Défis Innovation Québec

Supply and ground transportation
challenges: Innovation to the rescue!

The Défis innovation Québec program funds experimental projects by Québec companies with ties to government departments and public bodies in amounts up to $500,000 each. This program:

  • Supports the growth of Québec businesses by encouraging the development of marketable innovations that address supply issues confronting government departments and public bodies.
  • Helps these departments and public bodies find innovative solutions to better meet their supply needs (mission or operations).

Electric and Smart Transportation (EST) companies: Join the Défis innovation Québec program!

3 easy steps:

  1. Let us know your interest:
  1. You will receive the PDF application to fill out by email.
  2.  Fill out the form to propose a solution and return the completed file to Cédrick Lalaizon at : cedrick.lalaizon@propulsionquebec.com.
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WHAT IS THIS CHALLENGE ALL ABOUT?

This challenge is an opportunity for companies to innovate to advance their sustainable transportation and mobility mission. More specifically, the challenge is designed to:

  • develop and/or implement innovative technological solutions and services;
  • address issues confronting a government department or public body in response to a specific need not met by existing commercial products or services;
  • focus on the growth of Québec businesses;
  • promote conditions conducive to innovations that meet the needs of government departments or public bodies.
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DESCRIPTION and objectives

Government departments and public bodies need innovative goods and services to fulfil their overall missions, improve the public services they deliver, and make their daily operations more efficient and effective. Often, they lack the financial leverage, programs or resources to tackle these issues.

The Défis innovation Québec program supports businesses, especially SMEs, interested in addressing the ground transportation issues confronting government departments and public bodies by letting them develop and test their innovative technological solutions in real-life settings (electric and smart transportation products and services). Funds provided to the companies selected to join the Défis innovation Québec program will support various stages of their innovation projects to:

  • Support the various stages of the product or process innovation project, including planning, development and upgrading;
  • Accelerate the completion of innovation projects;
  • Help improve productivity and competitiveness of companies, especially SMEs;
  • Document he benefits of new technologies in addressing the challenges confronting government departments and public bodies (impact measurement).

The areas covered by this call for proposals (CFP) relate to electric and smart transportation, i.e., including but not limited to electric vehicles, charging infrastructure and digital solutions to modernize public services faster, while providing business opportunities to Québec companies, allowing them to market their innovations more quickly.

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WHO IS DÉFIS INNOVATION QUÉBEC INTENDED FOR?

The Electric and Smart Transportation Défis innovation Québec program is for EST companies via provincial, regional or municipal government bodies and their public institutions, organizations and government corporations (including public service providers) in Québec.

Applications to the Défis innovation Québec program are open to:

  • A single company;
  • A social economy enterprise (cooperatives and NPOs) within the meaning of the Social Economy Act (CQLR, Chapter E-1.1.1);
  • A group of companies in any activity sector legally constituted under the laws of the Government of Québec or of Canada and operating within Québec.

For groups of companies, funding applications may be submitted by a not-for-profit organization (NPO) responsible for managing the project.

Projects may be carried out in collaboration with one or more government research centres.

One or more companies or organizations outside Québec may join the group of companies provided there are returns for Québec.

 

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ELIGIBLE PROJECTS

EST product or process innovation projects that meet the CFP evaluation criteria are eligible from the planning through to the pre-marketing stages. At the pre-marketing stage, innovations must undergo real-life testing.

Projects may be carried out by a single company or a group of companies. Projects may be carried out in collaboration with one or more government research centres. One or more companies or organizations outside Québec may join the group of companies, provided there are returns for Québec.

Once the testing required by this CFP has been completed, the product or process developed by the company may be sold. The innovation project must meet the following five criteria:

  1. The project must involve the development of a new product or process or the significant improvement of one that already exists;
  2. The project must include the necessary level of innovation, i.e. the product or process must offer a decisive advantage over solutions currently available on the market and within the sector of activity nationally or internationally;
  3. The project must involve a technological and/or business risk or uncertainty for the company;
  4. The project must have required or will require research and development efforts;
  5. If the product or process is intended for sale, the project must demonstrate commercial potential.
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CRITERIA AND ELIGIBLE EXPENSES

Product or process innovation projects that meet the CFP criteria are eligible from the planning through to the pre-marketing stages. Prior to marketing, electric and smart transportation innovations must undergo real-life testing.

Once the testing required by this CFP has been completed, the product or process developed by the company may be sold. The innovation project must meet the following five criteria:

  • The project must involve the development of a new product or process or the significant improvement of an existing one;
  • The project must include the necessary level of innovation, i.e.: the product or process must offer a decisive advantage over existing solutions on the market and within the sector of activity nationally or internationally;
  • The project must pose a technological and/or business risk or uncertainty for the company;
  • The project must have required or will require research and development effort;
  • If the product or process is intended for sale, the project must prove its commercial potential.

Available funding

The financial support offered consists of a non-refundable contribution. Funding is limited to 50%, with total government assistance limited to 75%, and the maximum funding per company is $500,000, according to the stages or activities of the innovation project and whether the project is a collaboration. The total funding provided to a company for all eligible stages and activities may not exceed $500,000 from the date that the funding initiative is approved to June 30, 2023.

Project TitleFunding LimitTotal Government Funding LimitFunding Limit per CFP

Project carried out by a single company.

Project carried out by a company together with one or more government research centres in Québec.

A group of companies sharing the innovation project’s costs, benefits and intellectual property, with or without the collaboration of one or more Québec government research centres.

50% of eligible expenses75% of eligible expenses$500,000 per company
Maximum amount per company for all eligible stages and activities during the period covered by the CFP.$500,000

Eligible expenses

The following eligible expenses are considered reasonable and essential to the project:

  • Professional fees for specialized services, including subcontracted services;
  • Direct costs of labour assigned to the project including employee benefits and contributions to mandatory plans as well as project management fees;
  • Travel and accommodation expenses associated with the project, in accordance with government standards in force as set out in the Recueil des politiques de gestion du gouvernement du Québec;
  • Direct material and inventory costs;
  • Direct equipment costs based on the length of the project and the equipment’s useful life;
  • Equipment rental fees;
  • Research or documentation acquisition fees;
  • Animal facility and platform costs;
  • Intellectual property protection strategy preparation costs, intellectual property protection fees, acquisition of intellectual property rights or licences (including those related to patent applications such as patent agent fees).

In addition to the above-mentioned expenses, the following expenses are eligible for projects submitted by a not-for-profit organization (NPO) on behalf of a group of companies up to a maximum of seven percent (7%) of eligible project expenses for all the expenses listed below:

  • Project setup costs incurred by an NPO;
  • NPO project management fees.

Ineligible expenses

  • Expenses incurred prior to the application submission date including expenses contracted by the company;
  • Debt servicing, future loan repayment, a capital loss or replacement, a payment or an amount disbursed as capital;
  • Regular operating expenses;
  • Recurrent costs such as annual software subscriptions and upgrades;
  • Intellectual property maintenance fees;
  • Land acquisition or development expenses;
  • Building acquisition, construction and enlargement expenses;
  • Transactions between related companies or partners;
  • Applicable Québec sales taxes;
  • Marketing expenses;
  • Marketing plan development expenses.

Reimbursement of expenses

Eligible expenses incurred since the agreement was signed.

50% of the grant will be paid upon signing the agreement.

The remaining 50% will be paid upon delivery of the final report.

 

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THE STEPS IN THE DÉFIS INNOVATION QUÉBEC PROGRAM APPLICATION PROCESS

Step 1: Companies submit an experimental project proposal in answer to a challenge identified by a government department or public body.

At this stage, companies download the application package and complete the form while proposing an experimental solution to a specific challenge put forward by a government department or public body.

Step 2: A review committee analyzes the proposals received.

The review committee, composed of experts, analyzes the relevance of the proposals among the complete applications (letter of support from the government department or public body, form, etc.) within the limits of the program’s available funding.

Step 3: The company, the government department or public body and Propulsion Québec sign the agreement.

On signing the agreement, Propulsion Québec accepts the project and confirms its eligibility and the government department or public body accepts the conditions specified.

Step 4: Implementation of the Défis innovation challenge

The company carries out the work and provides Propulsion Québec with regular progress reports.

Step 5: Final funding claim

Applicants complete the form and include all necessary supporting documents to enable Propulsion Québec to process the claim request and update its accounts.

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KEY DATES

June 23 to August 22, 2022: Application submission period for companies

August 22 to September 19, 2022: Evaluation of proposals received by review committee members and selection of projects in keeping with the available budget

September 19 to 26, 2022: Signing of agreements between government departments and organizations, the companies and Propulsion Québec

October 1, 2022: Project launch

March 13, 2023: Progress Report

June 30, 2023: Cut-off date for eligible expenses

June 30 to July 31, 2023: Final Report – Project Impact Measurement Interview

July 31, 2023: End of program

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FAQ

Who owns any intellectual property developed in the facilities of government departments and public bodies over the course of the project?

The Défis innovation Québec is not specifically intended to generate intellectual property directly within government departments and public bodies. However, the Applicant’s Guide as well as agreements with innovators could include a clause stating that if the intellectual property belongs to the company, the government department or public body reserves the right to use it (in other words, a licence n perpetuity to the innovation developed during the program requiring no payment of royalties or licensing fees to the company).

This usage right also includes the right to modify, disseminate and use the innovation within the organization that initiated the Challenge as well as its supervising or affiliated organizations. The organization may not make the innovation available to other public bodies.

Any service proposal or request for the solution’s maintenance, updating or upgrading once the Défi process challenge is complete, must occur outside the program framework in accordance with the applicable regulations.

Can the company’s contribution toward the funding application include in-kind contributions?

The company’s maximum 25% contribution toward the total amount of the Défi challenge can amount to no more than 50% of the monetary funding that makes up the 25%. Contributions in kind are considered the same as a monetary contribution, up to a maximum of 50%.

Can the government department or public body financially contribute toward preparing the application? Can the government department or public body financially contribute toward preparing the application?

While the government department or public body is not required to make a financial contribution, it is strongly encouraged to contribute to the project to demonstrate its commitment, in particular by providing the opportunity to test the solution proposed by a company in a real-life setting during the Défi challenge period, or throughout the Défi challenge by mobilizing the internal resources of the public body assigned to its implementation. The overall financing setup for the company’s participation in the Défi (minimum 25% contribution from the private sector and government grant) is limited to government funds not exceeding 75% of the overall amount of the Défis innovation Québec initiated by the government organization and the Ministère de l’Économie et de l’Innovation (MEI).

Do projects necessarily have to involve equipment?

No, service-type projects are also eligible.

Does participating in the Défis innovation Québec program give a company a definite advantage as defined by the Act Respecting Contracting by Public Bodies (ARCPB) (which prevents the same company from responding to a potential call for tenders)?

Companies participating in the Défis innovation Québec should be able to benefit from the Bill specifically aimed at promoting “Québec-sourced and responsible procurement by public bodies.”Specific clauses would seem to allow government departments and public bodies to develop collaborative innovation projects with innovative companies without penalizing such companies when subsequent calls for tenders are issued.

The Défis program supports companies up until the pre-marketing stage of their solutions. Depending on the situation at the end of the Défis challenge, tested under real-life conditions inside the initiating organization and after a compliance check of the solution or product proposed, several scenarios are possible.

The Défis challenge was initiated following the market’s failure to respond to a specific need expressed the initiating body. At the end of the Défi challenge, the market call could be such that:

  • Only one company makes it to the final stage (after the government department or public body validates the solution in a real-life setting).
    • The government department or public body has an option, after publishing a Notice of Intent on the SEAO, to enter into a mutual agreement contract with the company concerned. Through the Notice of Intent, the organization again analyzes the market to ensure that the industry is still not able to meet the need that they expressed through the initial CFP at the start of the process. In the absence of a response from within the industry demonstrating that it can meet the need described in the Notice of Intent, the organization is then in a position, under the ARCPB, to award of a contract by mutual agreement.
  • Several companies participated in the overall challenge and were selected after the organization validated their respective solutions (after testing in a real-life setting). In this situation, in order to comply with the normative framework (ARCPB and its implementing regulations), the organization publishes a Qualification Notice for businesses (SEAO).

Qualifying a business is a process by which the organization publicly invites service providers or companies to submit a qualification file in order to draw up a list of companies qualified for a particular contract, which will then be used for the awarding of future contracts. All service providers or companies who pass the qualification step are on a list and any contract subsequent to their qualification is reserved for them.

This setup is therefore open to all companies, whether they participate in the Défis challenge process or not. Here, the selection criteria will be based on a company’s ability to meet the requirements. Subsequent calls for tenders will specify requirements related to the organization’s need to be filled.

Which representatives are involved in the review committee?

The review committee consists of at least one MEI representative, one representative from the government department or public body in an advisory capacity, and experts in the field related to the challenge and pre-approved by the MEI. Only MEI-approved subject matter experts take part in the committee’s decision-making. An MELCC representative could also sit on the committee in an advisory capacity.

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MORE INFORMATION

For more information about this program, please contact:
CÉDRICK LALAIZON
Director, Innovation & Experimentation
cedrick.lalaizon@propulsionquebec.com