Bill C-474 (Historical)

Transparency of Payments Made by Mining, Oil and Gas Corporations to Foreign Governments Act

An Act respecting the promotion of financial transparency, improved accountability and long-term economic sustainability through the public reporting of payments made by mining, oil and gas corporations to foreign governments

This enactment requires mining, oil and gas corporations to submit annual transparency reports that disclose all payments provided by them or their subsidiaries to a foreign government for the purpose of furthering mining, oil or gas industry activities. It also makes it an offence to fail to comply with this requirement and establishes a penalty for such contravention.

Transparency of Payments Made by Mining, Oil and Gas Corporations to Foreign Governments Act

[John McKay, Liberal, Scarborough—Guildwood, ON]

moved that Bill C-474, an act respecting the promotion of financial transparency, improved accountability and long-term economic sustainability through the public reporting of payments made by mining, oil and gas corporations to foreign governments, be read the second time and referred to a committee.

Mr. Speaker, I thank my hon. colleague from Winnipeg North for being the seconder to this bill.

It appears we are at the end of a parliamentary week and this has indeed been a week about corruption, I am afraid. I wish it were not so, but it is.

Ironically, today, the government introduced Bill S-14, which is a bill about corruption and we had quite a number of interventions on that bill. Then question period followed and that, too, was, regrettably, about carryings-on about corruption, bribery and things of that nature. Then we were supposed to proceed with Bill S-14 after question period, but the government switched off that bill.

However, my colleague from the NDP raised the issue of the report of the foreign affairs committee where, in fact, it was also a discussion in some manner or other about the use and abuse of aid money in the extractive sectors.

Here we are, at the end of our parliamentary week, talking about bill C-474, which I have suggested be called the “sunshine bill”. The reason we call it the sunshine bill is that sunshine is light on, how shall we say, murky practices. It is light on goings-on that people only suspect.

However, it also has another aspect. Sunshine also has the aspect of killing bacteria. In some respects when we have legislation such as the sunshine bill, I would suggest it would not only shed light on somewhat murky and dubious practices, but it would also kill off some of those murky and dubious practices.

The bill is, as far as I have been able to make it within our legislative framework, a mirror image of the Cardin-Lugar amendment to the Dodd-Frank bill.

Members will recall that in 2008-09 the world went through a pretty significant financial crisis. The major legislative response by the United States was the Dodd-Frank bill. In the Dodd-Frank bill was an amendment made by Senators Cardin and Lugar which said, in effect, that an extractive company operating in a foreign jurisdiction must, within 180 days of its fiscal year end, produce an audited statement to be filed with the Securities Exchange Commission, which discloses all payments it has made in the course of its previous fiscal year, those payments being taxes, royalties, dividends, licence fees, production entitlements, bonuses, provision of infrastructure and other in-kind payments and a variety of other payments that would be appropriate to disclosure.

Insofar as I have been able to make this bill as mirror image as our American friends have done, I have done so.

In the United States, the sanction for failing to file will be delisting from U.S. stock exchanges. Therefore, we can imagine that the Americans are very serious about corruption. Failure to comply means that a company will be delisted from, primarily, the New York Exchange. Its stock will be worth zero. The company will be functus. That is how serious the Americans are about corruption in companies in which it has administrative jurisdiction.

We do not have a national securities regulator. That case was decided about a year ago. I actually applaud the government's efforts to try to create a national securities regulator. Our securities regulation in the country is a joke. There are all kinds of little silos doing various different things. Therefore, I applaud the government's efforts, but those efforts failed. As a consequence, we had to rejig the sanction to be a fine sanction.

Failure to file with the government in a similar fashion as the Cardin-Lugar amendment would, in this instance, attract a fine rather than a delisting from a U.S. stock exchange.

I know the Americans are extremely keen on this legislation. In 2011 or 2012, I am not quite sure in which was the meeting, President Obama raised this matter with his G7 partners. All the partners at the G7 wanted each nation to commit to legislation similar to the Cardin-Lugar amendment. The only nation that resisted was Canada, which is quite regrettable because we are the world centre for the extractive industry. More transactions take place on the TSX than pretty well anywhere else in the world. This is the centre of the world for mine financing, law firms, accounting and geology. We are the best in the world in mining. That is an extremely important industry to us and our nation's well-being. Therefore, we should also be the leaders in an international regulatory environment for the benefit of our nation and the companies that call Canada home. It is good for Canada, for the industry and it is good for our national reputation.

Unfortunately, Canadians are fed up of reading in their national newspapers and other media about various companies that find themselves on the wrong side of bribery allegations, the latest example being SNC-Lavalin, which is by anyone's standard a world-class engineering firm. However, because of bribery convictions in Bangladesh, it has been barred from competing in world bank contracts for the next 10 years. That basically takes SNC-Lavalin, and essentially Canada, out from competing for engineering projects. Officials have been fired and the stock has been hammered.

One can go through quite a number of Canadian and Canadian-based companies such as: the Calgary-based Griffiths engineering company, which recently paid a $10 million fine for an inappropriate financial relationship with the wife of the Chad's former ambassador; Niko Resources another $9 million fine in 2011 for again an inappropriate relationship with a former energy minister in Bangladesh; and Blackfire Exploration Ltd. is having its offices raided by the RCMP.

This is serious stuff. The common pattern is the conviction gets registered, the officials get fired, the stock gets hammered, so there is a bunch of unhappy people and the most unhappy of all are the shareholders. All of us are shareholders in many of these companies because they are all on the TSX and our Canada pension plan has large holdings on many of these companies.

It gets worse than that. Members may or may not have caught an article in the Globe and Mail last year entitled “Canada ranked worst of G7 nations in fighting bribery, corruption”. In the second paragraph it states:

Transparency International, a group that monitors global corruption, put Canada in the lowest category of countries with “little or no enforcement” when it comes to applying bribery standards set out by the [OECD].

Mr. Dent further states that:

—the United States has prosecuted more than 200 companies and individuals, many of them “a veritable who’s who of the corporate world”...

The United States is serious about this kind of corruption and is very serious not only in a legislative fashion but also in a prosecutorial fashion in trying to deal with these allegations and concerns.

The United States, in a comparable period of time, has conducted 227 prosecutions. In a similar period of time, we have conducted two. We are the world centre for mining. Maybe when things go north of the border, we suddenly become a whole lot better than the rest of the world. I suppose we are entitled to believe in our fantasies.

However, the Americans, the British treat and the Europeans treat this very seriously. Unfortunately, the big hole in the legislative fence is right here. This has reputational damage, and it is not only reputation.

I hear my friends chirping over there because they are a little nervous that they have been caught with no legislative response going into the G8 next month.

If Conservatives do not think this is serious to shareholders, if they do not think it is serious to management, if they do not think it is serious to our corporations or our corporate brand, they should think about it in terms of our national reputation.

Positive views of Canada fell most steeply in the United States, Britain and China, according to the BBC World News survey of 20,000 people in 20 countries who were asked if Canada had a mainly positive or negative influence on the world. It is the first time Canada's popularity among its major trading partners has declined since polling from GlobeScan began tracking international sentiment in 2005.

GlobeScan chairman, Doug Miller, said, “the deterioration could hurt Canadian business interests”. He said, “If the conditions persist, it can start to set in more cognitively and become an anchor that weighs down [Canada's] reputation. What countries have found is that it's extremely hard work to regain trust”.

The industry is actually cognizant of this. The industry gets it. Over the last couple of years, I have been meeting quite regularly with industry groups. In many instances they have signed up for EITI, the extractive industries transparency initiative. In many instances they understand that not only is it important that their company have a good reputation, but it is important that their industry have a good reputation and it is important that our nation have a good reputation.

They have conducted on their own, at their own expense, all kinds of seminars, education things and the government has in some respects facilitated some of that discussion with the Vancouver-based organization which is on EITI.

Interestingly, Canada as a nation, unlike other nations like the United States, has not signed on for EITI. We actually cannot hold our own companies to account, even though some of our own companies have voluntarily joined the EITI initiative themselves.

Joe Ringwald, Transparency International Canada representative and an industry representative, said, “It is become important to become a leader in order to gain this reputational advantage”. He also stated that Canada had become a laggard on this industry, that industry in general was taking a favourable tone to this legislation and that there had been a number of industry players who wanted transparency.

The industry, the various other actors, the NGOs and others are stepping up to the plate, but what is really worrisome is that, internationally, we are about to get one more black eye.

At the G8 meeting in June, Prime Minister Cameron wants transparency to be one of the takeaways from that meeting. He wants the rest of the G8 partners to adopt the legislation similar to the Cardin-Lugar amendment. Thus far we are going in with fig leaves.

Bill S-14 is a fig leaf. It is wonderful in so far as getting prosecution, but it is not much good in terms of generating evidence.

I would encourage my colleagues, particularly my colleagues opposite, to support this legislation. This is extremely important to the industry and extremely important for our nation.

[Bob Dechert, Conservative, Parliamentary Secretary to the Minister of Foreign Affairs]

Mr. Speaker, the great irony here is the legislation the member is complaining about, the legislation that he says is not robust enough to convict Canadian companies responsible for corrupting foreign public officials, is known as the Corruption of Foreign Public Officials Act. It was passed in 1999 by the government the member was a minister in. Now he stands here today and says that there have not been enough prosecutions, not enough investigations under that act. It was actually his party, the government he sat at the cabinet table of, that passed that act and then sat on it for several years. That is the legislation the member is now complaining about.

Our government came forward with Bill S-14. The president of Transparency International, whom the member likes to quote, has said that Transparency International is delighted that the Government of Canada is moving to strengthen the corruption of foreign public officials act, the one that his government passed that is not robust enough to do what he says it should do, in accordance with Canada's international obligation and encourages the government to ensure that the RCMP have the resources necessary to enforce the CFPOA effectively--

[Some hon. members]

Oh, oh!

[The Acting Speaker, Conservative, Barry Devolin]

Order, please. I see that the hon. parliamentary secretary is next on the agenda. He will have the opportunity to conclude his remarks at that point.

The hon. member for Scarborough—Guildwood.

[John McKay, Liberal, Scarborough—Guildwood, ON]

Mr. Speaker, it is a nifty technique to make his speech in a question and then come back and make his speech all over again.

The simple issue is that this legislation has been on the books since 1999. He is perfectly correct about that. If it was not being prosecuted then he has had six, seven or eight years now to have done something about it. It is not as if the world has not been asking for Canada to step up to the plate. Conservatives have had the opportunity but they have not. Then to turn around and say now that we have this new legislation, Bill S-14, good, I am great about that, but we are not going to support 494, which is the evidence base that any prosecutor, any police officer is going to be able to use in order to have successful prosecutions. It is useless having legislation if we do not have evidence and we do not have resources and that is what Motion No. 494 does.

[Paul Dewar, NDP, Ottawa Centre, ON]

Mr. Speaker, this morning when we were discussing the other bill from the Senate I talked of the need to actually get Canada in the game again. The member talked about some aspects in the bill, about fines versus deregistering on the stock exchange that some have talked about in terms of critique. By and large, I think everyone is on board with this idea. The G8 is coming up and this will be front and centre. The question is will the government be onside with transparency?

I assume my colleague has full support of his own party. Is the government saying it is against this initiative based on merit or is it based on politics? If it is based on politics, how does he see this in light of what is about to happen in the G8, where this is going to be front and centre and something that Prime Minister Cameron is focusing on? I would like to get the member's comments on that.

[John McKay, Liberal, Scarborough—Guildwood, ON]

Mr. Speaker, the hon. member asks a perfectly sensible question because we are coming up to the G8. He and I met with the sous-sherpa of Prime Minister Cameron. They are keen to have this kind of legislation. This is the kind of legislation the world needs, the world wants. When the Americans get behind something, that is when we want to be there. We have one foreign policy that frankly is “do not get too far ahead of the Americans and do not get too far behind them”. When they get behind this kind of legislation, they set the world standards and we need to be on that train. This is extremely important for our international reputation.

The final point I would make is these are our main trading partners. Why gratuitously irritate the United States by not accepting legislation such as this, which is largely a mirror image of their own legislation? Why gratuitously irritate the EU while we are negotiating a trade agreement with it when this is something that industry wants, the international community wants and I know Canadians want?

[Bob Dechert, Conservative, Parliamentary Secretary to the Minister of Foreign Affairs]

Mr. Speaker, I am pleased to rise today to participate in the debate on Bill C-474, the transparency of payments made by mining, oil and gas corporations to foreign governments act.

Let me state at the outset that our government believes that responsible resource governance practices should include transparency to ensure that the extractive sector sustains economic growth and reduces poverty. Without sound management, natural resource exploitation can lead to increased corruption, poor development outcomes, and at times, the fueling of armed conflict or illicit trafficking.

Openness, clarity and accountability are not only good for the local community but enhance investor predictability and stability. This type of responsible conduct is valued by governments, communities and corporations. This is why it is important to have a solution that works for Canadians, a solution that promotes transparency and good governance and one that respects our Constitution and creates a stable investment environment in Canada and abroad.

Canada is a major player in the international extractive sector, which includes oil, mining and natural gas. This is an important sector for the Canadian economy, our government's top priority. It accounts for 1.6 million jobs and nearly 20% of Canada's GDP. In 2011, Canadian resource companies exceeded $128 billion in outward foreign direct investment. We know that Canadian companies operate overall in a responsible manner, not only here in Canada but around the world. They are instrumental in improving the lives of people in the communities in which they operate.

Let me be clear that our government is not opposed to the objectives of this bill. Indeed, we value transparency initiatives that work for all Canadians. Our corporate social responsibility strategy for the Canadian international extractive sector, or CSR strategy, works for Canadians. It builds host country capacity, promotes widely recognized voluntary international guidelines, provides an independent dispute resolution system through the Office of the Extractive Sector Corporate Social Responsibility Counsellor, and last, facilitates a multi-stakeholder group comprising business, government and civil society to provide practical tools and information on CSR.

Our government continues to innovate with new ways to responsibly advance natural resource governance that works for Canadians. In 2011, at the commonwealth summit, the Prime Minister announced a $25 million contribution for the creation of the Canadian Centre for Extractive Industries and Development. This institution will be jointly operated by the University of British Columbia and Simon Fraser University and will advance best practices in extractive sector technology and management to reduce poverty and protect the environment.

In 2007, the Minister of Finance announced Canada's support for the extractive industries transparency initiative, also known as EITI. Today, Canada is the second largest funder of the EITI multi-donor trust fund, as well as the largest funder of the World Bank's Extractive Industries Technical Advisory Facility. We also host the secretariat of the Intergovernmental Forum on Mining, Minerals, Metals and Sustainable Development, which convenes developing countries, training partners and donors to discuss and advance issues of mutual concern, such as international standards and best practices in extractive sector management and governance.

As well, let us not forget the Prime Minister's announcement in 2012 of $15.3 million in new funding for the African Minerals Development Centre. The AMDC will deliver guidance and policy advice to African countries on how to manage their extractive sectors responsibly and sustainably.

These are examples of Canadian solutions that work. They encourage extractive companies to make responsible investments, advance transparency and increase accountability. They reinforce Canada's brand as a global leader in this regard. This is why our government advances solutions that bring results not only here in Canada but around the world.

When it comes to advancing transparency and accountability, it is important to bear in mind that we are not the only player in town. At the upcoming G8, all countries will be working together to address this important issue. It is important that we work with our international allies to ensure that we have a strong transparency regime while ensuring that we have a comprehensive framework that does not unduly burden industry. Industry and civil society are also bringing new Canadian solutions to the forefront. There is work under way by Canadian mining companies and civil society to develop a framework for transparent financial reporting of payments to foreign governments.

In July 2012, the Mining Association of Canada, the Prospectors and Developers Association of Canada, Revenue Watch international and Publish What You Pay Canada, signed a memorandum of understanding to develop a framework for the reporting of Canadian extractive companies' revenues to foreign governments on a country-by-country and project-by-project basis. The objective is to create a single reporting framework that would reduce the reporting burden on companies, as well as to simplify the provision of information to all stakeholders.

This is an example of how Canadian industry is stepping up to encourage financial transparency in foreign markets. It demonstrates a constructive consultation for a workable solution. Unfortunately, Bill C-474 is not a workable solution. Bill C-474 tries to impose reporting features taken from other countries, such as the United States and Europe, with little regard to how our system works.

First, Bill C-474 has been presented without, it seems, consideration of how it would actually work under the Canadian Constitution. Our assessment is that the proposed legislation lacks constitutional validity under Canada's criminal law and our federal trade and commerce regulations. Simply put, Bill C-474 does not work under our Constitution. Second, the bill addresses the extraction of natural resources outside of Canada and does not include a domestic reporting regime. Third, Bill C-474 does not recognize the existing consultation in industry trends. Without effective engagement, the bill could result in an undue burden on the extractive sector. Bill C-474 does not work for our industry.

We believe in an approach that works for Canada, for Canadian companies, and an approach that advances transparency and accountability while also increasing economic prosperity and jobs for hard-working Canadians.

While I am standing, I would like to address an issue that I heard from the opposition members earlier today and that I have heard on an ongoing basis, that somehow Canada's international reputation has been going down. They do not cite any data for that. They cite a favoured member of the chattering classes.

I would like to put forward an article from The Toronto Star dated Thursday, May 23. The headline reads: “Canada's international reputation rising” says survey. It continues:

Canada's reputation is improving overseas according to a new public-opinion survey of respondents in 20 countries. Keep that maple leaf patch on your backpack for at least another year. Canada's reputation is improving overseas, according to a new public-opinion survey of respondents in 20 countries. Fifty-six per cent of about 20,000 respondents view Canada favourably, up from 53 per cent last year. The findings are included in a report by the polling firm GlobeScan [which was released yesterday]. Canada's reputation outside its own borders trails only Germany.

Around the world, Canada is the second most favourably viewed country in the world. That is hard data, done by an internationally recognized polling firm that has been doing this on an ongoing basis for 10 years. I understand that the opposition does not want to bring this to the attention of the Canadian people because it does not go along with what they have been trying to tell people for the last couple of years. The facts are that Canada's reputation in the world is going up not down, and that is because we have a responsible and principled foreign policy.

The pollster who did the survey said Canada's reputation has been trending positively since at least 2010, when 51% of the survey respondents had a favourable opinion of Canada. Those are the facts. I hope the opposition will read The Toronto Star. I am pretty sure my hon. friend from Scarborough—Guildwood is a subscriber. He might want to take a look at that article and perhaps respond to it at another time.

[Paul Dewar, NDP, Ottawa Centre, ON]

Mr. Speaker, I rise today to speak to what I think is a valid initiative and something we should get behind. We have talked a bit about this already earlier today, when we were talking about the bill from the Senate on corruption.

What is astounding about the current government is that even when there is a good idea, the Conservatives have to put a partisan political veil on it. I am going to diverge from my notes for a second here and respond a bit to the parliamentary secretary's comments.

He said that the government cannot support this bill. Let us remember that this is a private member's bill, so I encourage every member of the Conservative Party to look at this with an independent lens, to look at what the rest of the world is doing and saying, and to remember that it is a private member's bill and that they can vote, hopefully with their conscience, and represent their constituents on this issue. I know many of their constituents would be in favour of this bill.

In fact, when they look at who is supporting this bill and this initiative, they would be hard pressed to find constituents in any of their ridings who would be against it. What are they against? They would be against transparency, which our friends south of the border would be in favour of, and against the whole focus of the upcoming G8 conference.

If the Conservatives have problems with the bill, they should at least bring forward amendments. However, what the Conservatives are saying is that because it does not come from them but from someone else, they will kill it immediately. That is the philosophy of the current government.

To address the parliamentary secretary's comments, he should discern, and we sure do, the difference between the reputation of Canada as a country versus what is happening to our reputation because of the government. It is what happens when we do things as inane as what we did at the United Nations this past fall, where we hectored and lectored. Even though our Prime Minister was in the very city where people were addressing the General Assembly, we instead sent our Minister of Foreign Affairs, who got to speak to a nearly empty hall and hectored and lectored everyone in the hall. Then the Conservatives wonder why we are not getting along with our allies and others and are not on the Security Council.

However, on the bill, it looks to the future and says that when Canadian companies are doing their affairs abroad, they should be entirely transparent in their transactions. That is exactly what we need to see from Canadian companies, and interestingly, Canadian companies want to do it. My colleague and I, as he mentioned, had a meeting with the representative from the U.K. who is looking at organizing the meeting for the G8, and there were also representatives from the mining industry. They were saying they want to get on board with this approach. The government does not. Why? It is because it did not come from the government.

I am going to bring forward to second reading, hopefully in this next year, a bill on conflict minerals. My bill, like the one from my colleague from the Liberal Party, is based on the Dodd–Frank initiative from south of the border. We think it is smart to get in line with some of these initiatives that our allies are getting in line with because it is good for business and good for our reputation abroad to say that as a country we are going to be responsible actors abroad, nothing more and nothing less.

The Conservatives are so stuck in the past that they cannot even look at a good idea and say, “If we have problems with it, let's work it out.” That attitude is astonishing to constituents when they hear that there is a good idea being put in front of Parliament and that in fact it is a private member's initiative. I had thought that certainly members of the Reform Party thought that it was a really good idea to empower private members' initiatives, that they would actually be able to look at it on the basis of the merit of the idea and have a debate, have a vote and get behind it if they thought it was good for the country and for their constituents. However, what we see here and what was demonstrated by the parliamentary secretary is what we see time and time again. Why could there not be amendments? They could go to committee and do it, but no, we do not even get to go past the first reading point.

I hope the Conservatives remember this, because they will know that someday they will not be in government. One day they will have to take a look at how Parliament is functioning, and people will remind them of how they behaved. I hope they remember that, because right now we are seeing good ideas getting shut down. This is a good idea, and it seems that the government will kill it.

I hope those who are on the backbench actually look at the bill, listen to their constituents and say "based on the merits of the idea, I am going to support it" or "I do not agree with it and here is why" and have a debate about it. Just to get in line and do what they are told is fundamentally undermining their role in Parliament.

That is unfortunate, because most constituents within their ridings want to see transparency. They want to see good ideas put forward. In the case the sunshine bill, it is about Canada's reputation. It is about moving forward, not going backward. We see the government avoiding these ideas.

Do we really want to be seen overseas as laggards on transparency? I think not. Do we want to be seen as fighting even the motivation initiatives of industry? I hope not. That is what people will be doing, in essence, when they say no to this bill.

Finally, I will identify and go through some of the people who are behind this: Transparency International Canada; Probe International; Partnership Africa, which is doing good work on the ground in Africa; Africa Files; and the Corporate Knights. As I said, mining umbrella groups are behind the idea of this as is Publish What You Pay.

Why would anyone be against it? What the parliamentary secretary has pointed out is that somehow we are unable to apply this legislation, which has been adopted in other legislatures and jurisdictions in Canada, because of our Constitution.

We know how legislation is drafted. We know how it has to be in accordance with Canadian law. That is why we have amendments. As they say, that dog will not hunt. If they really do not believe that something can be done, amendments can be made. They cannot reject an idea just based on that.

In summation of why I think this bill is important to adopt, we have to take a look at what is happening in the global economy right now. We have a multi-polar world. We have the BRIC countries, which are major actors in the extractives. We have to get the social license to do business in countries abroad.

If we are not going to get in line with these norms that everyone else is adopting, what does that do to Canada's strategic advantage? If we reject transparency and if we reject the norms that we see others adopting, what does that do?

What it does, interestingly enough, is undermines the very goals that the government claims to be in favour of, which are to expand our investment and trade abroad. If we are seen as laggards on basic transparency, on governance and on the norms that others are following, it is clear what that will do to our reputation, not just as a country, but in terms of investment and how Canadian companies are seen abroad. This is not because of their behaviour, per se, but because of the lack of leadership from the government.

I would encourage all hon. members to take an independent look at this bill, listen to their constituents and ask them what they think of it. What are they here for if not to listen to their constituents, the primary mandate of any member of Parliament? If they hear from the constituents that it is a good idea that should be adopted, then they should break loose, do their jobs, vote independently, seize the day and free themselves from the tyranny of the whip and say "please support transparency".

[Irwin Cotler, Liberal, Mount Royal, QC]

Mr. Speaker, I rise today to address Bill C-474, the transparency of payments made by mining, oil and gas corporations to foreign governments act.

I would first like to commend the sponsor, my colleague representing Scarborough—Guildwood, for his persistence and dedication involved in seeing this legislation through Parliament these past several years.

Bill C-474, the sunshine bill, as my colleague has properly characterized it, would compel Canadian-based extractive companies operating abroad to disclose all payments made to foreign governments after having been reviewed by a qualified independent auditor. The disclosures would be made to the Minister of Natural Resources who would then ensure that they are made available online for public viewing. If it is discovered that a company has failed to disclose a payment, it would be deemed guilty of an offence and face a fine upon summary conviction of up to $5 million.

These provisions will not only help to promote greater transparency and accountability in Canada's extractive sector, the sunshine aspect, as my colleague put it, but they will also discourage the kinds of illicit payments to foreign governments, especially those that routinely violate human rights, the disinfectant aspect, that have long been used to gain access to resource reserves.

To be clear, this legislation is not an indictment of all Canadian extractive companies, nor will this legislation stifle business and trade. As Pierre Gratton, president of the Mining Association of Canada, stated last year with respect to payment disclosures:

I think by and large it's not only seen as the right thing to do, but it's starting to be seen as actually good business to have these payments to government published.

This legislation is about combatting corruption and ensuring corporate social responsibility and accountability. Admittedly, many Canadian companies already have excellent track records in this regard, but as my colleague pointed out, this is now a question for Canada's reputational integrity and to make these countries even more attractive to investors. There is also precedent for this kind of legislation in other jurisdictions, including the U.S. and the EU, as has been pointed out, as well as broad support from civil society organizations in Canada. I am therefore pleased to support this bill and trust that it may enjoy the full support of the House.

Canada has already established itself as a world leader in the extractive industry. This distinction, however, carries significant responsibility in terms of ensuring that our companies conduct business abroad in an ethical manner and with the utmost respect for human rights. Regrettably, this has not always been the case, as my colleague has pointed out, which is largely why this bill is being brought forward.

As well, throughout this parliamentary session, the House Subcommittee on International Human Rights, of which I am vice-chair, has heard from witnesses as to the activities of Canadian extractive companies in countries around the world. Regrettably, much of the testimony has given us cause for concern.

For example, this past October, the subcommittee had the pleasure of receiving Neri Colmenares, a member of the Philippine House of Representatives and an authentic human rights hero in his country. In his testimony, Mr. Colmenares explained how transnational corporations operating in his country, including Canadian mining company Toronto Ventures Incorporated, TVI, have hired paramilitary groups for security, which he dubbed “a recipe for disaster”. These “unwieldy elements”, as he put it, have reportedly carried out routine violations of human rights dating back many years.

In a recent example, Mr. Colmenares described how local media were detained and held hostage by such a paramilitary group hired by TVI. This is but one example Mr. Colmenares shared with our subcommittee and in several meetings that I had with him. Indeed, his testimony and similar witness statements only underscore the need for the kind of legislation at hand.

In addition to the Philippines case, the subcommittee has also been inquiring into the state of human rights in Eritrea, which, as members will know, is the most closed society in Africa, dubbed the North Korea of Africa, and is one of the world's most egregious violators of human rights.

This past November, the subcommittee heard testimony from Cliff Davis, president and CEO of Nevsun Resources, another Canadian-based mining company with operations in Eritrea. Mr. Davis repeatedly insisted that all who work at the company's mine, which it co-owns with the Eritrean government, are there of their own free will and are provided with good working conditions, food and accommodations, in accordance with international standards. Moreover, Mr. Davis claimed that his company fully addressed allegations of human rights violations, particularly the use of conscripted labour by an Eritrean government subcontractor employed by Nevsun.

However, in witness testimony before our committee, we heard Nevsun does not know whether conscripted labour is being used or that the company has been repeatedly denied the right to investigate by the Eritrean government-owned subcontractor and now “appears to feel it has no power” and has responded with “quiet acceptance”.

This is precisely the impression I was left with after hearing Mr. Davis' testimony.

When I asked him if he was aware of human rights violations in Eritrea, generally speaking, notwithstanding the public record, he said no. When I asked him if he was ever advised about human rights violations in Eritrea by anyone, he said no. When I asked him if he was aware of human rights violations at the mine site, he said no. When I asked him if he was advised by anyone of human rights violations at the mine site, he said no. When I asked him whether he had ever conveyed to the Eritrean government any concern of any kind about any human rights violations, he said, and I am paraphrasing for reasons of time, “ I do not acknowledge the premise of the question. That is a premise asserted by people outside of our mine site, and there are no human rights violations at our mine site”. In the end, it was, in my view, akin to hear no evil, speak no evil and see no evil.

Simply put, it is unacceptable for Canadian companies to profit while funding and enabling those who violate human rights. I believe that Bill C-474 can help end that practice. The legislation would also serve to advance the principles of transparency and accountability that have already taken root among Canadian companies, while reinforcing the notion in the minds of investors that corporate social responsibility is good business.

I trust that the House will adopt the bill.

[Scott Reid, Conservative, Lanark—Frontenac—Lennox and Addington, ON]

Mr. Speaker, it is my pleasure to contribute to the debate on Bill C-474. This proposed legislation focuses on Canadian extractive companies, Canadian mining companies in other words, that are operating internationally. Its main objective, which I do not think anyone could object to, is the improvement of financial transparency, accountability and economic sustainability through public reporting of any payment that Canadian mining companies or Canadian oil and gas companies make to foreign governments.

This is important because Canada is the world's largest investor in extractive industries, at least if we leave oil and hydrocarbons aside. We have investments in roughly 8,000 properties and around 100 countries around the world. Nearly 20% of Canada's foreign investments are in the extractive sector and 60% of the world's publicly listed mining corporations are listed on Canadian stock exchanges.

My own interest in this issue comes from the fact that I am the chair of the human rights subcommittee of the foreign affairs committee. We have done some work into human rights issues that relates to mineral extraction. In some cases, this involves mineral extraction, where Canadian companies either are involved, or potentially could be involved in the future. My colleague, the member for Mount Royal, mentioned the example of looking into the Bisha mine site in Eritrea which is operated by a Canadian company. There are other examples as well.

This is important because it is not always easy for Canada to have an influence on international human rights issues. We are not as influential in the hard power way as some of the other countries in the world: the United States, Britain, France and China. However, when it comes to the power of our investments in the international extractive sector, we are the most significant player.

Having said all of that, there are certain human rights issues that strike me as being particularly important. They have to be taken into account when one is dealing with these kinds of investments. For example, there is the issue of property rights and the land tenure of people who live on the land on which a potential mine might be placed. This can happen even in my own riding. Here in Canada we have had mineral exploration on property where the individuals who have lived for their entire lives do not have the underground rights to their own property and this creates conflict. However, in Canada we have expropriation acts; we have the rule of law. This is not true everywhere. Canadians investing in countries that do not have these rules have to find a way of dealing with the fact that these countries often do not have a proper mechanism for dealing with this kind of thing. In some cases, this includes issues that relate to indigenous rights in those countries. We have an obligation to deal with that.

We have to deal with the fact that in some countries the population is not truly free. There is the danger that we could find ourselves operating in a professional manner, but in an area where the population is enserfed, where there is forced labour. We could find ourselves, if we are not careful, complicit in some kind of human rights abuse. This is of course a major concern to this government, and to any responsible Canadian.

There are these considerations, and some others that are not truly human rights issues, but clearly they are human rights in the broader sense. The destruction of the environment, which can happen from mining, is a real worry. For example, one great tragedy that has occurred, which we could say is a human rights issue, has been the pollution of rivers with arsenic as a result of the gold mining industry. It is for this reason that the world community—and Canada has been a key participant in this—has adopted rules and practices relating to the use and monitoring of arsenic in mineral extraction to make sure this kind of harm does not occur. It can have disastrous implications. These are, in the broad sense, of course, human rights implications.

One issue to be concerned about is how we deal with foreign bribery, kickbacks and so on. The intent of Bill C-474 is to deal with illicit payments to officials in foreign jurisdictions in order to get access to resources or for favouritism.

The way that Bill C-474 aims to do this is by requiring Canadian extractive companies and their subsidiaries that are incorporated under Canadian or provincial law to submit to the Minister of Foreign Affairs and the Minister of Natural Resources an independently audited annual transparency report. This is all quite reasonable, but there are some problems that need to be addressed with regard to this bill.

First of all, Bill C-474 pre-empts the work currently under way involving Canada's international partners in the G8 in preparation for the G8 leaders summit, which is occurring this summer. The issue of transparency in the world's extractive industries is expected to be a key item at the G8 summit.

Second, Bill C-474 also pre-empts the collaborative work currently under way involving industry representatives and NGOs, work that is scheduled to be completed this summer as well. The revenue transparency working group is putting together a framework for mandatory reporting of payments that will ensure that we are in line with our international partners' regimes to ensure, again, that we have strong transparency that does not burden Canadian businesses disproportionately, as compared to our trading partners and competitors, with unnecessary red tape.

Third, there are many international or multilateral initiatives that already exist. For example, there is the extractive industries transparency index, which the government supports. In fact, just last October, Prime Minister Harper announced $20 million over a four-year period in support—

[The Acting Speaker, Conservative, Barry Devolin]

Order. The hon. member cannot refer to colleagues, including the Prime Minister, by their given names but rather simply by their titles.

[Scott Reid, Conservative, Lanark—Frontenac—Lennox and Addington, ON]

Mr. Speaker, my comments refer to the current Prime Minister. I think we all know which prime minister we are talking about. I will leave those who are watching to figure out which prime minister the reference is being made to.

The Prime Minister announced $20 million over a four-year period in support of the EITI and the extractive industries technical advisory facility. This support was announced at the francophonie session in Kinshasa, which oddly enough, or ironically enough, happens to be in the capital of a country that has been kicked out of EITI, or is currently suspended, because it is not compliant with EITI.

Canada is trying to support this initiative. I invite members to go to the EITI website. What they will see is that this is an initiative that essentially involves the countries in which the extraction will take place getting involved and demonstrating that they are living up to certain standards.

A map reveals those countries that are candidate countries, those that are full members and those that have become members and then have failed to comply and have been kicked out. They essentially cover a swath across Central Africa and Central Asia. They are the countries that are rich in resources but have a history of very problematic resource extraction, bribery, corruption, unsafe practices, human rights violations, and so on, and in which an effort is being made to correct this situation, sometimes not with full success.

By participating in this kind of process, and indeed, in helping to fund it and make sure it is on a sound financial footing, Canada is having a real impact and a better impact than we could have with any other method.

I want to mention a few other things we are doing here. There is the Canadian International Institute for Extractive Industries and Development, which the parliamentary secretary mentioned earlier. Canada is the largest founding donor of the African Minerals Development Centre, which promotes best practices and mining policy and management throughout Africa.

Canada is a major player. We are a responsible player. Our companies are the players that are most desired, for our skills, our expertise, and our substantial capitalization, by all of the countries in which resource extraction is going on. That means that we have, to a certain extent, the capacity to impose reasonable standards on those countries, and we should take care to do that responsibly.

We should not be shy about the responsibility that entails for us. We should do that in a way that ensures that we move forward on a level playing field, where all other competitors are also working towards those higher standards, and not cause ourselves to be in a situation where we are unfairly hobbled in the competition with those countries. That would not accomplish anything at all.

[Hélène Laverdière, NDP, Laurier—Sainte-Marie, QC]

Mr. Speaker, the arguments made by our colleagues opposite bring back memories. They are telling us that they are doing or are going to do all sorts of things. They are making excuses for not doing the right thing, which would be to agree with referring the bill to committee for further study.

This is a very important bill, especially in the current context. The government is putting more emphasis on natural resource development in developing countries, as part of its international co-operation strategy.

The development of natural resources can certainly be part of the equation, but it has to be done properly to benefit Canadians, particularly the poorest people in the country.

The problem is that the government thinks of itself as a sort of magic wand. I am seeing a growing tendency toward this type of magical thinking. The government says it will develop natural resources and that—just like that, by waving a magic wand—everything will automatically be better and everyone will be happy. I do not think that the Conservatives realize how complex this issue is.

One of the first questions that needs to be asked when we talk about natural resource development is whom does it benefit and what control do the people of a resource-rich country have over the way their government manages the benefits of that development. We know that far too often the elite of those countries has easy access to non-tax revenue, which allows them to eschew accountability and even oppress their own people.

To avoid that, greater transparency is key. That is why, for years now, so many agencies and countries have been working to improve transparency.

In Canada we have the Resource Revenue Transparency Working Group, which includes the Mining Association of Canada, the Prospectors and Developers Association of Canada, and Publish What You Pay Canada. Publish What You Pay is a global network of organizations around the world. Together with the Extractive Industries Transparency Initiative, PWYP is one of the most active organizations when it comes to transparency.

The hon. member was saying that we want to be on a level playing field with the other countries because, otherwise, it would not be fair for Canadian businesses. We know that the other countries have made a great deal more progress than Canada has to date. For example, in 2010, the United States passed the Dodd-Frank Act, which contains measures that are fairly similar to the ones proposed in the private member's bill before us today.

The European Union, Australia and the United Kingdom are also planning to implement similar standards. The G8 also wants to make this a priority at its next meeting, which is scheduled to take place in June.

Canada, the country with the most registered mining companies, is lagging behind. That is why we appreciate the idea behind this bill. The bill seeks to require Canadian mining, oil and gas companies to submit annual reports that disclose all payments provided by them or their subsidiaries to a foreign government for the purpose of furthering mining, oil or gas activities.

[The Acting Speaker, Conservative, Barry Devolin]

The time provided for the consideration of private members' business has now expired, and the order is dropped to the bottom of the order of precedence on the order paper. The hon. member for Laurier—Sainte-Marie will have six minutes remaining.

It being 2:30 p.m., the House stands adjourned until next Monday at 11 a.m., pursuant to Standing Order 24(1).

(The House adjourned at 2:30 p.m.)

[John McKay, Liberal, Scarborough—Guildwood, ON]

moved that Bill C-474, An Act respecting the promotion of financial transparency, improved accountability and long-term economic sustainability through the public reporting of payments made by mining, oil and gas corporations to foreign governments, be read the second time and referred to a committee.

Mr. Speaker, that is an exceedingly long name for a bill. Possibly, the name might even be longer than the bill itself. I have been referring to it as “the sunshine bill” because the notion is clearly that payments made by the extractive sector to various entities, that the light of sunshine be shone upon them so that all can see what is happening, but also that it acts as a disinfectant to what is the pernicious problem of corruption.

There is a broad consensus among civil society, NGOs, and the industry, and some governments that there has to be something done about the payments and the corruption involved in a variety of enterprises, particularly involving the extractive sector: that we need to have increased transparency and to curb corruption.

Indeed, recently PDAC, the Prospectors and Developers Association of Canada; MAC, the Mining Association of Canada; Revenue Watch Institute; and Publish What You Pay came together to say the following, as stated by Pierre Gratton, Mining Association of Canada's president and CEO:

The Canadian mining industry is fully committed to improving transparency in a way that aligns with global standards. Today's launch of the draft framework, which was developed hand-in-hand with our civil society partners, is an important step forward to help reduce corruption and build governance capacity, while showcasing the positive contributions we make to the countries where we operate.

Clearly, among governments, the United States has been the lead government through the Cardin-Lugar amendment to the Dodd-Frank bill. It is a very dramatic amendment because it says that every year within six months of a corporation's year-end, the corporation must file a statement saying whom it paid, how much it paid, the currency it paid, et cetera. If it fails to file, then it will be de-listed from U.S. stock exchanges. It is a very draconian sanction, and it shows the seriousness with which the United States takes the issue of corruption.

The European Union has passed similar legislation. The United Kingdom is in the final stages of drafting a bill. Prime Minister Cameron made it a central issue of the last G8 meeting in Ireland. He and his fellow summit leaders were even able to get our Prime Minister to say that he is in favour of transparency, “empowering people to hold governments and companies to account”; indeed, “progress towards common global reporting standards to make extractive industry payments more transparent”.

That was a commitment signed by all G8 leaders, and this, frankly, is a big change from the last G8 summit when our Prime Minister refused to endorse a similar communiqué.

So we take progress, however incremental, and we take some encouragement from that, even though the former president of Revenue Watch Institute, Karin Lissakers, said publicly that Canada was out of step with other countries on upping their game.

It is trite but true that Canada is the most important mining country in the world. We have something like 8,000 interests in a variety of properties in a variety of countries, something like 100 of them. That is 8,000 mining sites, or mining sites that are in the process of being developed. Yet, the government continues to dig in its heels. It was only last December that the public service launched a review of corporate social responsibility strategy for the extractive sector. A review is not a commitment to a legislation. A review is not draft legislation or regulation.

The United States is out of the blocks. Their legislation came into place as of September this past year. The first filing period will be September 2014. Also out of the blocks is the European Union, and the United Kingdom and others are following suit.

We, on the other hand, have a review, and maybe in the fullness of time before the end of this Parliament, we will have a bill to look at in this Parliament. However, Mr. Speaker, you and I know that legislation sometimes has a tortuous path, particularly prior to the dissolution of a Parliament, and it is not realistic or likely that a bill, such as what we see in the United States, would be put forward by the government for Parliament to debate.

Industry, on the other hand, is frankly a million miles ahead of the government. Pierre Gratton, again of the Mining Association, has said:

There was a little bit of a surprise that industry is asking for more regulation. But there are business reasons for doing this, and sometimes additional regulations is actually good for business.

Business can only carry the load so far. The best companies operate at the highest ethical standards, but they are frankly helpless when less ethical companies bribe their way into lucrative concessions. Regulation and legislation are not for those who wish to be transparent. Regulation and legislation are for companies that wish not to be transparent or to be less transparent. It frustrates the CEOs who want to do the right thing. It makes him or her unnecessarily vulnerable and, frankly, it trashes Canada's reputation.

I want to take the opportunity to relate a conversation I had with one of our Conservative colleagues, whom I quite like and respect. He had just returned from Africa and was commenting on the endemic corruption he had witnessed. However, he said that he would not support my bill because “...corruption is a way of life there, and frankly there is nothing you can do about it, so why bother?”. He did not add, but I will add, that if Canadian companies do not bribe, they will lose business, and that I am just being naive.

There are two sides to corruption: the demand side and the supply side. I do not expect that Bill C-474, the sunshine bill or any other bill, frankly, will stem the demand side. That would be naive. However, we could possibly just slow down the supply side of corruption, because every CEO and every project manager would know that their company would have to file sworn statements that this money was paid for this concession to this government or entity on this day in a particular currency, and failure to file would be an offence. In my proposal in Bill C-474, it would be a finable offence, and on the U.S. side, it would be a delisting offence.

Maybe SNC Lavalin would not be in the mess it is in today if something like the sunshine bill had existed. Maybe their executives would not be facing criminal charges. Maybe their stock prices would not have been hammered, as they have been in the last year. Maybe SNC Lavalin and their related companies would not have been cut out of World Bank business for the next 10 years, and maybe we would not see the headline that we saw on The Huffington Post and the Financial Post this morning, which said:

Canada has the dubious honour of being home for the largest number of firms on a World Bank blacklist of corrupt companies.

I want to point out that this is one occasion where I think a headline is misleading. The article goes on to say “Of the more than 600 companies now listed as barred from doing business with the World Bank over corruption, 117 are Canadian, the most of any one country”. However, further down in the article, it states that 115 of those 117 are related to SNC-Lavalin in some manner or another.

Therefore, this is a case of the headline of an article being misleading. Nevertheless, if people live in a fantasy world and believe that Canada is as pure driven as the snow, then I would ask them to take another look at that.

If we had legislation in place, maybe Griffiths Energy would not have been fined $10 million. If we had legislation in place, then Niko Resources would not have been fined $9.5 million. I am not so naive as to believe that Bill C-474 would have ended all of these problems, but I do know that legions of lawyers will be reminding their bosses of their filing requirements under the bill.

I commend the government for its initiatives on S-14, an act to amend the corruption of foreign public officials act. It was a good idea. It has put resources behind prosecution, which is a good initiative. It is a good idea to beef up the Criminal Code and its anti-corruption measures. When it comes back to the House, we will support it.

However, when a prosecution is launched, it means that the horse is already out of the barn and that a crown attorney has concluded that he or she has a reasonable chance of a successful criminal prosecution. I would suggest that it is much better to put resources toward keeping the horse in the barn. That is what Bill C-474 does.

The government has also taken other CSR initiatives, such as $25 million for the CSR centre in Vancouver. That is good. There is nothing wrong with that. It is not clear to me what it has accomplished at this point, but I think it is a good initiative on the part of the government.

The initiative that has been an unmitigated disaster is the CSR counsellor. It was a mandate that was designed to fail, and it did. I believe it was in 2009 that Counsellor Marketa Evans initiated two or three files. Last October or November, she resigned. It cost millions of dollars and there is no longer a head of the office itself.

Here we are with a modest regulatory initiative with which the House could put Canada back in the game. It is a simple bill, with a clear aim to promote transparency. It is largely a photocopy of the U.S. legislation. In the various times I have been speaking with industry, I proposed that if it has a filing with the Securities Exchange Commission of the U.S., to photocopy it and send it to us. I do not intend or want to have an increased regulatory burden on the industry. However, I have some sense that this would not be well received by the government. Unfortunately, we are the huge hole in the international fence. The United States has stepped up to the plate and is the leader. The U.K. is following, and the EU and Australia are already there. We are the largest hole in the international fence because this is where the action is as far as worldwide mining is concerned.

I appreciate the time and attention of the House. I urge my colleagues on both sides of the aisle to support this initiative. We do not want to see the headlines that we saw, as misleading as they might be, in the The Huffington Post and the Financial Post this morning.

[Erin O'Toole, Conservative, Parliamentary Secretary to the Minister of International Trade]

Mr. Speaker, I am somewhat concerned that my friend appears, once again, to be launching on his perverse crusade. I find it particularly interesting, as he represents a GTA riding. The GTA is serviced by two world-class industries: the financial services industry and the mining, finance, and exploration industries, which employ thousands of people in Toronto. These organizations, through the prospectors and developers of Canada, through our CSR programs, and through the work by Dr. Marketa Evans, who he referenced in his remarks, have been making huge strides on working well here at home and overseas.

I would like this member to comment particularly on whether he has looked at the financial impact of the burdens and the detriment he is causing to that industry, and how many job losses it would lead to in his own riding.

[John McKay, Liberal, Scarborough—Guildwood, ON]

Mr. Speaker, my hon. colleague has given a perverse illustration of my entire speech. Good regulation is good for business. That is the point.

Yes, he is right that the mining industry is very important to the GTA. It is the industry that is calling for regulation. I do not know whether he listened to my quotes from Pierre Gratton, the Mining Association of Canada's president and CEO. The association wants the government to get into the game, but the problem is that the government is not in the game. The industry is in the game, the NGOs are in the game, civil society is in the game, some provinces are in the game, and some international companies are in the game.

The consequence is that, if the government is not in the game, all of that industry will migrate to jurisdictions where there is a responsible attitude toward corporate social responsibility, rather than the "three blind mice" approach that the Conservative government exemplifies and my hon. colleague's question exemplifies.

[Philip Toone, NDP, Gaspésie—Îles-de-la-Madeleine, QC]

Mr. Speaker, I listened attentively to the speech and I agree with the member for Scarborough—Guildwood that the Conservative government seems to want to bring forward poisoned chalices to industry all the time. When industry asks for help, the government should be there at the plate, offering the help it needs.

The people on this side of the House are proposing reasonable regulation to be able to support our industries so that they can go forward and develop their industries, secure in the knowledge of the respectful reputation they have around the world.

This is an industry in which, around the world, there have always been some difficulties. Many countries have seen a lot of difficulties with mineral extraction and oil extraction. In many countries, the companies that are involved in this are involved in very dubious and very questionable practices.

We want to make sure that companies in this country have the full support of the Canadian people because we know they are transparent and they will be acting honourably. This bill could go a long way to that, and it absolutely deserves support so we can debate it at second reading.

When the Liberals were in power for 13 years, they could have brought this forward when they formed a majority. I do not know why they did not. Why are we asking now, in a private members' bill, which as the member suggested, is probably going to be defeated by the government, whether the Liberals are serious about this bill? If we go back to the last time this member brought a very similar bill forward in the last Parliament in Bill C-300, we see it was defeated in large numbers because there was an absence of Liberal members in the House to vote in favour of it.

Are the Liberals actually supporting this bill?

[John McKay, Liberal, Scarborough—Guildwood, ON]

Mr. Speaker, I can certainly give my hon. colleague that assurance. I would point out that we left government in 2006 and the round table report was tabled in the early part of 2007 and has never actually been acted on by the Conservative government. That is rather unfortunate, because it would actually put us at the beginning of the game, as opposed to the end of the game.

We are playing catch-up, and I do not even know if the government wishes to be in the game at all. That is my indication.

My colleague asked how much it would cost our riding. All I know is that, with the interest we might have in Griffiths Energy, we are not paying a $10 million fine. It is the same with Niko. We would not be paying the $9.5 million fine. How much do members think it has cost SNC-Lavalin over the last number of years? It has cost millions and millions of dollars. That is everybody's bottom line, including my colleague from Durham.

[Kelly Block, Conservative, Parliamentary Secretary to the Minister of Natural Resources]

Mr. Speaker, it truly is my pleasure to participate in the debate on Bill C-474. Our government believes that responsible resource development includes financial transparency and accountability for Canadian companies. This transparency aims to prevent bribery and other illicit payments that lead to corruption. It will help to ensure that any payments made by Canadian extractive industries to foreign governments clearly benefit their citizens.

Canadians understand the importance of transparency, and that is why we take this issue seriously. I know that all members of the House would agree that this type of transparency is good both for developing nations and industry. That is why we are doing our part to achieve these goals.

Canada is the second largest contributor to the extractive industries transparency initiative, which puts in place reporting mechanisms in developing countries to ensure transparency.

We have also introduced a corporate social responsibility strategy that encourages Canadian extractive industries to operate responsibly and transparently worldwide. However, we are doing even more to address transparency and accountability. Our government strongly supports actions that will enable the citizens of developing countries to benefit fully from their nation's resource development. Unlike the NDP, which would rather resources remain in the ground and the economic health benefits ignored, our government is focused on a balanced approach to economic resource development. That is why we have tough rules for companies operating at home and abroad. While the member for Scarborough—Guildwood may intend that this be the overall objective of Bill C-474, the proposed legislation contains serious shortcomings, and our government is currently taking action to create an improved reporting scheme. For this reason, we oppose Bill C-474.

Unlike the member for Scarborough—Guildwood, our government is working with our provincial counterparts, industry, and the international community. This cooperation will allow for the implementation of a robust reporting regime that will demonstrate Canada's international leadership with respect to good governance of natural resources.

Members will recall that this past June, in the lead-up to the 2013 G8 leaders summit, the Prime Minister announced our government's commitment to establish mandatory reporting standards. These standards would require Canadian extractive companies to report on the payments they make to both foreign and domestic governments. Our Prime Minister's continued leadership on this issue is respected on the world stage and contributes to Canada's positive international brand. Our commitment to mandatory international and domestic reporting contributes to an emerging international standard for transparency and accountability in the extractive industries that includes the United States, with its Dodd-Frank Act, and the E.U., with its transparency directive.

The new mandatory reporting regime, announced by the Prime Minister, will focus on the following: improving transparency, ensuring that Canada's framework is consistent with existing international standards and aligns with other G8 countries, ensuring a level playing field for companies operating domestically and abroad, enhancing investment certainty, helping reinforce the integrity of Canadian extractive companies, and helping to ensure that citizens around the world benefit from the natural resources in their countries.

Canada already has a well-established financial recording system that ensures transparency and good governance of Canada's substantial natural resource revenues. The new reporting system will complement existing reporting requirements and will reinforce Canada's role as a strong supporter of transparency and accountability. This initiative will help ensure that the Canadian brand in the extractive sector stays strong. It will reinforce investor confidence in Canadian extractive companies and will have benefits for local communities, which will be able to track payments from local projects to their governments.

Canada is in a strong position to implement positive change globally. Nearly 60% of the world's publicly listed mining companies list on the TSX or the Toronto Venture Exchange, and 70% of the global mining equity capital in 2012 was raised on these two exchanges.

Canadian mining companies have mining interests worth nearly $150 billion invested in more than 8,000 properties in 100 countries. Canada has a strong record, both domestically and internationally, of supporting transparency and accountability in the extractive sector. Since 2007, Canada has supported international efforts through the World Bank's extractive industries transparency initiative. Canada has contributed more than $12 million to the World Bank'S EITI multi-donor trust fund and $10 million to the Extractive Industries Technical Advisory Facility.

Since 2009, the Government of Canada has had a corporate social responsibility strategy in place for Canadian extractive companies operating abroad. Canada has demonstrated its commitment to transparency and good government through its support of such initiatives as the African Union's mining vision, the extractive industries transparency initiative, the Canadian international institute for extractive industries and development, and new strategic partnerships with Peru and Tanzania, designed to help strengthen transparency in their oil, gas, and mining industries, which were announced in June of last year.

Canada's efforts and the recent changes to mandatory reporting standards in the extractive sector demonstrate the Canadian government's support for transparency and accountability. They are also part of a broader effort in which Canada is helping developing countries harness the potential of their natural resources to achieve sustainable economic growth and lift millions out of poverty.

The development of natural resources is an important driver of sustainable economic growth both in Canada and in developing countries. Done right, such development regularly creates jobs, contributes to poverty reduction, and provides governments with revenues to improve the quality of life for their citizens. That is why our government continues to place such a high priority on the related issues of transparency, accountability, and good governance in the extractive sector. Once established, Canada's mandatory reporting regime for the extractive sector will be a powerful tool in addition to many other existing initiatives to realize these objectives.

[Laurin Liu, NDP, Rivière-des-Mille-Îles, QC]

Mr. Speaker, I am pleased to speak today in support of the principle of Bill C-474. It would require Canadian mining, oil and gas corporations to submit annual transparency reports that disclose all payments provided by them or their subsidiaries to a foreign government for the purpose of furthering mining, oil or gas industry activities.

Under the bill, any corporation that fails to comply with this requirement is guilty of an offence and is liable to a fine of anywhere between $20,000 and $5 million.

This is essentially about ensuring that Canadian corporations are held accountable for any payments made for doing business abroad and that foreign governments can be held accountable, in the court of public opinion, for the money they receive.

In the late 1990s, a number of economists and observers focused on the resource curse phenomenon. They tried to understand the paradox of why two-thirds of the world's poorest people live in countries that are rich in natural resources.

For example, Jeffrey Sachs, Joseph Stiglitz, Terry Lynn Karl and Paul Collier, to name a few, noted that many countries with an abundance of natural resources, oil, gas and mines, were not realizing their full potential. There are a few exceptions, but many countries rich in energy resources are very corrupt and lack transparency.

These researchers noted that the revenues from extractive industries are often managed by a few elites, a small minority of individuals who control the country's resources.

The multinational companies that are competing for access to natural resources are often complicit in maintaining the rules established by these elites and help them to stay in power. They are reluctant to give information on their profits and the share they give to the elites. If people knew how much their government got from the extraction of their country's natural resources, it would be easier to monitor how that revenue is being spent.

The researchers I mentioned earlier proposed a series of complex and sometimes contradictory measures to ensure that local populations benefit as much as possible from natural resources. However, they all agreed that transparency is needed to put an end to what is called the resource curse.

The writings of these researchers resulted in an array of initiatives. Just think about the work that Oxfam and Human Rights Watch have done in this regard. There is also the initiative on the Caspian region's petrodollars and the Publish What You Pay campaign on the poor management of oil in Angola, led by George Soros' Revenue Watch Institute.

Then, in October 2002, at the world summit on sustainable development in Johannesburg, Tony Blair spoke about these campaigns by civil society. The next year, the extractive industries transparency initiative was born to ensure transparency of payments made and revenues generated by extractive industries and to make that information accessible to civil society and the general public, thereby promoting the proper use of these resources. For now, the standard is voluntary, but it is garnering more and more support.

Calls for greater transparency began just over a decade ago, and existing initiatives are part of a global trend fuelled by the global financial crisis and the need to manage the corporate world's conduct, particularly when it comes to fiscal agreements and the fight against corruption.

In 2012, the Securities and Exchange Commission in the United States introduced new rules under the Dodd-Frank Act requiring American companies to disclose payments made to a foreign government for mining, oil and gas development activities.

The European Parliament and many other democracies subsequently implemented similar rules. Unfortunately, Canada is lagging behind.

The question is, why target resource extraction companies? First, as I explained earlier, natural resource royalties are easier for corrupt governments to divert than fiscal revenues, which are overseen by a large number of public officials.

Second, according to Transparency International's 2011 Bribe Payers Index, oil and gas and mining companies rank fourth and fifth, respectively, as the most likely industries to pay bribes. Companies in the mining and oil and gas sectors are second and third most likely to engage in grand corruption targeting high-level public officials and politicians.

It remains to be seen whether the new disclosure requirements will affect Canadian companies' ability to compete with companies that are not required to disclose. Opponents to mandatory reporting, including the Conservative members of the House, have complained about the effect of releasing what they consider to be sensitive information to rivals, making competition one of the cornerstones of their arguments against implementing new standards.

However, since the United States and the European Union are pursuing mandatory disclosure, about 90% of the world's largest mining and oil companies will be covered, according to Transparency International. This includes companies such as U.S.-listed PetroChina, London-listed Russian company Rosneft, and Brazilian mining company Vale, also listed on a U.S. stock exchange.

Furthermore, most of the Canadian giants, like Barrick Gold, will have to comply with the American rules. It will be hard for them to argue that the Canadian rules cause them more problems than the American rules. Furthermore, the executive director of the Prospectors and Developers Association of Canada does not expect any new legislation to erode the competitive environment for Canadian firms abroad, given the large number of companies that will have to reveal payments:

The biggest problem is going to be setting up and adjusting to any new accounting system. The challenge is to develop a framework where resource companies don’t have to duplicate information for various jurisdictions.

However, beyond the issue of competition, I think Canadians expect Canadian companies to have impeccable business practices and to lead by example.

In June 2013, in London, the Prime Minister announced that the Government of Canada was establishing new mandatory reporting standards for Canadian extractive companies in order to increase transparency regarding the payments that these companies make to foreign governments.

I must say, I am somewhat skeptical, because this government is always reluctant to regulate private companies. The Conservatives prefer to champion self-regulation and deregulation. Let us not forget, for instance, how they axed environmental assessments to please the big oil companies.

The government has announced consultations with the industry and the provinces. I hope the government will open up those consultations to the public. How ironic it would be, to say the least, if those consultations on transparency were to take place behind closed doors.

In closing, I am pleased to support Bill C-474, which has three objectives: first, to ensure transparency around the payments made and revenues generated by the extractive industries; second, to make this information available to civil society and the general public; and third, to promote the proper use of this wealth. Some people will say that the bill does not go far enough, but at least it is a step in the right direction.

I urge all of my colleagues in the House to support this bill so that it can be studied in committee.

[Irwin Cotler, Liberal, Mount Royal, QC]

Mr. Speaker, I am pleased to rise today to address Bill C-474, the transparency of payments made by mining, oil, and gas corporations to foreign governments act.

I would like to start by commending the sponsor of this bill, the hon. member for Scarborough—Guildwood, for his persistent pursuit of this important legislation over the past several years.

Bill C-474, which my colleague has properly characterized as a sunshine bill, would compel Canadian extractive corporations operating abroad to submit an annual audited transparency report to the Minister of Foreign Affairs and the Minister of Natural Resources. The reporting requirement would mandate the disclosure of all payments provided by a corporation or its subsidiaries to a foreign government for the purpose of furthering its mining, oil, or gas industry activities and to publish this report on the company's website. A company that fails to comply with these disclosure requirements would be guilty of an offence and liable on summary conviction to a fine of not less than $20,000 and not more than $5,000,000.

Canada's international standing respecting our promotion and protection of human rights is something in which many of us take pride. Accordingly, our relationships with local populations and environments, and the foreign policy values we represent and exercise as a nation, have become bound up with our global mining footprint.

Indeed, 75% of the world's mining companies are based in Canada, and the approximately 1,300 Canadian extractive corporations invest hundreds of billions of dollars in more than 100 countries around the globe. Certainly, many of these companies respect human rights and the rule of law and thus engage in responsible resource development. However, the regrettable reality is that many do not, as my colleague from Scarborough—Guildwood has demonstrated.

Given our position as a world leader in the extractive industry, we have a moral responsibility to implement rules that will ensure the transparency and accountability of Canadian firms operating abroad.

I am therefore supporting Bill C-474 and urge all members in this place to do the same for two compelling reasons: first, because the bill would buttress the current criminal law regime by ensuring its enforceability; and second, because this bill would prevent Canadian corporate complicity in the human rights abuses of foreign governments by exposing their financial relationships with foreign governments to proper public scrutiny.

I turn first to the issue of criminal enforcement.

The current legal regime addressing the issue of illicit payments by Canadian companies to foreign governments is the Corruption of Foreign Public Officials Act. Bill C-474 would in fact enhance this act by providing prosecutors with sufficient evidence to meet the high burden of proof required in criminal prosecutions.

The difficulties of enforcing this act are apparent when one considers that the conviction obtained this past August in the Regina v. Karigar case was the first trial ever to have occurred under the Canadian Corruption of Foreign Public Officials Act and only the fourth conviction obtained in the act's 14-year history.

Indeed, according to Jamie Kneen, a spokesperson for the Ottawa-based non-profit organization Mining Watch Canada, the RCMP has stated that it simply cannot keep tabs on corporate bribery and corruption in the extractive industry.

Simply put, what we are seeing here is an accountability and transparency gap that must be addressed by mandatory disclosure. As long as Canadian extractive companies are able to hide the details of their financial relationships with foreign governments, prosecutions—and in particular, effective prosecutions—under the CFPOA will remain few and far between.

The importance of the bill goes far beyond the question of criminal enforcement, however important that alone remains. Indeed, mandatory disclosure is inextricably intertwined with the question of Canada's reputation abroad as a defender of human rights and as a responsible global citizen.

In this regard, I refer to the Prime Minister himself, who expressed this very sentiment when he announced in June that he would be “...establishing new mandatory reporting standards for Canadian companies operating in [the extractive] sector” and further acknowledged that such standards would result in the enhancement of Canada's reputation as “...a world leader in promoting transparency and accountability...” both at home and abroad.

I am encouraged that the Prime Minister expressed this sentiment, and I am sure that we all agree with the proposition that we must effectively guard Canada's hard-earned but at-risk reputation as a defender of human rights. This bill would afford us an opportunity to take real action to further the rule of law in the international arena while enhancing our global reputation in this regard, and thus I am hopeful that all members of the House will join in this cause.

By passing Bill C-474 and implementing mandatory disclosure requirements, our message to Canadians and to the world will be clear: What is good for human rights is also good for business, that Canada is a global leader not only with regard to innovation and development but also with regard to the integration of human rights with economic development; that we will not waiver in our demand that multinational corporations and the governments with which they do business cannot simply disregard international human rights laws and norms with impunity, or under the cover of Canadian law.

Certainly, as I mentioned, criminal prosecutions alone are not enough to ensure responsible corporate citizenship based on respect for the rule of law and human rights. But by providing for transparency and accountability across the board, we will encourage Canadian companies to operate ethically and with the utmost respect for human rights. Yet, one might hope that such laws would not be needed for the simple reason that companies should seek, as it were, to do the right thing regardless of the content of statutes.

I recall the testimony last November before the Subcommittee on International Human Rights of Cliff Davis, president and CEO of Nevsun Resources, a Canadian-based mining company that operates one of the highest grade open pit base metal deposits in the world at the Bisha mine in Eritrea.

When I questioned Mr. Davis as to his company's response to reports from the U.S. Department of State, the U.S. Commission on International Religious Freedom, and other major human rights organization that describe systematic Eritrean patterns of detention, torture, forced conscription, and the wholesale denial of freedom of religions and freedom of expression, he pleaded ignorance.

When I questioned him as to what, if any, steps his company had taken to bring these human rights violations to the attention of the Eritrean government, he replied that it was “not in [his] purview as president and CEO of [his] company”.

Mr. Davis' testimony illustrates the importance of the bill before us today. Indeed, this very “hear no evil, see no evil, speak no evil” mentality is precisely what Bill C-474 seeks to address. If Mr. Davis does not consider the systematic human rights abuses perpetrated by the government with which he does business to be within his purview, at the very least he should be required to disclose the nature of his dealings with human rights abusing regimes so that Canadians can judge for themselves.

The issue here is that transparency leads to accountability, which we must all seek.

In conclusion, Bill C-474 affirms that as Canadians we expect our corporations to appreciate and respond to the human rights realities in the countries where they operate and to engage with these issues in the context of their operations abroad. This is the meaning of good corporate citizenship, which must be firmly rooted in the principles of transparency, accountability, and the promotion and protection of human rights and the rule of law.

Accordingly, I support Bill C-474 because I strongly believe that it will discourage Canadian-based corporations from profiting from, or facilitating, human rights atrocities in foreign countries and will reinforce in the minds of Canadians, including in the minds of investors and shareholders, that human rights are good for business and good for the rule of law. Indeed, Canada's reputation as a human rights defender is at stake in this regard.

I trust that the House will give its full support to the bill.

[Ryan Leef, Conservative, Yukon, YT]

Mr. Speaker, I am happy to rise today to speak about Bill C-474. I did assure the member for Scarborough—Guildwood that I would say nice things, and I can assure him that I will certainly say nice things about our government's efforts to date and about our Canadian companies. If he stays tuned for this entire speech, he will hear a lot of nice things.

This government has moved forward on this issue. The net result has been that the proposals our government has advanced will overtake many of the proposals outlined in the bill, and therefore make the bill unnecessary.

On June 12, 2013, ahead of the G8, the Prime Minister announced that Canada is establishing a mandatory reporting regime that will guide global efforts toward greater transparency by the extractive industry in reporting payments made to governments. Canada will continue to develop and implement this over the next two years.

As my colleague across the way was asking when that will be, I hope that answered that for him.

The extractive sector of oil, mining, and natural gas remains an important sector for the Canadian economy. It directly represented over 13% of nominal GDP and translated to over 950,000 jobs in 2012. Other sectors are impacted by this success and indirectly represent almost another 5% of nominal GDP and 850,000 jobs. Together, the natural resources sectors directly and indirectly account for over 18% of GDP and 1.8 million jobs.

Because of these successes, Canada is a major player internationally. We can be proud of our leadership toward sound management in general, preventing natural resource exploitation that can lead to increased corruption, poor development results, and possibly the fuelling of armed conflict or illicit trafficking.

Responsible resource governance fosters positive results for governments, communities, and corporations, including prosperity, sustainable economic growth, poverty alleviation, and improved investment environments.

This government stands firm that transparency of payments from companies to governments is a critical part of improving governance. It improves public trust and confidence in governments, and in particular it leads to accountability of how revenues are spent. This responsible practice will also enhance the brand of Canada's extractive companies internationally.

It is for these reasons that the Canadian government is establishing mandatory reporting in the extractive sector regime.

Since the G8 announcement, the government has already moved forward in the following three ways. Number one, the Minister of Natural Resources has been leading work on options for the policy and mechanisms for the regime; two, consultations have started with provincial and territorial counterparts, aboriginal groups, industry, and civil society organizations, and these have been met with broad support; three, a review of the government's corporate social responsibility strategy is under way as a broader approach to promote responsible business conduct.

Canada is situated as a leader on mandatory reporting because of consistent strong support and promotion of responsible business conduct by Canadian extractive sector companies. Canadian companies operate overall in a socially responsible manner, creating jobs and prosperity, not only in Canada but around the world. Canadian companies are often instrumental in improving the lives of people and the communities in which they operate.

I would like to remind members of our commitments.

Our government has made a $25-million contribution for the creation of the Canadian centre for extractive industries and development. This institution would be jointly operated by the University of British Columbia and Simon Fraser University and would advance best practices in extractive sector technology and management to reduce poverty and protect the environment.

Canada supports the extractive industries transparency initiative, also known as the EITI. This initiative helps governments, business, and civil society agree on a reporting system that ensures transparency on what revenues governments receive from the extractive sector.

Today Canada is the second-largest funder of the EITI Multi-Donor Trust Fund, as well as the largest funder of the World Bank's Extractive Industries Technical Advisory Facility.

Canada hosts the Secretariat of the Intergovernmental Forum on Mining, Minerals, Metals and Sustainable Development, which convenes developing countries, trading partners, and donors to discuss and advance issues of mutual concern, such as international standards and best practices in extractive sector management and governance.

As well, let us not forget the Prime Minister's announcement in 2012 of $15.3 million in new funding for the African Minerals Development Centre. The AMDC will deliver guidance and policy advice to African countries on how to manage their extractive sectors responsibly and sustainably.

These government initiatives, in consultation with industry and civil society, continue to demonstrate solutions that work for Canadians and indeed the global community. Bill C-474 is not required.

I conclude our opposition for this private member's bill with a reminder to all Canadians of our leadership in natural resource governance and our corporate social responsibility strategy. Canada's natural resource governance programs promote responsible resource governance that includes transparency and accountability for governments, companies, and communities. Canada's CSR strategy promotes high standards for company conduct and a stable investment environment. It also provides assistance to foreign countries to achieve better resource governance for win-win outcomes for all of our stakeholders.

The government believes in approaches that work for Canada, for Canadians, and for the world, approaches that advance transparency and accountability while also ensuring economic growth and long-term prosperity for all stakeholders involved.

[Jonathan Genest-Jourdain, NDP, Manicouagan, QC]

Mr. Speaker, I think it is important for me to take a stand in this House on the principles set out in Bill C-474, which seeks to promote financial transparency, improved accountability and long-term economic sustainability through the public reporting of payments made by mining, oil and gas corporations to foreign governments.

I like to think that everything happens for a reason. This is a subject that is relevant to my own riding of Manicouagan, although the legislative measure before us today deals with the realities of developing countries overseas. The same type of reasoning could be applied to remote regions, particularly to the realities of Indian reserves and land claims negotiations, which I will be talking about in this speech.

The spirit of the proposed legislative measure shows that the expectations of Canadians and the government are changing when it comes to public disclosure and the financial considerations given to governments by proponents of the extractive sector.

This is still relevant today because the federal government directed questions at a mining development promoter in my riding. Information was recently disclosed to the public about a substantial payment that the promoter made to a body of government, a band council. It seems as though $100,000 was handed over—and that number was recorded—in order to look at land claims. This all happened anonymously and behind closed doors.

It is clear why the Bribe Payers Index ranks oil, gas and industrial companies as the 4th and 5th likeliest to pay bribes. Bribes are paid behind closed doors, and that is what is happening in my riding because it is remote and people are not well educated. Influence peddling, insider trading and embezzlement are common in many remote communities and regions.

In light of the current political narrative, which is quick to recognize government-to-government relations, the same type of reasoning can apply to aboriginal matters because the bill before us concerns Canadian promoters who give bribes to foreign governments. However, when we apply this reasoning to nation-to-nation relations and government-to-government relations involving aboriginal peoples, it is obvious that the same type of reasoning can apply locally, here in Canada. Therefore, it is a very worrisome problem at the local and regional levels.

The literature points to an emerging concept, namely, the phenomenon of the curse of resources associated with the lack of transparency in payments made to governments by extractive sector companies. It has been shown that local populations have difficulty holding their government to account when information about the sources and the revenue earned from resources are hidden and, when, from the start, there is no financial incentive for the government to be accountable.

We have talked about this in the House. Transparency within band councils is a timely issue, but too often, the entire population in Manicouagan, and not just the Innu and Naskapi, is left out of these decisions. The deals, the negotiations and the payment of financial compensation are inevitably done quietly. That is why I wanted to speak to this issue today and share everything.

Resource extraction initiatives such as the ones under way right now in Manicouagan raise some serious concerns. That is why I plan to focus on this area in the coming months and the next year. This very clear bill is a step in the right direction in order to expose any wrongdoing, as well as the ins and outs of any bribery of the authorities.

[The Acting Speaker, Conservative, Barry Devolin]

The time provided for the consideration of private members' business has now expired and the order is dropped to the bottom of the order of precedence on the order paper.

It being 2:30 p.m. the House stands adjourned until next Monday at 11 a.m. pursuant to Standing Order 24(1).

(The House adjourned at 2:30 p.m.)

The House resumed from January 31 consideration of the motion that Bill C-474, An Act respecting the promotion of financial transparency, improved accountability and long-term economic sustainability through the public reporting of payments made by mining, oil and gas corporations to foreign governments, be read the second time and referred to a committee.

[Francis Scarpaleggia, Liberal, Lac-Saint-Louis, QC]

Mr. Speaker, I would like to start my speech by paying tribute to the bill's sponsor, my colleague from Scarborough—Guildwood. He believes strongly in this topic and has been patient and tenacious over the years as he fights to get justice for people in developing countries where mining companies, many of which are from Canada, develop the subsurface resources that are so valuable to the global economy. He does not give up.

This is his second bill to hold mining companies accountable to the people who provide labour, without which mining would be impossible. His first attempt to hold this sector accountable, Bill C-300, narrowly missed being passed in the House.

I would also like to pay tribute to my constituents who come to see me or write to me regularly in order to ensure that I keep up to date on the latest developments in this matter. A number of them contact me after they have travelled abroad and visited mining areas to tell me about the situation in those areas.

I would like to mention the Reverend Shaun Fryday, who regularly visits some of the most violent and dangerous areas in the Philippines; Yvonne Bourque, who is with St. Thomas à Becket parish in Pierrefonds; Monica Lambton, from the Office of Justice of the Canadian English-speaking Sisters of the Congregation of Notre Dame; Father Ernie Schibli, pastor at St. Edward the Confessor Mission in Pointe-Claire; and the Reverend Ian Fraser, pastor of St. Columba by-the-Lake Presbyterian Church in Pointe-Claire.

They all hold out hope, even when their efforts do not seem to have any impact immediately. They take the time to meet with MPs like me in order to raise awareness about this issue and the urgent need to take action. Through these contacts and meetings that are patiently organized, one at a time, these and other committed Canadians hope to establish a critical mass of MPs who will be more aware of the urgent need to take action.

They hope that one day either this government will finally wake up and take progressive action, as in the days of the Progressive Conservatives, or we will have a new government in Canada that will do what is right in this matter.

I sincerely believe that there are members opposite who would like to support this bill from the outset. I hope that they will do so for themselves and for the people overseas who rely on their support.

The measures in Bill C-474 are long overdue. The fact that the government has not already proposed and implemented these measures is in contradiction to the principles that Canada has repeatedly endorsed on the international stage. I will come to that in a moment.

As we all know, Canada is a world leader in mining, oil, and gas, with the latter two sectors also falling within the purview of this bill. If I am not mistaken, about half of the world's mining companies have their head offices in Canada and trade on the Toronto Stock Exchange, yet we lag behind in demanding, through law, greater transparency in the accounting practices of these companies.

This bill, which would compel Canadian-based extractive companies operating abroad to disclose to the Minister of Natural Resources any payment made to foreign governments, would level the playing field, just as the U.S. and the European Union have already taken steps to legislate on this issue. In other words, this bill would bring Canadian companies up to international standards.

In 2008, following the financial crisis in the United States, a provision was included within the Dodd-Frank financial bill, the Cardin-Lugar amendment. The amendment would require extractive companies listed on the New York Stock Exchange to publicly disclose all payments made to foreign governments. A number of a major Canadian companies cross-listed on the New York Stock Exchange have been caught under this new regulation.

A similar bill is also under consideration in the European Union and will require companies to comply with regulations similar to those in the Cardin-Lugar amendment and Bill C-474.

What is also important, as I mentioned earlier, is that we be consistent with principles we express we are in favour of on the international stage. The Canadian government has expressed an interest in revenue disclosure in the past through various international forums. The government has indicated its support for the extractive industries transparency initiative, which promotes the disclosure of payments made to governments.

Canada's sustainable economic growth strategy advocates increased transparency to aid in the promotion of international development. Canada has also ratified the United Nations Convention against Corruption, which requires state parties to take measures to promote the transparency of private entities and to ensure that the public has access to information.

Canada is also a signatory to the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions; is a signatory to the G8 Declaration: Renewed Commitment for Freedom and Democracy; and was party to the G8/Africa Joint Declaration: Shared Values, Shared Responsibilities, issued at the G8 summit at Deauville, in 2011.

It is not as if the government has never heard of this kind of measure that would require greater accounting transparency on the part of extractive companies doing business abroad. It is not as if it is a new issue. Not only is it not a new issue, it is one we support in words in the international arena.

Adopting this bill would simply be consistent with the path the government claims it wants to take. It would be beneficial to the mining companies themselves. Sometimes companies in the private sector balk at certain regulations. Then they find out later that, in fact, those regulations were beneficial to those companies in the long run.

For example, there are many investors, more and more, who want to invest ethically. They want to make ethical investments. If they see that these Canadian mining companies and other extractive sector companies operating abroad are being fully transparent, they will be able to invest. They will have licence, essentially, to invest in these companies. I think all CEOs and all management teams in all publicly traded companies want to have buy-in of their shares.

In the long run, this will be good business. It will also confirm, in law, the values we claim on the international stage to hold dear.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

Mr. Speaker, I want to begin by thanking the member for Ottawa Centre for putting forward this bill. In the past, we have had bills before this House that have dealt with corporate and social responsibility. It is an important issue, and I am most pleased to speak to it today.

I want to read one part of the bill. This is, “An Act respecting the promotion of financial transparency, improved accountability and long-term economic sustainability...”. That strikes me as almost the Conservative mantra, when I see that.

However, the reason I am particularly interested in this bill and pleased to have the opportunity to speak to it today is that in my capacity as critic for international human rights for the last eight and a half years, I have had numerous delegations. In fact, in a one-month period about a year ago, I had indigenous groups from Guatemala, Colombia, Honduras, the Philippines, and Mexico, all of whom accused their governments of removing their communities from their traditional lands to allow mining exploration and development, some of which was conducted by Canadian mining interests.

I know that Canadians from coast to coast to coast believe that Canadian mining interests would operate and function with the values that we hold dear about human rights in Canada. Unfortunately, from time to time that has been called into question. This bill would require that Canadian mining, oil, and gas corporations submit annual transparency reports that disclose all payments provided by them or their subsidiaries to a foreign government for the purposes of further mining, oil, or gas activities.

We know there have been Canadian companies called into question around Libya and other countries. We have some court cases that are underway. This type of legislative responsibility is important, not for the good mining companies, not for the people who follow the rules and have some pride in what they do, but for those companies that we would call into question their activities and how they proceed in foreign lands.

I spent time in Saudi Arabia, in the 1970s, and in that country at that time bribery was a huge undertaking. Nearly anything one needed or wanted to get done had a bribe attached to it. That is a culture that needed change. Part of the change is that countries that provide workforces to a country that functions on bribery have a responsibility to start that change.

From the reports of abuses that I heard from the indigenous groups who visited me, it is clear that part of the equation for change in those countries is contained in this bill. Clear reporting on those transactions will ensure that Canadian companies continue to use the proper due diligence in those countries with murky governments, and we all know what we are talking about here. There are governments out there that will use torture and will attack their own citizens. Members of the leadership of these indigenous groups are physically at risk as a result of standing up for what should be rights to their own traditional lands.

New Democrats have long supported transparency and accountability by Canadian corporations overseas. The member who sponsored Bill C-300 is with us here today. In fact, in that bill we had an opportunity to further corporate and social responsibility in the world by having Canada become a leader. Unfortunately, even though it was a minority Parliament, we lost, if I recall, by some 12 votes. We see that this bill further complements legislative efforts that the NDP members and others have made in this House to encourage that kind of responsibility and sustainable and transparent management practices in the Canadian extractive sector, which is then used around the world.

We also believe that the responsible management of natural resources means that part of the arrangement must provide the people of these countries with social and economic benefits. Rather than having all of the profits skimmed off, when they have a corrupt government that is practically willing to give away the resources in these countries, there must be some responsibility to ensure that the people who have lost their land receive the benefits.

It is clear to NDP members, as well, that corporate transparency about payments to foreign governments should further Canada's national foreign policy objectives, and we think it would do that.

Part of our goals as a country, for many years, has been to encourage the development of democracies around the world. Part of that, particularly, is governmental accountability. If there is a trail of transparency where we can see where the monies have flowed, when those get off base, it would be something that we could identify and act upon.

With this bill, Canada would join the growing international community that is starting to move toward disclosures of this nature. Another speaker earlier quoted the Barney Frank initiative in the United States. We also believe that enforced regulations would create a more level playing field for all Canadian companies.

In these countries, we know bribery happens and huge amounts of money are fed to governments under the table. When Canadian companies are abiding by the rules and being responsible but have been defeated in getting a chance to explore for a certain resource because someone else outbid them under the table, we have to develop international rules and regulations to ensure it does not happen.

Today, the EU, Australia, and the U.K. are considering standards similar to what was just imposed in the United States. Bill C-474 would put Canada on the path to joining those nations that believe their companies must show a commitment to corporate and social responsibility when dealing with resource development, particularly in the developing world. It would ensure that Canadian corporations are accountable for the payments they make, as I have said over the last few minutes.

The bill complies with the corporate standards of the extractive industries transparency initiative. Payments are required to be identified, under this initiative, and separated according to the specific extractive projects to which they apply. It is very direct, maybe in some terms simple, accounting for what people do, but if that payment is not linked to a specific reported project, it must be listed separately. If a payment that is listed generically is believed to apply to a specific project, the bill would authorize the Minister of Natural Resources to launch an investigation. That is what I would call true accountability.

The Transparency International bribe payers index ranks the oil and gas and mining industries as the fourth and fifth most likely sectors to issue bribes. Consider that for a moment, because Canada is a leader in resource development in both of these areas. We do not want our companies tempted or compromised into feeling they have to pay bribes in these other countries.

Two-thirds of the world's poorest people live in countries rich in natural resources. As I said before, if Canada is party to the extraction of those resources, it is part of our responsibility to ensure that those poor people benefit from that extraction and the sales of their resources. Note that I said they are their resources. Effective environment and labour standards in developing countries often depend on advocacy and activism by local populations; thus the groups that visited my office over last summer.

This bill would make sure local people are aware of the payments made to their governments by Canadian extractive companies. Beyond that, it would show where the give and take has been in those agreements and where the principles have been tested for the Canadian companies. We hope to be able to say that this bill would encourage those Canadian companies to the point where we will never see on record any evidence that they have bribed, been part of any coercion, or had anything to do with it. My belief is that companies do not do it, but this would ensure that it is not done and it would ensure direct accountability.

When the leaders of those nations see that there is an accountability chain that could cause Canadian companies to withdraw from their country, perhaps that is just the one lever that might be needed to start the change to where they treat their own people with dignity, they do not push them off the lands for exploration, and when the lands are taken and the delivery of the resources is done, the people benefit in a true way.

[John McKay, Liberal, Scarborough—Guildwood, ON]

Mr. Speaker, I thank the House for the opportunity to give a final summary of this debate. I want to thank all of my colleagues for participating in the two hours of debate. I am actually a little more enthusiastic about my colleagues on this side of the House than that side, but nevertheless I do appreciate their at least engaging.

I want to commend the member for Lac-Saint-Louis and the member for Hamilton East—Stoney Creek for speaking today. I do want to correct the member for Hamilton East—Stoney Creek. I think he confused me, as the sponsor of the bill, with his esteemed colleague from Ottawa Centre, who has his own very worthwhile bill on the floor of the House.

As he and others have rightly said, this bill is modelled on the Cardin-Lugar amendment to the Dodd-Frank bill. It is about as similar a bill as one could make it given the differences in the jurisdiction, because I did not want to see an unnecessary regulatory burden imposed on Canadian companies that trade exclusively in Canada.

Ironically, Canadian companies that trade both in Canada and the U.S. will be forced to comply on September 1. They will be forced to tell the United States Securities and Exchange Commission what moneys were paid, to whom they were paid, the currency they were paid in, and what project they were paid for, so that everyone in the world, including Canada, will find out what Canadian companies paid to secure those concessions, and yet the government continues to resist.

I had occasion to go over the arguments put forward by government members in the last hour of debate, which I found more amusing than anything else. Regrettably, it is not a laughing matter.

The Parliamentary Secretary to the Minister of Natural Resources has referred previously to “The new mandatory reporting regime announced by the Prime Minister...”. There is no mandatory reporting regime. There are no regulations. There is no law. There is an announcement. That is it. The only time a Canadian company would actually have to disclose the information in Bill C-474 would be when it files its return with the United States Securities and Exchange Commission.

The parliamentary secretary went on to say that “Canada already has a well-established financial recording system...”. There is no recording system. If there were a recording system, we would not have to go through this.

The Parliamentary Secretary to the Minister of Foreign Affairs recognizes international voluntary guidelines. It cannot be voluntary and mandatory at the same time. The industry is actually quite supportive of the voluntary guidelines.

The same parliamentary secretary then made reference to the CSR's extractive sector and Marketta Evans. She has been in place for, I think, either three or four years. She resigned last year. Her budget was around $1 million a year. She had precisely three cases, none of which were resolved. I do not know how that can be considered to be progress on this particular file.

This month, the former minister of natural resources, now the Minister of Finance, made a big announcement at the Prospectors and Developers Association of Canada conference, where he said that if they could not get their game together, particularly the provinces, the government would start the process of initiating legislation on April 1, 2015, more than a year from now. Any legislation he initiates will look a lot like Bill C-474.

As I said, it cannot be both voluntary and mandatory. There is no voluntary aspect. It is actually mandatory.

The government, by its announcement at PDAC, contradicts all of the representations made by the speakers from the Conservative side in the first hour.

This is very serious stuff. Mining companies are having real difficulties these days. It is extremely expensive. The meltdown in shares, particularly of one company in South America, because it did not follow disclosure requirements and did not take corporate and social responsibility seriously, has resulted in a massive multi-billion dollar write-down in its share value and the exit of the chairman of that corporation.

I wish not to be discouraged but I am. The Prime Minister is prepared to blow off the G8, President Obama, Prime Minister Cameron, and Canadians. I regret to say that the industry is desirous of this kind of legislation and the only drag is the government itself.

[The Speaker, Conservative, Andrew Scheer]

The question is on the motion.

Is it the pleasure of the House to adopt the motion?

[Some hon. members]

Agreed.

No.

[The Speaker, Conservative, Andrew Scheer]

All those in favour of the motion will please say yea.

[Some hon. members]

Yea.

[The Speaker, Conservative, Andrew Scheer]

All those opposed will please say nay.

[Some hon. members]

Nay.

[The Speaker, Conservative, Andrew Scheer]

In my opinion the nays have it.

And five or more members having risen:

Pursuant to Standing Order 93, the division stands deferred until Wednesday, April 2, 2014, immediately before the time provided for private members' business.

It being 1:51 p.m., this House stands adjourned until next Monday, at 11 a.m., pursuant to Standing Order 24(1).

(The House adjourned at 1:51p.m.)