for payment was sent, the value of the change had yet to be agreed on or determined.12 Payments and withholdings In certain circumstances, the public body may withhold any sum claimed by the contractor: A sum sufficient to cover any reservations for apparent defects or poor workmanship in the work.13 A sum sufficient to repair any damage caused by the general contractor or a subcontractor to the work.14 A sum previously paid to the general contractor for work performed by one of its subcontractors to ensure that the latter’s claims are paid by the general contractor or to enable the public body to pay these claims itself. This right to withhold exists regardless of whether the subcontractor can invoke a legal hypothec on the construction or not.15 A sum sufficient to pay the claims of persons other than the contractor’s subcontractors can invoke a construction legal hypothec on the work and who have given notice of their contract to the contractor, for work completed or the materials or services supplied after the notice was given.16 Up to 10% of the sum owed to ensure performance of the contract, provided that this possibility and its terms are stipulated in the contract. A general contractor may, in turn, withhold sums from its subcontractors, provided that a written agreement allows this and that the withholding does not exceed the withholding applied to the contractor by the public body. Each level of subcontracting can avail itself of this right, with the necessary modifications.17 All sums payable to the contractor if it has not provided all closeout documents, including the certificate issued by the CNESST in accordance with the law and final acquittances from subcontractors.18 Except in the last two cases, a general contractor may offer the public body sufficient security in lieu of the withholding, such as a bond or a letter of guarantee from a bank. In turn, the general contractor may deduct from a payment owed to one of its subcontractors an amount representing the sum claimed by that subcontractor for work, where that work has been identified in a notice of refusal issued by another debtor in the contracting chain. To avail itself of this right, the contractor must first have sent the subcontractor a copy of the notice of refusal on which it is relying.19 Subcontractors, for their part, must send the notice of deduction to their own subcontractors, if any, within two days of receiving the notice.20 In all cases, the Regulation provides for the release of the deductions applied when the conditions for release are met. Prompt dispute settlement The Regulation introduces a dispute settlement process by which the parties have recourse to a third-person decider after having attempted to settle the dispute amicably.21 Initiated by a “request for intervention,” the process is intended to be rapid, with decisions to be made within 50 days of the designation of the third-person decider.22 More specifically, this mechanism provides for the following stages and deadlines: Stages Time allowed Request for intervention 90 days after work accepted or completed* Other contracting party’s response 5 days Designation of the third-person decider 5 days Outline of claims by applicant 5 days Detailed response from other contracting party 15 days Decider’s decision 50 days from the designation date (this period may be extended for a maximum of 15 days) Payment, if any 20 days after decision rendered *    In the case of a contract between a general contractor and a public body, the request for intervention must be notified to the other contracting party no later than 90 days after the date on which the work was accepted without reservation, or, if accepted with reservation, the date on which the public body declares that it is satisfied with the repairs or corrections made to the work. In the case of a subcontract, the request for intervention must be notified no later than 90 days from the date the work the parties agreed on is completed.23 The Regulation also provides for the following: One dispute, one request for intervention – Although a request for intervention can relate to one dispute alone, a party cannot dissociate the constituting elements of the dispute in order to file multiple requests or otherwise act to abuse the right to have recourse to a third-person decider. Choice of third-person decider – Only persons whose names appear in the register kept by the Minister of Justice under the Regulation may act as third-person deciders. It is up to the party proposing a third-person decider to ensure that the person is available. In the event of disagreement, the parties draw lots. Procedure – As long as they ensure that the procedure is equitable and complies with the principle of proportionality, the third-person decider can conduct the intervention according to the procedure they determine. Also, unless the third-person decider decides otherwise, the proceedings are conducted orally, whereas testimony is given by way of a written affidavit. No lawyers – Parties cannot be represented by a lawyer during proceedings, although a lawyer may advise them. Confidentiality – The entire intervention remains confidential, subject to agreement between the parties or legal obligations. Third-person decider’s fees – As a general rule, the third-person decider’s fees are allocated equally between the parties (50-50), although the third-person decider may depart from this allocation if they consider that a party’s actions during the intervention were harmful, in particular because of abusive conduct or failure to meet deadlines. The third-person decider’s fees are capped according to the value of the dispute. Conclusion This new compulsory scheme now imposes, for cases covered, a prompt payment process and speeds up the settlement of disputes arising during the performance of the majority of public construction contracts. It will have major repercussions on the practices of contractors, subcontractors and public bodies alike. The imposition of the strict deadlines by the Regulation could require contractors and subcontractors to improve their internal processes to better process payment requests and properly document potential claims. Although the Regulation is intended to simplify and accelerate payments, some contractors and subcontractors may find it difficult to meet the imposed deadlines, especially in large-scale projects involving many stakeholders, as delays are likely to be passed on from one level of subcontractor to another. Whether this system will be successful will depend on the ability of the parties to quickly adapt to the new requirements and to make effective use of the third-person decider to resolve disputes. If you have any questions or need advice, we invite you to contact a member of our specialized construction law team at Lavery. Section 94 of the Regulation. SQ, 2022, c. 18. Sections 32 and 33 of the Regulation. Section 5 of the Regulation. Section 10 of the Regulation. Section 15 of the Regulation. Sections 7 and 8 of the Regulation. Section 5 of the Regulation. Section 6 para. 1 of the Regulation. Section 6 of the Regulation. Section 11 of the Regulation. Section 12 para. 1 of the Regulation. Section 22 of the Regulation. Section 23 of the Regulation. Section 25 of the Regulation. Section 26 of the Regulation. Section 20 of the Regulation. Section 28 of the Regulation. Section 16 of the Regulation. Section 16 of the Regulation. Sections 34 to 76 of the Regulation. Section 63 of the Regulation. Section 34 of the Regulation.

LAVERY: A LEADER IN MONTREAL IN THE PRIVATE EQUITY, VENTURE CAPITAL AND INVESTMENT MANAGEMENT INDUSTRY Creating and setting up private equity and venture capital funds are complex initiatives requiring specialized legal resources. There are very few law firms offering such services in Quebec. Lavery has developed enviable expertise in this industry by working closely with promoters to set up such structures in Canada and, in some cases, the United States and Europe, in conjunction with local firms. Through Lavery’s strong record of achievements, the firm sets itself apart in the legal services market by actively supporting promoters, managers, investors, businesses and other partners involved in the various stages of the implementation and deployment of private equity and venture capital initiatives. The Integrity in Public Contracts Act, also referred to as Bill 1, has been assented to on December 7, 2012. This Act imposes new requirements on public contracts tenderers. Managers of infrastructure funds have to be familiar with the rules under this Act as they most likely will have to deal with them in the context of an investment or a project involving a public body.AMENDMENTS TO THE ACT RESPECTING CONTRACTING BY PUBLIC BODIESThe Act Respecting Contracting by Public Bodies (“ARCPB”) determines the conditions applicable to contracts between a public body and private contractors involving an expense of public funds. The ARCPB applies to supply contracts, to services contracts and construction contracts entered into with these public bodies, as well as to public private partnership agreements entered into as part of an infrastructure project.Bill 1 amended the ARCPB in order to reinforce integrity in public contracts and control access to these contracts. It further increases the number of public bodies covered by the ARCPB by adding entities such as Hydro-Québec, Loto-Québec and the SAQ.The amendments provides for the implementation of a system to verify that enterprises wishing to enter into contracts with public bodies or municipalities meet the required conditions as regards integrity. Therefore, an enterprise wishing to enter into a contract (or a related subcontract) with a public body for an amount equal to or greater than a threshold determined by the government is required to obtain an authorization from the Autorité des marchés financiers (the “AMF”).The enterprise must generally have obtained this authorization by the date it files its bid. In the case of a consortium, each member enterprise must be individually authorized by that date. An authorization must be maintained throughout the performance of the public contract or subcontract. An authorization is valid for a period of three years and must be renewed upon expiry. The AMF keeps a public register of enterprises holding an authorization to enter into a contract or a subcontract with public bodies. These rules also apply to contracts awarded by towns and municipalities.CONDITIONS FOR OBTAINING AN AUTHORIZATIONAn application for an authorization must be made to the AMF. The contractor must provide with his application an attestation from Revenu Québec, stating that the enterprise has filed the returns and the reports required under tax laws and that it has no overdue account payable to the Minister of Revenue. Lastly, the enterprise must not have been refused an authorization or have had its authorization revoked in the preceding 12 months.Upon receipt of an application for authorization from an enterprise, the AMF sends to the permanent anti collusion squad (Unité permanente anticorruption or “UPAC”) the information obtained in order for the UPAC to make the verifications it deems necessary in collaboration with the Sûreté du Québec, Revenu Québec, the Régie du bâtiment du Québec and the Commission de la construction du Québec (“CCQ”). The UPAC sends to the AMF a report analysing the enterprise compliance with the integrity requirements. The AMF renders a decision on the application for an authorization.DECISION OF THE AMFBill 1 provides for mandatory and discretionary grounds for refusal. Thus, the fact, for an enterprise or related person, of having been found guilty, within the five preceding years, of any offence under various provincial or federal laws listed in Schedule I to this Act will result in the enterprise being automatically denied its application for an authorization. The offences listed in Schedule 1 mainly relate to criminal law and tax laws.If the enterprise applying for an authorization, or if any of its shareholders holding 50% or more of the voting rights attached to the shares of the enterprise, or any of its directors or officers has, in the preceding five years, been found guilty of an offence listed in such Schedule I, the AMF will refuse to grant or to renew an authorization. The AMF may even revoke an authorization if an enterprise or any of its related persons is subsequently found guilty of such an offence.Furthermore, if an enterprise has, in the preceding five years, been found guilty by a foreign court of an offence which, if committed in Canada, could have resulted in criminal or penal proceedings for an offence listed in Schedule I, the AMF will automatically deny the issuance or renewal of an authorization. Lastly, an enterprise found guilty of certain offences described in electoral laws or who, in the preceding two years, has been ordered to suspend work pursuant to a decision of the CCQ will also be denied its application for an authorization.Furthermore, the AMF may also, at its sole discretion, refuse to grant or to renew an authorization or even revoke an authorization already granted to an enterprise if the enterprise fails to meet the high standards of integrity that the public is entitled to expect from a party to a public contract or subcontract. In this respect, the AMF, following an investigation by the UPAC, will review the integrity of the enterprise, its directors, partners, officers or shareholders as well as that of other persons or entities that have direct or indirect legal or de facto control over the enterprise (a “related person”). To that end, the AMF may consider certain elements which are described in the ARCPB, particularly the fact that the enterprise or a related person maintains connections with a criminal organization, has been prosecuted, in the preceding five years, in respect of certain offences or has repeatedly evaded or attempted to evade compliance with the law in the course of the enterprise’s business. The AMF will also consider the fact that a reasonable person would conclude that the enterprise is the extension of another enterprise that would be unable to obtain an authorization or that the enterprise is lending its name to another enterprise that would be unable to obtain an authorization.CONSEQUENCES OF FAILURE TO BE AUTHORIZEDA contractor or subcontractor whose authorization expires, is revoked or denied upon application for renewal is deemed to have defaulted on the public contract or subcontract to which it is a party. In such a case, the enterprise must cease its work, except for contracts where only the obligation to honour the contractual guarantees remains. However, the enterprise may continue to perform the contract if the public body applies to the Conseil du trésor for permission for the continued performance of the contract or subcontract for reasons of public interest and the Conseil du trésor grants such permission. The Conseil du trésor may subject the permission to certain conditions.TRESHOLDS AND APPLICATIONUpon coming into force, the Act provided that the new provisions would apply to public contracts and subcontracts that involve an expenditure equal to or greater than $40,000,000. This threshold has been lowered to $10,000,000 in December 2013. Furthermore, the Act provides that regardless of the amount of the contract, the government may, before March 31, 2016, determine that the rules requiring an authorization apply to public contracts or subcontracts even if they involve a public expenditure amount of less than this threshold or that such rules apply to a category of contracts other than those currently regulated pursuant to the ARCPB. In such a case, the government may stipulate special terms for the applications for authorization that enterprises must file with the AMF in respect of such contracts.Lastly, the Act provides that the government may still before 31 March 2016, require enterprises that are parties to public contracts currently in process to file an application for authorization within the time it specifies. This provision is not limited to the contracts currently in process at the time Bill 1 comes into force and may therefore affect any contract in process before March 31, 2016.

BILL 1: NEW REQUIREMENTS FOR PUBLIC CALLS FOR TENDERSNearly everybody talks about it. The Integrity in Public Contracts Act, also referred to as Bill 1, has been assented to on December 7, 2012 after an expedited review process of barely three months. Everybody is talking about it because the Act imposes on tenderers new requirements aiming at curbing fraud and corruption which, according to investigations of public authorities, undermine the construction industry.AMENDMENTS TO THE ACT RESPECTING CONTRACTING BY PUBLIC BODIES The Act Respecting Contracting by Public Bodies (“ARCPB”) determines the conditions applicable to contracts between a public body and private contractors involving an expense of public funds. It applies, among others, to government departments and bodies, educational and health establishments and public transit companies. The ARCPB applies to supply contracts, to services contracts and construction contracts entered into with these public bodies, as well as to public-private partnership agreements entered into as part of an infrastructure project carried out under a public-private partnership within the meaning of the Act respecting Infrastructure Québec.The ARCPB imposes on public bodies the general rule whereby contracts are to be awarded by way of calls for tenders, which is supposed to enable owners to get the lowest contract price through competition between tenderers while affording to tenderers an equal opportunity to get State contracts. This being said, the conclusions of the Duchesneau Report, made following the police investigation of the Marteau Squad on fraud and corruption in the construction industry, and the revelations from the Charbonneau Commission, demonstrate that the call for tenders system for the awarding of public contracts obviously fails to achieve its expected results.Bill 1 accordingly amends the ARCPB in order to reinforce integrity in public contracts and control access to these contracts. It further increases the number of public bodies covered by this Act by adding entities such as Hydro-Québec, Loto-Québec and the SAQ.The amendments implement a system to verify whether enterprises wishing to enter into contracts with public bodies or municipalities meet the required conditions as regards integrity. Therefore, an enterprise wishing to enter into a contract or a related subcontract for an amount equal to or greater than a threshold determined by the government is required to obtain an authorization from the Autorité des marchés financiers (the “AMF”). This rule is also applicable to sub-subcontracts, the amount of which is equal to or greater than such threshold.Subject to transitional provisions, the enterprise must be authorized as of the date it files its bid, except where the call for tenders specifies a different date which precedes the date the contract is entered into. An authorization must be maintained throughout the contract or subcontract. An authorization is valid for a period of three years and must be renewed upon expiry. The AMF keeps a public register of enterprises holding an authorization to enter into a contract or a subcontract. These rules also apply to contracts awarded by towns and municipalities.CONDITION FOR OBTAINING AN AUTHORIZATION An application for an authorization must be made to the AMF using a prescribed form with several schedules, which can be obtained from the website of the AMF. A guide for enterprises wishing to obtain an authorization is also available from the same website. The contractor must also provide with his application an attestation from Revenu Québec, issued not more than 30 days before the date on which the application is files, stating that the enterprise has filed the returns and the reports that it was required to file under fiscal laws and that it has no overdue account payable to the Minister of Revenue. Lastly, the enterprise must not have been refused an authorization or have had its authorization revoked in the preceding 12 months.Upon receipt of an application for authorization from an enterprise, the AMF sends to the permanent anti-collusion squad (unité permanente anticollusion or “UPAC”) the information obtained in order for the UPAC to make the verifications it deems necessary, in collaboration with the Sûreté du Québec, Revenu Québec, the Régie du bâtiment du Québec and the Commission de la construction du Québec. The UPAC sends to the AMF a report on the compliance of the enterprise with the integrity requirements. The AMF renders a decision of the application for an authorization.DECISION OF THE AMF The Act provides for mandatory and discretionary grounds for refusal. The fact, for an enterprise or related person, to be found guilty of any offence under various provincial or federal laws as listed in Schedule I to the Act results in the enterprise being automatically denied its application for an authorization. The offences listed in Schedule 1 mainly relate to criminal law and tax laws.Therefore, if the enterprise which applies for an authorization, any of its shareholders holding 50% or more of the voting rights attached to the shares of the enterprise, or any of its directors or officers has, in the preceding five years, been found guilty of an offence listed in Schedule I of the Act, the AMF refuses to grant or to renew an authorization. The AMF may even revoke an authorization if an enterprise or any of its related persons is subsequently found guilty of such an offence.Furthermore, if an enterprise has, in the preceding five years, been found guilty by a foreign court of an offence which, if committed in Canada, could have resulted in criminal or penal proceedings for an offence listed in Schedule I, the AMF will automatically deny the issuance or renewal of an authorization. Lastly, an enterprise found guilty of certain offences described in electoral laws, who, in the preceding two years, has been ordered to suspend work by a decision of the CCQ or been ordered to pay an amount claimed under subparagraph c.2 of the first paragraph of section 81 of the Act respecting labour relations, vocational training and workforce management in the construction industry will also be denied its application for an authorization.The AMF may also at its sole discretion refuse to grant or to renew an authorization or even revoke an authorization to an enterprise if the enterprise concerned fails to meet the high standards of integrity that the public is entitled to expect from a party to a public contract or subcontract. In this respect, the AMF, following an investigation by the UPAC, will review the integrity of the enterprise, its directors, partners, officers or shareholders as well as that of other persons or entities that have direct or indirect legal or de facto control over the enterprise (a “Related Person”).To that end, the AMF may consider the following factors listed in the ARCPB:1. whether the enterprise or a Related Person maintains connections with a criminal organization;2. whether the enterprise or a Related Person has been prosecuted, in the preceding five years, for any of the offences listed in Schedule I;3. whether an enterprise or a Related Person has been a Related Person of another enterprise which was found guilty, in the preceding five years, of an offence listed in Schedule I, at the time such offence was committed;4. whether an enterprise or a Related Person is under the direct or indirect legal or de facto control of another enterprise that has, in the preceding five years, been found guilty of an offence listed in Schedule I;5. whether the enterprise or a Related Person has, in the preceding five years, been found guilty of or prosecuted for any other criminal or penal offence;6. whether the enterprise or a Related Person has repeatedly evaded or attempted to evade compliance with the law in the course of the enterprise’s business;7. whether a reasonable person would conclude that the enterprise is the extension of another enterprise that would be unable to obtain an authorization;8. whether a reasonable person would conclude that the enterprise is lending its name to another enterprise that would be unable to obtain an authorization;9. whether the enterprise’s activities are incommensurate with its legal sources of financing; and10. whether the enterprise’s structure enables it to evade the application of the ARCPB.CONSEQUENCES OF FAILURE TO BE AUTHORIZED A contractor or subcontractor whose authorization expires, is revoked or denied upon application for renewal is deemed to have defaulted on the public contract or subcontract on the expiry of a period of 60 days after the date the authorization expired or the AMF notified its decision. In such a case, the enterprise must cease its work under any public contract, except for contracts where only the obligation to honour the contractual guarantees remains. However, the enterprise may continue to perform the public contract if the public body, for reasons of public interest, applies to the Conseil du trésor for permission for continued performance of the public contract or subcontract in question. The Conseil du trésor may subject the permission to certain conditions, including that the contractor or subcontractor agrees to the implementation, at the contractor’s or subcontractor’s expense, of oversight and monitoring measures. In the case of bonded contracts, regulations favour the exercise of oversight and monitoring measures by the surety of the enterprise.TRANSITIONAL PROVISIONS The proclaimed target of the government is to submit any contract worth $25,000 and more to the authorization mechanism. However, as more than 24,000 different enterprises on average enter each year into contracts worth in the aggregate between $20,000,000,000 and $30,000,000,000 per year with public bodies, the UPAC and the AMF will obviously not be able to review the files of all the enterprises wishing to enter into contracts with public bodies.The Act therefore provides that, from the day it comes into force, the new provisions apply to contracts and subcontracts that involve an expenditure equal to or greater than $40,000,000 and for which the award process is underway on that date or begins after that date.Furthermore, the Act also provides that regardless of the amount of the contract, the government may, before March 31, 2016, determine that the rules requiring an authorization apply to public contracts or subcontracts even if they involve a public expenditure amount of less than $40,000,000 or that such rules apply to a category of contracts other than those determined in application of the sections in question. In such a case, the Government may determine special terms for the applications for authorization that enterprises must file with the AMF in respect of such contracts. We have seen some examples of the application of this provision since December 19, 2012, since the government, by five different orders in council, has identified 125 contracts of the City of Montreal, the estimated value of which would likely be less than $40,000,000, which would require an authorization. These orders in council have been issued at the request of the City of Montreal, which wanted to subject these contracts to the new authorization regime. Specific application conditions have been made applicable to these orders in council, particularly the following:  a preliminary application for authorization must be filed by each tenderer to the AMF no later than on the deadline for submitting bids; only the applications of the two best ranked tenderers after the bids have been analyzed would be considered by the AMF as being completed; if the contract cannot be awarded to either of those tenderers, the other preliminary applications would be considered completed for the subsequent tenderers until the contract can be awarded.Lastly, the Act provides that the Government may, before 31 March 2016, require enterprises that are party to public contracts that are in process to file an application for authorization within the time it specifies. This provision is not limited to the contracts that are in process at the time the Act comes into force and may therefore affect any contract in process before March 31, 2016, possibly for a contract whose awarding process would have commenced after January 15, 2013. The consequences of this provision are serious since an enterprise which would not obtain its authorization following a request from the government would see its name registered in the register of enterprises ineligible for public contracts (designated under tis French acronym the “RENA”) for a period of five years. Such registration results in a presumption of default under all of its public contracts in process and forces the enterprise to cease its work unless the co-contracting public body obtains from the Conseil du trésor the permission for the enterprise to continue its work, with or without conditions.A first order in council has just been issued under this provision on May 8, 2013, under which the Centre hospitalier de l’Université de Montréal (CHUM) and the Centre Universitaire de Santé de McGill (CUSM) requested the government to require a party to a contract with them to apply with the AMF for the authorization to enter into a contract. This order in council grants to the enterprise 21 days from the date it comes into force to file its application for the authorization to enter into a contract. The order in council adds that if the enterprise fails to provide within the allotted time the information and documents prescribed by the AMF, it will be deemed to have defaulted under the contract within 60 days following the expiry of the 21 days period or the expiry of the time granted by the AMF for providing the information it requested, according to the case. It must be understood from that order in council that should the enterprise fail to provide its application for authorization to the AMF, it will be deemed to have defaulted under the contract.CONCLUSION The new conditions for obtaining a public contract imposed by the Act are demanding but they are no stranger to the legislative framework applicable to the construction industry. In fact, the Building Act was already imposing similar high integrity conditions to enterprises who wish to obtain a licence from the Régie du bâtiment. It does not seem to this day that the Régie du bâtiment has pushed the systematic application of these control rules. However, it must be understood that with Bill 1, unanimously passed by the National Assembly, government authorities intend to exercise strict control over the integrity of enterprises wishing to enter into contracts with the State. These enterprises must therefore ensure that they, as well as their directors, officers and shareholders, have a clean record, failing which they will suffer a purgatory of up to five years with no access to public contracts. Enterprises with a director, officer or shareholder charged with, or found guilty of an offence listed in Schedule I to the Act must distance themselves from such persons if they wish to maintain their right to enter into contracts with the State.