Procurement Strategy for Indigenous Business (PSIB)

The Procurement Strategy for Indigenous Business (PSIB) is the Government of Canada's policy to support Indigenous businesses through federal procurement opportunities. According to the CanadaBuys glossary, its measures include mandatory and voluntary set-asides that, where applicable, limit bidding on government contracts to Indigenous businesses.

PSIB was launched in 1996 and was formerly called the Procurement Strategy for Aboriginal Business, as noted in a Government of Canada House of Commons question period note. It applies to federal procurement and is delivered through government procurement policies and procedures, including the Supply Manual of Public Services and Procurement Canada (PSPC) and the Treasury Board Directive on the Management of Procurement. The CanadaBuys Buyer's Portal page on PSIB sets out how departments apply it.

Mandatory, voluntary and conditional set-asides

A PSIB procurement can take three forms: a mandatory set-aside, a voluntary set-aside or a conditional set-aside. In each case, the set-aside restricts competition to qualified Indigenous businesses. Treasury Board's contracting policy notice identifies PSIB data as a record of whether a contract was set aside on a mandatory or voluntary basis.

A conditional set-aside begins as an open competition. It becomes restricted to Indigenous bidders if at least two qualified Indigenous suppliers submit compliant bids, a process described in the tender documents for a federal solicitation. Restricted tenders state the condition openly. For example, one Indigenous Services Canada request for proposal identifies the requirement as set aside under the federal government Procurement Strategy for Indigenous Business.

Who qualifies: ownership, the directory and certification

A qualifying Indigenous business must generally be at least 51% Indigenous-owned and controlled, according to a 2026 federal publication. Eligible businesses must also generally be listed in the federal Indigenous Business Directory, unless an applicable exemption or a Modern Treaty business-list provision applies.

Solicitations typically require a certification or attestation of Indigenous-business status. That eligibility continues after award. The Government of Canada states in its PSPC briefing materials that certification may be subject to audits by Indigenous Services Canada.

The 33% Indigenous content requirement

Where the PSIB requirement applies, at least 33% of the total value of the contract must be performed by the Indigenous prime contractor and/or other qualifying Indigenous businesses, as set out in the federal publication on PSIB requirements. A set-aside does not remove other obligations. The CanadaBuys PSIB page confirms that applicable procurement policies and procedures still apply.

A non-Indigenous business may take part in some structures, such as a joint venture with an Indigenous business. The specific PSIB conditions in each solicitation control eligibility and evaluation.

The 5% federal objective and departmental reporting

In 2021, the Government of Canada introduced a mandatory objective that federal departments and agencies ensure at least 5% of the total value of their contracts is awarded to Indigenous businesses, as described in a federal departmental publication. Departments with procurement budgets over $1 million must report on their PSIB performance objectives, according to this 2026 government publication. Departments select PSIB set-asides where requirements are suitable.

What PSIB means for a supplier

Check each solicitation for its PSIB status before you invest in a bid. If the tender is a set-aside, only qualified Indigenous businesses can compete, and a conditional set-aside can narrow to Indigenous bidders after bids arrive. Indigenous suppliers should confirm their Indigenous Business Directory listing, prepare the required certification and plan to meet the 33% performance requirement through the whole contract. Other suppliers can look at joint ventures or subcontracts with qualified Indigenous businesses, and should read the solicitation's PSIB conditions closely.