Chinese State-Owned Company Won $340 Million Canadian Defence Contract Through Straw Bidder, Whistleblower Alleges

OTTAWA – A whistleblower has come forward alleging that a Chinese state-owned enterprise won a $340 million contract to supply components for Canadas defence infrastructure by using a Canadian shell company as a straw bidder. The contract, awarded in 2022, involved specialized electronics for military communications systems. The shell company, incorporated in Mississauga just weeks before the bid, had three employees and no prior defence contracting experience. The whistleblower, a former procurement officer who worked on the file, provided internal emails showing that the shell companys bid was priced 40% below all competitors — a red flag that was ignored. I flagged it three times, the whistleblower said. Each time, I was told to stop asking questions and process the payment. When I asked for documentation about the supply chain, I was told it was proprietary. The contract was awarded through a program designed to streamline procurement for allied nations. China is not an allied nation. But the shell companys ownership structure, routed through holding companies in Singapore and the Cayman Islands, made it virtually untraceable until a routine customs inspection at the Port of Vancouver flagged the incoming shipments origin. The government has paused further payments pending review. The shell company has since dissolved.

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