Primary components of the PSAB include "set-asides", supplier development activities, supplier information activities, sub-contracting and joint ventures.

A set-aside is a procurement, which has been taken out of the normal context and reserved for Aboriginal businesses (keeping in mind that they have the capacity for the job and that value can be obtained for government).

There are two types of set-asides:

•  mandatory set-aside. Here, any requirement where the end user, recipient or beneficiary consists primarily of an Aboriginal population, must be reserved for bidding only by Aboriginal suppliers.
• voluntary set-aside. This occurs when the contracting authority itself decides to set aside a requirement for bidding exclusively by Aboriginal suppliers.

Supplier development activities are those undertaken by departments and agencies to raise awareness for Aboriginal suppliers of what the various departments buy, who in the departments make the buying decisions, what particular things they look for when they buy, how they buy things, and how they evaluate and qualify potential suppliers.

With respect to the PSAB,supplier information activities are those efforts by departments and agencies to increase awareness of existing Aboriginal business capacity.

The PSAB permits departments to establish criteria that encourage sub-contracting with aboriginal firms in order to enhance aboriginal business capacity. This can only happen when a requirement is outside one of the international trade agreements.

Furthermore, under the PSAB, Aboriginal suppliers are encouraged to enter into joint ventures with other Aboriginal or non-Aboriginal firms to bid on government contracts.

For the PSAB, the term "Aboriginal" refers to a Status or Non-Status Indian, Métis or Inuit.

To qualify for set-asides, a business - which can be a sole proprietorship, limited company, co-operative, partnership or a not-for-profit organization - must meet the following criteria.

• At least 51 percent of the firm must be owned and controlled by Aboriginal people.
• If it has six or more full-time staff, at least a third of the employees must be Aboriginal people.
• If the bidder is a joint venture or consortium, at least 51 percent of the joint venture or consortium must be owned and controlled by an Aboriginal business or businesses as defined above. It also has to have at least a third of the employees be Aboriginal people if there is more than 6 employees working for the joint venture or consortium.
• When an Aboriginal supplier or joint venture intends to sub-contract part of the requirement, the Aboriginal component in the work must be maintained.

When a firm bids for a contract under the PSAB, it must certify that it meets the above criteria, and it must provide proof of eligibility upon request. Indian and Northern Affairs Canada (INAC) exercises the right to audit Aboriginal supplier certifications.

Here is an example of a certification form.

Each department and agency that annually buys more than $1 million of goods, services and construction services has established yearly performance objectives for issuing contracts to Aboriginal suppliers, and performing Aboriginal supplier development activities.