Bill C-300 (Historical)

Corporate Accountability of Mining, Oil and Gas Corporations in Developing Countries Act

An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries

The purpose of this enactment is to promote environmental best practices and to ensure the protection and promotion of international human rights standards in respect of the mining, oil or gas activities of Canadian corporations in developing countries. It also gives the Minister of Foreign Affairs and Minister of International Trade the responsibility to issue guidelines that articulate corporate accountability standards for mining, oil or gas activities and it requires the Ministers to submit an annual report to both Houses of Parliament on the provisions and operation of this Act.

Canada-Colombia Free Trade Agreement Implementation Act

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

Madam Speaker, the hon. member will know that there is a great concern among Canadians about corporate social responsibility. I am sure that he has been receiving lots of letters about the responsibility of Canadian corporations when operating in the extractive sector.

We have in this Colombia free trade agreement an opportunity to put Canadian companies to a world class standard of corporate social responsibility. This would ensure that when Canadian companies are operating in Colombia and elsewhere, they operate to the highest environmental standards, to the highest human rights standards, et cetera.

It seems to me that if Canada had a legislated corporate social responsibility standard for Canadian corporations operating abroad, a lot of legitimate concerns raised by folks would be somewhat alleviated. May I suggest Bill C-300? I would be interested in the hon. member's comments.

Canada-Peru Free Trade Agreement Implementation Act

[Guy André, Bloc, Berthier—Maskinongé, QC]

Mr. Speaker, I would like to congratulate my colleague on his excellent speech. I am not surprised that the Conservatives plan to vote in favour of the agreement. After all, they have already signed it. It is in line with their right-wing ideology, as we have seen in other trade agreements.

However, I am surprised that the Liberals will be voting for the agreement. They tabled Bill C-300 in the House, a bill to ensure that Canadian mining companies behave responsibly in terms of workers' rights and the environment. They also moved Motion M-283, with which I am sure my colleague is familiar, to implement the recommendations of the National Roundtables on Corporate Social Responsibility and the Canadian Extractive Industry in Developing Countries advisory group.

I would like my colleague to comment on that. In his opinion, why did the Liberals vote in favour of those two measures if they are voting against—

[Paul Dewar, NDP, Ottawa Centre, ON]

Madam Speaker, thank you for the opportunity to rise to speak to Bill C-24.

Many have spoken of the concerns they have around this trade agreement. I think Canadians are listening carefully to the difference between what some call free trade and what we call fair trade. There is actually a shift in the debate around trade agreements and around how trade is done globally. I think we are going to see a change in the use of the term “free trade” because of the collective experience of countries with these agreements.

When we look at the details and drill down into some of these trade agreements, the notion that there is anything free is a misnomer. When we look at the give and the take, and what we end up with at the end of these trade agreements, many people have, quite rightly, been critical. I think we are going to move toward something more in line with a sectoral approach, that we really should not be doing these massive pieces of architecture to say that we are going to be all in or all out and give certain powers to certain sectors of society over others.

When we look at the experience with NAFTA, for instance, and chapter 11, and when we look at what was given up by Canadians to allow private corporations to meddle in the affairs of our governance, it actually undermines the fundamental premise of democracy. This is not free. This is actually a change of power where we end up with less and certain entities end up with more.

It has to do with the notion of sovereignty, as well. I think that most people would agree that our Parliament should be able to pass laws that are unfettered, in terms of outside interference, and be vigilant with respect to our obligations internationally, but also provide good governance for our citizens.

That is not the case when we look at the experience of chapter 11. In fact, not just people in this corner of the House have stated that but people outside who have critiqued these agreements have said that. That is one of the problems with this trade agreement. It continues down the ill-fated path of the chapter 11 experience. If we look at it, it really puts investors' rights over the rights of citizens. The fact that private companies can sue governments, with these chapter 11 provisions over our public policy choices, is a clear indication that there is something more than a free trade or an exchange or an opening of trade. It means that we are actually laying hands on certain people and giving them rights over others; in this case, private corporations.

I want to take that observation and align it with where Canadians are at and look at what is happening right now with another bill that is before us, Bill C-300, the corporate social responsibility bill. It is interesting. When people have critiqued Bill C-300, and I have a private member's bill that is similar to it and motions have been passed on corporate social responsibility, they have been concerned that extraterritorial provisions would be given to the Government of Canada over investments abroad in the extractive industries. It is interesting because when we take a look at chapter 11, what we are actually doing is legislating the rights of extraterritorial private interests to have influence on governance here. We do not hear them talk about that.

So, on the one hand we are saying we do not want to have too many rules for corporations when we are doing business overseas because that might interfere with the conduct of the business of certain countries, and on the other hand there is this chapter 11 cheque written out and handed over to private corporations with which we do these trade deals .

I think that is an important issue. I think Canadians want to know why these facets within these trade deals are being set. Who is benefiting? Is this helping the citizens of the countries with whom we are entering into these trade deals? I suspect not. I know that it is not. I think it is important because when we look at this trade deal, it again is reinforcing that.

When we look at this trade deal and we look at the side provisions on environment and labour, they are just that. They are side agreements. The language is voluntary. We cannot have voluntary human rights. Either human rights are embedded and we have strength in terms of support to ensure that those human rights are being granted or we do not. Having voluntary human rights, we might as well not bother. It really does a disservice to the whole concept and notion of human rights.

I can only think what John Diefenbaker would say to that. We have side agreements on human rights. I suspect that he would not be in favour of that notion and I think that is important.

I suspect that because the government thought there would be a furor over the lack of environmental and human rights provisions, it would do a little political inoculation and put a side agreement in, put a ribbon on it and everyone will be happy.

We on this side of the House see through that. We either have it embedded and strengthened with legislation or we do not bother. To have it on the side, as was mentioned by my colleague from the Conservative Party earlier in his intervention, makes it voluntary. It is like the response by the government to corporate social responsibility where it has taken a very robust report from both business and civil society about how we can do corporate responsibility and turned it into a suggestion box, that if we have a concern we can put the concern in this box and perhaps the government will deal with it. That is not good enough. We need to take this issue seriously because it affects the lives of ordinary people.

The trade agreement, sadly, is putting on the altar environmental protection and human rights protection for what? For profit. For the bottom line. As I said, I think people will see through that and we certainly do.

I would also like to point out where Canadians are in their view of where Canada should be when it comes to trade agreements. I want to reference a document that recently came out called “Back on the Map”. It is a very comprehensive overview of a study that was done for a new vision for Canada in the world. It was done recently by a non-partisan group called Canada's World during a national citizen's dialogue. The director is Shauna Sylvester whom I met with recently. She was pointing out to me the research that was done on what Canadians want to see in their foreign policy and in their trade agreements. One of the things in the research report said that Canadians wanted to see good governance as it relates to promoting good governance in trade deals. The report is based on researchers talking to Canadians about what they want to see in our foreign policy and trade deals.

They want to see the Government of Canada take a leadership role in convening and facilitating the reform of international financial development agencies; promoting fair trade practices and corporate social responsibility, particularly among Canadian companies with overseas operations; supporting a stronger voice for developing countries within international institutions; investing in public diplomacy; shielding effective programs from partisan politics; and instituting a federal process to help with that

What they want to see is Canadian governance in trade deals promoting fair trade, promoting corporate social responsibility and promoting the values that are embedded in our Canadian fabric, not to hand over to certain companies and interests a blank cheque to decide what they want to do with it and undermine not only our democracy but the interests of those in the country of origin; in this case Peru.

For those reasons our party will not be supporting this trade deal. I wish that we would have the support of the Liberals to oppose this trade deal because it is not good enough.

[Serge Cardin, Bloc, Sherbrooke, QC]

Madam Speaker, the Bloc Québécois is, in principle, in favour of Motion M-293 on the accountability act and Bill C-300, which also deals with accountability.

We agree in principle. Canadian companies abroad should be made more responsible, so this is an important step. There may, however, still be a sizeable gap between the laws and regulations of the country with which we are negotiating a free trade agreement and our own laws and regulations.

Accountability should also impose severe regulations relating to protection of the environment of these foreign countries. I believe that these two aspects can, and must, complement each other.

[Paul Dewar, NDP, Ottawa Centre, ON]

Madam Speaker, I want to raise a question with my colleague from the Bloc that stems from a related bill in front of the House right now, Bill C-300, which addresses corporate social responsibility.

In light of my friend from the Conservative Party raising the issue, if we really want to deal with corporate social responsibility, I want to get his take on whether it would be better to have it embedded in a policy, not just for trade agreements and voluntary, which is the problem with this trade deal, but to have that kind of approach, that legislation, embedded in the Canadian governance model right across the board, for all companies.

[Guy André, Bloc, Berthier—Maskinongé, QC]

Madam Speaker, it is an honour for me to speak to this bill. As I have already indicated, the Bloc Québécois does not support this free trade agreement, basically because it does not meet a number of criteria and objectives that are necessary when concluding trade agreements that will create fairer, more equitable trade, rather than trade that fosters inequalities.

We believe that all new free trade agreements must contain clauses requiring that minimum standards concerning human rights, labour rights and respect for the environment be met. The free trade agreement with Peru, for example, would open many doors to Canadian investments in mining in Peru, but it does not include adequate provisions to protect workers and the environment.

There is no doubt that Canada is a leader in the mining sector. The federal government uses tax credits and financial and logistical aid to support companies operating abroad. The current federal government promotes Canadian companies' activities, but does not seem too concerned about whether any particular company complies with minimum human rights and environmental standards. The federal government, with support from the Liberals, of course, refused to adopt mandatory social responsibility standards for Canadian mining companies operating abroad.

It is ironic, if not downright pathetic, to see the Liberals oppose the adoption of mandatory standards even though they are in opposition. People say that when the Liberals are in opposition, they have a New Democratic agenda, but when they are in power, they have a Conservative agenda.

On the one hand, they support this agreement, but on the other, they introduced two legislative measures this session: Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries, by the member for Scarborough—Guildwood; and Motion M-283 on the social responsibility of the Canadian extractive industry in developing countries, by the member for Pierrefonds—Dollard. Despite supporting the agreements with Colombia and Peru, they have introduced motions to support and, as they put it, encourage companies to respect the environment and labour rights abroad. They introduce bills like that, then they turn around and vote in favour of agreements between Canada and Colombia or Canada and Peru. That is a major contradiction. I would like to expand on that.

Take Bill C-300, which the Liberals introduced in the House. The purpose of the bill was to ensure that Canadian mining companies behaved responsibly and complied with international human rights and environmental standards. The Liberals introduced that bill, but now they are voting for the Canada-Peru agreement and the Canada-Colombia agreement. Unbelievable. That is a basic contradiction. That is what I call political hypocrisy. It is unthinkable that a party could take such positions.

For some years now, a number of Canadian mining companies have been directly or indirectly associated with forced population displacements—it happened in Colombia—significant environmental damage, support to repressive regimes, serious human rights violations and sometimes even assassinations, as has occurred with many union members working in Colombia, for example. That is why Bill C-300 was introduced and that is why the Bloc will support the Liberals' bill.

That is why the Bloc Québécois has always defended the need to impose standards of social responsibility on companies operating abroad. But the federal government has always defended the principle of laissez-faire, preferring a voluntary approach.

I would like to point out that the Liberals have not taken a consistent position in this House. It is disgraceful for the Liberals to be voting in favour of this agreement. I would like the Liberal members to explain their logic because I have a great deal of difficulty understanding it.

They support the Conservatives and refuse to include mandatory standards in the agreement with Peru when there is clearly a need to adopt mandatory standards for the social responsibilities of Canadian mining companies. Now they are presenting these two legislative measures. It is a contradiction.

What can we say about the Liberals in this debate? I hope they will go and hide. Fortunately, stupidity and ridicule are not deadly; otherwise there would not be many Liberals left in this House. I would say they are being devious in this matter. I have been listening to them since yesterday and I am amazed.

As I was saying, rather than imposing mandatory standards, the government continues, on the contrary, to believe in the myth that Canadian companies act responsibly. It naively continues to defend the idea that a voluntary commitment is enough to guarantee that the activities of Canadian companies abroad will be conducted in a responsible manner.

It is important to remind the Conservative and Liberal members that the radical reforms imposed by the government of Alberto Fujimori between 1990 and 2000 reduced the size of the state and undermined its capacity to intervene effectively and to impose standards over its entire territory. We must not forget that.

Since then, yes there have been reinvestments, and Peru is currently in a phase of good economic growth. We must, however, consider Peru a developing country.

The Canadian government is responsible for ensuring that its legislation does not run counter to the needs of the populations concerned. Development must be sustainable, fair and equitable. It must be harmonious and respect local populations.

It is not enough just to say that our legislation creates jobs or stimulates local economies. This is why the Bloc Québécois has always favoured the adoption of mandatory standards and accountability measures with respect to the activities of mining companies in other countries.

This bill does not even reflect the recommendations by committees whose representatives had been to the field. The industry has studied the matter. By turning its back on the numerous recommendations by industry and civil society contained in the report by the advisory group to the National Roundtables on Corporate Social Responsibility, in which all parliamentarians took part and which dealt with the Canadian extractive industry in developing countries, the Canadian government has made itself complicit in the human rights abuses and environmental damages caused by the actions of certain offending companies. I cannot accept that.

This is why the Bloc Québécois is voting against these agreements. A trade system that results in the exploitation of developing countries is not viable.

Contrary to what the government may say, increasing exports through a free trade agreement between Canada and Peru will not automatically resolve the economic inequalities, social problems and poverty related to that country's development.

Including in the agreement a clause protecting investments, patterned on NAFTA's chapter 11, will allow businesses to sue the government. This clause will, I am sure, limit the Peruvian state's capacity to ensure equitable social and economic development for its population.

In this context, the free trade agreement with Peru contains some basic elements that prevent us from supporting this bill.

Canada-Peru Free Trade Agreement Act

[Jim Abbott, Conservative, Parliamentary Secretary to the Minister of International Cooperation]

Mr. Speaker, as the member well knows, he and I have managed to find ourselves on different sides of many issues, but I respect the fact that he and I have also had occasion to work together for the kind of common good to which he has spoken. He would also know there is currently a private member's bill before the committee, which was passed by the House, Bill C-300 on the issue of corporate social responsibility.

We have been studying it as recently as this afternoon and the thing that has been most interesting is the aggressive action that the Government of Canada is currently undertaking with respect to corporate social responsibility.

I put to the committee today the concept that there was not one person in the House, and probably not one person in Canada, who was not serious about wanting all of our corporations to be involved in the world with the concept of corporate social responsibility.

The only thing I would suggest for my friend is this. An awful lot of the time I have been in the House and have taken occasion to listen to the speeches of the NDP, it always seems so dower, so down and so negative. we cannot do this and we cannot do that and those great big greedy corporations. There is all this negativism.

What the Government of Canada wants to do with this Peru free trade agreement, as with other free trade agreements, is to open up the possibility for Canada and Canadian workers to have more opportunity in the world because Canada is such a free trading nation.

Would my friend not want to put on a more positive face, a bit more of a smile, rather than always being concerned about being dragged down? Canadians are the most productive creative people in the world. We are a nation that can carry our own and we can carry these things to Peru and to other countries to help them bring themselves up to a higher level.

[Serge Cardin, Bloc, Sherbrooke, QC]

Mr. Speaker, I thank my hon. colleague from Québec for her speech.

I listened to her very carefully and she talked about the mining industry. As we know, two Liberal members have presented two measures, namely, motion M-293 from the hon. member for Pierrefonds—Dollard, and Bill C-300 from the hon. member for Scarborough—Guildwood. Both measures relate to corporate responsibility in the mining sector.

The Liberals are getting ready to vote for the free trade agreement between Canada and Peru, even though they know very well that the investment agreement based on chapter 11 allows mining companies to sue the state if it improves its legislation concerning the environment, workers' rights and occupational health and safety. They want to liberalize trade, but with such liberalism comes responsibility. How can the Liberals bring forward motions and bills to improve corporate responsibility among mining companies on the one hand, and on the other hand, accept and support such a free trade agreement, when the government should be sent back to the drawing board and forced to take a new approach to free trade agreements?

[Johanne Deschamps, Bloc, Laurentides—Labelle, QC]

Talk to us about Bill C-300. We have not had the opportunity to hear you speak on that bill. You were invited here for that reason.

Do you have an opinion?

[Serge Cardin, Bloc, Sherbrooke, QC]

Mr. Speaker, it is with pleasure and conviction that I rise again to speak to Bill C-24, An Act to implement the Free Trade Agreement between Canada and the Republic of Peru, the Agreement on the Environment between Canada and the Republic of Peru and the Agreement on Labour Cooperation between Canada and the Republic of Peru.

Once again, the environmental and labour issues are being dealt with in side agreements, which aim for the minimum requirements established by the country with which we are signing the agreement rather than promoting the environmental and labour rights and laws in that country. Every free trade agreement always contains a section on investment. We agree that there should be a minimum of protection for foreign investment and that it should be properly regulated. However, there must be limits on the powers given by agreements, for example NAFTA's chapter 11.

We are in an era of innovation. We must innovate not only in the sciences, social sciences and business, but also in free trade agreements. We are discussing bilateral agreements. We must be innovative and promote environmental rights, labour rights and, in some countries, human rights.

This innovation could start today, in the free trade agreement between Canada and the Republic of Peru, simply by our telling the government to redo its homework. The government must do it again and innovate in terms of bilateral free trade agreements, as in this case.

An aside, if I may. The Bloc Québécois strongly advocates multilateral agreements. It must be pointed out that, in this sort of agreement, the same set of rules applies to everyone. Even the WTO must protect human rights, labour rights and environmental rights. That is the end of my aside.

The government talks of liberalizing trade. An American author said that increasing the freedom of trade index by 1% could and would increase trade. Hence the mad race by all countries to establish agreements with other countries to liberalize trade. However, we must never lose sight of the fact that freedom must also rhyme with responsibility. When the government makes an agreement with another country it must be responsible for its actions and for the decisions and agreements it makes. They can create a multitude of problems for people in emerging countries who want to improve their situation.

We see this responsibility clearly in the mining sector, among others. At the moment, Canada's mining companies operating abroad cause damage to the environment and displace many people. They are responsible only under the environmental laws of the other countries. This agreement does not promote environmental rights strongly enough to ensure our mining companies are responsible. Their responsibility is voluntary, to all intents and purposes. It is why a significant number of mining companies from around the world incorporate in Canada, for then they are not responsible for their actions abroad.

Thus they can save a lot of money. But they create catastrophes as well, and they should be responsible for them. If I have the time, I will come back to the subject of mines.

In my remarks, unlike in the speeches we often hear, I would like to return to the testimony given before the Standing Committee on International Trade. This testimony was heard long after the agreement was signed and long after the parties had indicated what stands they would take on this bill.

I have notes on a number of witnesses, but not all, because I could have spent an entire day on it. A number of things were said in committee that most of the Liberal and Conservative members did not hear, unfortunately. Perhaps it would be a good idea to tell them that this might be the perfect opportunity for this agreement to become the model of agreements for Canada in the future. We oppose this agreement and hope to have the support of the majority of members in this House in order to innovate. Although we would prefer multilateral agreements, when bilateral agreements are made, they must be made in the best possible way.

For example, I will quote a witness who appeared in committee on May 7, the president of the Canadian Federation of Agriculture, which is the largest agricultural association in Canada with over 200,000 producers. In Quebec, there is an expression that the witness used at the beginning of his testimony. He said that this agreement ce n'est pas le Pérou, meaning that this agreement is not perfect, it is not a cure-all for all of the current trade problems or irritants. But it is being signed with Peru.

The president said that it is obviously not perfect, far from it. But he and his producers would still like it to move forward as quickly as possible. He also criticized the negotiators. I would make a distinction. There are negotiators who negotiate. Often, the negotiators negotiate what the government asks them to negotiate. The negotiators focus on things chosen by the government. The negotiators also negotiate by leaving out some aspects, because the government has asked them to leave them out. The government asks the negotiators to sign, at any cost, almost any condition, whether or not it is favourable to the people, to entrepreneurs and to businesspeople. He criticized the negotiators because, according to him, if we compare this agreement with the one signed with the United States, the reduction was faster in the United States than in Canada. The quotas were also much larger and there was no most favoured nation clause. He said that some sectors benefited more—grains, wheat, barley and pulses. Of course, some sectors lost out. We never saw an impact study from the government or the negotiators. According to them, some sectors stand to gain, and others stand to lose. However, we have never seen an impact study and projections of these impacts, not only for the business of people who export, or for the benefit of some who import, but also for all workers in Quebec and Canada.

Impact studies would tell us what will happen in a given industry or in a given sector and what the gains and losses will be. We should also ask ourselves what our priorities are and why. We never had impact studies on free trade agreements. We are not asking anyone to tell the future by looking into a crystal ball. In fact, it is obvious that there are not too many crystal balls around. I know a government that went from a zero deficit to a $50 billion deficit in a span of a few weeks or a few months. So we do not really need a crystal ball.

There are various other products, but I will not name them.

Of course, the president of the Canadian Federation of Agriculture was aware of deficiencies with regard to labour and environmental laws. He still argues that even though our farmers do not enjoy the same treatment as American farmers and even though progress is slow, we should sign the agreement. Again, there has not been any impact studies on producers and farmers, nor on the population as a whole whose quality of life we must look to improve to a certain extent. For example, to show the difference, in the United States, the tariff on certain products, including pork, will be eliminated within five years. However, in Canada, it will take 17 years. So the difference is quite substantial.

The president of the federation told us also that the federation agreed to multilateral negotiations. That being said, he kept repeating that negotiators would have to adjust, but also that ,in turn, it would be mostly up to the government to adjust.

We heard from other witnesses, including the Canadian Wheat Board. The wheat sector is obviously among the biggest winners.

I mentioned pork. I want to show the relative importance of that agreement for Canadian pork, for instance, on international markets. Director General Jacques Pomerleau said:

Knowing that we would never get what the Americans received, our negotiators became very creative in ensuring that we would still get some benefits. They accepted a longer tariff elimination period, 17 years instead of ten, but they were able to get for us a duty-free quota that will allow our exporters to better position themselves at the very beginning. We have to admit that this quota of 325 tonnes, that will progressively extend to 504 tonnes over 10 years, is relatively small for an industry that exports over one million tonnes every year.

There are little aberrations like that. Others, like the Canadian Chamber of Commerce, are very much in favour. The only thing, really, is that we do not want to be overtaken by other countries that could sign a FTA with Peru, among others. The same holds true for other agreements. Because Colombia and the United States were negotiating an agreement that did not get Congress approval, Canada raced like mad. It was intent on signing and implementing an agreement before the United States did. This was crucial to the government, even if it meant doing so at the expense of Colombia or human rights. Globally, a mad race was on, with businesses from all countries trying to globalize, as we do. Soon, every country on this planet will have bilateral free trade agreements with the 199 other countries. Naturally, variances and differences will develop. Why not focus primarily on multilateral agreements? I think it would be the most sensible way to go.

I was talking about environmental laws earlier. The Canadian Environmental Law Association was represented in evidence given before a committee on May 26, 2009. Ms. McClenaghan, executive director and counsel in that association, criticized the fact that investors can access the states. She said it was a serious problem. Particularly when we talk about investors, we must of course refer to the investment agreement that echoes chapter 11 of NAFTA whereby investors have access to the state, which could be problematic. We know that investors can sue countries for various reasons under the major heading of expropriation, which includes two elements. There is direct expropriation, that is, in the true sense of the word, and indirect expropriation, which, no matter what happens, relates to a business' loss of anticipated profits.

To give an example of such a free-trade agreement, Ms. McClenaghan referred to the agreement between Australia and the United States whereby no investors had access to the state. It was also a model of social and environmental protection. In terms of labour laws and occupational health and safety, Canadian businesses are operating in a country where little attention is paid to people's rights.

I must briefly come back to the topic of mining. Regarding mining companies and corporate responsibility, we have motion M-283, moved by the hon. Liberal member for Pierrefonds—Dollard, and Bill C-300 introduced by the hon. member for Scarborough—Guildwood. The Bloc Québécois supports both items—the motion and the bill—because their goal is to make mining companies accept greater responsibility in countries like Peru and Colombia. If the Liberals are to be consistent with their bill and their motion, they must also, for that reason, vote against the Canada-Peru Free Trade Agreement Implementation Act. I therefore call on all Liberal members, including those from Quebec, and all members to vote against this implementation act.

Canada-Peru Free Trade Agreement

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

Mr. Speaker, I was pleased to hear in the parliamentary secretary's comments a renewed commitment to corporate social responsibility. I think that is welcome news.

I wonder whether the parliamentary secretary is aware that there was a parliamentary report by the foreign affairs committee in 2005 that was followed up by round tables in 2007 to which his government did not respond. The round table's report was retabled in 2009, to which his government did not respond. It was then followed by my private member's bill, Bill C-300. Only lately has the government got religion, in March of this year, with a proposal that has the appearance of doing something but in fact is doing very little and may actually be counterproductive.

Some of the initiatives in that press release are actually good, and I encourage the government to pursue those. However, the ones that are most objectionable are the ones having to do with the actual investigative power of the councillor.

Would the hon. parliament secretary commit to incorporating the CSR obligations or responsibilities in the press release and the mandate of the new councillor into Bill C-300 as this bill goes forward?

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

Thank you, Mr. Chair. I look forward to being grilled and grilled.

Thank you, colleagues, for this opportunity to speak to you about this important initiative. As you know, this initiative has, in the last little while, generated a great deal of controversy. I hope that over the course of this next hour we can direct our minds to some of the issues that might be generated by Bill C-300. This committee, under the chairmanship of Dr. Bernard Patry, issued a report in 2005 to ensure socially and environmentally responsible conduct by Canadian companies, with a particular interest in the activities of a particular Canadian mining company, TVI Pacific, in the Philippines.

It was a comprehensive report that recognized that Canada, as a leader in the extractive sector, had a moral and legal responsibility to lead. It was also an unanimous report. It said in part that “Canada does not yet have laws to ensure that the activities of Canadian mining companies in developing countries conform to human rights standards, including the rights of workers and of indigenous peoples.”

The report led to the round tables in 2007. I have here a copy of the round tables' report. The round tables were a multi-stakeholder group of people from industry, NGOs, and various other entities who compiled the reports and tabled them. They had six recommendations, of which numbers three and four are the most significant for the purposes of this committee. Recommendation three called for “An independent ombudsman office to provide advisory services, fact finding and reporting regarding complaints with respect to the operations in developing countries of Canadian extractive companies.”

And the fourth called for “A tripartite Compliance Review Committee to determine the nature and degree of company non-compliance with the Canadian CSR Standards, based upon findings of the ombudsman with respect to complaints, and to make recommendations regarding appropriate responses in such cases.”

It was felt this would improve Canada's competitive position. It was hoped that the government would respond in a timely fashion, but it didn't do so. In 2009, the report was re-tabled. We still have had no response. So along comes Bill C-300, a rather modest little bill that.... If you listen to its critics, you'd think we were approaching the end of western civilization as we know it.

The government has felt that doing nothing was not an option, so they chose to do the next best thing, which is the appearance of doing something while in fact doing very little. In fact, I'll argue that what they did on March 26--that is, the issuance of a press release and the order in council appointment of a counsellor--is in fact worse than nothing.

I'm working on the assumption that all of you are fairly well informed about corporate social responsibility and environmental stewardship. In the time allowed to me, I don't propose to re-plow old ground—although I dare say that given your witness list, there will be quite a number of witnesses who do want to raise to your attention some very, very serious issues regarding CSR and environmental stewardship.

Ironically, the tabling of the press release and the setting up of a dedicated counsellor foreclose the debate about CSR. The government, by doing so, has in fact confirmed that we—meaning Canada—do have a CSR problem and proposes to address it in particular way. So the debate about whether we should or we shouldn't is now over. Now we're on to the question of what is the appropriate methodology.

So essentially you have three approaches. You have this approach, which is the round table report. You have the second approach, which is the government's press release with an order in council attached. And you have Bill C-300.

For the purposes of our discussion, this approach is off the table. It is very clear that whatever response this government is going to give to CSR, it has given it already. It is reasonable to conclude that the Prime Minister has done pretty well everything he's going to do about CSR during this government.

What he has proposed instead is the appointment, by order in council, of a counsellor dedicated to CSR, with a mandate to educate and investigate. I have no great objection to the Government of Canada educating and encouraging Canadian companies to be world leaders and to adopt best practices on CSR. That should be applauded. My objection is to the investigative part of the mandate, which, in my judgment, has the appearance of doing something while doing little or nothing.

The counsellor is an order in council appointment. It's trite but true, but what a Prime Minister can make, a Prime Minister can unmake. The appointment will only last as long as the Prime Minister wants it to last, and if the counsellor strikes a course just a touch too independent for the Prime Minister, he will have his appointment revoked or suffer the fate of a death by a thousand cuts--witness Mr. Page, in the Library of Parliament. There is nothing like having your budget cut to curb your investigatory enthusiasm.

Bill C-300, on the other hand, proposes a legislative mandate that will not be subject to the whims of a Prime Minister or, indeed, of any Prime Minister. A repeal of the order in council requires a pen and a piece of paper in the hands of a Prime Minister, whereas a repeal of an act of Parliament requires an act of Parliament--two very different beasts.

In addition to the vulnerabilities that the appointment process and the whim of a Prime Minister's limitations place upon the ability of the counsellor to investigate, there is within the mandate a heading called “Limitations on Authority”. It says that no investigation can be launched into the activities of a Canadian mining company unless the company itself consents to the counsellor conducting the investigation with the “express written consent of the parties involved”.

How do you think that's going to play out? Would it be reasonable to assume that the only companies that are going to consent are already CSR-compliant? If they are already CSR-compliant and they agree to an investigation, what kind of report is the counsellor going to produce? We're going to have a happy bunch of little reports that are entirely useless to everyone.

Contrast that to Bill C-300, wherein the minister is not under a similar restriction. Under a Bill C-300 regime, the minister will not have to obtain the consent of the corporation or company prior to launching an investigation. It's a little like the police asking the accused whether they can investigate the allegation first. Just to state it makes it sound somewhat dubious.

So we have a counsellor appointed--or unappointed, as the case may be--on the whim of a Prime Minister, vulnerable to budget restrictions without notice, and producing happy little reports of dubious benefit to anyone. But it gets worse.

Prior to launching an investigation, the counsellor shall “consult with the national contact point”. You will hear from other witnesses on what they think about the national contact point, but “dysfunctional” and “a tremendous reputational burden for inaction” are words you will hear. Civil society and private sector actors in the national round tables agreed that the national contact point was not an appropriate mechanism for advancing human rights and performance standards in mining, oil, and gas.

It gets worse. In addition, “The Counsellor shall not...make binding recommendations”. If the recommendation is not binding, what is it?

The counsellor may only review on getting a request from an individual, group, or community that “may be adversely affected”. If an NGO such as the Mennonite Central Committee--or any other NGO, for that matter--observes something that is a breach of CSR standards, it in itself is not adversely affected, so the counsellor has no mandate to investigate.

Further, under section 6.2, the counsellor may not on his or her own initiate a review. If an NGO sees something that should be investigated, the counsellor's hands are tied. He or she has no power to do an independent investigation.

So let's review. We have an order in council, which is on the PM's prerogative. We have an inappropriate precondition of a national contact point. If we have no consent by the company, we have no investigation. If there are no adverse interests affected, the person has no status to complain. There is no independence on the part of the counsellor and no initiative ability. And just to top it all off, all recommendations aren't binding.

If the counsellor jumps through all these hoops, there's an elaborate process set out in paragraphs 6(5)(a) to 6(5)(f) for conducting a review that will have a number of formal and informal add-ons from the lawyers of the affected company. I say good luck to that counsellor.

If the counsellor jumps through all the foregoing hoops, before he or she issues a statement the counsellor must inform the parties of the results. If the report is adverse, the counsellor must give them opportunity to comment. If the counsellor is still determined to publish after all this, the company then may go to the courts and seek a mandamus order to quash the findings. So how many adverse findings do you think we're going to hear out of this counsellor?

Canada is at a crossroads here. It's an important player on the international stage in this area, and the complaints are starting to pile up. You have a bill kit. You'll see in there three very serious complaints: one about Barrick in Papua New Guinea; another one about Goldcorp in Honduras; and another about Banro in the Congo. You'll see some pretty negative commentary on the part of some pretty respectable people.

On the Barrick Gold one, it says there have been numerous complaints over the actions of Barrick Gold at this mine, with the most recent allegations culminating in the Norwegian Ministry of Finance disposing of its shares in the company over ethical concerns in regard to their waste disposal practices. Based on an in-depth assessment of Barrick's operations in Porgera, the pension fund's council of ethics concluded that investment in Barrick amounted to “an unacceptable risk of the Fund contributing to serious environmental damage.” The council added that “the company's assertions that its operations do not cause long-term and irreversible environmental damage carry little credibility.”

You can read the rest for yourselves. Goldcorp in Honduras had the largest fine ever assessed by the Honduran government against a corporation. And then, in the Congo, that's another story altogether.

So there we have it. Other witnesses will speak far more eloquently than I about these complaints and, I assume, others. I'm quite prepared to concede that occasionally these reports may be frivolous and vexatious and there may be actually other games in play, but if you look at Bill C-300, there is a mechanism to deal with frivolous and vexatious complaints.

We will be presenting amendments that incorporate the Government of Canada's press release and the counsellor into Bill C-300. We think incorporating the counsellor into Bill C-300 meets some of the criticisms I've just outlined and addresses the vulnerability of the appointment in the preconditions of consent and the ability of the counsellor to initiate proceedings. It also neatly sidesteps the royal recommendation, because the Government of Canada, in its press release, has already committed funding to a regime. I would invite any one of my Conservative colleagues to move that amendment. I'd be happy to have you move it.

As members of Parliament, you will incur significant blowback from some of the most powerful people and companies in Canada who do not want, under any circumstances, a legislative response to the allegations of a growing CSR problem. From their perspective, a preferable course would be to do nothing at all. Their default position, however, is the Government of Canada press release and then fighting it out behind closed doors with the counsellor.

Let's be clear here. Canada has a choice: it can legislate a response that would put Canada at the head of the class, or it's more business as usual--see no evil and hear no evil. Voluntary guidelines have pretty well run their course. The question is really whether you as MPs want to move Canada along to the next logical position: a legislative mandate for CSR. Their preference would be to kill Bill C-300 and then lawyer it to death. Unless you give the counsellor some legislative spying, it will be a repetitive environment.

You have written your report, and it now has a response some four years later. I wish you Godspeed in your deliberations, and I thank you for your time and attention.

[The Chair, Conservative, Kevin Sorenson]

Good afternoon, colleagues.

This is meeting number 20 of the Standing Committee on Foreign Affairs and International Development. Today, Monday, May 26, 2009, we commence our study on Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries.

As our first witness, we have the author or sponsor of this private member's bill, the Honourable John McKay.

We look forward to your comments, Mr. McKay. Welcome to our committee. You know very well the procedure here: you will give us an opening statement of about 10 to 15 minutes, and then we will grill you on this bill. But we do welcome you and thank you for your hard work on this bill.

[Jon Baird]

It's a shame that, as you put it, the only solution is Bill C-300. I mean, what we really need....

We had a proper consultation, a proper negotiation, proper systems, and reports being tabled. It took two years for the government to respond to that report, and they came back with something that's watered down.

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

We agree on that. In fact, we built into Bill C-300 a section for frivolous and vexatious complaints. I agree with you. I don't want Canadian companies spending of dollars trying to defend themselves against complaints that are frivolous and vexatious.