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.

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

I have a point of order, Madam Chair.

As you can see, Madam Dwyer and I have a complicated relationship, shall we say. She was a good supporter on Bill C-300. She hasn't seen the light with respect to Bill S-211. I just want, for the edification of the committee, to have the leave of the committee to table Bill S-211, and members can read for themselves whether clause 11 should be interpreted the way I expressed it or the way Ms. Dwyer expressed it.

If I have unanimous consent, I'd be happy to table this.

[Emily Dwyer]

Yes.

The network has been around since 2005. We were involved in the national round tables. We worked closely for quite a long time to advance Bill C-300, for the creation of the ombudsperson's office, and for human rights and environmental due diligence legislation.

We also work to bring the voices of impacted people to parliamentarians, because we think that being faced with the stories and accounts of directly impacted people will help to drive the necessary change.

Thank you very much for your time.

Federal Courts Act

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Mr. Speaker, it is indeed a great pleasure to stand in this House to speak to Bill C-331, brought in by the member for New Westminster—Burnaby.

I know this particular issue has been very dear to him over many Parliaments. It is really great to see that we are in the second hour of debate on Bill C-331, which means it is probably going to come to a vote next week. We will finally see where members of this House actually stand on this issue, because it does matter to a lot of people.

The long title of Bill C-331 is An Act to amend the Federal Courts Act (international promotion and protection of human rights). The reason this is so important is that, at present, human labour and environmental rights are subject to few concrete, effective enforcement mechanisms. This bill fills this need for the victims of international rights violations when there is no forum available to them in the country where the violations are taking place.

By way of addressing my Conservative colleagues' concerns, this is not going to result in a flood of people coming to Canada. It is really just providing a forum in Canada when no such legal option is available to the person in the place where the violation happened.

Specifically, Bill C-331 is going to allow non-citizens to bring a civil suit against anyone for gross violations of the rights of indigenous peoples, and for basic labour, environmental and human rights violations when they are committed outside the country. Furthermore, judges on the Federal Court would have to satisfy themselves that their court is an appropriate forum to hear these cases.

This legislation, if enacted, is not going to force the court to hear every single case. It still specifies within the bill that Federal Court judges will have the ability to judge the merits of each case before them, and whether in fact there is enough evidence to proceed with trial.

When we look at Bill C-331 in detail, it is an amendment to the Federal Courts Act. The bill would add a specific section 25.1 after the existing section 25. Some of the claims listed within the bill are genocide; a war crime or a crime against humanity; slavery or slave trading; extrajudicial killing or the enforced disappearance of a person; torture or other cruel, inhuman or degrading punishment; prolonged arbitrary detention, and so on. These are crimes that really speak to some very horrible actions that take place around the world.

We are so very lucky to live in Canada under the rule of law. We have a judicial system that we place a lot of trust in. Generally, when people see police on the streets, we know they are doing their job. We have a lot of trust in those institutions, not only to keep us safe but also to hold people to account. In many places in the world, this is a luxury or simply does not exist.

Canadians, by and large, are fairly detached from some of the horrors that go on internationally. The unfortunate fact is that a lot of Canadian-based companies have actually been responsible for some of the worst behaviour around the world. We know some Canadian mining companies have been implicated in brutal crackdowns on local populations, because they were daring to protest a mining operation. They have employed paramilitary guards who have used sexual violence as a weapon. They have violated environmental rights by dumping mining tailings into a local drinking supply. These are companies that are based in Canada.

The issue here is to basically hold those companies accountable. We want to ensure that we are not engaging in a race to the bottom for economic reasons, while neglecting those very important rights.

We have corporations based here in Canada that generate a tremendous amount of wealth. That wealth is not equally distributed. Often, the wealth that is being generated is coming directly from the so-called global south and from countries that are rich in natural resources that are being exploited by companies, but the wealth is being unevenly distributed.

Therefore, corporate social responsibility should not be a voluntary thing. This is something we need to have firm legislation around and firm accountability. I believe that Bill C-331 is a step in the right direction.

If we look at Global Affairs Canada, we see, as I mentioned earlier, that 50% of the world's publicly listed exploration and mining companies are headquartered in Canada. If we look at the TSX, it is quite evident.

The federal government, just recently, in April, appointed Sheri Meyerhoffer as the first Canadian Ombudsperson for Responsible Enterprise. Before I receive any applause from my Liberal colleagues, they may want to listen to the next part of my speech.

This is what the Canadian Network on Corporate Accountability stated when that office was announced:

The government announced that it would create an independent office with the power to investigate. Instead, it unveiled a powerless advisory post, little different from what has already existed for years.

United Steelworkers Canada national director, Ken Neumann, said:

With today’s announcement...of the appointment of a special advisor, without the powers of an effective ombudsperson, this government has again disappointed thousands of Canadians who were expecting serious action on human rights.

Again, we cannot just create the office and then walk away without giving it the necessary powers, the legislative framework and the resources necessary to actually act on these particularly egregious crimes against humanity. As listed in Bill C-331, these are some of the worst crimes imaginable.

I am proud to be a member of a party that has long demonstrated a keen interest in this particular issue. The member for New Westminster—Burnaby, as I said in the introduction of my speech, has been pursuing this through multiple parliaments. Our former colleagues, Paul Dewar and Alexa McDonough, and the Liberal member for Scarborough—Guildwood also saw this as an important thing. Several parliaments ago, the member for Scarborough—Guildwood presented Bill C-300, which unfortunately ran aground because not enough Liberals showed up at a key vote.

It is important that we act on this. It is a signal to citizens of countries where these rights do not exist. This is a signal to the world that Canada actually means what it says when talking about human rights, labour rights and environmental rights. Furthermore, we are actually going to provide a forum for the affected party to come here and use our Federal Court system to pursue justice. I can think of no better signal to the world than Canada actually standing by what it says and showing, through this proposed legislation, that it is going to follow through with it.

We have some great endorsements for this proposed legislation, and the endorsements have kept on coming from the member for New Westminster—Burnaby. We have the Canadian Association of Labour Lawyers, the National Union of Public and General Employees and the B.C. Teachers' Federation. It is great to see Canadian civil society, and indeed international actors as well, come behind this legislation to recognize its importance.

To conclude, I am particularly and personally attached to this bill, because it is following in the same vein of what I am trying to do with my own private member's bill, Bill C-431, which would amend the Canada Pension Plan Investment Board Act to make sure that our public pension monies are no longer invested in entities that are guilty of human rights, labour rights and environmental rights transgressions. It is particularly shameful, when we ask the Library of Parliament to do research, that we find the Canada pension plan still invested in companies that are committing these kinds of rights transgressions around the world.

I am happy to see that we are going to put force behind our words, as New Democrats always do. I congratulate the member for New Westminster—Burnaby on this important bill, and I look forward so very much to next week, when I can stand in the House and vote on it on behalf of my constituents.

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Mr. Speaker, thank you for giving me the opportunity to speak to this very important bill introduced by my colleague from New Westminster—Burnaby. It is important to the New Democratic Party, because we have introduced it ourselves in several different forms in the past. I think this is really interesting. I am going to come at this subject from a different angle, by focusing on the Canadian aspect and the international aspect. I will also respond to the member for Winnipeg North's intervention.

First off, I want to point out that Canada already offers many advantages to mining companies. That goes a long way to explaining why over 50% of the world's mining and mineral exploration companies are headquartered in Canada. It is because we have a very permissive tax system and regulatory system, making Canada highly appealing to these corporations. On that note, I urge my colleagues to check out the work of Alain Deneault. He has written two fascinating books on this subject, Imperial Canada Inc. and Canada: A New Tax Haven. These books clearly demonstrate that the Canadian tax system was designed to minimize mining companies' tax obligations and corporate responsibility.

My colleague spoke of human rights violations in a number of countries. Over half of the world's mining companies are headquartered in Canada, which is why we need a way to hold them to account. We need to give the Federal Court the power to make these companies take responsibility for their actions and those of their executives and employees. We see that as crucial to ensuring true accountability, not just lip service.

Governments used to say that these companies were out of reach because they operate internationally. My colleague shared some examples of the many excuses that have been used, but none of them hold water. The excuses we have heard from the Parliamentary Secretary to the Leader of the Government in the House of Commons do not hold water either. He said we do not necessarily need to give the Federal Court that power or have the Canadian justice system handle these issues because the government created the office of the ombudsperson for responsible enterprise.

The Liberals announced the creation of this office during their election campaign in 2015. Fifteen months ago, the government announced that the position was finally being created. The ombudsperson was appointed just this month, in April, but we still have not been given a breakdown of the duties of the office of the Canadian ombudsperson for responsible enterprise. Organizations that monitor this file very closely, such as MiningWatch and the Canadian Network on Corporate Accountability, are not terribly impressed with the government's efforts. It makes no sense that the creation of the office of the Canadian ombudsperson for responsible enterprise was announced 15 months ago, and we still have no idea what her job description entails.

This is crucial, because right now, the government, especially the minister of international trade, is under heavy lobbying from mining companies that are basically against increased powers for this office. They are opposed to the office being able to compel documents when it is investigating cases of mining company abuse in the world. They are opposed to the fact that this body could compel testimony from executives in mining companies. They have been heavily lobbied, as can be demonstrated through the lobby registry.

The Parliamentary Secretary to the Leader of the Government in the House of Commons claims that we do not need this legislation and its ramifications because the government has created something, but that simply does not cut it.

I find it interesting that he also referred to the efforts of one of his Liberal MP colleagues, the member for Scarborough—Guildwood. He tabled Bill C-300, which was a step in the right direction. He said that it was a demonstration of the goodwill of the federal government on this file.

What he neglected to say is that at report stage for Bill C-300, back in October 2010, it failed by six votes. The bill was defeated by six votes. Fourteen Liberal MPs were missing during that vote, including the party leader, Michael Ignatieff, Scott Brison and John McCallum. Most of the front bench did not show up for the vote on that bill. If there had been seven or eight more MPs, that bill would have passed. That shows that the Liberals had no intention of letting the bill through.

A bill like this is necessary because of the countless examples of abuse we have seen in the past, especially in the mining sector. The environment has been destroyed by these companies, and entire communities have suffered as a result.

People in these countries have been abused and even murdered, particularly those who were concerned with the workers' situation and tried to advocate on their behalf. Unspeakable atrocities have been committed, and the mining industry does not want to take responsibility for its actions.

The acting president of the Mining Association of Canada said that his organization does not support the investigative powers that human rights advocates and groups like MiningWatch want the office of the ombudsman for responsible enterprise to have.

I doubt they agree with my colleague's bill.

Mining companies will say that they have improved their practices and that they are better than they were at the end of the 2000s and early 2010s, but that is no excuse. I hope they have improved their practices because many of them were indefensible. It goes without saying that we are pleased that this is happening.

Does that mean we do not have to have a stronger framework and better tools, given that these practices may well re-emerge? Is this an excuse to get Canada out of requiring a minimum level of accountability and responsibility in exchange for the extremely good benefits it gives to mining companies?

The bill introduced by my colleague is indeed necessary. I sincerely hope that the government will take note and do what it should have done when it was in this position in 2010, namely stand up and vote in favour.

The bill is currently at second reading stage. We want the bill to at least be studied in committee, which would allow us to debate it and call witnesses from around the world. We want the countries that are currently being exploited by some of these mining companies to inform us of what has happened and why Canada should introduce measures to protect ourselves. The courts, police, and the systems of law and order in many countries where mining companies do business are not as developed and robust as ours.

We have the means to ensure that this accountability is not just lip service. Words are often forgotten and fade away. Accountability must be written into the law and the judicial process so that mining companies operating abroad start conducting themselves as they would here and be subject to the same monitoring and oversight they would have in Canada.

For all these reasons I will be voting for my colleague's bill and strongly urging all members of the House, whether in government or the opposition, to vote in favour of it. This will ensure that the bill is sent to committee and that we can start working on it to advance objectives and ideas that should have materialized a long time ago.

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Mr. Speaker, it is with pleasure that I rise to address what I believe is a very important issue, one which members on the government benches had talked about in opposition. It is an idea that I believe this government has addressed in a very tangible way, which the member across the way, the sponsor of this piece of legislation, somewhat pushed to the side, and that is the creation of the ombudsperson for responsible enterprise.

Let me make it very clear that Canadians have an expectation regarding corporate or company responsibility, not only within the boundaries of Canada, but even outside of our country. There is an expectation that our companies and corporations would behave in a manner that would reflect the kind of values we have here in Canadian society.

I know that, in a previous session, the member for Scarborough—Guildwood brought forward legislation, Bill C-300, that attempted to ensure there was more of a social conscience or accountability for mining corporations. It was my local high school, Sisler, that brought it to my attention and asked that I get behind my colleague and friend from Scarborough—Guildwood, someone who I believe has been a very strong advocate, not only in the last couple of years but for many years, for this critically important issue of the social responsibility of corporations and companies that go abroad. This government has taken that issue seriously.

As coincidence would have it, we just had the appointment of a Canadian ombudsperson for responsible enterprise, Ms. Sheri Meyerhoffer. The Minister of International Trade Diversification appointed her on April 8, 2019. The ombudsperson will review allegations of human rights abuses arising from activities of Canadian companies abroad. For companies found to be involved in wrongdoing abroad, the ombudsperson can recommend measures, which could include the withdrawal of certain government services, such as trade advocacy. The ombudsperson can also make specific recommendations to companies, including in relation to compensation, apology or corporate policy changes. I think that clearly demonstrates a government that is really in tune with the type of values Canadians have.

We can take a look at the fine work that members, and I have cited my colleague, have done over the years, reflecting what I believe his constituents and the constituents of many of my colleagues on both sides of the chamber have been able to express, which is the expectation and value system we have, that it is not good to violate basic human rights outside of our boundaries and we need to be able to support that in whatever way we can. In a relatively short span, we had a very aggressive agenda on a wide variety of things that have had a real impact on Canada's middle class. I can tell members that this critically important issue has become a top priority and we have seen specific action taken by this government. When I look at the issue, I feel very comfortable knowing that, with this ombudsperson, we will have a positive impact.

I come from the city of Winnipeg, where we have the Canadian Museum for Human Rights. I drive by it every other week, when I am in Winnipeg and not in Ottawa. It is a beautiful symbol that constantly reminds Winnipeggers who drive by it or see it in Google searches just how important the issue of human rights really is for the constituents I represent and indeed anyone who is associated with Winnipeg and far beyond.

However, it is fair to say that Canadians recognize the importance of that issue. It is one of the reasons why this government has seen such an aggressive approach to provide some sort of action that would see tangible results. That will happen with the appointment of the Canadian ombudsperson, who will be responsible for enterprise. That is a good thing.

The proposed bill will amend the Federal Courts Act to provide that the Federal Court has jurisdiction with respect to certain claims involving violations of international law outside of Canada. Under existing law, the superior courts of the provinces and territories can hear lawsuits involving events that occur outside of Canada if there is enough of a connection to Canada. Lawsuits alleging that Canadian companies have been involved in violations of international human rights abroad, which involve claims for negligence or other violations of Canadian or foreign law, are based on existing bodies of law.

The question of whether the common law also allows a person to claim damages in a superior court, specifically for a violation of customary international law, is at issue in the case of Nevsun v. Araya, which was heard by the Supreme Court of Canada in January.

Unlike the superior courts, the Federal Court generally does not handle cases against companies or individuals for actions taken outside of Canada. The Federal Court's jurisdiction is limited both by the Federal Courts Act and by the Constitution. The Federal Court mostly hears cases involving judicial review of the decisions of federal boards and tribunals, lawsuits against the federal government and cases involving patents or maritime law. Civil claims between private parties do not usually end up in Federal Court except in those areas.

The bill would amend the Federal Courts Act to provide that the court may exercise jurisdiction over certain cases involving violations of international law outside of Canada. As the member for New Westminster—Burnaby has said, the bill was modelled on the U.S. Alien Tort Statute, or ATS. It provides “The district courts shall have original jurisdiction of any civil action by an alien for a tort only, committed in violation of the law of nations or a treaty of the United States.”

The ATS has been controversial in the United States and there has been a lot of litigation about its scope. This has included disagreements about what kinds of claims are covered and the application of the statute to foreign defendants and corporations. Bill C-331's main provision is more complicated than the ATS, but the idea is very similar.

I would like to make some observations about the kinds of cases in which the federal court would have jurisdiction.

First, Bill C-331 appears to give Federal Court jurisdiction over existing types of legal things rather than creating new ones. It provides that the Federal Court will have jurisdiction to hear cases involving claims respecting conduct that arises from violation of international law. Jurisdiction delineates the scope of the court's authority, either territorially or by subject matter. Jurisdiction is not the same as the right of legal remedy.

For example, the Federal Courts Act gives the Federal Court jurisdiction in all case in which relief is a claim against the Crown. However, that does not mean the Federal Court can address any complaint a Canadian might have about the federal government. The act gives the court jurisdiction, but the court can only give a remedy if one is provided by Canadian law, for example, by a law governing contracts if the claim is one of breach of contract.

Second, the bill would grant jurisdiction to the Federal Court rather than the provincial superior courts. The Supreme Court of Canada has held that the Federal Court can only hear certain kinds of cases. It needs permission from Parliament in the form of a statutory grant of jurisdiction. In addition, the case must also be governed by an existing body of federal law.

I want to emphasize why it is important for us to recognize what this government has been able to accomplish on the trade file. We recognize the importance of international trade. We have also recognized the very critical importance of ensuring that companies and corporations behave in such a way that reflects what Canadian values truly are all about.

That is why, on April 8, we put in place the first Canadian ombudsperson for responsible enterprise. It is all a part of corporate responsibility. It is about international trade. It is about protecting Canadians, not only in Canada but also to protect people and human rights abroad.

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Mr. Speaker, I would like to thank my colleague for his speech and his work. This is certainly not the first version of this bill. I believe he has gone through the 40th Parliament, the 41st Parliament and now the 42nd Parliament.

I know there may be some members who have qualms about this bill, but what is important to underline is that through this important amendment to the Federal Courts Act, we are not making the determination whether a case has merit; we are simply allowing an additional forum for plaintiffs to access the justice system. Ultimately, it is the justice system that will determine whether a case has merit and whether the plaintiffs are to be awarded funds.

In past parliaments, we have seen the Liberals support bills like Bill C-300. We know there are good intentions on the other side of the House to support these kinds of initiatives. I would like the member to just underline the important fact of his bill, for anyone who might have qualms about this, that this is simply enabling an avenue and it will still ultimately be up to the justice system to determine the merit of a case.

International Trade

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

Mr. Speaker, today is a good day for corporate social responsibility in Canada. In the 10 years since the introduction and ultimate defeat of Bill C-300, the responsible mining bill, Canada has evolved from a strong resistance to naming an ombudsman for the Canadian office of responsible enterprise. This office will help support Canadian companies around the world to operate in accordance with international human rights standards.

Could the Minister of International Trade update the House on the appointment of the ombudsperson and the establishment of her mandate?

Corporate Social Responsibility of Extractive Corporations Outside Canada Act

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, I, too, would like to share some thoughts in regard to Bill C-584.

At the outset, I want to say that as a caucus, Liberals have had the opportunity to go through the member's bill. My colleague from Montreal has already had the opportunity to speak to it at second reading. We have indicated that we do support the bill going to committee, because we do think there is a great deal of value. It is about ethical standards.

The House of Commons can play a role in terms of ensuring there is more corporate responsibility when it comes to international affairs, especially in the area of development proposals and mining, for example, in some of the underdeveloped countries. We recognize the value of that. In fact, other members in our caucus have attempted to do something of a similar nature, in the sense of trying to raise the bar for Canadian corporations that do business beyond our borders.

In particular, most recently the member for Scarborough—Guildwood introduced Bill C-300. I had the opportunity to speak to that bill. From what I can recall, it dealt with mining and oil and gas companies. It would have ensured there was a sense of transparency through an annual reporting, including showing payments. I use that as an example.

I have heard some of the comments from the government in terms of this type of legislation, and the government tends to want to resist or turn down the legislation. I think that is a mistake. There is a great deal of value in seeing legislation of this nature advance through the process.

I believe it would have been a great value for my colleague's bill, Bill C-300, to have gone to the next level. It came very close, in terms of the actual vote. I believe that a number of members from the Conservative Party saw the merit in that particular bill.

In essence, the bill did what was currently happening in the United States, in that standards are set in legislation. The U.S. is not the only country in the world that has already done that. My colleague, on behalf of the Liberal Party, in his particular initiative attempted to do something here in Canada that was actually being done in other countries. It would have had a very positive impact.

I listened to the previous speaker when he talked about his three- or four-point plan, and it seemed to me that the government is not open, from a legislative perspective, to playing a stronger international leadership role.

I believe Canada has good reason to get involved, and good reason to pass legislation of this nature.

Recently the Canadian Human Rights Museum, one of our national museums, opened in my home city of Winnipeg. That museum is all about human rights and the importance of human rights. If this bill were to see the light of day and it passed, it would go a long way in dealing with some of those human rights issues that we often hear about.

We need to be aware that it is a very small world nowadays. There are many different forms of media. Constituents are very much aware of world issues today, and this is one of those issues that is raised on an ongoing basis.

A year or so ago, I visited a high school just outside of Winnipeg North. There was a group of students from grade 11 or grade 10, who wanted to talk about what role Canada should be playing in terms of corporate social responsibility in developing countries.

This is very admirable. It is encouraging to sit in a classroom and hear grade 10 or grade 11 students who get it. They understand that Canada has a role to play in dealing with international exploitation.

We know people are forced to work in horrendous conditions. We know many developing countries have all kinds of exploitation. We know there are Canadian investments and corporations, both private and non-profit, in many of those countries, where the exploitation of workers or the environment takes place. Because of the involvement of those Canadian-based companies or agencies, there is an opportunity for us to demonstrate, as those students did, that we understand what happens beyond our borders and that when there are those serious violations, whether it is on human rights or the environment, we are prepared to act where we can.

If we acknowledge that, what we should give the signal that we would like to see the bill go to the committee.

What does the government have to lose by allowing the bill to go to committee? We could then hear from some of the NGOs and other stakeholders on what they would like to contribute to the larger debate.

The idea in the bill is to have an ombudsman, an individual who has the responsibility of establishing some guidelines, putting things into place, then administering it and ensuring that it is being followed. It is definitely an idea that we should allow to go forward. There are number of things we could allow to move forward.

I made reference to my colleague, the member for Scarborough—Guildwood' bill, Bill C-300, from the previous session. If we had allowed that to go forward and it was passed, it would have meant that we had acted upon something that other countries had done.

There is a litany of different ideas are out there. We should try, as much as possible, to listen to our constituents to get a better understanding of what they believe. I think they believe there is a social responsibility for corporations, companies and non-profits that do business in those countries to do something when the people or the environment are exploitated, and we can.

The government should recognize there is a need for Canada to play some leadership role in this. I would challenge the government to come up with ideas and fulfill the leadership role that has been lacking to date.

Conflict Minerals Act

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

Mr. Speaker, I would like to thank the member for Newmarket—Aurora, because I am forever standing in this place saying that we should be working together, sharing information, and trying to make bills better. I hate to use the word “conflict“ when we are talking about this issue, but oftentimes, between the two sides of the House, there is more conflict than co-operation.

I would like to commend the member for the speech she gave. Now, after saying that, I take issue with a couple of points, but I will address only one. Perhaps the sponsor of the bill, the member for Ottawa Centre, will discuss later with the government other areas they seem to have concerns about.

When we say “voluntary”, to me that fails the test of true due diligence. I come from farm country, and that is like saying to the fox that we trust it not to come near our henhouse. It would likely not work there.

Again, it is very important in the House, especially as this session is winding down, that there be a glimmer of a possibility that all sides will work together on an important issue.

For the viewers who are just joining us now in this important debate, I would like to reiterate the fact that Bill C-486, once passed, would require Canadian companies using minerals from the Great Lakes region of Africa to practise public due diligence. I stress that word. It would ensure that no armed groups that are engaged in illegal activities would benefit from the extraction, processing, or use of these minerals.

In my past speeches I have often referred to Hollywood versions of stories. There was a movie made in the last five to eight years called Blood Diamond. It highlighted in a very personal way the particular problems in that part of the world.

The most important feature of Bill C-486 is that it would allow Canadians to know whether minerals that may have contributed to funding or fuelling a conflict are in the products they have purchased. It would empower them, as consumers, to make an informed choice. It would not order them to do anything, but it would be guidance that an awful lot of responsible Canadians would appreciate having.

This bill would continue the NDP's agenda on corporate social responsibility. It would have an important role in enhancing, as I said, consumer knowledge and control of purchasing choices. As the critic for international human rights, I can tell the House that New Democrats have long supported transparency and accountability by Canadian industry abroad.

I will step back for just a moment. The member for Newmarket—Aurora mentioned the Dodd-Frank bill. I had the pleasure a couple of years back of spending two hours with Barney Frank in Washington and listening to his passion. The member was fairly critical of aspects of his bill, such as the length of time and the delay. That would be an area I would suggest the member for Ottawa Centre discuss as well. If there is a better way of doing it, we would certainly want to look at it.

I remember that not that long after I was elected in 2006, we had Bill C-300. There was excitement in our activist community about the potential the bill had for holding Canadian companies to the same standards in foreign countries they are held to in Canada. As I recall, sadly, the bill failed by about 12 votes. More sadly, there were 15 Liberals who did not come into the House to vote. That bill was sponsored by a Liberal at the time, so there was significant disappointment.

Because Canadian extractive companies are among the most successful in the world, a fact that we are proud of, we believe that it is important that they lead in responsible, sustainable, and transparent management practices in the world's extractive sector.

In my role as the critic for international human rights, I met, in a three-week period, indigenous groups from five countries. They were from the Philippines, Colombia, Honduras, Mexico, and Guatemala. When they came before me, they made suggestions that bordered on accusations that Canadian mining interests in their countries were complicit in pushing them off their lands.

I do not think Canadian companies would do that with deliberate intent, but certainly the governments they deal with in their daily business often have people in charge who are prepared to do nearly anything for money, for greed. Therefore, when something comes before us that would make sure that Canadian companies are responsible and do not allow practices such as pushing people off their land, that to me is very satisfying.

Bill C-486 at its best is part of an international trend toward due diligence and corporate responsibility. Again, the member opposite, in her speech, referred to the OECD, the United States, and other countries. If legislators enforced regulations, it would no doubt lead to a more level playing field for all Canadian companies.

One of the fair arguments that could come from the government side is that if we put restrictions on Canadian companies that are not put on other international companies in that part of the world, that could be seen as handcuffing them and holding them back. Now that there is a broader consensus out there about the need for this particular type of legislation, there is less possibility of that.

Further, I believe that this bill would go far in ensuring environmental, labour, and human rights protections of which all Canadians can be proud. We know that when we talk to Canadians and listen to them, their expectation is that in Canada our corporate citizens will abide by all these laws, and for the most part they certainly do. However, they also expect that these companies will do the same thing abroad when they are working in other countries.

At its worst, the international illegal exploitation and trade of minerals from the Great Lakes region of Africa is funding and fuelling one of the deadliest armed conflicts, I would say, since the Second World War. Canadians are just now coming to understand that many of these conflict minerals, as various speakers have mentioned, end up in many of their products, such as cellphones and even tin cans and medical devices. One of the things I kind of smiled at was that they are in jet engines. I do not know quite how they would wind up there, because they are certainly not technically inclined in that area.

Clearly Canadians need support and guidance if they are looking to understand what products they should avoid.

Members no doubt know that mineral profits in the conflict zones provide revenues from trade, taxes, bribes, and fees imposed by armed groups, and those are substantial. Conflict minerals account for up to 95% of the revenues of these groups. Clearly, those minerals literally keep some armed groups in business.

More than half of all the mines, and all but one major mine in the eastern DRC, are controlled by armed groups that may also impose illegal taxes on minerals transported through the territory they control, which brings to mind what is happening in Iraq today. The insurgency in Iraq has taken over part of an oil field, and they are actually selling that oil and getting money, even though they illegally took it over. It is being reported in the news.

Much of the DRC's mineral output is smuggled into countries. Again, that goes to the heart of what the member across the way asked. Where do we do the audit, upstream or downstream? That is something to consider.

One of the things I am pleased to say is that virtually all the main technology companies are now watching where they purchase their materials, such as BlackBerry—a good Canadian company that I hear today is doing a little better than it had been—Microsoft, Apple, and Nokia. These companies are starting to take steps to avoid using conflict minerals in their products. As was said, the OECD also made moves, I believe, in May 2011.

It is very important that a country like Canada maintains it international reputation and takes a lead in this area.

Corporate Social Responsibility of Extractive Corporations Outside Canada Act

[Paul Dewar, NDP, Ottawa Centre, ON]

Mr. Speaker, I want to thank my colleague for bringing this legislation forward. I was delighted to second the bill.

I want to pick up on what my colleague from the Liberal Party said. I am heartened to hear that the Liberal Party supports this legislation.

The last time we debated similar legislation put forward by the member's colleague from Scarborough—Guildwood, the Liberal Party unfortunately did not support it entirely. At the time, the Liberal leader and some members of the front bench could not find a way to support Bill C-300, so I am glad the Liberals will be supporting sending the bill to committee.

These are really important initiatives. We have already had an overview of what the bill proposes to do, but for those members who are hearing about this legislation for the first time, it essentially says that Canadian companies doing business abroad should more or less follow the same rules that they follow here. That is essentially the theory around this legislation and that is what the round table came up with.

The round table, as has been mentioned, included members of civil society, industry, and government. Ed Broadbent, who formerly represented my riding, was very much a part of moving that forward.

Then Alexa McDonough had a bill similar to the one we are debating now; I also had a similar bill, and my colleague from Scarborough—Guildwood put forward Bill C-300. We have had a lot of debate and discussion.

The government has said that it has acted. It has talked about its CSR counsellor being in place. The government felt that this was taking care of people's concerns about the behaviour of Canadian extractive companies abroad. However, when that position was created, we all noted that the position was actually toothless.

It is important to note the title of counsellor, not ombudsman. When complaints came in, the counsellor did not have the power to investigate them. The problem with the counsellor position was that it was incumbent upon both parties, the party making the accusation and the company, to accept an investigation. To no one's surprise, there were not many investigations. The CSR counsellor was not effective at all.

My colleague has brought this issue back to the House of Commons. It is fantastic to see the progress that has been made because of civil society. It really should be noted that civil society has incredible leverage, particularly when it comes to both foreign policy and domestic policy. Development and Peace and unions such as steelworkers that are involved with extractive companies have been front and centre in making this issue known to Canadians and to politicians. They want them to move forward, and they have not let up. They want Canada to be smart about what we do abroad and proud of what we do abroad. That way Canadian companies abroad are seen as responsible actors.

Development and Peace, the faith communities, unions, and everyday Canadians have been carrying this flag and making sure that we do not lose sight of this issue. It is terrific that my colleague has taken it up. She is carrying on the work that was done before.

I also want to acknowledge the change in mindset of the mining sector. In particular, for the record, I want to cite the Mining Association of Canada. This organization has written to government to advocate what we heard from my Liberal colleague, which is to bring in regulations on what we call “publish what you pay”, meaning that the transactions that any company does abroad would be made public. They want to see consequences if companies do not make those transactions public.

The government has said it is consulting on this issue, but industry is ahead of government. What is going on here? We need to get the government to listen more carefully, not just to Canadians but to industry as well. The government has to get on board and get moving on this issue.

I will read what the association said on this issue. It was noted, and I will not be surprising some members, that there was a bit of tension between industry and civil society representatives on the last iteration of this legislation, Bill C-300.

Here is what the Mining Association of Canada is saying in a letter to government:

The function of the Office of the CSR Counsellor should...be focused on the “front end” [at the beginning of the process] of any request for a review...to clarify the issues and the guidelines involved, to encourage the parties to address the issues through direct dialogue under local-level mechanisms, and to advise parties on the implementation of the guidelines. MAC believes companies will be motivated to participate in this front end of the process, as they have participated in the initial stages of the requests for review brought to the Office to date, and as an alternative to other, more formal forms of review.

It goes on to say, and here is the important part:

This first step is essentially to determine the nature of the dispute and whether mediation could be effective in resolving it. In MAC's view, this first step should be mandatory: a company's refusal to participate in this front-end process should have as a consequence a loss of public support for the proponent's project by the Government of Canada's Trade Commissioner service.

It is industry that is saying this. This is progress. This is the Mining Association of Canada acknowledging that collectively the industry has a responsibility to engage when there are concerns and complaints about activities on the ground.

The government says that somehow this is not in its domain. It is extra-territorial. It cannot be involved in these things, et cetera. Industry is saying no; we need to be engaged.

We have seen incredible advancement. We have seen engagement. What we need to see from government is to be at least at the same level as industry and adopt these measures that have been put forward.

The reason is that, when we see mining operations abroad—and we see it, frankly, here in Canada and we see it with gas and oil as well—and the fact that companies can make a profit from mining, no one has a concern around that. However, when we see that people's human rights are abused or that the environment on which they rely is being negatively affected and they feel they have no voice at all, what are their choices? I have Bill C-486 before the House on conflict minerals,

When mining companies, extractive industries, or oil and gas companies are abroad, they are not just any companies; these are Canadians companies, and there are certain values and responsibilities, I will say, that go with that.

We have heard stories of mining companies hiring security firms to clear the land, so anyone who protests any of the developments is cleared off the land and sometimes people are killed. This is extraordinarily troubling for many of us, but the question is, what are we going to do about it? Will we just continue to listen to these grievances, or will we act?

That is why the bill is so important. It says that there is a responsibility for the Government of Canada to have an objective person to oversee the concerns that may arise because of our activity abroad.

CSR is a great term. The problem I have noted over the last number of years is that it seems to only apply in-house to business and the corporate side. Frankly, I think it is quite obvious to many that it should be something that government adopts, that the cornerstone of part of our trade policy and our foreign policy should be corporate social responsibility, and the Canadian government should ensure this happens.

We just had some great debates in our foreign affairs committee about what happened in Bangladesh with the Rana Plaza collapse. Over 1,000 people died a year ago, on April 24. Why? It was because there were not proper standards and because the integrity of the building was not kept up. What happened? We saw 1,100 people die, many of them children, most of them women.

We can do better. We need to have oversight. The bill is a reasonable offer. We can make sure that when Canadian companies are operating abroad, we can say in good faith that they are following the same values and the same regulations that we want to see them follow here.

I would ask the government to at least look at what is being proposed and see if we can improve it, so that we can be proud Canadians when Canadian companies are operating abroad.

[Marc Garneau, Liberal, Westmount—Ville-Marie, QC]

Mr. Speaker, I welcome the opportunity to speak to Bill C-584, although I have to admit I am disappointed with what I have just heard from the government side, which seems to suggest that everything is going along perfectly and there is no need to do very much. In fact, if one looks at what it has been doing, it has been dragging its feet for a very long time.

I would like to congratulate my colleague from La Pointe-de-l'Île for this initiative. She is headed in the right direction and the Liberal Party will support this bill, An Act respecting the Corporate Social Responsibility Inherent in the Activities of Canadian Extractive Corporations in Developing Countries.

I would like to begin by thanking the large number of my constituents who wrote to me about this bill and about their concerns regarding the activities of Canadian mining companies in foreign countries. We would not be hearing from them if everything was going along perfectly.

Many Canadians care deeply about these sorts of issues and want to see us holding ourselves to a higher standard. I share those concerns and wishes. As I will be arguing, it is in everyone's interest that Canada adopt the highest possible standards in this area.

Corporate social responsibility is an important issue, and Bill C-584 is one of several private members' bills that have been introduced in recent years that seek to better regulate the activities of Canadian corporations working in the extractive sector.

My own colleague from Scarborough—Guildwood, for example, introduced a bill in the previous Parliament. It was called Bill C-300. I have to commend him for this, because he really did make a very honest effort to address corporate social responsibility in the mining sector. It was a private member's bill that would have been the Canadian equivalent of the U.S. legislation passed in September of 2013, which requires mining and oil and gas corporations to submit annual transparency reports that disclose all financial payments provided by them to foreign governments for the purposes of furthering mining or oil and gas industry activities.

The bill before us today shares the same basic goal as the bill advanced by the member for Scarborough—Guildwood, but approaches it from a different angle by proposing to establish an ombudsman who would be responsible for:

(a) creating guidelines respecting the best practices to be followed by corporations in their extractive activities in developing countries; and (b) monitoring the corporations’ extractive activities to ensure compliance with the guidelines.

Earlier I mentioned the importance of corporate social responsibility. This is important because it is through a good regime of transparency and ethical safeguards that corporations acquire the social licence to operate successfully.

My colleague from Scarborough—Guildwood put it eloquently in a past speech, when he explained that:

Social license is more than a stack of legal documents and geological surveys; rather it is the social permission of the people affected to mine the minerals. Sometimes the people are well represented by their government and sometimes not.

The Canadian government has an obligation to ensure that companies based here are not engaged in corrupt activities that encourage foreign governments to not act in the best interests of their own citizens. This happens more than we would like.

For example, in January 2013, as documented by the CBC, Human Rights Watch reported that a Vancouver-based company failed to ensure that forced labour was not used in the construction of a mine it operated in Eritrea. The agency said that Eritrea's conscripted workers, some of whom had been forced to work for over a decade, face torture or other serious abuse, and revenge is taken on their families if they desert their posts.

Sadly, all over the developing world there are other similar examples of corporations failing to live up to the ethical standards that they need to adhere to. Most do, and do a great job, but we are here to make sure that they all do.

A failure to respect the human rights of workers and residents in areas affected by mining operations can lead to social instability and failed states. We all end up paying the price when this happens.

In the example I just cited, there is some evidence that the Canadian company tried to address the problem on its own, but evidently whatever action it did take was insufficient to prevent these abuses from occurring. This is bad for Eritreans, it is bad for Canada's global reputation, and it is also bad for the mining company itself, which was subjected to considerable criticism.

The company might very well have benefited from independent guidelines regulating how it should operate in foreign countries and a watchdog to ensure it was compliant with those guidelines.

In fact, there is already a broad consensus among civil society, NGOs, industry, and some governments that there has to be something done about the problem of unreported payments and corruption involved in a variety of enterprises, particularly the extractive sector, and that we need to have increased transparency in order to curb corruption. The government claims that it shares this goal, yet I note that it failed to support the bill from my colleague from Scarborough—Guildwood, which would have brought Canadian regulations up to par with American and EU standards. I suspect a similar fate, based upon what my Conservative colleague just said, will befall this bill presented by the member for La Pointe-de-l'Île. I hope I am wrong.

The Prime Minister announced with much fanfare in June 2013—that is, a year ago—that the government would adopt a G8 initiative that requires companies to disclose any payments they make to foreign governments, but a year later, no such legislation has been introduced. My hon. colleague from the Conservative Party said, “We're on top of this and our corporate social responsibility plan is just working beautifully”.

We are told now that something will be forthcoming by April 1, 2015. There is no excuse for this two-year delay. We will see if the government is any quicker at introducing these rules than it has been so far in, for example, regulating carbon emissions in the oil and gas sector. That was promised five years ago.

One way that it might demonstrate good faith and show that Canada is taking this issue seriously is to allow Bill C-584 to be taken to committee.

With regard to the bill itself, let me reiterate again that it is a very well-intended piece of legislation. Liberals recognize that, and we are supportive of it.

That said, there are a few areas that can be improved. For example, clause 9 of the bill indicates that corporations would have to report to the office of the ombudsman on any extractive activities within one year of the act coming into force. However, a later section, subclause 10(1), gives the office of the ombudsman up to three years to develop the guidelines. If the ombudsman does, in fact, take three years to develop the guidelines, how will companies be able to report in the first and second year in the absence of those guidelines?

However, that is something that could be corrected in committee.

Another problem is in clause 8 of the bill, which would require companies to:

(a) take all necessary measures to minimize the negative impact of its activities on the environment or on human rights in the developing country

Without defining what “necessary measures” are, the bill would leave major loopholes for corporations that the bill is supposed to close.

There are a couple of other things; however, my time is coming to an end. I would encourage all members in this House to vote in favour of taking the bill to committee, because its objectives are good objectives for Canada, good objectives for the extractive industries, and the right thing to do.

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

[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.

[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.

Fighting Foreign Corruption Act

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

Mr. Speaker, I want to thank the member for Saint-Bruno—Saint-Hubert for her remarks. Earlier the member for Winnipeg North was talking along the same lines and said that perhaps something could have been done earlier on this bill.

The member who just spoke was not in the House when Bill C-300 came before the House. I recall that night distinctly. The galleries were full of people from various NGOs and groups concerned about corporate social responsibility. It was debated when we had a minority Parliament. When the vote was called, despite the fact that it was a Liberal member's bill, it was lost, because 13 Liberals did not bother to vote.

We certainly have had an opportunity before to start addressing this.

Earlier I raised concerns that often we have NGOs trying to bring goods ashore to help people who are in difficulty. Often they are displaced persons or are even in another country. The NGOs have to pay an offloading fee or a tip, or we could call it a bribe. The reality is that those things facilitate getting that food ashore to help people.

Does the member see in this bill any concern about the fact that this might sideswipe the NGOs?

[Dany Morin, NDP, Chicoutimi—Le Fjord, QC]

Mr. Speaker, I find it rather ironic that my Liberal colleague is asking for my support and wondering if Canada can do more. Yes we can, and that is why the NDP introduced Bill C-300. That bill would have required mining companies that receive government support to comply with certain standards, but it would also have established a system for lodging and evaluating complaints against such companies.

Unfortunately, the government members voted against the bill. What people may not know is that 13 Liberal Party members, including the member who asked me the question, voted against the bill. Bill C-300 was defeated by six votes.

Yes, Canada can do more and so can the Liberals, by supporting NDP bills that are designed to strengthen these types of laws. We need to do more than just talk. We need to take action and vote the right way.

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

You have to question whether that's benign neglect, and it's to their advantage not to know. Again, I don't want to make accusations here, because it's a very, very difficult place to function. From the standpoint of a committee of Parliament, if we're trying to look at where we can go to influence a situation like that, obviously Canadian companies would be one of the places that we could start. And in fact, because of suggestions in Parliament about a corporate social responsibility act—I think it was Bill C-300, if I remember correctly, that people tried to get through here—at least it drew attention to the fact that our companies do have a social responsibility when they're in these other countries.

It's very important to us that your organization provides us with this kind of counter-perspective of what's happening. In your organization's dealings in that country, what are your opportunities to actually explore what's happening there? I can't imagine you having very much freedom.

Speaker's Ruling

[The Acting Speaker, Conservative, Barry Devolin]

There are five motions standing on the notice paper for the report stage of the member for South Surrey—White Rock—Cloverdale's Bill C-377, An Act to amend the Income Tax Act (requirements for labour organizations).

While it is not usual for the Chair to provide reasons for the selection of report stage motions, in this case it has been decided to do so given that the Speaker has received written submissions from the hon. members for South Surrey—White Rock—Cloverdale and Cape Breton—Canso, outlining exceptional circumstances surrounding the committee consideration of the bill.

As members know, consistent with the note to Standing Order 76.1(5), the Chair would not normally select motions that could have been presented in committee.

In the present case, however, there appears to be extenuating circumstances. The hon. members who have submitted motions at report stage were in attendance at the meeting scheduled for the clause-by-clause consideration of the bill by the Standing Committee on Finance. In addition, they had both submitted motions in advance of this meeting and these had been circulated to all members of the committee. At first glance, it would therefore appear that the amendments submitted by these members could have been proposed during the committee consideration of the bill.

In his submission, the member for South Surrey—White Rock—Cloverdale explained the efforts that were made to ensure that the committee would actually begin the clause-by-clause study of the bill as scheduled in order to complete consideration of the bill within the prescribed deadlines attached to it. He reported that these efforts were unsuccessful and, as a result, there was no opportunity to propose amendments in committee.

The Chair has been met with this kind of circumstance before. On September 20, 2010, in the Debates on page 4,069, Speaker Milliken ruled on a case where the member for Scarborough—Guildwood faced a similar situation in relation to his Bill C-300, an act respecting corporate accountability for the activities of mining, oil or gas in developing countries. In that case, the Speaker selected report stage motions for debate because it had been established that the member had made clear attempts to have the clause-by-clause study take place so that amendments could be considered by the committee.

Similarly, in the case before us today, the Chair has carefully reviewed the sequence of events as well as the written submissions from the members for South Surrey—White Rock—Cloverdale and Cape Breton—Canso and is satisfied that these motions could not be presented during the committee consideration of the bill.

Accordingly, Motions Nos. 1 to 5 have been selected for debate at report stage. They will be grouped for debate and voted upon according to the voting patterns available at the table.

I shall now propose Motions Nos. 1 to 5 to the House.

Bill C-377—Income Tax Act

[Tom Lukiwski, Conservative, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Mr. Speaker, I do appreciate the member's attempt at brevity but I must say that it reminded of that old classic movie, Airplane from 1980, penned by Jim Abrahams and David Zucker.

What I kept thinking of when I was listening to his brief presentation was those continuous scenes where Ted Striker, the ex-army pilot who was afraid to fly would continue to tell stories to the people in the seat next to him and they would end up attempting suicide. However, I do want to thank my friend for being at least a little more brief than the official opposition House leader. I will attempt to be even briefer than my friend from the Liberal Party.

I rise to respond to last Thursday's intervention by the hon. member for Rosemont—La Petite-Patrie and yesterday's intervention by the hon. member for Saint-Lambert concerning a royal recommendation for Bill C-377, An Act to amend the Income Tax Act (requirements for labour organizations).

Bill C-377 was introduced on December 5, 2011, by the member for South Surrey—White Rock—Cloverdale and has since been read the second time and referred to the Standing Committee on Finance. The bill would amend the Income Tax Act to require labour organizations to provide financial information for public disclosure.

I would note that this bill was not identified by the Speaker as an item of concern with respect to the financial prerogative of the Crown, nor has it been the subject of an intervention by a minister of the Crown or a parliamentary secretary on behalf of one.

The hon. member for Rosemont—La Petite-Patrie argued that the provisions of the bill requiring labour organizations to submit financial information and the requirement for the Canada Revenue Agency to publish the information on a website with search tools somehow represent new and distinct charges on the treasury which are not currently authorized.

The hon. member for Saint-Lambert then added the information provided to the finance committee by the Canada Revenue Agency which provided estimates on the expected incremental costs associated with implementation.

There are procedural authorities and precedents for cases where a new royal recommendation was not required for incremental modifications to expand the operation of provisions already authorized by a royal recommendation. The hon. member for Rosemont—La Petite-Patrie cited page 833 of the second edition of the House of Commons Procedure and Practice. The most relevant portion pertaining to amending bills, such as Bill C-377, is that a royal recommendation is required for:

...bills which authorize new charges for purposes not anticipated in the estimates. The charge imposed by the legislation must be “new and distinct”; in other words, not covered elsewhere by some more general authorization.

Section 220 of the Income Tax Act provides the minister with the authority to administer and enforce the provisions of the act. Indeed, this authority was cited in the same materials provided to the finance committee which the member for Saint-Lambert cited yesterday.

In particular, subsection 220(2) provides broadly and generally that:

Such officers, clerks and employees as are necessary to administer and enforce this Act shall be appointed or employed in the manner authorized by law.

Clearly, the authority to retain any necessary staff has already been addressed by Parliament.

It may also be useful to add here that subsection 5(1) of the Canada Revenue Agency Act provides that:

The Agency is responsible for

(a) supporting the administration and enforcement of the program legislation....

Program legislation is, in turn, defined in section 2 of that act as:

....any other Act of Parliament....

(a) that the Governor in Council or Parliament authorizes the Minister, the Agency, the Commissioner or an employee of the Agency to administer or enforce, including the....the Income Tax Act....

Indeed, this broad mandate already enjoyed by the Canada Revenue Agency is addressed in response to the Liberal question 1(a) in the finance committee materials the hon. member for Saint-Lambert cited, which asked how Bill C-377 aligns with the Canada Revenue Agency's mandate.

The agency replied:

A measure introduced by Parliament that is incorporated into the Income Tax Act and falls under the responsibility of the Minister of National Revenue will be administered by the CRA. Parliament determines if a measure will be incorporated into the Income Tax Act.

In other words, the Canada Revenue Agency has already been given a broad, sweeping mandate to administer and enforce federal taxation laws. Meanwhile, other existing provisions of the Income Tax Act allow the minister to require certain persons or entities to file information for the purposes of taxation.

Specifically, for example, subsection 149(14) dealing with qualified donors provides a requirement for public foundations to

—file with the Minister both an information return and a public information return for the year in prescribed form and containing prescribed information.

In other words, the act already requires information to be submitted to the minister in a prescribed form and containing prescribed information. Therefore, this does not constitute a new function, mandate or duty for the minister or the agency.

The hon. member for Rosemont—La Petite-Patrie also argued that making the information public represented a new and distinct activity that was not currently authorized.

First, the agency has a comprehensive website which publishes lots of information and materials, so that would not be a new responsibility for the agency.

As for making information public, I would note that the Income Tax Act provides provisions now to that effect. Subsection 149(15) relates to information that may be communicated in respect of charitable organizations. It states:

—the information contained in a public information return...shall be communicated or otherwise made available to the public by the Minister in such manner as the Minister deems appropriate...the Minister may make available to the public in any manner that the Minister considers appropriate...

In other words, the act provides the minister with the authority to publish in any manner the minister considers appropriate the content of a public information return. That other information would fall within an existing mandate and duty does not, I submit, require a royal recommendation.

Turning to some precedents, on February 10, 1998, at page 3647 of the Debates, Bill S-3, an act to amend the Pension Benefits Standards Act, 1985 and the Office of the Superintendent of Financial Institutions Act, was found not to require a royal recommendation. In his ruling, Mr. Speaker Parent said, in a case where powers were expanded yet no royal recommendation was needed, that:

It seems fairly evident that the powers of the superintendent would be extended by Bill S-3. It may well be that additional expenditures would be incurred because of those enhanced powers of the superintendent. Should an increase in resources be necessary as a result of these new powers, the necessary allocation of money would have to be sought by means of an appropriation bill because I was unable to find any provision for money in Bill S-3.

The hon. member for Rosemont—La Petite-Patrie made mention of the additional tasks which would fall to the employees of the agency as well as training which might be required for the new filings. Your immediate predecessor's ruling, Mr. Speaker, at page 7261 of the Debates for February 23, 2007 on Bill C-327, an act to amend the Broadcasting Act answers this point, states:

Bill C-327 may or may not result in a greater workload for the CRTC, but the activities being proposed are within its mandate. If additional staff or resources are required to perform these activities then they would be brought forward in a separate appropriation bill for Parliament’s consideration.

More recent, on October 26, 2010, Mr. Speaker Milliken ruled concerning the need for a royal recommendation for Bill C-300, an act respecting corporate accountability for the activities of mining, oil or gas in developing countries. The bill, among other things, required the Minister of Foreign Affairs to establish a process for the examination of complaints concerning possible contraventions of the guidelines. The Speaker ruled then:

—the Chair is of the view that the examination of such complaints is not a departure from or expansion of the current ministerial mandate under the Department of Foreign Affairs and International Trade Act...Bill C-300 may put forth more stringent requirements, but it does not expand the mandate per se.

It may be that a reorganization of resources or even additional funds would be required, however, it appears these would be operational in nature.

I submit that Bill C-377 is consistent with the precedents cited in that it does not authorize a new expenditure of public funds. Rather it deals with the operation of provisions already authorized by Parliament which were accompanied by a royal recommendation at the time these provisions were enacted.

The hon. member for Rosemont—La Petite-Patrie mentioned that there was nothing set out in the recently tabled supplementary estimates (B) for this fiscal year. The hon. member for Saint-Lambert also claimed that this was confirmed in the agency's answers to finance committee.

Let us be clear. The usual practice we can expect to see unfold would be that the agency would account for its operations under Bill C-377, should it become law, in its estimates after the bill becomes law. That is a common practice with respect to any proposed legislation that has not yet been enacted. The supplementary estimates argument advanced by those hon. members is really a red herring in this entire debate.

Should Bill C-377 become law, the authority to spend for the purposes set out in the bill will be under the general authority of existing broader provisions of the Income Tax Act as well as the agency's general authorities under the Canada Revenue Agency Act. Should additional funds be required, the government would seek them from Parliament as part of the supply cycle through an appropriations bill in the ordinary manner for operating expenses.

I respectively submit that Bill C-377 does not require a royal recommendation and is properly before the House.

[Karyn Keenan]

No, I'm not speechless. I don't know where to start.

I guess I would encourage the honourable member to review testimony given before this committee on Bill C-300 and to review statements of claim before the Ontario and Quebec Superior Courts regarding the operations of Canadian companies, the Norwegian pension funds documents, and the websites and publications of reputable organizations like Amnesty International and Human Rights Watch. I can't imagine how anyone could review those publications and not come away with concerns about the operations of Canadian extractive companies overseas.

[Lois Brown, Conservative, Newmarket—Aurora, ON]

Thank you very much, Mr. Chair.

Ms. Keenan, I think that both our extractive industries and the members of this committee would take offence at the suggestion that our extractive companies are going into other countries and making rape and pillage their norm. I know people who are in the extractive industries, and they are fine, upstanding people who run reputable companies. So personally, I find your characterization highly offensive.

I shouldn't speak for the rest of the committee, but I think this is an accusation that goes beyond the pale. I have attended the PDAC convention in Toronto, the prospectors and developers convention. It's enormous. It's attended by people from every country in the world. Every country that has a booth there places a high value on the expertise of Canadian companies and the reputation of the Canadian extractive industry. They want our companies to go to their countries and do business there. I could probably name 50 countries off the top of my head with whom I have had conversations.

I have been in Burkina Faso. I have seen the wonderful project that Iamgold has in that country and the wonderful work that they are doing to create alternative economic opportunities for the people of Burkina Faso. These people are thrilled that they now have a school for their youngsters and a training centre for their young people, who are getting the ability to do electrical and plumbing work, and take real jobs into the economy. They have a health care clinic populated with competent health care workers who are providing assistance to the people of Burkina Faso in an area that is four hours removed from Ouagadougou. So there are good things going on with our extractive industries.

We can also look at the Equator Principles. You talked about Bill C-300. Canadian extractive companies comply with the Equator Principles. We have a counsellor—there are no complaints against Canadian companies she's dealing with. We have a fine reputation around the world. You talked about Talisman. Talisman was in South Sudan, and there were some accusations against Talisman. Talisman threw up their hands and decided to pull out. China went in, and we know the sad tale that's ensued.

You've heard Dr. O'Neill's testimony. You heard what she said here. What you're telling us is 180 degrees removed from the good work that USAID is seeing done. They talked about 800 permanent jobs being created in Peru in the agricultural sector. I've visited countries in Africa where, in tandem with Canadian companies working in Kenya, we have agricultural projects going on in Ethiopia. We have agricultural projects that are creating real opportunities. The private sector, the extractive industry, they're all part and parcel of this. It's not that we're only working in that area. CIDA has much money going into capacity-building in these countries—developing judicial processes, developing a civil society. It can't be one or the other. Civil society, a fair and open judiciary, transparent elections—these things can't happen unless there is a reliable and growing economic process happening at the same time.

When you look at these things happening in tandem, is it not possible for CIDA to partner with companies and make life better for people in these emerging economies?

[Lois Brown, Conservative, Newmarket—Aurora, ON]

Thank you very much, Mr. Chair.

Thank you very much for being here today with us. This has been a most interesting study for us, one of the most engaging I've been involved with on the foreign affairs committee.

I was on the foreign affairs committee when we reviewed what was then Bill C-300, which was the CSR bill brought forward by one of our Liberal members. We also had some very interesting representations on that one.

Mr. Gratton, I wonder if I can address a couple of questions to you.

Mr. Royer just talked about workplace action, and I think this is a quote. He talked about “changing people's attitudes” toward the workplace. I've had the opportunity to spend some time in Africa. I've now visited nine countries. I have seen many of our CIDA projects, and I have had the opportunity to meet with the extractive industry in every country we've been in.

I want to particularly focus on two projects. One is the IAMGOLD project in Burkina Faso, in Essakane, and the other is the project that has developed around the De Beers facility in Botswana.

Now, Botswana has been very intentional in turning its economy around through understanding what the mineral resources can do for it. De Beers has built a phenomenal facility there that does all of the grading of the diamonds, but there are seven facilities outside of this De Beers facility that are businesses where the people who are Botswanian citizens have real jobs doing all the cutting and the polishing of the diamonds. Botswana has been able to lift itself to become what's now a middle-income country, through tax revenues that are being paid by the individuals who are employed in these facilities.

In the Essakane project that IAMGOLD is investing in, we saw a hospital facility, a primary school, a secondary school, and a skills development school that is giving the people of Burkina Faso real jobs, real opportunity to make a change for their families.

I wonder if you have any other examples, or if you would like to comment a little bit on projects you've seen where these same kinds of initiatives are taking place, where we see that the extractive industry has taken responsibility to help provide the countries with real income.

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

Thank you, Mr. Chair.

Mr. Neve, thank you for a very comprehensive report, as always. It's not a surprise coming from you, but this seems particularly more pervasive—the explanation of the more pervasive violations there. I want to start by giving the government members some credit here.

I'm going to be a little critical of the government, but the government members are the ones who brought to us that we should do this study. I think it's only fair to say that. We had a situation here, as you will recall, where we tried to get Bill C-300 on corporate social responsibility through the House a few years ago, and that failed.

When I look at your comments about the guidelines from the United Nations, it's in line with the due diligence guidelines we were hoping to get through our own House. You have a United Nations mission in Eritrea and Ethiopia. Do you know if they have any access in this country? As well, is Canada a participant in that particular group?

Criminal Code

[Charmaine Borg, NDP, Terrebonne—Blainville, QC]

Mr. Speaker, I am pleased to rise in the House today to speak to Bill C-310, which would amend the Criminal Code to address the cruel and serious problem of human trafficking in Canada.

I congratulate the member who sponsored this bill for introducing a bill that will have the support of all parties in this House. This is the first time I have supported a government initiative and I congratulate her on it. I hope that in the future the opposition parties and the Conservative government will have many opportunities to work together.

This bill proposes two very important amendments to the Criminal Code that will make it easier to prosecute perpetrators of human trafficking. This heinous crime has destructive effects on the victims, which reminds us that in a not-too-distant past, slaves were treated similarly by Canadians and by our neighbours to the south. Unfortunately, at a time when human rights and individual freedoms should prevail and at a time when we would have thought our attitudes had evolved enough to eliminate this abominable crime, there are still people in this country who can deny their own humanity and sell people who are just as deserving of freedom as any other person.

Therefore, I believe that the House has the duty and the power to hold these individuals accountable by proposing and adopting a legal framework to eliminate this form of slavery and severely punish the perpetrators, so that we can set an example for the rest of the world.

This bill targets the real criminals—the traffickers. This bill would extend Canada's jurisdiction beyond our borders, which means we could go after traffickers with Canadian citizenship or residency regardless of where they are in the world. I would once again like to congratulate my colleague opposite for developing a bill that targets the real criminals and not the victims.

However, since there is a distinction made between human trafficking and human smuggling, I have to wonder about Bill C-4, which targets the migrants instead of the smugglers in cases of human smuggling in Canada. Migrants are the victims in this fraudulent scheme, and the real criminals are those who deceive these people by promising them a better future. I would have liked to see the government use Bill C-310 as an inspiration and to withdraw Bill C-4 from the Order Paper.

The first section of the bill amends the Criminal Code in order to apply Canadian extraterritorial jurisdiction to the offence of human trafficking. This will give the Canadian government the legal means to prosecute a Canadian or a permanent resident of Canada involved in human trafficking, regardless of where he or she works, lives or operates. Introducing extraterritorial jurisdiction using the nationality principle in international law is compatible with our international obligations under the United Nations Convention Against Transnational Organized Crime, the Palermo convention. Given the international nature of human trafficking, extraterritorial jurisdiction is crucial. We simply cannot allow Canadian traffickers to live a comfortable life without any fear of being held responsible for their crimes just because they can hide behind international borders.

Thus, I am convinced that our government has a responsibility to ensure that our legal system can prosecute those responsible for such crimes to the full extent of the law through this extraterritorial jurisdiction. We have the right to hold our citizens to a certain standard of behaviour, even those who are outside our borders.

In her introductory speech, the sponsor of the bill said that it would ensure justice in cases where the offence was committed in a country without strong anti-human trafficking laws. I agree with her completely, but I find it unfortunate that this government did not live up to this standard during the previous Parliament with regard to Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries. Once again, I hope the government will learn something from this private member's bill.

Coming back to Bill C-310, before 2005 the only legal action that could be taken against human traffickers was based on charges of kidnapping, threats or extortion. Section 118 of the Immigration and Refugee Protection Act prohibits anyone from bringing someone into Canada by means of abduction or fraud. In other words, human trafficking was not considered a criminal offence per se until 2005. Since then, only five people have been prosecuted on the basis this new offence.

Crown prosecutors and experts blame the lack of prosecutions on the current definition of exploitation, which requires proof of a threat to safety. This proof is difficult to obtain, which results in traffickers being found not guilty.

This leads me to the second amendment to the Criminal Code proposed in this bill. The member sponsoring this bill has every reason to propose expanding the current legal definition of the word “exploitation”, which defines the conditions for a person to be considered a victim of human trafficking. The current legal definition of this word in the Criminal Code does not contain any precise examples of exploitation. Therefore, this second amendment would add evidentiary foundations to enable courts to give clear examples of exploitation, such as threats or use of violence, coercion and fraudulent manipulation. This would update the legal terminology and would give courts the legal tools they need to successfully prosecute these criminals.

Once again, I congratulate the member on her wise and well thought-out bill.

I will conclude by talking about human trafficking in Canada. In Canada it is tragic to see that aboriginal women and girls are disproportionately more likely to be victims of human trafficking. This tragedy is the result of a number of factors, and to address this, our government will have to combat it from all sides. We absolutely must recognize that poverty, lack of housing and very difficult living conditions for aboriginal women and girls are factors that explain why they are disproportionately more likely to be victims of human trafficking.

I would like to point out a coincidence. Today, the Standing Committee on Status of Women will present its report on violence against aboriginal women. This report is the product of two years of study on a very serious issue and an unfortunate tragedy in our country. Over the course of this study, the committee heard from about a hundred aboriginal women and people working with victims and their families. I had the opportunity to listen to some of this testimony when I sat on this committee. It is clear that to fight violence against aboriginal women and girls, including human trafficking, we must acknowledge the poverty and economic marginalization they experience.

I truly hope that this report will lead to concrete recommendations for improving the economic conditions of these women and decreasing their vulnerability to violence and human trafficking. I strongly encourage all of my colleagues in the House and the general public to listen to the presentation of this report today. Once again, I thank my colleague for this wise and necessary bill.

Mining Industry

[Pat Martin, NDP, Winnipeg Centre, MB]

Mr. Speaker, I have today a petition to present from literally thousands of Canadians across Canada.

The petitioners point out that they are appalled by reports that Canadian mining and oil and gas companies are involved in human rights and environmental violations around the world. In particular, they are embarrassed at the Canadian government's lack of action against such violations in eastern Congo, leading to the use of the term “the iron fist of Canada” to describe the Canadian government's support of activities harmful to Congolese communities.

Therefore, the petitioners request that the House the Commons legislate the standards for Canadian mining companies operating outside of Canada to be the same as the standards they must reach operating inside of Canada. This would include, but not be limited to, making participation in corporate social responsibility review process, allowing the corporate social responsibility review to produce legally binding judgments to include the violation of human rights and other harm to communities as part of any legally binding accountability mechanism and to revitalize the spirit and the principle of Bill C-300 of the last Parliament to hold Canadian extractive companies to the standards of decency Canadians expect of their government—

Keeping Canada's Economy and Jobs Growing Act

[Kevin Sorenson, Conservative, Crowfoot, AB]

Mr. Speaker, it is a real honour to again stand in this House and speak on behalf of the constituents of Crowfoot to Bill C-13, Keeping Canada's Economy and Jobs Growing Act.

The legislation that we are debating today introduces our Minister of Finance's key elements of the next phase of Canada's economic plan, a low-tax plan for jobs and growth.

My constituents of Crowfoot know that our Conservative government is focused on creating jobs and promoting economic growth. Under the leadership of our Prime Minsiter, Canada has the strongest economy and the strongest job growth record in the G7. We have created nearly 600,000 net new jobs since July 2009.

The International Monetary Fund, IMF, projects that Canada will continue to be among the nations with the strongest economy and the strongest economic growth in the G7 over the next two years.

However, Canada is not immune to the global economic turbulence. Bill C-13 provides our government with the means to stay the course and implement the next phase of Canada's economic action plan.

One of the features of Bill C-13 is a temporary hiring tax credit for small business. It would make it easier for small businesses to hire workers or enhance wages. This is precisely the kind of measure that Canadian workers need at this time. This would create new jobs and help save the jobs presently had by the workers across this country.

Hard-working, tax-paying Canadians raising their families need stable and predictable employment to see them through this difficult economic time. The keeping Canada's economy and jobs growing act would help support Canada's economic recovery.

I just want to touch on a couple of highlights of Bill C-13.

First, it would expand tax support for clean energy generation to encourage green investments. According to what opposition members have said today, they will vote against that, the opportunity to enhance green investments and clean energy generation.

Second, the bill would extend the mineral exploration tax credit for flow-through share investors by one year to support Canada's mining sector.

I had the privilege in the past Parliament to chair the Standing Committee on Foreign Affairs and international Development. At that committee, we studied a number of bills, such as Bill C-300 and others. I know that the Canadian mining sector contributes over $300 billion to Canada's GDP each year and over 300,000 Canadians are employed in the mining industry.

The mining industry stimulates and supports economic growth, both in large urban centres and in remote rural communities, including numerous first nation communities across the country. However, again, the opposition members say that they will not support that.

Mining accounts for 19% of Canadian goods exports and $5.5 billion in taxes and royalties paid to the federal, provincial and territorial governments. The industry also generates considerable economic spin-off activity. There are more than 3,200 companies that provide the industry with services ranging from engineering consulting to drilling equipment. In addition, over half of the freight revenues of Canada's railroads are generated by mining.

Many Canadians are not aware of the large role that Canada's mining sector plays in our economy. However, it is important to nurture Canada's mining industry.

Bill C-13 also would simplify custom tariffs in order to facilitate trade and lower the administrative burden for all businesses.

Most Canadians do not know that Canada is a nation built by trade. We do more than $1 billion a day in trade flowing over the Canada-U.S. border. While many Canadians understand the important role of trade, they do not realize that trade just with the Americans amounts to $1.8 billion a day.

Since 2006, our Conservative government has been working diligently to boost Canada's access to markets, not just across the border with the neighbours closest to us, but all around the world, and we are having success.

I look in the House today and I see our agriculture minister who has been working hard at his desk here all afternoon. I commend him and our trade minister for the amount of work they have done around the world to open new markets and give, whether it is our agriculture sector or our manufacturing sector, the opportunity to market their goods in many of those countries. Yes, we are having success.

The agriculture producers, the farmers, who I represent work hard every day to take advantage of the opportunities that the Minister of Agriculture and the government are providing. We could feed the world from where I come from in Alberta and from the west, so we welcome all customers, and that includes the new customers. The more the merrier. We pledge to fill all the orders that our Minister of Agriculture and our Minister of International Trade can find for our agricultural sector.

The bill would extend the accelerated capital cost allowance treatment for investments in manufacturing and processing machinery and equipment for two years to support the manufacturing and processing sector. Bill C-13 would extend this well received measure from one of our previous budgets. Our Minister of Finance has been fighting the effects in Canada of the global economic recession since 2009. Canada's manufacturing and processing base has been using this measure to create and save jobs. They still want this accelerated capital cost allowance and our Conservative government is glad to give it and to be in a position where we can allow it to continue.

We are eliminating the mandatory retirement age for federally regulated employees in order to give older workers the option of staying in the workplace. We know that Canadians are healthier and they are living longer than ever before in our history. In economically difficult times, older workers sometimes want to choose to stay working for another year or two and make some extra money for their families or for themselves in their retirement. This contributes to economic growth. Older workers have a great deal to contribute and our government is giving them the go-ahead. However, it sounds like the opposition will be voting against it.

There is a very important initiative in Bill C-13 for the constituents in my riding. The government would provide a permanent annual investment of $2 billion in the gas tax fund to provide predictable, long term infrastructure funding for municipalities. Unlike the Liberal governments of the past, our government has returned gas tax revenues to jurisdictions where they were raised. We deliver these revenues to local jurisdictions earlier in the year than ever before so they can plan for the building in the summer season. This allows local governments to free up other funds in their budgets and get more accomplished through the calendar year.

In my riding of Crowfoot, we have many small county municipal governments and they rely on these funds. When I attend those council meetings, they let us know how much those funds are needed and appreciated. In some cases, the amounts of revenues in small villages or communities seem small but it makes projects possible and it allows small communities to grow when it spurs on local employment.

There are a number of other initiatives in Bill C-13 for creating and saving jobs and helping Canada's economy. Over the course of the debate on this bill, other speakers from this side of the House will detail some of these initiatives.

Bill C-13,, as already mentioned by the member for Souris—Moose Mountain, introduces the volunteer firefighters tax credit for volunteer firefighters. When the opposition talks about tax credits for those who do not need it, well we are talking about the volunteer firefighters of my constituency.

The bill would increase the ability of Canadians to give more with confidence to legitimate charities by introducing a package of integrity measures designed to help combat fraud and other forms of abuse. I know that the people in my riding are very charity minded. My constituents are generous and engaged in many charitable projects. They appreciate this initiative to ensure their efforts are not in vain.

Bill C-13 has help for families. It introduces the new family caregiver tax credit to assist caregivers of all types to help with dependent relatives.

This is a good bill. I appreciate the number of opposition members who have been here to listen to the debate today.

When we are in opposition, it is not always about opposing. It is about standing up and supporting families in tough times in the economy. We would appreciate members' support.

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

I'll try to be to the point. What I was going to ask you, Madam, was whether there was a specific ask of the Government of Canada that this committee might present that you might offer to us.

You may be aware that Bill C-300 failed in our Parliament. It called on Canadian mining companies in foreign counties to observe the same rules and regulations they would in this country. We're about to go into an election, but I'm telling you right now that in the next Parliament, and should I be re-elected, I intend to present that bill again and make another effort, particularly in the area of conflict minerals.

This committee is probably going to dissolve within 48 hours. The past history of our committees has been that once we return to Parliament, they'll look back at the studies that have been done and will resurrect certain studies. I believe that we would want to resurrect this particular study.

In the meantime, if something comes to your mind that you would like to ask this committee to consider adding to the report, please let us know.

I don't have a specific question.

[Pedro Landa, Coordinator, Honduran Centre for the Promotion of Community Development]

Good afternoon, honourable members of Parliament. I thank you on behalf of my people for this opportunity to speak to you today.

It has been suggested that in the context of a significant improvement in respect of human rights and democracy in our country, the conclusion of a Canada-Honduras free trade agreement would be acceptable. The fact is that our daily reality shows that the situation regarding human, civil, political, economic, social, and cultural rights continues to deteriorate in Honduras. Nonetheless, as far as we are concerned, this notion is only part of the debate. Human rights, of course, play an essential role, but in the context of these discussions of commercial activities, it is only part of the debate. The other dimension is that commercial activities in themselves have an impact on respect for and enjoyment of human rights, and states therefore have a responsibility pursuant to international human rights agreements, a responsibility to ensure that this impact will be positive and not negative, even if those activities are being carried out beyond their borders.

We know that with respect to the negative effects, this is the reason that we were discussing Bill C-300, which promotes better social responsibility for corporations engaged in activities of mining, oil, and gas in developing countries. We have to continue these discussions. The effects of all of these decisions have not yet come to fruition. We know that in December of last year there was another discussion held a short while ago. Unfortunately, in Honduras no one is aware of the effect and the potential consequences of all of these. We are not getting access to information.

Long before the coup d'état in Honduras, several mining corporations with Canadian capital had been involved in questionable situations, either through commission or omission, that constituted acts of corruption as well as disrespect for and violations of international human rights standards. This situation motivated us to work together with the Canadian Catholic organization Development and Peace and Honduran civil society for the last eight years in carrying out an advocacy campaign aimed at changing the mining law in Honduras. A number of members of Parliament had in fact supported us in this regard and had sent letters to our Parliament to ask for accountability on the part of Canadian companies in Honduras.

Human rights organizations in Honduras, as well as the public prosecutor's office on environmental crimes, have noted various crimes involving water pollution, environmental damage, and the violation of the people's right to a healthy environment as a result of the actions of the mining companies. In other words, they are complicit. These companies are therefore complicit in human rights violations.

All of this is also happening while the economic elites and political elites turn a blind eye. We believe that signing a free trade agreement in these conditions is reprehensible. One cannot support the forces that organized the coup d'état and that continue to have power in our country.

Further, we ask that you not legitimize these human rights violations, assassinations, illegal detentions, and the like. It is a crime in Honduras even to have an opinion that is not in line with that of the current government. Any free trade agreement would legitimize this type of oppression.

We're here to ask Canada to support us and to delay signing a free trade agreement with Honduras. The signature should be conditional on meeting requirements, including significant improvements in respect for human rights in Honduras. That's the only way to promote the rule of law.

Second, Canada has to require Honduras to engage in a transparent process for commercial activities so that all social sectors can be involved, so that anyone potentially affected can be involved.

We also have to have fair trade policies that are consistent with international policies and that take into account the environment, climate change, and human rights. These policies mustn't be there just to promote wealth generation and economic growth.

The regime in Honduras today should have to take concrete steps to improve the prosecution of human rights violators before, during, and after the coup d'état of June 2008, as my colleague Bertha Oliva said before. To date, none of these crimes has been investigated or has led to any charges. A clear message has to be sent to Honduras. You mustn't support a regime that engages in this type of practice and does not promote justice and fairness.

When in comes to hydro production and mining, there has to be a policy to promote human rights and international standards. Unfortunately, Canada is seen abroad as a country that makes off with other countries' natural resources without any concern for society.

Urgent steps are necessary to put an end to persecution and threats against the general population, and resistance groups in particular, including human rights advocates.

Thank you.

Government Accountability

[Pat Martin, NDP, Winnipeg Centre, MB]

Mr. Speaker, the Conservatives said they would clean up the revolving door between their government and lobbying firms. Yet Alanna Heath went directly from the finance minister's office to Barrick Gold as the director of government relations. Guess what her first job was? It was to kill Bill C-300, the corporate social responsibility bill for the mining industry. Then Rodney MacDonald left the Minister of Industry's office to become the director of government relations for Visa, the very file that his former boss was directly involved in.

What happened to those promises, what happened to the cooling-off period for connected political staff and what happened to the integrity of the government?

Canada-Panama Free Trade Act

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

Mr. Speaker, I am pleased to stand today to speak on behalf of my party to Bill C-46.

I commend the member for Hamilton Mountain on her intervention. It struck me, as she was answering questions, that the Liberal member stood in the House and basically said that it was trade at all costs. The reality for our country is that human rights and labour laws are the defining set of principles. To hear that kind of intervention from a party that proclaims human rights struck me as strange. It is not trade at all costs. As the member just indicated, our trade with Panama is around $100 million. That is an awfully cheap price to give up on the rights that Canadians believe so much in.

I want to go through a bit of the chronology on this bill. The Conservative government concluded the negotiations in August 2009. This agreement, by the way, as has been indicated by previous speakers, is very similar to the one with Colombia. We, of course, opposed the Colombia free trade agreement for weeks on end in the House because we felt that it was beneath Canada's dignity to be signing a free trade agreement with such a reprehensible government.

This agreement was signed May 14, 2010. On the same day, the government tabled side agreements in the House on Bill C-46. The NDP is opposing this bill for a number of reasons. In committee, compelling testimony was heard from witnesses regarding the tax haven situation in the Republic of Panama, as well as the poor record of labour relations in the country.

The previous speaker from the NDP, our labour critic, talked about the lack of labour rights in Panama. The member for Burnaby—New Westminster moved motions and amendments in committee that would have addressed some of the glaring failures in this agreement. Sadly, the record will show that they were opposed by the Conservatives and supported by the Liberals.

We do have issues with the free trade agreement. For example, despite requests from the Canadian government, Panama has refused to sign a tax information exchange agreement. This is very troubling considering the large amount of money that is being laundered in Panama, including money from drug trafficking, similar to Colombia. Panama's complete lack of taxation transparency has led the OECD to label the nation as a tax haven.

Just before the clause by clause review of Bill C-46, the member for Burnaby—Douglas proposed a motion to the committee that would have stopped the implementation of the Canada-Panama agreement until Panama agreed to sign a tax information exchange agreement. Again, his motion was defeated by the Conservatives and the Liberals who argued that the double taxation agreement Panama had agreed to was satisfactory. We do not agree. Unfortunately, the double taxation agreement only tracks legal income, while tax information exchange agreements will track all income, including money made through illegal means. That was as proposed by the member for Burnaby—New Westminster.

Considering Panama's history and reputation on such matters, it should be clear as to why such an agreement is necessary before signing the deal. Again, we hit a roadblock with both the Liberals and Conservatives on that point.

Subsequently, during the clause by clause review, the member for Burnaby—New Westminster proposed nothing less than 11 amendments that would have made progressive changes to the bill. These amendments included the addition of the crucial concepts of sustainable development and investment, a requirement for taxation transparency and provisions, and to corporate in the bill the protection of labour rights, including the right to free collective bargaining.

Other amendments would have required the Minister of International Trade to consult with labour and trade unions, as well as work with human rights experts and organizations in order to create impact assessments for the trade agreement. It is one thing to sign these agreements but it is quite another thing to follow up and see what the impacts have been on both the country we sign with and in our own industries and businesses that are part of the agreement.

A final amendment would have required Parliament to vote to extend the provisions of the act beyond the first year. All of these amendments, once again, hit that same wall and were voted down by the Conservatives with the help of the Liberals.

The committee heard testimony from Todd Tucker of the Public Citizens Global Trade Watch. Mr. Tucker made a very compelling case when he said that Panama was one of the world's worst tax havens and that the Panamanian government had intentionally allowed the nation to become that tax haven. Obviously there are benefits for a government seen in such a thing.

To summarize Mr. Tucker's testimony, he said that the tax haven situation in Panama was not improving under the current government nor under the conditions today in Panama. In addition, a trade agreement with Canada, in his opinion, would worsen the problem and could cause harm to both Panama and Canada.

Another major issue for myself as a former labour leader is the status of labour rights in Panama and the complete failure of this trade agreement because these are pending agreements. They are like letters of intent in a collective agreement that have no legal weight. These side agreements on labour rights fall far short of what is needed.

Two of the amendments put forth in committee by the member for Burnaby—New Westminster would have protected trade union workers in Panama. The member for Hamilton Mountain made a point a few minutes ago regarding Bill C-300, as well as labour rights. Why would we sign an agreement with a country and not demand, as part of that agreement, equal rights in that country to the rights we have here in Canada. As the principal representative of Canada on the joint Canada-Panama commission, the minister should have consulted on a regular basis with representatives of Canadian labour and from trade unions both here and in Panama.

Like all other amendments, those amendments were also defeated by the Conservatives with their friends the Liberals. Unfortunately, this creates a free trade zone that belittles the rights of labour, a serious problem that is already prevalent in Panama.

Teresa Healy of the Canadian Labour Congress spoke to the committee studying the bill regarding the agreement. She testified that while the ILO's, the International Labour Organization, core labour standards had been invoked in the agreement, the agreement was still weaker than it should be. As well, the current Panamanian government has been increasingly harsh on labour unions and workers in recent years.

In addition, two amendments regarding definitions were proposed by the member for Burnaby—New Westminster. By the end of the day, people will know the member for Burnaby—New Westminster who sits on this committee for our party.

The first amendment was with regard to sustainable development. The member for Nanaimo—Cowichan spoke a few moments ago in debate on this. The amendment would define sustainable development as development that meets the needs of the present without compromising the ability of future generations to meet their own needs, as set out in the Brundtland report, published by the World Commission on Environment and Development.

The second amendment was with regard to the definition of sustainable investment. The amendment would have defined sustainable investment as investment that seeks to maximize social good as well as financial return. Again, that is a principle in this country of Canada that we should be sharing with any other countries with which we have agreements, specifically in areas of environment, social justice and corporate governance, in accordance with the United Nations principles for responsible investment.

In addition to those issues with the Canada Panama free trade agreement specifically, there is also the fact that this agreement is just another step in the massively flawed Canada-U.S. strategy of pushing serial bilateralism in the form of NAFTA-style free trade agreements.

The NDP prefers a multilateral approach based on a fair and sustainable trade model. Bilateral trade deals amount to protectionist trade deals since they give preferential treatment to few partners and exclude the rest. This puts weaker countries in a position of inferiority vis-à-vis larger partners. A multilateral trade model avoids these issues while protecting human rights and the environment.

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

Mr. Speaker, it is a pity that even at this stage, after two years of debate on Bill C-300, the hon. member has not read or does not understand the implications of the bill.

Contrary to what he says, this actually would have been an opportunity for any company that he cited to have a full and fair grievance resolution process. However, he would rather take along with the mining companies their chances in the public media, and so our reputation continues to be degraded.

We continue to have to deal with this in a fashion that we bear the price. It has come to the point in some countries that it is not a good idea to identify oneself as Canadian. That has happened under the watch of this government and it is regrettable to the extreme.

[Dean Del Mastro, Conservative, Parliamentary Secretary to the Minister of Canadian Heritage]

Mr. Speaker, it is disappointing when we talk about establishing bilateral trade agreements that are so important for a trading nation like Canada that we have to descend into a discussion that once again impugns the good name of Canadian mining companies, companies like SGS operating in Lakefield in my riding, which work with mines around the world.

The member continues to talk about Bill C-300 which specifically targeted jobs not in other countries, but jobs in this country. He impugns the good name of Canadian mining companies and would limit their ability to compete around the world. Mining is one of the most important sectors in this entire country.

It is terrible that we cannot talk about a bilateral agreement, something important to Canada, without having a member stand up and impugn the good name of Canadian mining companies. I am disappointed.

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

Mr. Speaker, this is a pretty minor treaty. It is not a large bill by any means. The trade between Canada and Panama is fairly limited, some might even say “insignificant“. Certainly when compared with the daily trade between Canada and the U.S., it is not significant at all.

However, as a proposition, these treaties are important because they establish a legal framework, particularly with the reduction of tariffs and the freeing-up of trade. They are the beginning of the establishment of a legal framework for contractual relationships between countries and between corporations and persons. They are a small step in international law. However microscopic the steps might be, as a general proposition, it is a good idea to enter into these trade agreements. Members of the Bloc, my party and the NDP have rightly criticized the modesty of the agreement. That is what I wish to talk about while I have time in the House.

The side agreements with respect to labour and the environment are at least a step in the right direction. They are rather modest, hardly robust, but a step toward developing a legal framework between the two nations.

Last Wednesday I had the good fortune of listening to a lecture by Mr. Justice Ian Binnie at the University of Ottawa law school. His starting point was that if there is going to be an international economy, as there is, as nations trade more with each other and if they are to have economic relationships with each other, we must have and continue to develop our legal relationships with each other. In other words, at some point, somehow, somewhere, people who have grievances need to be able to redress them in some fashion or other, regardless of the merits. Frankly, I agree with Mr. Justice Ian Binnie, as I am sure you would, Mr. Speaker, that there is quite a gap between the development of economic relationships and the development of legal relationships.

A treaty is a modest step. As members may know, I was the sponsor of Bill C-300, which was a modest attempt to bring to Canadian corporations a degree of accountability with respect to their funding received from the government and the people of Canada.

It was ironic to me that the proponents of this Panama treaty were simultaneously very vigorously opposed to Bill C-300, when in fact all of this is the creation of a larger legal environment so that relations between people and corporations might be properly regulated. Had the government embraced Bill C-300 and, possibly, other forms of engendering corporate social responsibility, a treaty such as this might actually have been an easier pill to swallow for those who are opposed to treaties as a general proposition.

I want to quote Justice Binnie. He stated:

It is beyond question that companies have the ability to significantly influence human rights around the world for good or for ill. Sometimes influence implies obligation. In light of mounting evidence of “corporate complicity” in human rights abuses, there is, at the very least, an obligation upon the legal community—

—and I would add, upon the parliamentary community—

—to clarify the obligations of transnational companies as a matter of national and international civil and criminal law.

He then favourably cited John Ruggie and the work that he has been doing at the United Nations.

The big issue is access to justice. I do not profess to be an expert on Panamanian law, but as a general proposition I can say that the access to justice and the satisfaction one might receive from a court in a developing country is somewhat less than satisfactory.

It is quite clear that a lot of these courts are not robust, that corruption is rife, and that people seeking redress for very legitimate claims, be they regarding human rights abuses or forms of civil remedy, be they regarding environmental degradation or expropriation, do not receive satisfaction. From time to time it is Canadian corporations that are involved in these human rights abuses and there is no place for the individual to go.

If a Panamanian had a complaint with a Canadian company and wished to sue in a Canadian court, that individual would be precluded from doing so by the rule called forum non conveniens. It is a simple concept. Regardless of the merits of the individual's claim, regardless of how aggrieved the individual might be, regardless of the quantum of the individual's damages, that individual is cut off from access to Canadian courts by virtue of the fact that Canadian courts will say they are not the place in which the individual can sue for that particular grievance.

We do not have to reinvent the wheel. We could quite easily insert into a treaty such as this one the ability to modify in certain circumstances this rule of common law so that Panamanians in this particular instance would have access to Canadian courts so that they too could receive justice and redress from Canadian corporations.

I refer again to Mr. Justice Ian Binnie who said that a very practical level, domestic law reform is needed if domestic courts are to play a useful role in remedying international human rights abuses. He said:

For example, statutes of limitation are often unduly strict on their face or as interpreted and applied; statutory and common law obstacles to corporate veil-piercing exist and these may inappropriately shield parent companies from liability in respect of subsidiaries. There can be inordinate difficulty establishing...jurisdiction (especially where liberal use is made of the doctrine of forum non conveniens).

Justice Binnie said that in some cases there will be a good reason to limit or deny the possibility of civil recovery. However, as a general matter the state duty to protect means that a concerted effort be made to eliminate barriers to recovery that are unnecessary or arbitrary in their operation.

It is a pity that the government did not take this opportunity to open up a justice system on both sides which would allow Panamanians and Canadians access to a justice system which has some opportunity of receiving redress not only for states but for individuals and for corporations. The reason this is important is that not only does it affect the individual potential litigants, those who have been on the receiving end of human rights abuses, but it also affects us as Canadians and our reputation abroad.

I regret to say that our reputation in the last number of years has not been enhanced by the activities of some Canadian mining companies. I can literally take members on a world tour, from Mexico to Guatemala to Honduras to Peru to Venezuela to Colombia, over to various African countries, et cetera. In all of these instances people in those countries are alleged to have had some grievance with Canadian companies. There is no effective remedy for those grievances. For better or for worse, the Conservative government has cut those folks off from having access.

This could have been an opportunity to open up a legal system that is fair and just and one where there would be an opportunity for people to receive redress. Regrettably, the government chose not to do that and that is to our detriment and ultimately to the detriment of our national reputation which has been suffering around the world.

In conclusion, I see this as a minor treaty, but I also see it as an opportunity lost.

Opposition Motion--West Coast Oil Tanker Traffic

[David Anderson, Conservative, Cypress Hills—Grasslands, SK]

Madam Speaker, I do not think we need to take lectures from the members across the way about representing our constituents. I will bring a couple of illustrations into this. On Bill C-300, the mining bill that would be so damaging to Canadian industry, Canadian economy and Canadian jobs, and the NDP members fought against that.

The free trade agreements, particularly the one with Colombia, which our western Canadian farmers desperately needed for their special crops, the NDP members fought and fought against it and took as long as they could to see that stop.

The long gun registry is another example. Since coming here, I do not think I have ever seen anything that was handled as cynically as the NDP handled the long gun registry, allowing a few of their members to vote with us so the others could oppose it and ensure the bill was defeated.

Another example would be the economic action plan. Yesterday the leader of the NDP begged us to increase, improve, expand and continue our economic stimulus plan after he had opposed it at every turn.

When it comes to listening to Canadians, we will not take any lessons from the New Democratic Party. We have the environmental assessment process in place for these projects so everyone gets a chance to participate and government can make the best decision.

[Jamie Kneen]

I understand that the Panamanian government has been revisiting Bill C-30. At the same time we've lost Bill C-300. The opportunity is there. As I say, the question is, what kind of investment would be made by Canadian companies in the absence of any particular requirements?

In Canada, under the land claims agreements, for instance, we have specific powers for first nations and Inuit to require impact benefit agreements with profit-sharing, employment and training, and so on. We have other examples in the provinces of mining companies engaging in long-range planning and training projects in order to bring local people into those better jobs.

In Latin America it has been less successful. Even in countries with mining experience--and Panama is not one of those--it has been more difficult. Countries like Peru have been able to move their own people into the better jobs, but only over time and with some cost. I think the difficulty is that instituting that kind of investment in a virgin territory, for lack of a better term, is not going to lead to success in the short or even the medium term.

[Claude Guimond, Bloc, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Last June, the Panamanian government introduced Bill 30, which many people considered anti-union legislation. A few weeks ago, the Parliament of Canada introduced Bill C-300, which was defeated.

What do Panamanians still have to help them access jobs that are of the slightest degree of quality? Do these people still have means?

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

Thank you, Mr. Chair.

I want to thank both of you for being here today.

I have about seven pages here; this is one of those times when it's almost difficult to know where to start. You're calling this national plan, in very polite terms, a band-aid approach to a very, very serious situation.

From your comments on village-to-village work and work on the ground, it sounds to me as if that's one of the things that you think is a very sore point in this plan, that it's not going anywhere. Also, it sounds like your analysis says there is no strategic direction; you have departments over here, but they don't have anything to coalesce around.

There's another thing that jumped out at me, Ms. Lebert, when you were talking about local resources and extraction companies. You weren't very specific on that. Are we talking about Canadian companies? Because we just had Bill C-300 before the House, which I'm sure you're aware of. It was quite a conversation piece for a number of years and was worked on by a number of people from our party, the NDP. Are there concerns about our extraction companies over there? Is that something you'd feel comfortable talking about?

I have one last question, and it's going to sound right off the wall. Funding for both of you is independent of government, I suspect. No, it's not?

Opposition Motion—National Defence

[Claude Gravelle, NDP, Nickel Belt, ON]

Mr. Speaker, I would like to ask the hon. member for Markham—Unionville a question, but first I would like to make a statement.

We had a vote on Bill C-300, the mining accountability act, which was a Liberal private member's bill. We had the vote on Bill C-440 on war resisters, another private member's bill. We had the opposition day motion on maternal health. All were Liberal sponsored. However, the Liberals did not show up for a vote.

I want to know if they are going--

Opposition Motion--Foreign Takeovers

[Claude Gravelle, NDP, Nickel Belt, ON]

Mr. Speaker, generally speaking, the Liberal members have spoken in favour of this motion, maybe the member for Willowdale excluded, but we are not sure yet.

The Liberal Party has been known to speak in the House in favour of a certain bill and then not show up for the vote. Bill C-300 is a good example, where every Liberal member spoke in favour of the bill but when it came time for a vote, it was like entering a hunting camp in the fall and turning on the lights and the mice scatter all over the place.

Is that what the Liberals are going to do when it comes time to vote on this motion, scatter?

Opposition Motion—Foreign Takeovers

[Lynne Yelich, Conservative, Blackstrap, SK]

Yes, Madam Speaker. We always support the people of Saskatchewan. In fact, just last week we showed how well we support them.

Mining is important to Saskatchewan.

The opposition coalition is not transparent. Those members were not clear or transparent with their constituents. They talk about mining and how they support it, but Bill C-300 would have devastated the whole mining industry.

We are working hard to adhere to the law and to the act.

As for BHP and the government of Saskatchewan, the industry was aware of the concerns raised by the government of Saskatchewan, and those concerns were taken into consideration. It is important for the member to know that we support the government and the industry minister in his decision yesterday.

[Ralph Goodale, Liberal, Wascana, SK]

Mr. Speaker, it is hard to know if a question was actually buried there. It seemed to be more like a rhetorical statement.

The fact is that in the lifespan of the Investment Canada Act, going back to the mid-eighties, there has not been a proposed transaction in the resources sector in the order of magnitude as the Potash case. This is the first one that has been this big, and we have been very clear about our position on the case of Potash.

We have also indicated that the major takeovers of large chunks of Canadian natural resources, whether that was Inco, Falconbridge or Alcan, they have all occurred since 2006 under the watch of the present government, not the previous government. I think the hon. member should pay a little more attention to the timeframe and direct his criticism where it belongs.

The stripping away of Canada's ownership of its natural resources in terms of the control factor has all occurred since 2006. If Potash were to be added to the list of Inco, Alcan and Falconbridge, many in the Canadian business community would look over the horizon and ask, “What is left? It is all gone”. It is very clearly time to draw the line in the case of Potash.

On the issue of Bill C-300, I would point out to the hon. gentleman that in the course of that vote, every Liberal in the House voted in favour and there were members of Parliament missing from all political parties at the time that vote was taken.

[Jim Maloway, NDP, Elmwood—Transcona, MB]

Mr. Speaker, for a while I thought I was listening to an NDP member. The Liberals when in opposition can talk a great line and sound progressive but their history in government is something quite different. In fact, when they were in government they stopped absolutely zero in terms of foreign takeovers.

I want to take the member back to November 2, 1989, when Grant Devine was the Conservative premier of Saskatchewan. The Potash Corporation of Saskatchewan was privatized. For many years it had been government owned and very successful. It was privatized by a Conservative government at that time. Mulroney was the prime minister at the time and the Liberals were the official opposition but I do not recall the Liberal Party of Canada taking a strong position against that particular issue.

Bill C-300, the corporate social responsibility bill sponsored by a Liberal member, which was recently before the House, would have forced Canadian mining companies to act responsibly in foreign jurisdictions and treat workers and the environment fairly. The member's own party held out sufficient members when it came time to vote so his colleague lost his bill. That is the way the opposition acts. The Liberals sit on both sides of issues but particularly with Bill C-300.

While the member made a great speech, we have some questions about how solid the Liberals are in terms of following through if and when they ever get back into government.

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

Mr. Speaker, we will look forward to doing that in 30 days, when our legal requirements are up under the Canada Investment Act.

I would say to my hon. colleague on the other side that, from this government's perspective, every business is strategic that helps to drive the economy and create jobs. That is why we are dispirited when we see carbon taxes coming from the member's party; when we see support for Bill C-300, which would drive all our mining resources out of this country; and when we see the opposition talking about raising business taxes. That is why we get upset. That is why we feel that every business in this country is strategic.

[Gerry Ritz, Conservative, Minister of Agriculture and Agri-Food and Minister for the Canadian Wheat Board]

Mr. Speaker, it is a pleasure to stand and join my colleague, the Minister of Industry, in discussing, not so much the BHP bid and Potash Corporation of Saskatchewan, but the motion put forward by the NDP. The motion recommends that we change the way the Investment Canada Act would arbitrate these types of situations. It would also take away a lot of the end result decision making from the Minister of Industry. We are working under a legal precedent. However, if I remember correctly, this document first came about in approximately 1985, some 25 years ago, and everything should be updated. There is no doubt in my mind about that.

However, under the act, the Minister of Industry and government members, who are involved in whatever region that decision would have an impact upon, are constrained legally. I am distressed, to say the least, when certain members of the opposition, and I will not even bother to name them because they are inconsequential, bray at the moon and howl and scream when they know there are legally things that can and cannot be done. As a member of the democracy we call Canada and as a regional minister from Saskatchewan, when I look at the way some of the media and members of the opposition handled this I take affront to that. They went beyond the pale in their condemnations and their demands.

As we know, these companies are both major global players. Potash Corporation of Saskatchewan has holdings throughout the world, as does BHP, maybe on a different scale but similar in that they are international. The legislation is set out as it is because of market disruptions. Ripples that would go through the marketplace would send the incorrect and devastating signals to a lot of investors and so forth.

I commend the Minister of Industry, my Saskatchewan colleagues, the overall cabinet and caucus of this great government for keeping this interior. The ultimate decision rests with the Minister of Industry. However, I know, from the Saskatchewan caucus perspective, we had some 17 meetings with all the stakeholders, everybody who had a role to play or something to say on this matter. We entertained that, took it to heart and passed it along to the Minister of Industry to help him make this decision.

A lot of the discussion is all about politics. Certainly from the opposition side, I see that. When we go back and assess what those members have said and how they have done it, it was all about partisan politics. I think Canadians at the end of this will condemn them for that. Whenever the coalition decides to bring this government down and go to the polls, I think Canadians will remember the disrespectful way it handled itself in this instance.

Now this is a one-up situation. There is a lot of discussion about how this would impact negatively Canada's place in the world when it comes to outside investment. That is absolutely ridiculous. These are all adjudicated on a case-by-case basis. More will happen. It could be today, or tomorrow or next week. We do not know. However, in a free-market enterprise like Canada, a democracy and the rule of law, we are a welcome investment. Look at the strength of our dollar. Look at the way we have come through this recession. A lot of countries entertain investment in Canada because of that stability, and we welcome that.

However, we certainly reserve the right to judge each one of these on a case-by-case basis as per the net benefit clause as set out in the act. It is what is in the best interests of Canada moving forward.

I can speak from an agricultural perspective. With the marketing we have done around the world now, in country after country, working with industry, working with my provincial colleagues, opening markets, rejuvenating markets, Canada is becoming of age again on the global stage. It had been dropped for some time. We were not really getting out there and doing the job.

When we arrive in a lot of these countries, one of the first things we are asked is where we have been. The Australians, the Americans, the European Union, Brazil, and some of the emerging economies like China and India are aggressive marketers and are getting to be more so. They welcomed us being there. They recognized the safety and security of the food supply in Canada. Part of that safety and security is also on the input side. When we look at a strategic resource like potash, which is the basis for fertilizers and so on around the world, we do a tremendous job of supplying both potash and foodstuffs, in a lot of cases to the same countries, for example, China, India, Korea. These are great markets for our fertilizers, as well as our finished foodstuffs. It gives us a power and a strategic position in the global food supply to be a major supplier of both the inputs and our crop and livestock production.

From a strategic standpoint, we have that in spades in Canada.

Under the net benefit, having someone different mine it certainly does make a difference in that Australia is a major marketer of a lot of the same foodstuffs that Canada has. We are a volume producer and so is Australia. For it to be able to go to the Indies and Chinas of the world and say that it now controls their fertilizer too, I think would have had a very detrimental effect.

I know the Minister of Industry took all of that under advisement and it helped him and his department formulate the decisions they have taken. At this time and place, it is absolutely the right decision. There is no doubt in my mind whatsoever. I think the Saskatchewan people have recognized the great work done by my colleagues and the Minister of Industry on this file. I think they also recognize the questionable attitude of some of the members of the opposition in trying to make partisan politics out of this.

At the end of the day, the decision is based on the criteria that comes before the minister, straight up and that is it, and the right decision was made.

As we move forward, I am more than happy to have this debate about changing how we assess these because there will be more, not less. Canada is a land of wealth and riches. We have great raw materials. We have tremendous resource wealth. As we strive to open up our Canadian north, which we have done as a government, and secured that sovereignty there and as we look at our fresh water supplies and the growing demand around the world, we will have to come to grips with that demand from the rest of the world to either invest or buy outright these types of commodities.

At this time and place, we can say no because we do have some guidelines. Could they be better guidelines? Probably. We are looking at things that are in demand now that never were when this act was written in 1985.

I welcome the opportunity and the motion from the NDP. I take exception to some of the political undertones in it. The last line is an outright denial. I do not think we can do that in a free and democratic society in a global stage, where we are becoming and growing rightfully into a major player.

Some of this is couched in politics. That is what we do here and I welcome that. I love the rough and tumble of it. We get our elbows up in the corner. It is like a good hockey game. However, at the end of the day, there are rules and regulations and the referee is the Canadian people. They will adjudicate this deal. We are aware of the fact that a growing number of Canadian residents and a growing number of Canadian businesses, which are free traders, support this decision in the way it is written.

When I read editorials in certain papers and at certain authors who claim to be on the inside track, I wonder how they justify their stance to their subscribers and advertising purchasers. I also look through the lens of an opposition that votes for things like C-300, which in a global situation, and PCS and BHP Billiton are part of that, would condemn them and force them to continually fight a rear flank action with causes and situations that come up in some global outpost somewhere. We would have to shut down production on behalf of PCS and adjudicate that.

I also look at the opposition's stance on raising the tax on business. Part of what draws investment to Canada is that lower tax rate. All the opposition members stand in question period and condemn us for moving forward with tax cuts to business. They all go on about big business. However, the tax cuts pertain to little guys too. Every business in Canada is important. Businesses are the growth of the economy. They are the job creators. They are the engine of the economy. Everyone gets that.

Why do those members condemn tax cuts as we come out of the recession? We have seen net job growth in Canada, unlike our closest ally in the U.S. We see stability in our systems in Canada, unlike the turmoil in our closest partner, the U.S. We see a growing acceptance of Canada on the world stage. We see a growing acceptance that Canada can do more. I cannot understand their stance, other than it is a pure crass political situation. I condemn that, but I welcome the opportunity to have this debate.

Trade

[Lee Richardson, Conservative, Calgary Centre, AB]

Mr. Speaker, in this time of continuing economic uncertainty, our Conservative government is continually striving to create jobs, boost trade and open new markets for Canadian workers. We stand in contrast to the Liberal-led coalition that continually promotes policies that kill Canadian jobs, such as their support of Bill C-300 or their promise to cancel the purchase of F-35s.

Could the Minister of International Trade update this House on Canada's ambitious free trade agenda and how it will benefit Canada's economy?

Corporate Accountability

[Stephen Woodworth, Conservative, Kitchener Centre, ON]

Mr. Speaker, I wish to present a petition from about 50 residents of the Kitchener--Waterloo area who wish to draw the attention of the Government of Canada to alleged abuses of human rights and environmental degradation and who would have wanted the Government of Canada to consent to the expeditious passage of Bill C-300 and also create effective laws regarding corporate responsibility.

Sustaining Canada's Economic Recovery Act

[Jim Maloway, NDP, Elmwood—Transcona, MB]

Mr. Speaker, I agree with the hon. member that the government really has a lack of focus. It is confused. It lurches from misstep to misstep. The long form census is a really good example of that. I think the public are beginning to see this, but its confusion in some ways is exceeded by the confusion of the opposition party itself.

The member introduced Bill C-300 last week in the House, which we voted on, regarding corporate social responsibility for mining companies that operate in other countries. It was an excellent bill and his party had the ability to make it pass. Yet his leader had 30 members miss the vote so the bill would be lost. That gives a terrible message to people out there in the public who supported his bill, liked his bill a lot and wanted to see his party support him.

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

Mr. Speaker, there is probably no member in this House who has more knowledge and authority on the issues he just spoke about. The member is very articulate in showing the relative and absolute decline in the influence of CIDA as far as our nation is concerned. It shows an absolute decline in numbers.

For whatever reason, we have chosen to deal with our deficit on the backs of the poor of this world. We have recently suffered a slap in international prestige before the United Nations. CIDA is a diminished force. Of course, there is what happened to Bill C-300 last Wednesday night. All of this makes us, in my judgment, a diminished nation.

I am interested in the hon. member's views on the diminished nature of CIDA going forward.

Potash Industry

[Tony Clement, Conservative, Minister of Industry]

Mr. Speaker, I thought I had heard it all in this place, but the member for Willowdale thinking she knows what is in the best interests of the MPs from Saskatchewan is certainly a new high or a new low, I am not sure which.

I would also remind the hon. member that if she wants to talk about people looking out for their own interests, the hon. member's party had 13 AWOL MPs for the Bill C-300 vote yesterday. That shows that the Liberals are trying to suck and blow at the same time, which is a typical Liberal tactic.

In our case, we will do the best thing for Canadians because that is what we do.

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

[Gordon O'Connor, Conservative, Carleton—Mississippi Mills, ON]

Mr. Speaker, if you seek it, I believe you will find unanimous consent to apply the results of the vote just taken to all remaining motions in amendment at the report stage of Bill C-300. This does not include the motion for concurrence of the bill at report stage.

The House resumed from October 26 consideration of Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries, as reported without amendment from the committee, and of the motions in Group No. 1.

[Jim Maloway, NDP, Elmwood—Transcona, MB]

Mr. Speaker, I am very pleased to speak to Bill C-300, and I give full support to it.

The mining companies and their Conservative surrogates have been very active in their lobbying efforts to try to convince members of Parliament to vote against the bill.

For people who are watching tonight, the summary of the bill sets out its purpose, which is to promote environmental best practices to ensure the protection and promotion of international human rights standards in respect to the mining, oil and gas activities of Canadian corporations in developing countries. The bill would also give the Minister of Foreign Affairs and the Minister of International Trade the responsibility to issue guidelines and articulate corporate accountability standards for mining oil or gas activities and it would require the minister to submit an annual report to both Houses of Parliament on the provisions and operation of the act.

There is a number of very good reasons why the bill should be supported. Bill C-300 seeks to ensure corporations that receive assistance from Canadian taxpayers operate in a manner that respects basic human rights and the environment. Our national reputation is enhanced when our corporate citizens adhere to these values.

Numerous witnesses before the foreign affairs committee gave testimony regarding the significant violations of basic human rights. We know that to be the case in all kinds of countries, particularly South America, Peru, as an example. These violations take place in various Canadian mine sites around the world. The legislation would help sort out the bad practice from the good and enhance the operations and reputations of good Canadian companies.

There have been numerous accusations of serious and unnecessary environmental degradation by Canadian companies. The bill would encourage companies to ensure their practices were up to international standards. The Conservatives seem to want a situation where this—

[France Bonsant, Bloc, Compton—Stanstead, QC]

Mr. Speaker, today we are talking about Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries, which is supposed to ensure that Canadian mining companies behave responsibly in terms of human rights and the environment.

Social and environmental responsibility is very important to Quebeckers. Unfortunately, it seems that Canadian mining companies operating abroad often fail to respect these principles. In 2009, the mining industry itself produced a study for internal use only. The study contained plenty of evidence. Leaks revealed that Canadian companies were responsible for two-thirds of the 171 environmental and human rights violations recorded. Naturally, these companies do not want the bill to pass. They say that it is not necessary and would make them less competitive.

The Bloc Québécois has long been concerned about the fate of populations and ecosystems affected by these companies' abusive activities. In 2001, my colleague, the member for La Pointe-de-l'Île, introduced Bill C-332 to enable the Government of Canada to take action against companies engaging in abusive practices. The private member's bill did not make it past first reading.

Despite our concerns, the government continued to espouse the laissez-faire principle. This attitude is irresponsible. In fact, the Conservatives say that mining activity in underdeveloped countries is a means of fighting poverty. However, that assumes that developing countries have the means to establish long-term development strategies. But such is not the case.

In reality, foreign investment can benefit certain disadvantaged countries if they have the institutional capacity to properly manage the new capital. Given their economic situation, such regions obviously lack the political and administrative means and are unable to benefit from the presence of the mining companies. That is the case for a number of developing countries that are being shamelessly exploited by the industry because of their inability to negotiate acceptable terms for their resource operations. This results in irreparable damage to the environment, the displacement of people from mining sites and the destruction of historical sites, not to mention the industry's use of armed groups that violate human rights.

There are a large number of Canadian mining companies operating abroad. More than 60% of the world's mining companies are registered in Canada. Thus, the phenomenon is very widespread. We must ask ourselves whether such registered companies are taking advantage of Canada's legislative shortcomings and generous tax incentives to further exploit developing countries. At the end of the day, the benefits for countries that host these companies are very few, even non-existent. In fact, these countries often pay dearly for the industry's presence on their land.

In Peru, 97 conflicts between communities and mining companies were reported in 2004. The Honduran mining act does not take residential, environmental or tourist areas into consideration and only gives communities 15 days to appeal the granting of permits.

At present, Canada is a legal paradise for these companies. They benefit from investment conditions that are not well regulated abroad and they are accountable to no one. These Canadian companies continue to post huge profits. The cumulative value of their direct investment totals more than $50 billion annually. Therefore, we wonder why the government refuses to regulate this industry and puts the onus for monitoring them on disadvantaged governments.

The member for Kootenay—Columbia stated that Bill C-300 would put Canadian companies in danger. However, it seems that we should no longer be surprised that the government answers to mining, oil and gas companies.

Bill C-300 is a step in the right direction because it forces the Minister of Foreign Affairs and the Minister of International Trade to establish minimum standards. However, the bill is void of any restrictions that would get at the root of the problem. It does not put appropriate mechanisms in place to ensure that the established framework is respected. In fact, the bill does not provide for an advisory committee, made up of industry representatives, dedicated to helping the government create a framework. It is critical that companies be involved; otherwise, the government cannot count on their co-operation.

Similarly, the bill we are discussing today does not propose an ombudsman. It is essential to have an independent procedure for receiving complaints. Finally, Bill C-300 proposes few penalties for offending companies.

In September 2009, my colleague from Laurentides—Labelle introduced a bill that reflects how important we believe respect for human and environmental rights to be. Among other things, it would create a Canadian extraterritorial activities review commission to receive complaints, conduct investigations, issue recommendations to the government and draft a code of Canadian standards for corporate activities.

Although we would rather debate a stricter bill, such as Bill C-438, we support Bill C-300 in principle. Right now, dozens of countries are suffering because of our mining companies. Canadian companies operating abroad simply must respect international standards.

The bill before us today would set minimum standards, which is better than the distressing absence of rules that the government would like to maintain. The Conservatives' dishonest tolerance for the blatant exploitation of people in other countries must end now. I hope that the Conservatives will have learned their lesson following their defeat at the UN Security Council. I hope they will finally honour their international obligations.

[Peter Van Loan, Conservative, Minister of International Trade]

Mr. Speaker, I am pleased to have the opportunity today to discuss Liberal Bill C-300 and address the risks it poses to Canadian jobs: jobs for Canadians in mining companies, jobs for Canadians in related equipment and other manufacturing sectors, jobs for Canadians in our financial markets that serve the mining industry and, of course, the surrounding legal community.

Canada has proven itself to be a global leader in encouraging and supporting its companies to operate abroad in a socially and environmentally responsible manner. This bill, however, threatens that traditional leadership by Canadian companies and in the process threatens jobs.

This bill, in effect, would create additional regulatory burdens, additional hurdles, additional red tape. It would tie up good Canadian corporate citizens who conduct themselves well with time, money and efforts defending themselves against frivolous and vexatious claims with little basis. In the process it would put Canadian mining companies on a very uneven playing field against mining companies elsewhere.

In understanding the mining sector it is important to appreciate this one thing. For most mining companies there is really no reason to be headquartered in Canada other than the considerable expertise that has grown up around our markets that finance and support that industry. They are highly portable. Very few of those mines are still located in Canada. These mining companies are engaged in efforts all around the world and, therefore, could just as easily shift those jobs, shift their headquarters, shift all the associated economic activity with literally billions and billions of dollars to other countries, to other markets.

This would cost us jobs here in Canada. It would cause the lawyers, articling students and staff that support them to lose their jobs, which are considerable numbers in the mining sector. It would cost those in the financial sectors that provide the investment and capital for them to undertake their projects, the Toronto Stock Exchange of course being a focus of the efforts to raise finance to support investment activity, as well as the entire Toronto area that has grown up around it in the financial sector. Of course, it would cost the mining companies and equipment sectors themselves. That is the risk of this bill.

It is a bill that stands to kill jobs, kill economic activity and, in fact, kill the revenues that go to government through taxes as a result of all that economic activity. Not only would that leave us in a position where we would be less able to provide social services and the other things government must do with the tax revenue we receive but also it would increase needs as Canadians would be facing a more challenging environment with fewer jobs and fewer economic opportunities.

The fact is that Canadian mining companies are overwhelmingly good corporate citizens, model leaders that we can be very proud of. We can be proud of the fact that Canadian mining companies have moved into a position of global leadership. They are regarded as a focus of talent and also a focus of good corporate citizenship.

It is easy to look for recent examples. I was in Chile on day 17, following the mining accident in which the miners were trapped underground. On day 17 when the sun rose, there was not very much hope left for those miners. For two and a half weeks, efforts to try to reach them had been without success.

It was not a Canadian mine that was involved, but Canadian mining and equipment companies were already there as good corporate citizens doing their bit to help. They were providing airlift for the families of trapped miners. They were generating support. They were providing satellite communications equipment that was necessary in that remote area, and of course, they were providing some of the critical drilling equipment that was necessary in the effort to try to reach the miners.

On the day I was there, halfway through the day the news broke that a note had been brought to the surface that indicated they were there, all 33 alive. It was an exciting time to be there. Everyone I talked to was exuberant. The nation rallied around, and hope sprung that a miraculous rescue could occur, which ultimately did, a miraculous rescue that occurred with the help of Canadian companies that were good corporate citizens, that did so because it was the right thing to do and showed the kind of leadership Canadian companies always have. They were the same kind of Canadian companies that are targeted by this legislation with the suggestion that somehow they are bad corporate citizens.

We know that story ended well. It was a triumph of the human spirit, a triumph of technology and something I think all Canadians can be proud of, that our mining companies played a part in delivering a successful ultimate outcome.

That is the kind of story that we might not have if a bill like Bill C-300 became law, because those would not be Canadian mining companies anymore. They would be Australian mining companies or Chilean mining companies or Brazilian mining companies. They would not be here anymore, the jobs would not be here anymore, the prosperity would not be here anymore and we would not be able to be proud of having played a role.

As I travel this world, I can tell members I get the same stories again and again. I do not get complaints about the bad conduct of Canadian mining companies. I hear the stories about what good corporate citizens they have been, in terms of providing for the communities they are in, not just in jobs, not just in good respect for the environment, but also in providing critical social services that remote communities would never have in some of these developing countries, schools, clinics for health care, doctors and high-quality housing, things that otherwise simply would not be there. They do it because it is the right thing to do. It makes sense and, if they want to have successful mining operations, it is just the right thing for them to do and a logical thing for them to do.

I would like to draw members' attention to the fact that Canada already has a number of existing mechanisms that serve to help our companies function as good corporate citizens. These mechanisms enhance the positive reputation and global competitiveness of Canadian companies, including those that are in the extractive sectors. They also provide a means to address any issues that may arise.

Our Conservative government has initiated a four-point corporate social responsibility strategy, something that I might point out did not exist at the time when the hon. Liberal member who is sponsoring the bill was in government. There was no such policy in place. We now have one in place.

I will now outline the four points of it and elaborate on each one of them.

First, we appointed Dr. Marketa Evans as a corporate social responsibility counsellor.

Second, we established a new independent centre of excellence.

Third, we provide assistance to foreign governments to develop their capacity to manage natural resource development in a sustainable and responsible manner.

Fourth, we continue to promote internationally recognized corporate social responsibility performance and reporting guidelines.

I would like to remind the members of this House that the Government of Canada has further reinforced its commitment to good corporate citizenship through building the Canadian advantage.

This strategy, based on broad consultations, was developed to promote best practices among Canadian companies operating abroad and to build capacity in developing countries.

Working through the Canadian International Development Agency, the first pillar of the strategy is the continued support of initiatives to enhance the capacities of developing countries to manage the development of minerals and oil and gas, and to use those resources to the benefit of those countries to help reduce poverty. Countries like Libya and Peru, for example, have benefited from such policies.

The second pillar under our government's strategy is our continued commitment to internationally recognized standards and performance guidelines, standards of good corporate citizenship, standards we can all be proud of.

Building on Canada's adherence to the Organisation for Economic Co-operation and Development guidelines for multinational enterprises, the Canadian government promotes the following important frameworks: the International Finance Corporation performance standards on social and environmental sustainability; the voluntary principles on security and human rights, a set of guidelines for projects that involve private and public security forces, and Canada is a full member of the voluntary principles with a seat on the steering committee; and, finally, the global reporting initiative, which is a mechanism to enhance transparency and encourage market-based incentives. Of course, there are the additional pillars I spoke of earlier of the corporate social responsibility counsellor and the centre of excellence.

The bottom line is that Canadian companies have been performing well. We have the mechanisms in place to ensure they perform well, whether it be the Export Development Corporation applying corporate social responsibility standards when it makes decisions on loans, or the voluntary principles that the sector itself has been practising.

The key is that if the bill were to pass, we would not have an opportunity to see those things develop. We would likely see the evaporation of one of the areas in which Canada has been leading the world economically, in which we create jobs and prosperity for literally thousands of Canadians. That is too great a risk to consider at this time. It is too great a risk to consider at any time, for the sake of Canadian workers.

[Martha Hall Findlay, Liberal, Willowdale, ON]

Mr. Speaker, I rise to speak to Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries.

We in the Liberal Party completely agree with the intentions behind Bill C-300. We are 100% behind improving the corporate social responsibility of Canadian mining companies in developing countries. In this regard, all members of the Liberal Party agree completely. Indeed, I commend my colleague from Scarborough—Guildwood for being so concerned when the Conservative government has done so little.

In 2005, a decision was made under a Liberal government to move forward on the issue of CSR among Canadian mining companies. Throughout 2006, extensive all-stakeholder round tables were conducted. These included non-governmental organizations, civil society organizations, mining and oil companies, labour, governments and individuals. It was an extraordinary process and very unusual in the progress achieved with so many different participants.

There were 156 oral presentations and 104 written submissions. Of these, 61 were from civil society organizations, 33 were from industry, 15 were from labour organizations, 31 were from academics and research institutes, and 16 were from members of the public without a stated affiliation.

This extraordinary process resulted in a 2007 report which was roundly approved and supported. It was the product of many people who might have had opposing views, but who came together exhibiting a will to compromise and to find constructive consensus. The 2007 report included several strong and very positive recommendations for the improvement of CSR among Canadian mining companies working in developing countries.

However, the Conservative government did nothing for two years. Only recently did the Conservatives come up with a much watered down plan, a plan with no teeth. They are pretending to do something when not doing anything at all.

Bill C-300 tries to address these concerns. We Liberals all agree completely on the end goal even though we may have some disagreements on how best to reach that goal. In that regard, I am pleased to have the opportunity to rise in this House to do exactly what we are supposed to do, engage in debate.

All too often we let party lines dictate what any one of us now says in the House. It has become entirely predictable. Not everyone agrees on everything all the time, not even everyone in the same party. The ability to disagree or to have different opinions is, and should be, a fundamental part of democracy. I am proud to be a member of a party, the Liberal Party, that not only allows debate but recognizes its importance.

Bill C-300 creates some challenges. The bill's proponent himself has acknowledged that it is flawed due to the limitations on what a private member's bill can do. As a result, there is legitimate debate about whether Bill C-300, if passed, would in fact accomplish what it is intended to accomplish, or whether there may be unintended, perhaps even negative, consequences.

Indeed, one of the concerns is whether passage of Bill C-300 might make it more difficult for a Liberal government to implement an even tougher regime further to the 2007 report to ensure greater CSR, but it is important that people be able to engage in this kind of debate with respect and civility. It is one of the reasons why I am a Liberal. We are able to debate and indeed sometimes disagree.

The 2007 report sets out some very tough recommendations, including strict and clear guidelines on the level of CSR expected of Canadian mining companies operating in developing countries, a robust complaint and review mechanism, the creation of an ombudsperson with tough responsibilities, and significant funding to help developing countries build their own capacity to create and enforce locally CSR standards and regulations.

We are all frustrated that the Conservative government ignored the 2007 report for two years and then only just recently implemented a much watered down approach.

The Liberals are united in strongly supporting implementation of a regime based on the full 2007 report as the best way to achieve the highest levels of CSR among Canadian mining companies operating in developing countries, something the Conservative government has failed to do.

I rise today to speak to Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries.

First, I would like to say that we in the Liberal Party completely agree with the intentions behind Bill C-300. We are 100% behind improving the corporate social responsibility of Canadian mining companies in developing countries. In this regard, all members of the Liberal Party agree completely. Indeed, I commend my colleague from Scarborough—Guildwood for being so concerned when the Conservative government has done so little.

In 2005, a decision was made under a Liberal government to move forward on the issue of CSR among Canadian mining companies. Throughout 2006, extensive, all-stakeholder round tables were conducted. These included non-governmental organizations, civil society organizations, mining and oil companies, labour unions, governments and individuals.

This process is an excellent example of a situation in which all of the stakeholders came together to find a solution to a fundamental problem. The 2007 report that came out of these consultations was roundly approved and supported. It included several strong and very positive recommendations for the improvement of CSR among Canadian mining companies working in developing countries.

Unfortunately, the Conservative government did absolutely nothing. Two years after the report was released, the Conservatives chickened out and in the end implemented a watered-down solution.

Even though Bill C-300 is not perfect, it aims to improve the situation. We in the Liberal Party fully support the end goal, although we may have some disagreements on how best to reach that goal.

As I already said, I am pleased to have the opportunity to rise here in the House to do exactly what we are supposed to do: debate the issue. Having the opportunity to express disagreement and different opinions is, and should be, a fundamental part of democracy. Once again, I am proud to be a member of a party, the Liberal Party, that not only allows debate but recognizes its importance.

Bill C-300 does create some challenges, I admit. Even the bill's sponsor has acknowledged that it is flawed because of the limitations on what a private member's bill can do. As a result, there is legitimate debate about whether Bill C-300, if passed, will in fact accomplish what it is intended to accomplish or whether there may be unintended, perhaps even negative, consequences. As I said, there are fears about whether passage of Bill C-300 might make it more difficult for a Liberal government to implement an even tougher regime to make corporations even more accountable. It is important to be able to engage in this kind of debate with respect and civility.

The 2007 report sets out some very tough recommendations. We are all frustrated that the Conservative government ignored the report for two years and only recently implemented a much watered-down version.

Once again, the Liberal Party is united in strongly supporting the implementation of a regime based on the full 2007 report as the best way to achieve the highest levels of CSR among Canadian mining companies operating in developing countries, something the Conservative government refuses to do.

[Paul Dewar, NDP, Ottawa Centre, ON]

Mr. Speaker, I rise to speak once again to Bill C-300 and to lay out some of my concerns with respect to this legislation. I note that the Minister of Labour also put down markers on her concerns.

It is important for people to understand that Bill C-300 would do no more and no less than provide fair play for Canadian companies functioning abroad. It would not undermine the opportunities for mining companies abroad. Witnesses at committee have told us time and again that this was exactly the way to go to ensure that not only Canadian companies have opportunities abroad but that Canadians in general can be proud of the business those companies are doing abroad.

More than a majority of Canadian companies already employ the criteria set out in this legislation. Representatives from Canadian companies told us at committee that they were already onboard with these practices.

If the equator principles on corporate social responsibility, which are well known around the world, are being practised by Canadian companies and are already in play with the EDC, why is there opposition to this fairly straightforward proposition? I believe some of it has to do with misinformation but perhaps some people do not want the government to oversee regulation in the game.

It is important to understand how we arrived here. My predecessor for Ottawa Centre, Ed Broadbent, went through a process to ensure that all voices would be heard on this important file and pushed for the round table on extractive industries, a process, by the way, that has not been repeated but should be.

Members on that round table heard from industry and civil society and they came up with recommendations that were agreed to by both sides. One of the recommendations was that an independent ombudsperson would be appointed by government to oversee Canadian extractive mining industries abroad. The ombudsperson would have the ability to investigate and oversee mining operations and, if need be, to not only follow the criteria that I mentioned in terms of the equator principles, but to ensure that if there were any concerns some sort of remedy would be available. For example, if we had a Canadian mining company that was abusing environmental or human rights standards, the ombudsman would be able to do something. That was agreed to.

The sad part of this is that the government took more than a year and a half to respond to the recommendations. It came up with a counsellor but her hands are tied should any complaint come forward. She can only investigate a complaint if both parties agree to an investigation and, of course we know what that means. If one party decides it does not want an investigation to go forward then it will not.

If members look at Bill C-300, they will see that it supports the round table. Many people are concerned that there will not be sufficient time for companies to respond. I will go over the amendments that we will be voting on tomorrow.

We will ensure that vexatious or frivolous complaints will be tossed out. A company will have time to put its concerns forward and there will be a lengthy time period for the investigation. If there is cause for concern under the equator principles and other principles agreed to by the company, then the company, by way of engagement with the minister, as it is written in the bill, would have time to respond to ensure there is no wrongdoing.

Having those safety valves, throwing out frivolous vexatious claims, making sure that there is a thorough investigation, making sure that Canadian companies have an opportunity to respond is fair play. That is what we will be voting on tomorrow night. The question is, do we want to raise the standard of Canadian companies, yes or no?

I should also note that a recent report by the industry itself has pointed to the problem. The mining companies are the ones who commissioned the report. It says that Canada, among countries like Australia, India, U.K., South Africa, the U.S. and Indonesia, has the most claims against the industry. We are by far the leader in terms of claims of incidents that have been filed.

That says that the industry itself, having commissioned this report and having the data, understands the importance of dealing with corporate social responsibility. The report lays out the type of infractions by Canadian companies. It clearly underlines the need for action.

The mining companies say that they wish the government had come forward with the ombudsperson, with independence and having more ambit around investigation and remedy.

What is important to note in this report is what is said in terms of CSR as an idea. The report says very clearly that mining and exploration firms operating in Canada thrive while working under arguably more rigorous CSR and regulation paradigms when compared to other sister operations in the developing world. The success of mining companies in Canada happens even as companies are faced with a divergent cultural context while working alongside indigenous communities that are often marginalized.

Our companies can do this. They are up to the job. Our job is to make sure we support them by having a level playing field. That is exactly what Bill C-300 would do.

Those who say it would inhibit investment obviously have not read the bill and considered the amendments. The Export Development Corporation supports Canadian industries abroad. It is very active abroad and it is not true to say that it would not be able to do its work if Bill C-300 is passed. In the past it has involved itself with the voluntary principles and the equator principles. It is the one that is saying it is involved in this.

We need to say to EDC that not only should it have this in its own portfolio, but Parliament and government have a role to make sure it regulates. Why? EDC is a crown corporation. It is not up to someone else to regulate it. It is our job here.

If Canadian companies are not able to follow the principles that other Canadian companies are following and after the rigorous oversight that I mentioned they are found to be in violation, then EDC would not be able to support them. No companies have an absolute right to EDC money. It is something that companies have to apply for and standards need to be enforced. That is exactly what Bill C-300 would do.

That is why we will be supporting the bill, as amended, tomorrow night.

[Richard Nadeau, Bloc, Gatineau, QC]

Mr. Speaker, the Bloc Québécois supports Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries, in principle.

The issue of social and environmental responsibility for Canadian companies abroad, particularly Canadian mining companies, has long been a concern for the Bloc Québécois. Canada is a world leader in the mining industry. It has a huge presence in Africa, where most companies are Canadian or American and are incorporated in Canada or listed on Canadian stock exchanges.

For some years now, a number of Canadian mining companies have been directly or indirectly associated with forced population displacements, significant environmental damage, support to repressive regimes, serious human rights violations and sometimes even assassinations.

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

We have always supported the recommendations in the report of the advisory group to the National Roundtables on Corporate Social Responsibility and the Canadian Extractive Industry in Developing Countries. These recommendations were unanimously supported by civil society and the extractive industry.

While Bill C-300 is a step in the right direction, we believe it has flaws in terms of what the national roundtables advisory group recommended. For example, Bill C-300 does not provide any clear, independent and transparent mechanisms to ensure accountability or to monitor Canadian companies' compliance with accountability standards.

In Noir Canada: Pillage, corruption et criminalité en Afrique, a book about Canada's involvement in plundering, corruption and crime in Africa published by Les Éditions Écosociété in 2008, Delphine Abadie, Alain Deneault and William Sacher provided the following analysis of Bill C-300.

First, the bill does not take the Canadian International Development Agency's policies and activities into account.

Second, it does not take Export Development Canada's lack of transparency into account.

Third, it does not take into account instances of political interference attributed, in some cases, to Canadian diplomacy in southern countries on behalf of Canadian mining interests.

Fourth, it does not take into account the harmful role of the Toronto Stock Exchange in the appreciation of mining claims often obtained under suspicious circumstances in southern countries.

Fifth, it does not say whether and under what conditions Canadian companies can or could be prosecuted civilly or criminally in Canada for injurious actions attributed to them abroad.

Sixth, it does not provide for an independent body to receive complaints from foreign nationals, leaving it rather to the minister.

Seventh, it does not provide a process to evaluate the damages to populations outside Canada and consider implementing redress programs.

Eighth, it totally ignores the numerous cases of abuse by Canadian companies already recorded in many credible documents. I am thinking of expert reports from the United Nations, parliamentary reports, conferences held in parliamentary precincts, reports from independent organizations like Amnesty International and Global Witness, comprehensive investigative reporting, compelling documentaries and assessments by recognized experts.

Here are some representative cases cited in Noir Canada with respect to Canadian mining companies' detrimental activities in Africa. The first example is from Bulyanhulu, Tanzania. In the summer of 1996, bulldozers and the national police force were used to expropriate several hundred small-scale miners and clear the way for Canada's Sutton Mining to exploit the area.

Fifty-two people were buried alive in that operation. Sutton Mining was then bought by another Canadian company, Barrick Gold. Canada's diplomatic service was actively involved in the affair; allegations of interference are well founded. The Government of Norway, the Lawyer's Environmental Action Team, Friends of the Earth, Rights & Democracy, Mining Watch and master's student Dennis Tessier have all stated publicly that these allegations are credible and alarming.

The second example is Banro, a company that helped kindle the bloody conflict in the African Great Lakes region in eastern Congo between 1997 and 2002. Millions died in that conflict, and untold distress was inflicted on the people in the form of systematic rape, recruitment of child soldiers and destruction of villages.

The third example has to do with Diama-Manantali and Sadiola. CIDA steadfastly supported dam construction projects that profited Canadian engineering firms. These dams, which have had a catastrophic impact on the people—think of floods, loss of arable land, ecosystem destruction, disease, social tension and so on—allowed IamGold to turn a 38% profit on operating an open pit mine in Sadiola, another project with a disastrous impact on the people.

The fourth example is the Talisman corporation, which had to leave Sudan after, according to several sources, it apparently ordered the Sudanese army to violently remove any civilian presence in the vicinity of its development site. This passage from Noir Canada shows that Talisman was pressured to leave Sudan because it was listed on the New York stock exchange, not just the Toronto exchange.

Another book that has been written on this topic is Not on Our Watch: The Mission to End Genocide in Darfur and Beyond by Don Cheadle and John Prendergast, published by Hyperion in 2007. On page 62 is a paragraph that reads:

The Sudanese regime, supported by Canadian, Malaysian and Chinese oil companies, was able to wipe out whole populations in south-central Sudan, leaving the way clear for the oil companies to start pumping the oil.

This information is supported by a memo from the International Crisis Group, Human Rights Watch and Amnesty International. The book I quoted from has an introduction written by none other than Barack Obama, who was then a U.S. senator, and a preface by Elie Wiesel.

Bill C-300 is a step in the right direction. But to put an end to injustices by Canadian and foreign mining, gas and oil companies, we must make sure that they fully respect human rights and environmental rights, without exception.

This bill seeks to ensure that Canadian extractive corporations act responsibly and comply with international human rights and environmental standards.

How can anyone be opposed to that?

The Department of Foreign Affairs is responsible for preparing guidelines on best practices. These standards are based on recognized documents, including the Universal Declaration of Human Rights.

It is in this spirit that the Bloc Québécois is supporting Bill C-300, and I sincerely hope that all of the members in the House will support it. It is definitely humanistic and targets real issues concerning crooked mining companies that do not respect human rights.

[Lisa Raitt, Conservative, Minister of Labour]

Mr. Speaker, I am rising today to speak in strong opposition to Bill C-300.

Bill C-300 is entitled “An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries”. Without actually looking at the content and implications of the bill, in other words, just looking at the substance of the bill, it sounds good. It has good optics. It is laudable. We all support corporate social responsibility. Every Canadian wants to see our companies follow the highest standards when it comes to the environment and human rights, especially if the company is representing Canada abroad.

My past is rooted in the mining culture in Cape Breton, and I believe this country's future truly depends upon prosperity in the great resources we have, especially in the north. I strongly support CSR, or corporate social responsibility, but the substance of the bill will not help the issue of corporate social responsibility.

Bill C-300 is more than just a nice title, and as parliamentarians, we are called to carefully consider the implication of legislation. So I implore parliamentarians that we cannot vote in favour of the bill simply because we agree with the title of the bill. We need to look at the text. We need to look at the implications of the bill. We need to consider the substance of the bill and we need to listen to experts if they warn us about the shortcomings in the legislation.

The member for Scarborough—Guildwood is attempting to create an international political circus around his bill. His witnesses are well meaning and they all speak in favour of the optics of corporate social responsibility in general, but he refuses to address the specific concerns that have been raised on the substance of the legislation.

Also heard as witnesses in opposition to the substance of the bill are Canadians with expertise in the area: Export Development Canada, the Canadian Chamber of Commerce, the Canadian Council of Chief Executives, the Canadian Bar Association and the entire mining industry.

All these people, all these groups, believe in corporate social responsibility, but the bill is a clear example of throwing the baby out with the bathwater. It is imperative to give context to the mining, the oil and the gas sectors in Canada, because it is so important. Canada's extractive industries have been, continue to be, and will be a hugely important factor in Canada's economic growth and its recovery.

Domestically, we have the vast resources of the north and we have responsible people there who will develop it. Internationally, we are a world leader in exploration and mining. In fact, Canada is home to over three-quarters of the world's exploration and mining companies. We lead the world. We are respected. Indeed, we are revered, and this is a crucial sector of the Canadian economy. In substance, Bill C-300 guts our competitiveness for this crucial sector and it is done all for optics.

I will speak to two reasons that Bill C-300 should be defeated here in this chamber. One, essentially and fundamentally it is a badly drafted piece of legislation and it has extremely poor implementation mechanisms. Two, it has a very politicized complaints process, and that is the one I will focus on right now.

One witness testified before the committee that all it takes is one person writing a single letter to initiate a ministerial investigation, which puts a political official as the police in charge of the investigation, as the judge weighing the evidence, as the jury making the decision and maybe even the executioner in meting out the punishment.

When the National Roundtable on Corporate Social Responsibility came forward with recommendations on this issue of implementation and on the issue of a complaints process, it was adamant that the complaints mechanism must be independent. So the government responded by establishing the independent Canadian corporate social responsibility counsellor, who was appointed in October of last year and whose mandate is to review corporate social responsibility practices of Canadian companies that are operating outside of Canada.

Dr. Marketa Evans is available to receive complaints regarding the conduct of Canadian companies, and in contrast to what Bill C-300 proposes, Dr. Evans is at arm's length from political interference.

While the author of Bill C-300 claims that his bill would increase accountability for corporate social responsibility, the complaints process that he is actually proposing is a partisan political mechanism that is fraught with difficulties associated with ministerial investigation in a foreign jurisdiction, when Canada already has in place an independent process.

The fact that it is a political complaint process is a major red flag, but the problems with Bill C-300 continue.

The complaints process itself in the bill is irresponsible because it would offer no protection for responsible Canadian companies that are faced with false allegations. I will say it is completely disingenuous to suggest that there is no risk of false claims and I will tell members why.

CIBC has indicated that it believes that Canadian mining companies deal with thousands of stakeholders on an ongoing basis across almost 10,000 different projects in 100 countries. It is more likely that several thousand complaints would happen per year.

Throughout the world, there are offices that investigate allegations of corporate abuse. The World Bank's investigator throws out countless false allegations every year.

However, Bill C-300 has no filter for false allegations. As soon as an allegation is received, the bill would require that the allegation be made public and for a Canadian minister of the Crown to investigate the allegation in a foreign jurisdiction. During the investigation, until the cabinet minister concludes that the claim was actually false, the claim would have undeserved credibility and could damage the international reputation of our responsible companies.

However, under international complaint mechanisms and in the current Canadian system, false claims are filtered and the reputations of responsible companies are not attacked.

In Bill C-300, this issue is so obvious that even several prominent Liberals have put partisan politics aside to voice concern about this bill, stating that foreign governments could end up withholding or actually taking away permits from Canadian firms, citing the minister's ongoing investigations of allegations, investigations that ultimately conclude that the allegation was completely false but still render the permit being taken away.

Both Jim Peterson and Raymond Chrétien provided expert testimony against this bill.

One of the facts about Canadian mining companies that I am very proud of and that I have been witness to is their track record on cleaning up mines they have bought from other companies. I am talking about mines that were owned by people who did not respect the environment, abused local populations, did not hold to the same high standards as Canadian companies and were dangerous.

Currently, Canadian companies are able to purchase these mines, and in the process they bring Canadian principles of labour safety, environment protection and human rights to the local community. There are countless examples of Canadian companies doing that around the world. I was very lucky to be able to witness this first-hand in South America, travelling and speaking with both local officials and union groups who assured me that Canadian investment and Canadian leadership is hugely important.

If Bill C-300 passes, many of these Canadian companies would have to think twice about investing in countries like this. We cannot jeopardize our Canadian extractive sector and allow them to shy away from investing in a particular region because of the potential for false allegations.

This bill ignores Canada's current system on corporate social responsibility and our great work on labour co-operation agreements.

In conclusion, there is a big difference between supporting the optics of the bill and supporting the substance of the bill. The optics of the bill try to make things look good and the author claims it would force Canadian companies to follow acceptable rules and standards.

I would say that respecting our mining sector and the work it does in the world and support for the sector as we come out of this economic recession means that we vote against Bill C-300, because I can tell members that, as was said by the CIBC, I believe the only remedy that responds to the passage of Bill C-300 is for companies in mining and oil and gas to relocate to any other jurisdiction in the world so that they can remain competitive.

The House resumed from September 20 consideration of Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries, as reported without amendment from the committee, and of the motions in Group No. 1.

Bill C-300—Speaker's Ruling

[The Speaker, Liberal, Peter Milliken]

I am now prepared to rule on the point of order raised on Monday, September 20, 2010, by the hon. Parliamentary Secretary to the Leader of the Government in the House of Commons concerning the need for a royal recommendation to accompany Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries, standing in the name of the hon. member for Scarborough—Guildwood.

I would like to thank the Parliamentary Secretary to the Leader of the Government in the House of Commons for having drawn this matter to the attention of the House as well as the hon. members for Scarborough—Guildwood and Mississauga South and the Parliamentary Secretary to the Minister of International Cooperation for their comments.

In raising this issue, the Parliamentary Secretary to the Leader of the Government in the House of Commons argued that Bill C-300 established a new, quasi-judicial function regarding Canadian companies engaged in mining, oil or gas activities in developing countries to be exercised by the ministers of foreign affairs and international trade. He also contended that the framework required to implement the provisions of the bill was not foreseen by the Department of Foreign Affairs and International Trade Act and that considerable expense would be required to put it in place. In supporting this point, the Parliamentary Secretary to the Minister of International Cooperation noted that during 2009 the World Bank had expended $3.3 million conducting what he described as “parallel investigations” to those he believed would be required by Bill C-300.

The hon. Parliamentary Secretary to the Leader of the Government in the House of Commons noted that in other cases, the Speaker had found that bills mandating an expansion of the functions of an existing department or agency required a royal recommendation. He referred in that regard to the ruling concerning Bill C-280, An Act to amend the Employment Insurance Act (Employment Insurance Account and rate setting) Debates, June 13, 2005, pages 6990-1, as well as to the ruling concerning Bill C-474, National Sustainable Development Act, Debates, February 11, 2008, but I will not cite the pages.

It is in that context that the Parliamentary Secretary to the Leader of the Government in the House of Commons maintained that the terms and conditions of the Department of Foreign Affairs and International Trade Act were therefore being altered by Bill C-300 and that funds would need to be appropriated to carry out the new function imposed by the bill. He concluded that for these reasons, a royal recommendation would be required for Bill C-300.

In his remarks, the hon. member for Scarborough—Guildwood asserted that the bill had been carefully drafted with a view to avoiding any requirement for a royal recommendation. He acknowledged that some reorganization of existing resources would be necessary, but that new resources would not be required.

The Chair takes very seriously the need to respect the requirements for a recommendation of the Crown to accompany any legislation requiring new expenditures. The Chair has therefore examined with care the details of Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries, as well as the precedents enumerated by the parliamentary secretary.

The case of Bill C-280, cited by the Parliamentary Secretary to the Leader of the Government in the House of Commons, involved the creation of a new employment insurance account outside the consolidated revenue fund. Bill C-474, to which he also referred, assigned new functions to the Commissioner of the Environment and Sustainable Development, including the assessing of provincial performance in the meeting of sustainable development goals, which was clearly a significant expansion of the existing mandate.

The Parliamentary Secretary to the Leader of the Government in the House of Commons was correct in saying that both Bill C-280 and Bill C-474 required a royal recommendation. In the first instance, the bill created an employment insurance account outside the consolidated revenue fund as well as several other proposals. These included lowering the threshold for becoming a major attachment claimant; setting benefits payable to 55% of the average weekly insurable earnings during the highest paid 12 weeks of the 12 month period preceding the interruption of earnings; reducing the qualifying period before receiving benefits; and removing the distinctions made in the qualifying period on the basis of the regional unemployment rate. From a mere listing of the measures in the bill, one must clearly conclude that the bill had the effect of authorizing increased expenditures from the consolidated revenue fund in a manner and for purposes not currently authorized.

As for Bill C-474, it sought among other things, to modify the mandate of a new independent Commissioner of the Environment and Sustainable Development. Specifically, it sought to develop “a national sustainability monitoring system to assess...the state of the Canadian environment, nationally and by province” as well as “...the national and provincial performance in meeting each sustainable development goal...” listed in the bill. There is no doubt that extending the commissioner’s mandate into the provincial arena was clearly a significant expansion of the existing mandate.

Thus, we are in agreement on the issues raised by these two bills, however, it seems to me that the situation presented by Bill C-300, the case now before the House, is not analogous to the circumstances just described.

Bill C-300 does require the Ministers of Foreign Affairs and International Trade to examine bona fide complaints concerning possible contraventions of the guidelines to be established under clause 5, but the bill is silent with respect to the manner in which such examinations are to be conducted. The respective ministers appear to have entire discretion in this regard. Furthermore, the Chair is of the view that the examination of such complaints is not a departure from or expansion of the current ministerial mandate under the Department of Foreign Affairs and International Trade Act to carry out such examinations. Bill C-300 may put forth more stringent requirements, but it does not expand the mandate per se. Hence, a parallel cannot be made to Bill C-474.

In addition, Bill C-300 does not actually call for the establishment of the quasi-judicial process referred to in testimony by departmental officials. Nor does it require that investigations be carried out in other jurisdictions. It may be that a reorganization of resources or even additional funds would be required, however, it appears these would be operational in nature. In short, there is little ground for comparison of Bill C-300 with Bill C-280 and Bill C-474.

Consequently, from a strictly procedural point of view, the Chair cannot find that Bill C-300 requires the expenditure of public funds for a new and distinct purpose. I therefore rule that there is no requirement that the bill be accompanied by a royal recommendation. The House may continue to consider it in accordance with the rules governing private members' business.

I thank hon. members for their attention.

Mining Industry

[Ed Fast, Conservative, Abbotsford, BC]

Mr. Speaker, the Liberal-NDP-Bloc coalition is attacking a key pillar of the Canadian economy. Bill C-300 would, among other things, subject Canadian mining companies to grievances lodged by foreign interests.

If the coalition has its way, many Canadian jobs will be lost in an industry that contributed $40 billion to Canada's economy in 2008 and which employs 351,000 workers. During the thick of the global recession, overseas contracts kept the mining industry afloat. At a time when the economic recovery is still fragile, why does the coalition want to make life harder for Canadian companies?

Unlike the coalition parties that simply want to score political points and jeopardize Canadian jobs, our government will continue to fight hard for Canadian working families.

[Paul Stothart]

Thank you very much for the question.

Certainly, the mining industry takes its responsibility in the environmental and social area very seriously. I would highlight the mining industry's contribution to the whole emergence of the clean energy economy and the fact that minerals are essential for hybrid cars, catalytic converters, and lightweight materials, etc. There's a harmony between those goals.

On Bill C-300, I think our main concern is that the mechanism proposed doesn't really bring any due diligence or due process to it. It's a mechanism that would be out there basically to damage companies' reputations. Companies' reputations would be damaged over the period of a year or two until there is some resolution brought to whatever the complaint may be.

There are already two mechanisms that exist today for people who want to complain about the operations of a company overseas. There's the OECD counsellor and the national contact point within the Foreign Affairs department, and there is the CSR counsellor, who has been established and has laid out a process that she would envision for resolving disputes.

There are already two mechanisms that exist. We don't see the need for a third, especially one that has a very low regard for due process.

[Robert Carrier, Bloc, Alfred-Pellan, QC]

Good morning, ladies and gentlemen.

I have a question for Mr. Stothart from the mining industry. I read your statement with great interest. From your document, I understand how important the mining industry is to this country. I am aware of this because I am an engineer. In fact, my son worked at the Raglan mine in northern Quebec. I am therefore very aware of how important it is. However, I would like to talk about the environment. You have a chapter on the environment. You recognized that this is not an unimportant issue for the mining industry. I believe that the environmental consequences of mining are still very significant.

I had the opportunity to visit a gold mine in another country, namely Burkina Faso. The environment seems to have been well protected there, both the physical environment of the mine and the place where the population lives. However, the record of the Canadian mining industry abroad is not very good. This is why we introduced a bill which is being debated. You mentioned this a little earlier. Bill C-300 would regulate or impose environmental standards. We are trying to apply them here, but when we engage in mining activities abroad, it seems we forget them. I would like to hear what you think about Bill C-300. I think you do not support it. I would like to hear some good arguments for your position.

[Paul Stothart, Vice-President, Economic Affairs, Mining Association of Canada]

Thank you very much, Mr. Chair, and thank you as well for the invitation.

I want to use my five minutes to just quickly highlight two figures from the “Facts and Figures 2010” document. You each have a copy en français et en anglais.

Page 9 shows the distribution of the industry clusters across Canada. As you can see from the map, the industry is very strong in all regions of the country: nickel in Newfoundland and Labrador; base metals in Quebec; base metals in Ontario; a lot of gold in Quebec; base metals in Manitoba; uranium and potash in Saskatchewan; oil sands in Alberta; base metals and metallurgical coal in British Columbia; and a lot of diamond activity in the northern territories. It's a very diversified and strong industry across the country.

It employs anywhere from 300,00 to 350,000 Canadians, depending on the state of the economy, and it pays anywhere from $6 billion to $12 billion per year to governments in the form of taxes and royalties, again depending on the state of world mineral prices.

More importantly, perhaps, it provides business for about 3,200 companies that supply goods and services to the industry in Canada. About 3,200 companies supply engineering, environmental services, drilling equipment, and so on. That's important to keep in mind.

The second figure, on page 13, shows the state of proven and probable mineral reserves in Canada, and it shows a fairly troubling picture, which is that the level of Canadian reserves has declined by around one half over the last quarter of a century for copper, nickel, zinc, silver, and so on. That is troubling, because a lot of the other benefits of the industry depend on our having strong levels of mineral reserves in Canada.

We're seeking a couple of things in that regard. One is a continued effort to enhance the investment attractiveness of Canada, and that would include continuing to reduce corporate tax rates to 15% and continuing the super flow-through share provisions of the Income Tax Act. I should add, within the investment attractiveness theme, that we seek the defeat in the coming days of the negative private member's bill, Bill C-300.

We would also seek continued investment in geoscience and geological mapping, especially in northern Canada, where we need to know better what the makeup is in the territories in terms of geological formations. That kind of information is very useful to companies.

On enhanced investment in innovation, there is potential for the government to better support the innovative future of this industry. It's a very technological and innovative industry when you think of some of the processes it goes through to turn rock into 99.99% pure metal.

Finally, I would echo earlier comments about continued support, and in this case, of the Mining Industry Human Resources Council. It's a very effective human resources council and is very useful to our industry in terms of information, research, mentoring, partnerships, and certification. It plays a very useful role and we hope to see enhanced support of that sector council.

I'll wind up there, Mr. Chair.

Thank you.

Bill C-300--Royal Recommendation

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

Mr. Speaker, I am rising on a point of order regarding Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries, introduced by the member for Scarborough—Guildwood.

I recognize that my colleague, the Parliamentary Secretary to the Government House Leader, rose on another point of order on this bill earlier this week. This also prompted submissions by members for Scarborough—Guildwood and Mississauga South.

I would like to submit my arguments as to why this bill would require a royal recommendation in order to proceed to third reading.

The member for Scarborough—Guildwood submitted that we have been at this bill now for some 13 or 14 months and here we are at the last minute raising the issue of royal recommendation. I would like to point out that it was not until the last possible opportunity that the member put forward amendments to his bill. None of these amendments address the need for royal recommendation so now we are faced with a bill that should not proceed.

Standing Order 79(1) reads as follows:

This House shall not adopt or pass any vote, resolution, address or bill for the appropriation of any part of the public revenue, or of any tax or impost, to any purpose that has not been first recommended to the House by a message from the Governor General in the session in which such vote, resolution, address or bill is proposed.

Mr. Speaker, as you are no doubt aware, as we see in the Journals from November 9, 1978, the imposition of new duties on an existing department or authority requires a royal recommendation. Bill C-300 clearly assigns new duties to the Minister of Foreign Affairs and International Trade.

On September 27, 2006, you ruled a particular bill acceptable because you could not speculate on the functions that the legislation would force the government to disburse. Fortunately, in this instance, you need not speculate. Section 4 starts by saying:

In carrying out their responsibilities and powers under this Act, the Ministers shall--

It is obvious and does not require speculation that this bill attempts to ascribe new responsibilities and powers to the Minister of Foreign Affairs and International Trade.

On November 9, 2006, Mr. Speaker, you ruled another bill needed a royal recommendation because it extended a program that would require funding. Bill C-300 required disbursement of funding in order for the ministers to carry out their duties ascribed to them.

I point out that I have information in hand that says that the World Bank's parallel investigations, for example, which is exactly what this bill is calling for, cost $3.3 million in 2009 to investigate 11 new complaints. Mr. Speaker, I submit that fact for your consideration as well.

We had the opportunity to hear expert testimony from our bureaucrats at DFAIT. Allow me to read into the record the testimony from the Standing Committee on Foreign Affairs and International Development meeting of December 1, 2009:

[The member for Kootenay—Columbia]: I want to be careful that I'm not putting words in your mouth. I believe, in answer to a question of Mr. Patry, your response was that in your judgment it would require a new section or arm or department, which would require additional human resources or financial resources. Is that correct?

Mr. Grant Manuge: Yes, that is correct.

Further I asked:

Presuming that there is a finite amount of money in DFAIT's budget, which there is, where would you take those dollars from? What department or current function that DFAIT is doing would have to suffer? Or in fact would it be possible to do it without having to come to the Treasury Board for additional funds?

Mr. Grant Manuge representing DFAIT said:

Thank you for your question. In this case, at this stage in our analysis, we are indeed aware that additional resources would be required, not only human resources, financial resources, but also significant investment in training or in recruiting highly qualified individuals who provide the competencies that would be required to carry out that function.

At this point in our analysis, we would not be in a position to indicate whether that could be addressed through reallocations within our department, but our departmental resources are completely allocated, so this would be a decision that would have to be reviewed very carefully. As you say, there could potentially be impacts on the ability to carry out our mandate in other areas of the department.

Mr. Speaker, I recognize that you face a rather challenging situation in taking a look at the provisions relative to a royal recommendation, and that is it is not crystal clear that additional funds will be required. I am fully aware of that. If we take a look at the fact that we know from the World Bank that it cost $3.3 million last year to investigate 11 complaints, in the name of logic it is very obvious that additional funds will be required.

It is clear that this bill would directly affect the disbursement of public funds. It would assign new duties to an existing department where funds have already been allocated and functions have already been described for that department.

I realize there is often a good deal of discussion regarding royal recommendations. However, it is the Speaker who is duty-bound to protect the Constitution through the Standing Orders of the House and to assure that bills that should require royal recommendation do not proceed.

I would also like to quote from Hansard, June 1, 2006:

I am also aware that a bill may be repaired at committee or during report stage and also that a minister at any point in the legislative process can come forward. That is not a problem and I believe the member for Scarborough--Guildwood has a bill on international development which I think can be repaired in that fashion.

Clearly, the bill has not been repaired. Bill C-300 is the current version of the legislation to which I reference. The bill was recognized by the member for Mississauga South as needing a royal recommendation at that time.

The clauses in Bill C-300 still stand. The need for a royal recommendation still stands, even though the member for Mississauga South has apparently changed his mind. Fortunately, he is not the Speaker of the House.

It is clear that even at a time the Liberals realized this bill needed a royal recommendation or amendments to address the problem. That was a matter of a year ago.

The precedents are clear. The member for Mississauga South was clear in 2006. Without amendments addressing this issue, Bill C-300 does require a royal recommendation.

Motions in Amendment

[Greg Rickford, Conservative, Parliamentary Secretary for Official Languages]

Madam Speaker, I would like to expand further on some of the challenges that Bill C-300 would present in its implementation. I will drill down, no pun intended, on at least seven substantive issues we have with Bill C-300.

I should say from the outset that the great Kenora riding is home to vast mineral assets, and in fact has one of the most productive gold mines in the world, operated by Goldcorp in Red Lake and Pickle Lake. Needless to say, constituents, families, communities, and corporations performing exploration and mining activities in the great Kenora riding have expressed serious concerns with respect to Bill C-300.

I am therefore pleased and honoured to speak to this bill on behalf of my constituents.

Many members of the House have pointed out certain practical issues that need to be considered, while recognizing the intent and the goal of this bill.

I want to reiterate that this government is a firm believer in corporate social responsibility. However, this bill is not the way to promote it.

Over the last year, the Standing Committee on Foreign Affairs and International Development has heard from almost 70 witnesses on Bill C-300. Many witnesses have raised a number of practical issues with the bill, and these must be considered while recognizing the intent of the bill. I would like to highlight some of the more significant obstacles that they have raised regarding the effective implementation of the bill.

First, Bill C-300 does not appear to include any procedural safeguards to ensure that it is consistent with Canada's procedural fairness or even every Canadian's right to a fair and public hearing by an independent and impartial tribunal. For example, Bill C-300 would not require those conducting an examination to give notice or even consider evidence from the affected company. It would, however, permit complainants to give evidence against affected parties without subjecting themselves to cross-examination. Furthermore, this bill puts at stake the rights, privileges, and interests of an affected company.

Because a negative judgment under Bill C-300 would significantly affect a company's reputation and operations, we owe our Canadian companies the right to procedural fairness.

Second, Export Development Canada—EDC—uses its trade influence to encourage businesses to develop socially responsible practices and helps businesses implement them.

The categorical nature of the compliance standards set out in this bill would force EDC to immediately cut off any association with any Canadian business that fails to fulfill its corporate social responsibility.

This means that if Bill C-300 becomes law, EDC's ability to provide lending and insurance to companies in the extractive sector will be seriously compromised, without providing any real corporate social responsibility benefit.

Once again, if Bill C-300 is enacted, EDC's capacity to provide loans and insurance to companies in the extractive sector will be seriously compromised, and there will be no real corporate social responsibility benefit.

In the last year alone, EDC's support is estimated to have generated $61 billion in Canadian GDP, which amounts to 5¢ of every Canadian dollar, and sustained 642,000 jobs in communities across the country. When we consider that the extractive sector comprises one-third of EDC's total business volume, we can appreciate the impact that EDC's departure from the market would have on working families here at home. This clearly highlights the economically reckless and irresponsible nature in which this bill was conceived.

Third, the department already has two mechanisms in place to assist in the resolution of disputes: the National Contact Point for the OECD Guidelines for Multinational Enterprises, and the Extractive Sector Corporate Social Responsibility Counsellor. Both of these mechanisms focus on improving the performance of Canadian companies. This allows for longer-term solutions that benefit all parties involved.

By comparison, Bill C-300 is largely punitive. Unfortunately, in many cases the Government of Canada does not have the leverage over extractive companies that the bill presumes. Junior companies, especially, often do not seek the government support this bill proposes to deny them. In these cases, the company would not be compelled to change its performance under the threat of Bill C-300.

The implication is that this bill would see changes we do not want, because a prejudicial regime such as that proposed by this reckless bill could serve only to encourage more companies to leave Canada.

Those companies might see the constructive mediation provided by the national contact point and the corporate social responsibility counsellor as a better way to enhance their performance and be more competitive.

That is what mining companies in Canada are saying about the bill. In fact, a number of witnesses also put forth that the bill would discourage companies from maintaining offices in Canada. Instead, they would relocate to another jurisdiction. Why risk such a result when we have a strategy that is working? That is the question.

The punitive framework of Bill C-300 contrasts with the constructive, productive, and effective mediation offered by the National Contact Point and the Corporate Social Responsibility Counsellor.

Regrettably, Bill C-300 could be counterproductive to the existing mechanisms, since a company might not want to engage in the informal mediation if the information it provides could subsequently be used against it in a complaint under Bill C-300. It burns goodwill and good faith.

Fourth, the bill proposes changes to the Special Economic Measures Act. It is not clear why an act that deals with state-to-state relations would appear in a bill designed to regulate the activities of corporations.

Fifth, even if the consequential amendments that are proposed are applied domestically, the bill may constitute an extra-territorial application of Canadian law since it would be regulating the activities of Canadian companies outside Canada's jurisdiction.

Many countries, including many of our trading partners, would likely take issue with the patronizing implication that Canada viewed their laws as inferior. Likewise, it might harm diplomatic relations if we were to send teams of investigators into these countries, especially if they were in the process of conducting their own investigations.

Sixth, we have serious concerns about whether there is the constitutional authority to enact Bill C-300. The regulation of business, including issues relating to human rights and the environment, is constitutionally a matter for provincial jurisdiction, with regard to property and civil rights. Therefore, there is a serious risk that the regulatory scheme of complaints, examinations, and published findings envisioned by Bill C-300 would be found to be unconstitutional. Simply put, there does not appear to be any federal head of power that clearly authorizes Parliament to establish the regulatory scheme as proposed in Bill C-300.

Seventh, and finally, Canada's missions abroad provide critical advice on corporate social responsibility to Canadian companies. Bill C-300 would prevent our missions from engaging companies facing difficulties and would prevent us from helping to resolve their disputes.

For these reasons, we feel that the government's corporate social responsibility policy is a more effective way of helping Canadian extractive companies continue to develop a social licence to operate. As discussed in the past, building on Canada's commitment to the OECD's Guidelines for Multinational Enterprises and our country's National Contact Point, the government's strategy describes four specific initiatives for action that outline our commitment to promoting best practices for Canadian companies operating abroad.

The government has supported the development, outside government, of a multi-stakeholder Centre for Excellence in Corporate Social Responsibility that will help the Canadian extractive sector to implement these voluntary performance guidelines in their operations abroad.

We applaud organizations like the Prospectors and Developers Association of Canada who have developed e3 Plus, A Framework for Responsible Exploration, which is intended to complement established norms for corporate behaviour as exemplified by the OECD Guidelines for Multinational Enterprises and the United Nations Global Compact.

Our efforts promote corporate and social responsibility, both domestically and abroad. I ask all members from both sides of the floor for their support as we continue to take measures to ensure that Canadian companies can make the most of our global opportunities.

[Frank Valeriote, Liberal, Guelph, ON]

Madam Speaker, I stand before you to speak in favour of Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries, as well as recent amendments that serve to incorporate recommendations made by Canada's extractive sector.

The bill grows out of actual recommendations made in the 2006 government round table report on corporate social responsibility and the Canadian extractive industry in developing countries. It empowers ministers to review serious, not frivolous, allegations made against Canadian extractive firms that operate in foreign jurisdictions. Firms found to be in actual violation of the norms set out in this legislation risk losing financial support from the Canadian Pension Plan and Export Development Canada should they fail to make improvements. Currently no investigation is even allowed without the actual consent of the company.

Having briefly described what this bill will do, I will now explain why we need to pass it, and I will begin with a brief quote:

Canada has shown its determination to be a good world citizen.

This quote comes from a children's book on Canada and the world. It is used in schools to teach kids about Canadian identity and about how Canada is perceived internationally. These types of textbooks have a profound impact on our identity as Canadians. They speak of what we once stood for as a country.

When I was fortunate enough to travel to Honduras, Guatemala, and Peru over nine years of being involved in international aid work, I was proud to tell locals that I was a Canadian, and they welcomed me as such. Today our image is changing. Today people in certain developing countries see us as no different from other western countries that are eager to exploit their natural resources, compromising the human rights of indigenous peoples and their ability to manage their own resources, such as water, oil, minerals, and agricultural products.

In voting on Bill C-300, we are being forced to answer a simple question: What do we want our children to read when they are learning about the way their country responded to this bill while we were its decision-makers? How shall we reconcile the legacy we are leaving with the values that we claim are so dear to us: fairness, equity, generosity, and social and environmental responsibility?

Today we could choose to be the decision-makers who continue to provide funding that enables socially irresponsible acts committed by a select few Canadian firms. Instead we could act and cut off funding if and when, and only if and when, firms are found to be in actual violation of the respected norms set out in this bill.

I will now provide examples of some of these socially irresponsible acts to illustrate why action is required. Let us begin with Guatemala.

The Canadian firm HudBay Minerals stands accused of evicting local Guatemalans from ancestral and culturally significant land. When surprised villagers inhabiting the El Estor region of Guatemala protested their forced relocation, violence broke out. Homes were burned and hacked to the ground. Protesting villagers were harassed, beaten, raped, and killed, or they vanished.

Reports of these allegations are extremely difficult for me. We are all partly responsible and frankly, anyone who has contributed to the Canada pension plan, our national retirement fund, is unwittingly supporting this conduct by association. The Canada pension plan has $30 million invested in HudBay.

The situation in Honduras is not much better. The Canadian firm Goldcorp and its subsidiaries are accused of deforestation, of polluting streams, and of illegally altering the course of waterways to support their San Martin mine. Water near the mine has been found to have unsafe levels of harmful metals, and Hondurans living near and using that water have been found to have unsafe levels of arsenic, mercury, and lead in their blood, conditions we would simply not permit in our own country. Goldcorp's environmental record was found to be so atrocious that the Honduran government fined the company for, among other things, allowing cyanide and arsenic to leach into the environment.

Again, we passively support this conduct because we do nothing, while the CPP and Export Development Canada use our money to invest in this company. CPP investments amount to $256 million.

The list continues and is disturbing. Vancouver-based Copper Mesa stands accused of harassing and displacing Ecuadoreans. Contractors for the Toronto-based Barrick Gold stand accused of gang-raping women in Papua New Guinea.

How much can Canada's reputation withstand?

Marcia Ramirez was pepper-sprayed by Copper Mesa security personnel in Ecuador. She described Canada as being a bad country that destroys everything.

Despite these compelling examples, I know that many are still thinking about our economy. Just as some rightfully understand that economic prosperity and environmental stewardship are not mutually exclusive, so too can the human rights of indigenous people co-exist with economic development.

Let me now take a few minutes to explain why passing this legislation will not hamper our economy. First, the United States recently passed legislation to regulate the way their version of the Export Development Corporation invests its money overseas, and mining companies have not boycotted the United States. As with the U.S., mining companies will continue to choose Canada as their headquarters, because we are a stable country with favourable regulatory regimes.

Second, a firm operating responsibly with respect for the environment and human rights will be less likely to encounter resistance from the residents of host states or from its shareholders. As such, firms will be able to operate with greater efficiency, will be more stable in their business operations, and will therefore have access to cheaper money.

In 2003, Talisman Energy was forced to cease its undertakings in Sudan after investors threatened to sell off their shares in light of allegations of human rights abuses.

Shell's operations in Nigeria were also threatened when locals began to sabotage mining equipment in response to human rights abuses and environmental contamination.

Professor Richard Janda, an expert in environmental law and sustainable development at McGill University's Faculty of Law, explains Bill C-300 this way:

There is no evidence that Bill C-300 will unfairly disadvantage Canadian extractive companies, and in fact there is strong reason to believe that the opposite is true. It is more likely to create a regulatory environment that would make Canadian extractive sector companies world leaders in the area of CSR, resulting in a competitive advantage for those Canadian companies when operating internationally.

Instead of continuing to let our once-good reputation be blemished by a few, and I stress “a few”, extractive firms inclined towards such irresponsible behaviour, we have an opportunity to take action and pass this progressive legislation. Today we can show people in the developing world that yes, we are capable of doing the right thing. We can show them that we will no longer be “a bad country that destroys everything”.

Instead, let us vote for this legislation so that we can once again be thought of as international leaders in human rights. Members of Canada's honourable foreign service undergo rigorous training before they are posted overseas to represent Canada to the world. Some, and I stress “some”, of our corporations go into these same countries and with heavy-handed brush strokes undermine the efforts of our foreign service and paint Canada and Canadians as human rights abusers, militia-funding displacers of local populations, environment destroyers, water contaminators, rapists, or killers.

If we do not do something about it, if we do not vote in favour of this bill, it is our children who will read about this in their textbooks as the moment we squandered, the moment when we chose profit over justice when we had the opportunity to choose both. One need not prevail at the expense of the other.

While not posing a threat to Canadian extractive businesses, this bill represents an important first step towards enabling the government, in the most severe cases, to investigate and sanction conduct that is by all accounts irresponsible.

We have a choice. We can either sit back and let our country's identity be shaped by certain irresponsible firms whose objectives do not include the positive portrayal of Canada or the protection of human rights and the environment abroad, or we can do something about it.

Join me in ensuring that our children learn of a Canada and inherit a legacy they can be proud of, rather than a Canada that many in developing countries are starting to question. We must grasp this opportunity to correct this wrong, strengthen our legacy, and re-write the stories that, if we do not do something now, our youth will read and see their country cast in a poor light.

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

Madam Speaker, first of all, I want to say welcome back to all of my colleagues, to you, and to the House staff.

I am very pleased to speak to Bill C-300 on this first day back. The Bloc Québécois will support this bill, because it is a first step in the right direction. Unfortunately, there are not currently any mechanisms to adequately regulate the activities of Canadian mining, oil and gas companies abroad. This is a senseless situation that must be changed. We know full well that Canada is a world leader in the mining industry, and Canadian companies must set an example.

The vast majority of Canadian mining companies that operate abroad are respectful of the local populations and the environment. However, it is clear that for several years, Canadian mining companies have been directly or indirectly associated with forced relocations of communities, major environmental disasters, support for repressive regimes and serious human rights violations. Some companies even hire armed groups, such as militias or security agencies, to protect them.

Far too many conflicts still exist between communities and mining companies, and far too many human rights advocates are still being abused psychologically, kidnapped and sometimes even murdered.

Extraction practices need to be regulated so that they pose no threat to the sustainable development of local populations or their health and safety.

Those are several reasons why Canadian companies should be held accountable for the impact of their overseas activities. The Bloc Québécois is recommending a clear, independent and transparent process to ensure accountability and to monitor Canadian companies' compliance with accountability standards.

We are debating Bill C-300 and its amendments today because we need to act quickly. There are far too many people affected by the negligence of some Canadian companies to ignore such a serious issue. Yes, there are currently some serious gaps. And we did not make them up: numerous people spoke to this on a number of occasions before the Standing Committee on Foreign Affairs and International Development.

Like many of my colleagues, I repeatedly met with many individuals and with members of civil society organizations working in Honduras, Guatemala, Mexico, Colombia and Africa, where the people have been affected by the questionable behaviour of some Canadian mining companies. Their testimonies were all marked by deep distress, great suffering and injustice.

Bill C-300 is a rudimentary legislative tool, and while it is debatable, it is still high time that Canadian parliamentarians pass legislation to regulate the activities of Canadian mining, oil and gas companies working overseas. The Canadian government has its head in the sand if it believes that the voluntary measures it has proposed are effective deterrents. This government is refusing any form of legal regulation of Canadian companies, saying that monitoring is the host countries' responsibility, even though they do not possess the resources needed to manage the situation.

These countries and the mining industry need to make sure that natural resources help reduce poverty and promote economic and social development. The government should exert more control over these companies' practices and give Canadian investments abroad the tools they need to ensure that these companies' activities truly benefit the people of these countries.

The government should recognize that this situation is serious and adopt measures that require mining companies to operate responsibly. The government appears to be downplaying the social, environmental and human rights impacts that these companies' practices and activities have.

This debate has been going on for too long. In 2005, the Standing Committee on Foreign Affairs and International Development released a report entitled “Mining in Developing Countries - Corporate Social Responsibility”. Three of the recommendations in the standing committee's report proposed specific objectives relating to the Canadian government's responsibility to monitor and exert greater control over the activities of Canadian mining companies abroad.

Two recommendations concerned the importance of establishing clear legal standards for accountability and developing mechanisms to monitor the activities of Canadian mining companies in developing countries.

At the time, a number of Canadian NGOs called the committee's recommendations “a real breakthrough”.

As we all know, the then government's response was deeply disappointing because it was interested only in voluntary measures.

In its response, the government agreed to organize a series of round tables to study in greater depth the issues that the Standing Committee on Foreign Affairs and International Development raised in its report. Four round tables were held from June to November of 2006 in four different cities: Vancouver, Toronto, Calgary and Montreal. Participation levels were high: 104 briefs were submitted, 156 oral presentations were given and 57 experts were invited to participate. Members of the public and experts spoke for a total of 101 hours.

Following this extensive consultation, the members of the advisory group, the Canadian and Quebec NGOs, and the experts managed to come to an agreement with a good part of the Canadian mining industry. They published a report on March 29, 2007, in which they asked the Canadian government to immediately adopt a set of standards establishing a corporate social responsibility framework for Canadian mining, oil and gas companies operating abroad. These recommendations are the result of a consensus between civil society and the extractive sector.

The report recommends the establishment of a corporate social responsibility framework for the extractive sector.

In addition, it recommends the appointment of an independent ombudsman to handle complaints about the activities of Canadian extractive companies abroad, the establishment of a tripartite committee—consisting of members of government, civil society and the extractive industry—to monitor compliance with standards, and the establishment of an advisory group to provide advice to government on improving corporate social responsibility.

The report recommends that offending companies no longer be entitled to tax benefits, loan guarantees and other forms of government assistance.

It took the Conservative government two years to respond to the round table report. The Conservative government chose to ignore the recommendations made by the parliamentarians and advisory group members who took part in the round tables and instead set up a bogus agency that will not impose any rules or consequences on companies that pollute or infringe on human rights. The government's decision to rely on voluntary measures and its refusal to adopt effective sanctions make the communities affected by mining projects even more vulnerable.

The Bloc Québécois has always defended the need for social responsibility standards for corporations working abroad and for that reason we are in favour of the principle of Bill C-300. We have frequently denounced the overseas activities of Canadian extractive companies that violate human rights and compromise the sustainable development of local populations.

In closing, Bill C-300 makes it possible to continue the debate about the social responsibility of Canadian mining, oil and gas companies abroad. A number of groups have mobilized to voice their support for Bill C-300. Civil society has taken this opportunity to inform parliamentarians and the public of the need to monitor the overseas activities of mining companies.

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

Madam Speaker, it gives me a great deal of pleasure to stand and rebut the bunch of stuff that just came from the other side. I rise today to speak in strong opposition to Bill C-300. I had the opportunity to be fully engaged in the committee process and discussions. My presentation will lay the expert testimony and facts we heard onto the record for all members of the House.

The debate on Bill C-300 has been constantly muddied by partisan division and a cliché of anti-business rhetoric. I must say that was a great exhibition we just had. The partisan division is along party lines on the frivolous premise that one party is more virtuous in protecting human rights than others. It should be made clear right from the beginning of this debate that all members of Parliament, Canadians, indeed Canadian companies, want to ensure that human rights are protected. We all agree with corporate social responsibility.

It should be noted that we are very fortunate in Canada, in a country where the big bad corporations that the member has tried to make out just do not exist. There is no Avatar planet full of blue people and mysterious trees being destroyed by the big bad mining company. We live in a country where everyone realizes the value of human rights and corporate social responsibility. Canada has an independent corporate social responsibility counsellor who works with NGOs and companies to ensure that Canada is a world leader in respecting human rights abroad. Around the world Canadian companies are noted leaders, practising corporate social responsibility, contrary to what the member just said.

Bill C-300 should be defeated in the chamber for the following reasons. It is badly written legislation and it has extremely poor process in its implementation mechanism.

I want to be clear. The MPs who are voting against the bill are not voting against corporate social responsibility. None of us would vote against corporate social responsibility and human rights. Canada has its own independent CSR program, which involves consultations, public reporting, third party verification. Bill C-300 dismisses the existing collaborative approach and promotes an open-ended punitive one.

Bill C-300 would harm our businesses, which are already world leaders on corporate social responsibility. The bill is often referred to as the product of the national round table on corporate social responsibility. It does not deserve that title. The bill does not represent the round table.

The round table was very successful and it involved representatives from civil society, corporations and the bureaucracy. All participants were happy with the result of the discussions, but not all are happy with the bill.

As previously noted, the government response to the national round table was the establishment of Canada's independent corporate social responsibility counsellor. In contrast to the thoughtful government action, Bill C-300 was hastily drafted with no consultations, as we heard time after time during the committee process. The product we see before us is sloppy. The bill, if ever enacted, would have drastic consequences that were never ever envisioned by the round table.

In the bill the complaints mechanism is placed in the hands of the ministers of the Crown. Bill C-300 converts a process that should be fair and independent into one that is entirely partisan. The complaints mechanism should be run at arm's-length by an independent individual, who reports to the government and that is precisely the existing rule of Marketa Evans, Canada's corporate social responsibility counsellor.

In comparison, the bill would promote soapbox partisan antics on the issue. No minister would be able to deem a claim frivolous without that decision being derided by the opposition's partisan political agenda. However, the same claim could be deemed frivolous by an independent corporate social responsibility counsellor because he or she would be independent from politics.

Unfortunately, the problems with the complaints mechanism go further. Any claim will automatically be perceived as having credibility because of the involvement of ministers of the Crown. Even the most frivolous accusation could be perceived as legitimate. Bill C-300 does not have any mechanism to protect the system from frivolous claims and therefore even the most facetious claim could be given false credibility when the minister so-called investigated.

This issue is so obvious that several prominent Liberal politicians have put partisan politics aside and expressed their concern about the bill, stating that foreign governments could end up withholding or taking away permits from Canadian firms citing the minister's investigations. This could happen in spite of the fact that at the end of the investigation there still might be no evidence of wrongdoing against the company.

When Bill C-300 was in committee, scores of expert witnesses came to testify against the bill. Many of the witnesses had voluntarily participated in the national round table discussions. We heard from the Canadian Chamber of Commerce and the Export Development Canada. These two organizations are representative of the leaders of the Canada's economy and the fact that they are strongly opposed to the bill should not be ignored.

We heard from countless Canadian companies that have outstanding reputations and are examples for the world when it comes to investing in the communities in which they operate. We even heard from the foreign minister of Burkina Faso, who appearing on a different topic, spoke of the immense contributions that Canada's private sector was making in his developing nation.

If we collect the committee witnesses, placing them onto a scale, those opposed to the bill on one side and those in favour of it on the other, the scale will overwhelmingly tilt in opposition to the bill. We cannot ignore the qualifications of the witnesses who spoke out against the bill. They are experts and came with precise concerns about specific details of the bill.

I will not deny there were witnesses in favour of the bill. However, they spoke in favour of corporate social responsibility in general and could not rebut the concerns about specific sections of the bill.

Let me restate that around the world Canadian companies are noted leaders, practising corporate social responsibility. Canada has its own independent CSR program, which involved consultations, public reporting and third party verification.

Bill C-300 dismisses the existing collaborative approach and promotes an open-ended punitive one. The bill would harm our businesses that are already world leaders on corporation social responsibility. In fact, it is important to note that many witnesses stated that the bill would jeopardize the ability of Canadian corporations to purchase mines from less reputable operators.

Frequently Canadian companies will purchase mines that were previously run with little regard for human rights and Canadian companies will correct the problem. Canadian companies invest heavily in local communities and bring mines up to acceptable standards. If Bill C-300 were to be enacted, we have been advised this will no longer be possible because the bill does not protect a company from the allegations of abuse that occurred before it acquired the mine in question.The Canadian corporation could be in jeopardy of liability for prior actions by previous owners.

If Canadian companies are unable to purchase previously poorly run mines, then the local communities will be left at the mercy of the less reputable companies from countries with lower human rights standards than those in Canada. We have also been advised that it will be difficult for Export Development Canada to partner with any mining operation overseas.

Mines are not entirely financed by one organization, but are a collection of international investors. This typically include Canadian companies, Export Development Canada, private investors from around the world and other investment sources. International investment partners would not agree to invest if EDC were at the table and C-300 were to become law. The bill would force EDC to walk away from its investment if any claim were made against the project.

This is highly problematic because Canadian direct investment abroad in the mining sector was $66.7 billion in the last two decades. Putting this at risk would cripple our Canadian companies. If international investors feel that the EDC is default-risk due to the poor complaints mechanism of the bill, they will only invest in EDC if other public organizations are not involved.

Canada's mining sector is a world leader. We have every right to be proud of the work that our companies do. Our companies have an excellent economic track record and have incredible corporate social responsibility programs that operate in communities around the world.

Canada is well positioned throughout the current worldwide economic crisis, but we are not out of the woods yet. The economic recovery is still fragile. Our commodity sector has led the way for our economy and we must not hinder its progress now. We must not cripple our strongest economic sector.

Supporters of the bill will argue that we are saying that if the bill is passed, there will be a mass exodus of companies from Canada. These are the same people who twist the debate into cliché anti-business arguments.

For every reason, the bill is sloppily written, does not reflect the national round table, does not create an arm's-length independent process, creates a partisan political process, has an inadequate complaints mechanism, hinders reputable—

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

moved:

Motion No. 1

That Bill C-300 be amended by replacing, in the English version, the long title on page 1 with the following:

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

Motion No. 2

That Bill C-300, in Clause 2, be amended by replacing lines 9 to 11 on page 1 with the following:

““corporation” means any company or legal person incorporated by or under an Act of Parliament or of any province, and includes holding or subsidiary companies of the corporation.”

Motion No. 3

That Bill C-300, in Clause 2, be amended by replacing, in the French version, lines 10 to 13 on page 1 with the following:

“Opérations de recherche, notamment par forage, de production, de rationalisation de l'exploitation, de transformation et de transport de ressources minérales, de pétrole ou de gaz, réalisées dans le territoire d'un”

Motion No. 4

That Bill C-300, in Clause 2, be amended by replacing lines 12 to 16 on page 1 with the following:

““developing countries” means countries classified as low income, lower middle income or upper middle income in the World Bank list of economies, as amended from time to time.”

Motion No. 5

That Bill C-300, in Clause 3, be amended by replacing, in the French version, line 34 on page 2 with the following:

“3. La présente loi vise à faire en sorte que les”

Motion No. 6

That Bill C-300, in Clause 4, be amended by replacing, in the English version, lines 3 and 4 on page 3 with the following:

“receive complaints regarding Canadian corporations engaged in mining, oil or gas activities”

Motion No. 7

That Bill C-300, in Clause 4, be amended by replacing lines 22 and 23 on page 3 with the following:

“ister who receives the complaint shall consider any relevant information provided by the corporation or the”

Motion No. 8

That Bill C-300, in Clause 4, be amended by replacing, in the English version, line 27 on page 3 with the following:

“that a corporation has contravened a guideline set”

Motion No. 9

That Bill C-300, in Clause 4, be amended by replacing line 32 on page 3 with the following:

“undertaken pursuant to this section, which shall include a determination regarding the corporation’s compliance with the guidelines set out in section 5 and the Ministers' basis for any finding, within eight”

Motion No. 10

That Bill C-300, in Clause 4, be amended by replacing lines 39 to 44 on page 3 with the following:

“(8) If a corporation is found by a Minister to have contravened a guideline referred to in section 5, the corporation shall have six months, from the date of publication of the Minister’s finding, to bring itself into compliance. During that period, no adverse steps resulting from that breach of compliance shall be taken against the corporation by Export Development Canada pursuant to section 10.2 of the Export Development Act or by the Department of Foreign Affairs and International Trade pursuant to section 10 of the Department of Foreign Affairs and International Trade Act.

(8.1) The Ministers shall publish in the Canada Gazette their findings regarding compliance with the guidelines within a period of 30 days after the conclusion of the grace period provided for in subsection (8).

(8.2) If, at the end of that grace period, the corporation remains in contravention of a guideline, as determined by the Ministers, the Ministers shall, within a period of 30 days, notify the President of Export Development Canada and the Chairperson of the Canada Pension Plan Investment Board that the corporation’s mining, oil or gas activities are inconsistent with the guidelines referred to in section 5.

(8.3) If a corporation found to be in contravention of a guideline at the end of the grace period provided for in subsection (8) subsequently undertakes corrective actions, the corporation may request the Ministers to review the results of those actions and make a determination regarding compliance with the guidelines. The request shall be made in writing and shall include such information as is required to determine compliance with the guidelines.

(8.4) Subsections (3), (4), (6) and (7) apply to a request for review provided under subsection (8.3) as if it were a complaint.

(8.5) If the Ministers determine through a review that the corporation remains in contravention of a guideline, the Ministers shall notify the President of Export Development Canada and the Chairperson of the Canada Pension Plan Investment Board that the corporation’s mining, oil or gas activities are inconsistent with the guidelines referred to in section 5.”

Motion No. 11

That Bill C-300, in Clause 4, be amended by adding after line 12 on page 4 the following:

“(11) Every investment manager who invests the assets of the Canada Pension Plan Investment Board pursuant to the Canada Pension Plan Investment Board Act shall take into account the results of examinations and reviews undertaken pursuant to this section.”

Motion No. 12

That Bill C-300, in Clause 5, be amended by replacing line 17 on page 4 with the following:

“(2) The guidelines shall be substantially consistent with:”

Motion No. 13

That Bill C-300, in Clause 5, be amended by replacing lines 18 to 23 on page 4 with the following:

“(a) the IFC's

(i) Policy on Social and Environmental Sustainability,

(ii) Performance Standards on Social and Environmental Sustainability and Guidance Notes to those standards,

(iii) applicable Industry Sector Guidelines, and

(iv) General Environmental, Health and Safety Guidelines;”

Motion No.14

That Bill C-300, in Clause 8, be amended by replacing line 36 on page 5 with the following:

“enter into or renew a transaction”

Motion No. 15

That Bill C-300, in Clause 9, be amended by replacing line 17 on page 6 with the following:

“functions under subsection (2)”

Motion No.16

That Bill C-300 be amended by deleting Clause 10.

Mr. Speaker, I welcome you back to the House. I am sorry to see you had to be put to so much work so quickly. I also welcome back my hon. colleagues on their return from summer recess.

It is an honour to be the lead speaker on Bill C-300 in the opening of this parliamentary session. Ironically, this bill has spent some 13 months in committee and over that time the arguments in favour of the bill have actually become stronger.

I would never, in my wildest imagination, have thought that this bill would attract so much attention. Certainly, I had not anticipated it would attract so much international intention. People are literally flying in from around the world to support Bill C-300 and are encouraging my colleagues to get behind this bill and do something for the world's poor, the world's indigenous and the world's people who cannot speak for themselves. They are literally taking their own time and spending their own resources to lobby colleagues and encourage them to support this bill.

Why would people spend their time and resources and have all of the international attention and domestic attention on what is quite a modest bill? My view is that it is due to Canada's reputation as a fair-minded democracy that adheres to the rules of law and where aggrieved persons can actually come and expect to receive redress. That may or may not be true in some of the countries from which these folks are coming.

I also believe that this bill has received so much attention because of the increasingly negative reputation of Canadian mining companies operating abroad that do things to people and communities which would never be tolerated in this country. I could literally take members on a world tour. Mexico, Guatemala, El Salvador, Honduras, Peru, Ecuador, Chile, Argentina, Colombia, Papua New Guinea, Tanzania and the Congo have enormous conflicts with Canadian mining companies. The allegations that have been put forward against these Canadian mining companies are very serious as witness after witness came before our committee and made these allegations.

It is never a good day for Canada when our own Governor General is surrounded by 200 Mexicans chanting “Canada, go home” because of the activities of the Canadian mining company operating in that country. It is not a good day when, as a witness described, he was chased out of a village because the villagers thought he was a Canadian supporting a Canadian mining company. He deemed it appropriate to take the flag that was on his backpack and black it out. It is not a good day for our reputation. It is not a good day when one of the people who was moderating a debate in which I was involved said that she had recently been in Guatemala where people would naturally ask her where she was from. When she would say that she was from Canada, they would say that in Guatemala it was better that she described herself as being from America.

Ironically, one of the great objections that the industry puts forward to the bill is that it would cause reputational damage. Reputational damage to whom? Is it reputational damage to Canada or is it reputational damage to the country?

We already know that a lot of activities of Canadian mining companies destabilize governments, put other Canadian companies at risk and put Canadians travelling abroad at risk. Why the objection to reputational risk? Why the fear of a quasi-judicial process where the impartial laws of natural justice actually prevail in a hearing? Why indeed?

It is hugely ironic to me that at the same they are complaining about the process, they are saying that they adhere to the IFC standards that are set out in the bill itself. They do not want to have a process to find out whether they actually adhere to the IFC standards because they say that they are already adhering to them. It seems a bit of an ironic argument.

Possibly, though, the real reason that the objection is so vociferous on the part of the companies and the government is that there possibly is something to be hidden.The allegations in the aforementioned countries are possibly true.

Sometimes where there is smoke there is just smoke but sometimes where there is smoke there is an actual fire. Did witness after witness really tell the truth about murder, rape, environmental degradation, officials being bought and paid for and paramilitaries enforcing the so-called companies? With all of those witnesses, was that just smoke and mirrors?

Possibly there is some truth and the companies do not want anyone, let alone a government official, a minister of the crown or the people of Canada, actually taking evidence, having a look, listening to arguments and making a finding one way or another, good or bad. Not only do the companies not want anything resembling a fair and impartial inquiry, they do not want any sanctions. They want to exist in a sanction-free environment. They say that the sanctions are too draconian.

What are the sanctions? The sanctions are that they will not get support from the Export Development Corporation of Canada. They will not get support from the Canada pension plan. The Canada pension plan will not be allowed to buy shares on the stock exchange. They will not get consular support. They will not get the promotional activities that our consuls general provide right around the world to Canadians operating abroad. In other words, no taxpayers' money, no pensioners' money and no parties.

That is three rather modest teeth and I am proposing pulling half a tooth on one of these amendments because we took the view of the Canada pension plan that there would be a requirement to amend the Canada pension plan, which would require provincial consent. My thought was that if the Minister of Finance could not get his own provincial counterparts to make much needed amendments to the Canada pension plan, what hope would I have of getting amendments? Therefore, we have modified that objection somewhat.

Then there is the full argument about extraterritoriality. This is just plain nonsense. This bill is about accountability for taxpayers' hard-earned money and how it is used, not where it is used. Like foreign aid, Canada has expectations and the absolute right to withdraw its money at any time and in any place. So also does EDC and the Canada pension plan. Canada retains the right to invest abroad based on its own set of laws and guidelines. It has the right to invest and it has the right to divest.

The other proposed amendment of significance is whereby the company would be given a period of time to rectify its non-compliance. Notwithstanding what the companies say and its handmaiden, the government, I would much prefer compliance over non-compliance. I prefer honourable and responsible mining over no mining at all.

These are the objections: the companies are too draconian, they will hurt our reputation and they will leave Canada in droves. To go where? To go to the United States, the most litigious nation on earth? To go where the alien tort claims act is? To go where Senator Lugar's bill is, which now requires that Canadian mining companies wishing to list their shares on the New York Stock Exchange must tell the department how much money they are giving governments and government officials? It is an attempt at accountability and transparency, which speaks well for our American friends but does not speak well for us.

Will they go to Great Britain, which is another great place? It is actually proposing a more robust version of Bill C-300. The European Union has very high standards of corporate social responsibility. I doubt the companies will go to Russia or China. The only place they may possibly go is to Switzerland. When companies go to Switzerland, they generally want to hide something. If they are going to Switzerland, fine, Lord love them, but they are not going to take Canadian taxpayers' money or pensioners' money with them.

This really is a modest bill. It has run into a virtual tsunami of objections from the industry and the government. Government members may face clear and overwhelming testimony from those who have chosen to turn their backs on the poor, the helpless and the aboriginal. By voting against this bill, they embrace the status quo. If this bill does not pass, we will have failed vulnerable people and struggling democracies. We will be diminished in the eyes of the world. We will erode our credibility to speak in international fora. We will be smaller in every way.

Speaker's Ruling

[The Speaker, Liberal, Peter Milliken]

I thank the hon. parliamentary secretary, the hon. member for Scarborough—Guildwood, and the hon. member for Mississauga South for their submissions on this point. I will examine the bill in light of their submissions and return to the House in due course with a ruling in respect to this matter.

There are 16 motions and amendments standing on the notice paper for the report stage of Bill C-300.

Motions Nos. 1 to 16 will be grouped for debate and voted upon according to the voting patterns available at the table.

The Chair does not ordinarily provide reasons for its selection of report stage motions. However, having been made aware of the exceptional circumstances surrounding the committee study of this bill, I would like to convey to the House the reasoning involved in considering these motions.

The note accompanying Standing Order 76(5) reads, in part:

The Speaker...will normally only select motions which were not or could not be presented [in committee].

The Chair takes note that the hon. member for Scarborough—Guildwood sits on the Standing Committee on Foreign Affairs and International Trade, which was mandated to study Bill C-300. Although I believe that the majority of the amendments in his name could have been proposed during the committee consideration of the bill, they were not.

In a written submission to the Chair, the member outlined his efforts to overcome the committee's inability to deal with the bill in the prescribed timelines, even going so far as to move a motion that the committee begin clause-by-clause study of the bill. These efforts proved fruitless, and although the member had submitted his amendments to the committee, he was not afforded the opportunity to propose them.

Having carefully reviewed the sequence of events and the submission made by the hon. member for Scarborough—Guildwood, I am satisfied that these motions could not be presented during the committee consideration of the bill and, accordingly, I have selected them for debate at report stage.

I shall now propose Motions Nos. 1 to 16 to the House.

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

[Paul Szabo, Liberal, Mississauga South, ON]

Mr. Speaker, the issue here that is raised by the Parliamentary Secretary to the Leader of the Government in the House of Commons refers to the creation of a new quasi-judicial function. A function is not a new agency or a board.

The procedures with regard to assessing the requirements for a royal recommendation on private members' bills begin with a notice by the Speaker after consultation with the Clerk of the House. The Clerk's officials do a rigorous examination of each of those bills and they report to the Speaker who in turn reports to the House on the possibility of a royal recommendation being required. No such report was provided to the Speaker, and the Speaker has not in fact given such an alert to hon. members in this regard. Therefore, I would submit, for all the reasons that the Clerk of the House of Commons did not flag this for the Speaker, that those reasons would stand in the stead of the member who has moved this bill.

The other consideration, and I have seen this with regard to other bills, is that significant alteration of the role of any body does not necessarily rule out the fact that there is a responsibility for that. I think, Mr. Speaker, you would find that there is no other department or agency, whether it be Foreign Affairs or International Trade, to which this particular matter that is raised by Bill C-300 would come under. It must be under their ambit; it must be under the scope of their work.

I submit, Mr. Speaker, that this is the only place that it could go so that it is consistent with the responsibilities as departments, agencies, and boards, and that this bill does not require a royal recommendation.

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

Mr. Speaker, we have been at this bill now for some 13-14 months and here we are literally at the last minute raising issues of royal recommendation, which have already been, in my judgment, ruled on. This bill was carefully crafted in order to avoid the issue of royal recommendation because that is a limitation on private members' bills.

I take note, Mr. Speaker, that it requires no creation of any new agency. It does not create any new ombudsman. It does not create any new department. It does not create any agency which would require further appropriation of any moneys or any expenditures on the part of the government. This bill was intentionally crafted that way so as to avoid the very objections that my hon. friend has raised. There will be required, within the government itself, a reorganization of its resources, but there are no new resources contemplated by the creation of this function in the ministry.

I say to my hon. friend and I say to you, Mr. Speaker, that this bill does not require a royal recommendation as it does not require any fresh resources. The fresh resources are literally the prerogative of the government. There is no intention and, in fact, there is no requirement on the part of Bill C-300 to create any new agency, any new organization, or any new expenditure of funds.

[Tom Lukiwski, Conservative, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Mr. Speaker, I rise on a point of order regarding Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries, introduced by the member for Scarborough—Guildwood.

I submit that the bill contains provisions which would require new spending for purposes not currently authorized in statute and therefore should be accompanied by a royal recommendation.

Bill C-300 would add new functions to the Department of Foreign Affairs and International Trade Act by requiring the ministers of Foreign Affairs and International Trade to establish a new, quasi-judicial function regarding Canadian companies engaged in mining, oil or gas activities in developing countries. Currently, the Department of Foreign Affairs and International Trade Act does not authorize spending for that new function.

The government did not raise a point of order on the bill prior to second reading. However, during committee consideration of the bill, the issue of new spending was raised, and I now want to bring that to your attention. On December 1, 2009 officials from the Department of Foreign Affairs and International Trade stated in committee:

The mechanism itself would require...the set-up of a whole new procedural framework that is not currently in existence within DFAIT and is not foreseen in the DFAIT Act.

Let me explain why this would require new spending. Clause 9 of the bill would amend the Department of Foreign Affairs and International Trade Act to compel the ministers of Foreign Affairs and International Trade to ensure that mining, oil and gas activities by Canadian corporations in developing countries are consistent with the guidelines in clause 5 of the bill.

Clause 4 of the bill sets out a formal complaints process to require the ministers of Foreign Affairs and International Trade to receive complaints and conduct investigations on whether the guidelines have been contravened.

In a case where the ministers determine that activities contravene the guidelines, the ministers would be required to notify the president of the Export Development Corporation and the chair of the CPP Investment Board that a Canadian corporation's mining, oil or gas activities are inconsistent with the guidelines.

In such a case, the EDC would not be able to enter into, continue or renew a transaction with a Canadian corporation found to have contravened the guidelines and the CPP Investment Board would have to ensure that assets are not invested in any corporations that have been found to be in contravention of the guidelines.

Bill C-300 would alter the terms and conditions in the Department of Foreign Affairs and International Trade Act by adding a new quasi-judicial function. The need for a royal recommendation for a new function is explained on page 834 of the second edition of House of Commons Procedure and Practice. It states:

A royal recommendation not only fixes the allowable charge, but also its objects, purposes, conditions and qualifications. For this reason, a royal recommendation is required not only in the case where money is being appropriated, but also in the case where the authorization to spend for a specific purpose is significantly altered.

On June 13, 2005 the Speaker ruled on Bill C-280, An Act to amend the Employment Insurance Act (Employment Insurance Account and premium rate setting) and another Act in consequence, stating:

Second, clause 2 significantly alters the duties of the EI Commission to enable new or different spending of public funds by the commission for a new purpose--

On February 11, 2008, with respect to a new role or function for an existing organization or program, the Speaker ruled on Bill C-474, the National Sustainable Development Act, stating:

Bill C-474 also proposes a new mandate for the commissioner.

However, clause 13 of Bill C-474 would modify the mandate of this new independent commissioner to require, namely, the development of “a national sustainability monitoring system...The clause 13 requirements would impose additional functions on the commissioner that are substantially different from those foreseen in the current mandate. In the Chair's view, clause 13 thus alters the conditions set out in the original bill to which a royal recommendation was attached.

I have explained how the new function proposed in Bill C-300 would alter the terms and conditions of the original royal recommendation for the Department of Foreign Affairs and International Trade Act.

In keeping with the precedents I have mentioned, I therefore submit that Bill C-300 requires a royal recommendation.

The House proceeded to the consideration of Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries, as reported without amendment from the committee.

[Peter Goldring, Conservative, Edmonton East, AB]

Thank you.

I tend to agree with the member when he says we're fed up with this bill. But I want to expand on a few of the reasons why. I'm not alone in this. I note a number of former Liberals from the other side, such as Mr. Don Boudria, who works as an expert on federal parliamentary procedure for Hill and Knowlton as a strategic communications consultant and as vice-president of the firm. On his blog he has a posting entitled Bill C-300. He happened to be out in the hall before this meeting, and I talked to him. He confirmed to me his concerns about this bill and how it might kill the mining industry. He related the example of Talisman. When Talisman moved out, China moved in. That same scenario could happen again and again.

Also, we had before us the Honourable James Peterson. He spoke against the bill here in committee and said it was flawed in its construction. It is highly prejudicial to Canada's mining sector. We have Bill Graham, another member, co-chair of the Canada-Mexico Initiative, a think tank led by Canadian Foundation for the Americas, FOCAL, which has said that Bill C-300 has to be in the running for the worst piece of legislation before Parliament. These are significant people commenting very negatively on this bill.

If we review the bill, we can see why these concerns would be put forth by even some of the former Liberals themselves. We can start with the title of the bill. I believe it had been suggested and talked about before. In question is the relevancy of why we would want to have something so constrictive affecting only one portion of industry, while leaving other types of industry wholly out of account. If you're going to have a bill on corporate social responsibility, I believe the operative word should be “corporate”. It should apply to any corporation that would be engaged in other parts of the world, not just mining, oil, and gas corporations. I think it was suggested that it could be the service sector, the shipping sector, the forestry sector. I would make the argument that the forestry sector would—

[The Chair, Conservative, Dean Allison]

I'm going to rule against you, Mr. Abbott. I want to say that we do have a motion on the table. We have been talking about Bill C-300, so his motion was well within it. So we are going to debate that particular motion at this particular time.

I would suggest that if your motion had come beforehand, we could probably have debated yours first.

I'm going to go back to Mr. McKay just to have his opening comments on that and then I will open that for debate. So we will be debating Mr. McKay's motion.

[Glen Pearson, Liberal, London North Centre, ON]

Yes, I know; I know, Paul.

The other thing I just want to say is that as somebody who's worked a lot overseas, in Sudan and other places, I believe in a lot of what Canadian companies do, and companies in general. I just think in this particular situation, my own opinion is that if Bill C-300 would have existed, you wouldn't have been in this spot.

Thank you, Chair.

[Prof. Audrey Macklin]

Let me finish my answer.

Under Bill C-300, as I read it, there is a space between complaint, investigation, and outcome that is available to be developed through, as I read it, the regulations and guidelines.

So it's not, as I read it, self-evident, as you suggest, that if a company is non-compliant, therefore these consequences must immediately follow. I could well imagine, and it appears to me just as a matter of statutory interpretation, that there is room in this legislation for saying, “You are falling out of compliance, so what is it you can do at this point to bring yourself back into compliance?”, or, “We will grant you this period of time to bring yourself back into compliance, and if you do not do so, certain consequences may follow.”

But it is not obvious to me, on reading this, that it is complaint, assessment--

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

But, Professor Macklin, EDC's testimony.... If you had the opportunity to review the testimony that was made at this committee, you would understand; those are the standards that EDC is currently applying.

The difficulty is that in the legislation, in Bill C-300, the fact that EDC would be obliged to withdraw the funding that they had already committed puts them in an impossible position that they cannot go ahead and commit it in the first place. The worst possible time for EDC to be withdrawing funding is if a corporation happens, for a period of time, over a period of events, to be in non-compliance. That's the worst possible time, because the pressure that EDC can bring, on behalf of the Canadian people, is that we will withdraw. Under Bill C-300, they would be forced to withdraw. That forcing of a withdrawing is at the worst conceivable time. When they could be bringing financial pressure on the corporation, all of a sudden they have to withdraw; in fact, I submit to you that they would not be doing it in the first place.

Now, $22 billion to $24 billion is not an incidental amount of money. That's far more than anybody in this room can imagine. To suggest that withdrawing $22 billion to $24 billion of support by EDC in a 12-month period from the external exploration companies will not shut down some of the projects....

I don't want to be harsh, but I think that's kind of naive.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

Mr. Shrake, I think there's been a misunderstanding of your testimony, certainly on the part of some opposition members. The fact of the matter is that you have given us an absolutely classic example of the kind of thing that happens when there are unfair charges, and it is the position of the government that Bill C-300 would just increase the pile-on.

I believe that you have Canadian equity in your company; therefore, you would be subject to Bill C-300. As I say, there are already these egregious, unfair, and outrageous charges that have been made against you and your company that would be exacerbated very substantially by the imposition of Bill C-300. Now the interesting thing is that there has been a total ignoring of the function of the CSR counsellor, who is in place and is coming up to speed—notwithstanding the cynicism of my friends on the other side of the table. The fact is that all of the things they have said they want to happen under Bill C-300 are going to be happening, and are in fact happening, under the CSR counsellor. So I thank you very much for your testimony.

The question that I have of you is that it seems to me that you have come here with this story. If you were approached by the CSR counsellor with the claims of these NGOs, would it not be...? In fact I think you've indicated that it would only be responsible to respond to the CSR counsellor and that you would be very happy to react to that CSR counsellor. Given the fact that it is voluntary compliance, you would be pretty happy to volunteer, and any responsible company would be happy to volunteer, wouldn't they?

[Francine Lalonde, Bloc, La Pointe-de-l'Île, QC]

Given your answer, I am inclined to ask Mr. McKay's question again.

Under these circumstances, given that you have to use the justice system and to put pressure on the United States and El Salvador, don't you think that Bill C-300 can prevent this escalation since a decision will be made in all fairness? It is a process that you can start with.

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

Let me direct this to Mr. Shrake.

I accept that your positioning is quite heartfelt, and you certainly have a strong and coherent view about your company's activities in El Salvador. Yet if Bill C-300 doesn't pass—and certainly, if this government has its way, it won't—you will continue with this press war forever and a day, with extraordinary reputational damage to your company and the industry and, I would even argue, to Canada's reputation.

Given that I think your view would be that you would prefer the ombudsman's report, the 2007 report, which the government has chosen not to proceed with, and given that Bill C-300 is, at the end of the day, the only forum in which you could actually clear your name in any kind of a serious way, why would you be fighting Bill C-300 so vigorously?

[Prof. Audrey Macklin]

I recall that when I was part of the mission to Sudan there were certainly conflicting reports from Talisman Energy and from non-governmental organizations about what was going on there. Sitting in Canada, it was difficult to know what was really going on.

If a company is, as Mr. Shrake suggests, the victim of wrongful accusations and allegations that have a detrimental effect on its reputation, it would seem advantageous to have a forum within which those allegations can be considered in a reasonable and attentive way. It seems to me that what Bill C-300 does is provide a forum for that. Rather than being judged in the court of public opinion, which as I understand from Mr. Shrake's assessment is deeply damaging to his corporation, it might be beneficial--indeed it might well be more than beneficial--to have a neutral forum where allegations that are brought can be tested against the response the company would make and dealt with in a constructive way. I could imagine that under this legislation, if one got to the point of devising regulations under it, you would want to establish a process by which that could be done.

Ultimately, if Mr. Shrake is correct that there is no basis for these allegations, then presumably the outcome of this process would vindicate his corporation in a way that cannot satisfactorily be done at present.

There is provision in this for a rapid disposition of what is termed here to be frivolous and vexatious complaints. I have no view, obviously, on the complaints that are brought with respect to this corporation. But I would note that if Mr. Shrake is correct that they are merely frivolous and vexatious, this provides a mechanism for disposing of them quickly. If it turns out there is some evidentiary basis to them, it provides an opportunity by which they can be fully ventilated. So in either case I would think it would be to the benefit of all concerned to provide that forum.

Again, if Mr. Shrake is correct that there are organizations whose actions are not motivated by good faith, then I would think a process like this would discredit them ultimately and thereby deflate their potency, all of which would be done to the benefit of Pacific Rim or other corporations in his situation.

I say this, of course, taking no position on the allegations that were made against his company, or indeed Mr. Shrake's response to them. I'm in no position to assess that.

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

Thank you, Chair.

Thank you both for coming. I particularly thank you, Mr. Shrake, for coming and talking to the committee about a real live situation.

I want to direct my question to Professor Macklin, because Mr. Shrake does, in effect, put a live example in front of the committee. He talks about his company putting $80 million in, and that at one point it was valued at several hundreds of millions. Now he's written it down to $20 million. He's being effectively forced to withdraw his company's presence in the community because the government isn't renewing its licences.

They've got pretty serious allegations--which he describes as gross misstatements, if not outright lies--about murder and various other activities. It's a bit of a difficult situation, to say the least. And he's come here to defend his company's reputation, which is one of the things the mining companies are very concerned about, their reputation, and the ironic effects of a country with 40% unemployment having a significant employer withdraw from activity in El Salvador.

Ironically, as I was listening to his testimony, I was thinking this is actually the case for Bill C-300, because there's no place for Mr. Shrake--or for that matter Mr. Steiner--to go. These kinds of allegations will go on and on and on and on because there's no resolution to these allegations. And whether the NGO is motivated by good motives or motivated by bad motives, or something in between, it just carries on.

So using Mr. Shrake's I think heartfelt presentation to this committee, make the case as to why Bill C-300 would actually be good for Pacific Rim.

[Professor Audrey Macklin, Faculty of Law, University of Toronto, As an Individual]

Thank you.

I've been asked to comment more broadly on Bill C-300, so I will not be responding directly to Mr. Shrake's remarks.

I was a member of the national roundtables on corporate social responsibility and the Canadian extractive industry in developing countries. I was also a member of the Harker mission in 1999 that went to Sudan to investigate allegations with respect to Talisman Energy in that country.

What I want to say today about Bill C-300 is fairly straightforward. Let me begin with this point. I think we would all agree that the Canadian government has a legitimate interest in how its money is spent--that is to say, how its financial support, or investments, or tax incentives are used by those who are the recipients. This is true whether that money goes to support domestic or international projects, or whether the recipient of government funding is a non-governmental organization that is part of civil society or a corporation.

In other words, the Government of Canada, I hope you will all agree, has an interest in accountability for how its money is spent, and Bill C-300, in short, is nothing more or less than a mechanism for accountability. That is to say, the government supplies export credit and investment and undertakes promotional activities for Canadian corporations in their activities abroad. Bill C-300 is, I think, directed at ensuring that the financial support that the government provides is not spent on conduct that would run contrary to Canada's public policy commitments or international human rights obligations.

It seems to me that in the government expenditure of funds for overseas projects, whether that's through CIDA or the IDRC, there too the government has a legitimate interest in ensuring that the money it provides is used for purposes that are consistent with Canada's own obligations and its public policy with respect to, say, international development in the case of CIDA.

So, really, Bill C-300 is no more or less than simply a mechanism for holding those recipients of government financing—corporations—accountable for how they use government money, and a way of saying, “We, the government, the taxpayers of Canada, don't want to spend our money on activities or conduct that we think are inimical to Canadian public policy or our international human rights obligations.”

I hope that by saying that, I've made one point very clear: in no way is this bill about extraterritoriality, any more than Canada acts extraterritorially in deciding whether CIDA is going to fund some project in another country. We don't say that's an act of extraterritorial regulation, and neither is this; this is about how the government is going to spend its money. No company, no corporation, has a legal entitlement to that money, and there's nothing wrong with holding it accountable for how that money is spent.

Now, what does this bill suggest or indicate will be the criteria for accountability? Well, it indicates a couple of codes of conduct, most notably, I think, the voluntary principles on security and human rights and the International Finance Corporation's policy on social and environmental sustainability, performance standards on social and environmental sustainability, etc.

These are codes of conduct that many companies have voluntarily signed on to--though not all companies. These are also standards or principles that the International Finance Corporation, which is the commercial branch of the World Bank, uses to decide who it's going to lend money to. These principles also form part of what are called the “equator principles”, which private lending banks around the world have used as criteria for deciding to whom they will lend money.

So for the Canadian government to bring these principles to bear in assessing accountability for recipients of government support is not to stray far beyond and is not to extend its reach beyond what we already see in play among financial actors worldwide.

These principles are evidently not so vague that international banks can't apply them or that the companies that want loans from these international banks can't meet them. They're not so vague or general or devoid of meaning that companies are unwilling to sign on to them for fear that they are signing on to principles they cannot understand or operationalize.

This is a way to bring those same principles and standards of accountability to bear on the forms of government support that Canada provides to companies. In so doing, I think Canada is simply acting in a way that is consistent with what the special representative of the Secretary General, John Ruggie, proposes as a good way to ensure corporate social responsibility worldwide. It encourages individual states to use instruments within their jurisdiction and authority. So it's consistent internationally. It's not inconsistent with what host states can do or will do. In the end, then, it is just a mechanism for Canada to take part in the global trend toward ensuring accountability for how transnational corporations engage in their activities in various states.

I think that you have already heard my colleague Penelope Simons' response to a concern that this form of accountability will somehow drive Canadian companies to incorporate elsewhere, that it will encourage corporate flight, so I won't reiterate what she said. I will only say that all over the world countries are adopting various mechanisms for holding their corporations accountable for their activities abroad. They aren't identical to what Bill C-300 does; some are much more interventionist. The United States, for example, has in place a whole system of tort liability.

This statute in no way creates a new ground of civil liability. It's not as if anybody can use this statute to go and sue a Canadian company in a Canadian court. Nor does it create any kind of criminal liability, an even more significant form of regulation. It doesn't do any of those things.

Some people, some organizations, take the position that perhaps Canada should await the outcome of special representative John Ruggie's report sometime in 2011 before taking any steps. I would simply point out that John Ruggie has in fact come out in favour of home state regulation. Some people take the position that if states are the ones to regulate it should be the host states and not the home states of corporations that do the regulating.

There are three responses to this. First, not all host states have the rule of law infrastructure to effectively regulate themselves. Second, they do not necessarily oppose or find a conflict between a mechanism like this and the actions they may take. These are not substitutes; they may be complementary. Third, it's important to realize that a claim that companies will flee Canada if they are held accountable in the way that Bill C-300 proposes is in a sense a threat. It's a mechanism of intimidation that companies use. If you regulate in this way, they say, firms will leave. Canada's a pretty strong country. It's a fairly financially secure country. If those kinds of mechanisms of intimidation are used against a country like Canada, imagine what corporations are saying to the host states, which are weaker, less able to regulate, and more desperate for investment. They might ask a host state to sign a contract that exempts them from their national regulation. They might demand that a foreign government sign an agreement not to pursue disputes against them in their national courts.

I'd encourage members of the committee to be mindful of these strategies of intimidation that are used to discourage home state regulation. If your view is that it is appropriate for the host state to regulate, you should know that they, too, are being subjected to similar kinds of challenges and they are even less able than a country like Canada to deal with them effectively.

Thank you.

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

Chair, I've submitted a motion that we use the second hour of today's proceedings for clause-by-clause. When we initially went through this last week, we were given the impression that there was literally quite a number of witnesses who wanted to come before the committee to talk about Bill C-300. The result is what you see: two witnesses.

We have a drop-dead date of June 11 on this bill. I think it would behove the committee to at least attempt a clause-by-clause for the second hour of this committee hearing, so that we can at least make an effort to introduce the amendments, which in my view strengthen the bill and make it possibly more acceptable to the government members. I'm not quite sure that it does, but nevertheless, it is a step in some direction.

I was just wondering whether I could seek to have you solicit the opinion of the honourable members as to whether we could use the second hour for clause-by-clause.

[The Chair, Conservative, Dean Allison]

Pursuant to the order of reference of Wednesday, March 3, 2010, Bill C-300, an act respecting corporate accountability for the activities of mining, oil, or gas in developing countries, we will commence. This is meeting number 22.

I want to thank our witnesses for being here today. We have Audrey Macklin, a professor of the faculty of law at the University of Toronto. Thank you for being here today.

We've also got Thomas Shrake, chief executive officer and president of Pacific Rim Mining Corporation. Thomas, thank you for being here today.

Before we get started, I have Mr. McKay.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

Mr. Stewart-Patterson, here is a final question for you. Right at the end of your presentation, you indicated that Bill C-300 could “also imperil the brand of many other Canadian companies operating in developing countries, beyond those in mining and oil and gas” sectors. Could you just elaborate a little bit on that?

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

Thank you.

Mr. Stewart-Patterson, I'll turn to you, sir. Can you assess what costs, if any, Bill C-300 would have on business or what costs there would be to doing business? Can you comment on that at all?

[Dr. Penelope Simons]

I think you're right. There was a huge campaign. As you've said, it did divide people and it did have a negative impact. Had we had standards in place beforehand, like the ones that we have in Bill C-300, and some sort of mechanism to investigate these things, it could have been dealt with in a much different way.

Talisman would have had guidelines on how to deal with it. If they had decided to go in, as they did, and what happened had happened, I think it would have been concluded that it was not a good investment and that there was no way you could go in there and not be complicit in the human rights abuses that were going on. I think that if there had been a regulatory mechanism to prevent that type of engagement in the first place, to give companies that got into situations guidance about what they needed to do, and to provide for some sort of complaints mechanism, it would have completely changed the impact on Canadian society.

[Glen Pearson, Liberal, London North Centre, ON]

Thank you, Chair.

Ms. Simons, the committee knows about my own past history and involvement in Sudan. This conversation about Talisman always drives me a little bit crazy. I've been there a lot. It's no worse under the Chinese than it was under Talisman. I think that's a specious argument.

Without Bill C-300, what Talisman went through was gruelling. It went through a 7% share drop. It divided the country as a result of its own lack of expertise in knowing what to do in the country. It didn't heed the government's advice when the government of the day gave it advice not to do it.

My concern is not so much with what everybody is talking about here, but that within Canadian society we had teachers' federation groups delisting from Talisman. We had all sorts of other NGOs and we had companies speaking out against Talisman. It actually created a rift within Canadian society, and I am concerned about that.

We had no place to go to in the end to actually find out what was going on, to find out who was actually obeying the standard and who wasn't. I wonder, since you were part of the Harker report--and I'm aware of its work--if you could speak to that comment about its effects on Canada.

[John Rafferty, NDP, Thunder Bay—Rainy River, ON]

Mr. Nash, let me stay with you for a question.

If Bill C-300 is a bad bill, but some kind of CSR strategy is important, as you indicated in your remarks, how should we pursue a CSR strategy without this bill?

[James Lunney, Conservative, Nanaimo—Alberni, BC]

Thank you, Mr. McKay--on your own time.

There has been speculation that if the measures that have been discussed a little bit already come in, the measures in Bill C-300, which really start with a punitive approach, it might take a while, given the time and the legal uncertainties, for anybody to sort out exactly what's happened in the extraterritorial setting.

First of all, let me just ask simply, is the possibility that companies might reconsider relocating headquarters something that you might see on the horizon?

[Laureen Whyte]

One of the most important things we've learned in working with first nations in B.C. in particular is that where there is a great deal of fluidity in terms of jurisdiction, decision-making, issues management, and all kinds of things--and we have been working in that area for quite some time now--what has become quite apparent to us is that only in partnership can we succeed in anything that we do in the communities.

I think there are also a couple of other considerations to take into account here.

When people say there would be some credibility attached to a Canadian company that would be regulated by the Canadian government overseas, people question that statement and whether or not the fact that the Canadian government is regulating something means it's going to provide a solution for a community that's going to address its needs. Specifically, first nations here have pointed to that in conversations about Bill C-300. I don't think we can say internationally that we've figured this out in a way that keeps communities whole and protects their human rights and their dignity.

So there are questions to be asked in that regard, but I think the other thing that's really important is that our experience, certainly with first nations, is that there are components that are done on a collaborative basis, where we learn from each other, and there are components that have a legal element to them, and they're both at play. They're effective together. We work with that.

The problem I have with Bill C-300 is that we've been working very hard on this issue for quite some time now and we're very close to seeing the results of John Ruggie's work. Our CSR counsellor is consulting with us extensively to try to build some kind of Canadian framework that makes sense for us, that does have that operational detail. I really don't think you can regulate things effectively without looking at the operational detail.

We've been doing this for only a few years. This isn't an area of practice that we have a lot of experience with in terms of managing it to a good outcome. It does take some time. That's what we spend a lot of our time on as an association: helping people to understand how they manage this stuff on the ground.

[James Lunney, Conservative, Nanaimo—Alberni, BC]

Thank you, Mr. Chair.

I thank the witnesses for appearing today. All of us around the table recognize that it's an issue on which there is a variety of opinions. We heard them at the table today.

I think it's clear that we all recognize Canada's major role in the world in this regard. Canada has played a role in the development of the guidelines that exist around the world--voluntary guidelines. We have participated in many of the processes and we've encouraged Canadian companies to be involved in all of these: the Equator Principles, OECD guidelines, and IFC guidelines. I believe that EDC was one of the first organizations worldwide to sign on to the OECD guidelines.

We've been working in this direction. We've been through an extensive consultative process here in Canada, a round table process that was collaborative and brought everybody to the table, and we've come up with a strategy. The government has already announced the strategy, out of a collaborative process, to address some of the concerns out there and to enhance our capacity in this area.

Mr. McKay himself was involved in or aware of this round table process that was collaborative and called for an independent counsellor to address these issues. One of our objections with this Bill C-300, one of our concerns here, is the politicizing of this whole agenda by putting it in the hands of a minister.

Regrettably, we would find the kinds of allegations that are not easy to sort out from afar, or to investigate quickly, given the legal uncertainties, and we would be in a position where members could use parliamentary privilege to bash away at a minister, to make unfounded allegations under the cover of parliamentary privilege, with no legal consequences, and at the expense of the Canadian economy and the well-being not only of extractive companies, but of our economy itself.

That is one of the fundamental flaws that I see in the bill. I'm very concerned about it. I think Mr. McKay and others would be wise to consider that. Regardless of which party is in power, that would create a very untenable situation for something that may not be resolved quickly, given the legal uncertainties in the bill.

Having said that, I note that some of the people at the table here have been involved in the collaborative process and have some extensive experience in developing cooperation from conflict, even in British Columbia, my home province, where we have a number of issues with communities, first nations communities in particular.

You made reference to that, Ms. Whyte.

Canada has been developing tremendous expertise in trying to sort out these things. They're not easy to solve domestically, and are certainly even harder internationally, but I wonder if you'd care to expand on the B.C. experience, your organization's experience--it's been around since 1912--your participation in the collaborative process, and some of the lessons that have been learned that might be beneficial.

[Chris Albin-Lackey]

I think the example of the Barrick mine at Porgera in Papua New Guinea is very relevant to this discussion, because it is actually an example of a situation in which there is no real regulatory framework being applied, given the failure by the government of Papua New Guinea to apply its own laws and regulations to the situation.

So what you have, essentially, is a company that says it is applying all of the standards that are incorporated in Bill C-300. Barrick is not yet a member of the voluntary principles on security and human rights, but it says that it applies them in all of its operations. It says that it has a zero tolerance policy for all of the abuses that our research and Harvard and NYU research uncovered there. They say they're doing everything they can think of to combat these abuses, but the fact is that they haven't managed to go as far as they need to go.

I think their failure to do so really does expose the limits of a purely voluntary framework. There has to be some kind of binding regulation to go along with whatever voluntary measures businesses choose to participate in. Even if those voluntary measures are very useful and ought to be encouraged, they're not an adequate replacement for government regulation in and of themselves.

[Tyler Giannini]

I think that fundamentally Bill C-300 sets up a regime that companies should actually be used to. They're used to a regime that has a collaborative approach at the beginning, as Mr. McKay pointed out. Then you'll have some sort of complaint mechanism on the back end when things go wrong.

While companies may not like those sorts of complaints mechanisms, they're actually fairly routine in legal forums, as Professor Simons has pointed out. I think the fears about this are overstated. Actually, there could be a competitive advantage if they embraced this, if they went to countries and to the places where they wanted to invest and said, “We actually embrace these standards and we are going to be good corporate citizens in your country”.

We believe that is the way to build trust with communities so that you don't have problems down the road that can be quite costly in terms of reputation and in terms of actually having to deal with the dissatisfied communities. These sorts of regimes can actually work as a comparative advantage in the long run.

I think that's where our business in human rights is headed and where the special representative, John Ruggie, is headed with all of this.

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

I thought you had raised your hand.

Professor Giannini, in your opinion, what is it about Bill C-300 that really frightens the mining companies?

[John Dillon]

Thank you.

It seems to me there are a couple of premises to what Ms. Simons has said, which we fundamentally reject.

The first is the suggestion that when the profit motive somehow conflicts with environmental protection or human rights, companies will always choose to ignore those issues of environment and human rights and look only to profit. Whatever may have been the practice in the past, that is certainly not where Canadian companies and members of the CCCE are today. I fundamentally reject that premise.

Second is that somehow companies choose the location of their operations in order to avoid regulation. Again, that's a premise that I fundamentally reject.

I'm not sure what you've heard from other witnesses, but we're not here today to suggest that Bill C-300 will suddenly lead to all Canadian mining companies moving their head offices offshore. We are, however, concerned about Canadian companies losing out on opportunities to competitors that don't face the kinds of investigations we're talking about.

I don't know what Canadian companies may decide to do about location of investment in the future, but we're not here to suggest that all of those companies are suddenly going to move their head office. We are concerned with the potential impact on a Canadian company, in the very competitive environment our companies face today, when a rival bidder from another country has an opportunity and the government in that developing country is unsure because there's an investigation under way, which, as Mr. Nash pointed out, could take many years to conclude. That is what we're concerned about.

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

I have some more questions for you, Ms. Simons.

We have heard testimony suggesting that companies operating in Canada might go overseas if Bill C-300 were to come into force. Is there reason for concern that there could be a mass exodus of Canadian companies leaving Canada for fear of attacks on their credibility?

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

But no one's arguing that Bill C-300 is the first line of response. You have a CSR counsellor. You have the best practices that the government has set up. There are the PDAC folks who have set up e3 Plus. There's all kinds of educational encouragement to do the right thing.

This bill is in the event that companies ultimately don't do the right thing, and possibly we've had described here a serious failure of human rights standards. So do you still think that there should be no sanctions regime at the end of the day?

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

But Bill C-300 is a sanctions regime--

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

Thank you, Chair.

I thank all of you for joining the debate. I appreciate that all of you are on the same panel. Hopefully we can go back and forth with a few ideas.

I also want to thank Mr. Stewart-Patterson for in effect giving a pithy summary of the corporations' position. I thought it would be most useful if I asked those who promote Bill C-300 to respond to some of the assertions you've made in your paper.

For the first assertion, I will direct my question to Professor Giannini: the legislation is based on a flawed premise that assumes that Canadian companies are not to be trusted in their international operations. You made a rather interesting point about companies that investigate themselves. Can you expand on that point, please?

[Dr. Penelope Simons, Associate Professor, Faculty of Law, Common Law Section, University of Ottawa]

Thank you.

Thank you very much for inviting me to appear before the committee.

I'm an associate professor of international law and international human rights law at the University of Ottawa. I also teach corporate law. I specialize in the human rights impacts of extraterritorial corporate activity. I've been engaged in investigation and research in this area for over a decade.

I was a member of the Harker mission that was sent to Sudan in 1999 to independently investigate and report on the alleged link between oil development and human rights violations, particularly the allegations of forced displacement around the oil fields and oil-related development where Talisman Energy, a Canadian company, was operating.

I want to address today three key arguments against the introduction of Bill C-300 that have been raised in testimony. The first argument is that the standards imposed in Bill C-300 are too high and will affect the global competitiveness of Canadian extractive companies. The second argument is that Canadian companies are going to have to relocate to other jurisdictions because of the impact these high standards will have on competitiveness.

The third argument I want to address is one that was raised in testimony by Mr. Dade, from FOCAL. It is that if we impose such high standards on Canadian companies that they will be forced to withdraw from certain projects, Chinese companies will take their place, and, in the end, because Canadian companies do such good corporate responsibility work, the local people will be worse off under the regime of the Chinese companies.

In terms of the first two arguments, we heard these types of arguments in the 1970s when the government began to introduce environmental regulations. These are now law, and businesses continue. We heard them when issues arose requiring consultation with aboriginal people before undertaking extractive activity on their traditional territories. The requirement of consultation and accommodation is now entrenched in our constitutional law, and it is also now a requirement under the new Ontario Mining Act. The extractive industry has continued to flourish. It has continued to be very profitable despite these regulatory developments.

The first argument is that the standards are too onerous in Bill C-300 and that Canadian companies will therefore suffer a debilitating competitive disadvantage if Bill C-300 is enacted. The bill requires Canadian companies to comply with the IFC performance standards, with the voluntary principles on security and human rights, and with human rights provisions that are to be determined. These provisions are to ensure that these companies operate in a manner that is consistent with international human rights standards.

Well, Canadian extractive companies already have to comply with the performance standards. The IFC and the OECD countries' export credit agencies, including Export Development Canada, claim they already apply the performance standards to those companies seeking financial support.

All major Canadian extractive companies are funded by financial institutions that subscribe to the Equator Principles, such as the Royal Bank of Canada, Scotiabank, and Export Development Canada, and these institutions also claim to apply their performance standards to borrowers. The voluntary principles on security and human rights have been endorsed by the Canadian government and have also been adopted by major extractive companies, including Talisman Energy.

All companies that seek Export Development Canada's support will already be subject to human rights screening for the impacts of their project. EDC claims to take human rights into account in its decision on whether or not to fund a project.

In its “Taxation Issues for the Mining Industry: 2009 Update”, the Canadian Intergovernmental Working Group on the Mineral Industry stated, “Corporate social responsibility...activities are believed to be vital to ensure the competitiveness of industry”.

The other point that I'd like to make is that OPIC, one of the export credit agencies of our biggest trading partner, is now required by an amendment that was made to the Foreign Assistance Act in December 2009 to issue “a comprehensive set of environmental, transparency and internationally recognized worker rights and human rights guidelines with requirements binding on the Corporation and its investors”.

These standards are to be no less rigorous than the performance standards among others, so Bill C-300 is not such a great extension. This is happening in other places as well, and in particular in the U.S.

It's becoming a significant competitive disadvantage for Canadian companies not to comply with high environmental and human rights standards. You remember the issue of Pacific Rim in EI Salvador; El Salvador has recently banned all metal mining in the country because it is concerned about the environmental impacts of the gold industry and other industries on their water supply. Bill C-300 will help to redress this bad press. These standards are already being complied with, so there is no reason for these companies to be saying that they're too high.

The second argument is that the competitive disadvantage is so great that Canadian companies will have to move to other jurisdictions. Companies do relocate their headquarters, and corporations often make changes to their structures or use complex corporate structures to avoid domestic regulation, so will the enactment of Bill C-300 cause large numbers of Canadian extractive companies to move out of Canada? This is doubtful, and it's doubtful for a number of reasons.

The first point is that Canada is home to over 75% of the world's largest mining and exploration companies, and this is not just by chance. There are important reasons that mining and exploration companies are headquartered or otherwise present in Canada. Canada is resource-rich in oil, natural gas, potash, uranium, nickel, copper, gold, and diamonds and has some of the highest mineral exploration activity in the world within its own borders.

Mining in Canada is a lucrative business. The corporate operating profits in the Canadian mining industry were at $9.1 billion in 2008; that's double what they earned in 2007. Mining companies are able to raise billions of dollars on the Toronto and Vancouver stock exchanges. These two exchanges are the world's largest source of equity capital for mining companies undertaking exploration and development.

The Toronto Stock Exchange and the Toronto Stock Exchange Venture Exchange list 10 times more public mining companies than any other exchange in the world. In 2009, these two exchanges traded 79.1 billion mining shares and raised $22.2 billion in equity capital. Canada's insurance, banking, legal, and engineering industries have specialized groups that are tailored to providing, respectively, insurance, financing, legal advice, and technical mining support to mining corporations.

Other resource-rich countries such as Australia and China are actually considering introducing resource taxes. China wants to introduce a 5% tax on crude oil, coal, and natural gas sales, and Australia is introducing a “super profits tax” on windfall profits of resource companies. Other countries in Africa, Asia, and Latin America have also considered windfall taxes and, in some cases, have actually implemented them.

Canada, on the other hand, has no such tax. On the contrary, Canada has a number of advantageous tax incentives to encourage investment in domestic mining. Flow-through shares, for example, allow investors to write off 100% of their exploration expenses being passed down, and the federal government's program of super flow-through shares gives an additional 15% tax credit for grassroots exploration.

As you can see, there are significant incentives for extractive companies to remain in Canada.

The final point I want to address is this argument that when Canadian companies pull out of countries, the Chinese will then fill the void and the people will be worse off.

In his testimony, Mr. Dade from FOCAL stated that it was a mistake to put pressure on Talisman to withdraw from Sudan and that Talisman had moved to address the human rights issue with a very rigorous and serious corporate social responsibility program. He said, “The investment is being controlled by the Chinese. The people in the communities are, if anything, worse off than they were before. This is a scenario that has a possibility of repeating itself throughout the hemisphere.” This is the argument of constructive engagement--better us than them.

First--I won't go into any detail, and I'm happy to answer questions on this--Talisman's self-regulation efforts in Sudan were very weak and deeply flawed. They claimed they had engaged the Government of Sudan and made progress on human rights issues, but there was no independent evidence to support this argument. In fact, the human rights situation deteriorated while Talisman was operating in Sudan.

The other point that's important is the distinction that needs to be made between corporate accountability and corporate social responsibility activities. Talisman claimed it was a force for the good, and this is misguided, okay? Its community development works, the hospitals, the schools, and the wells, those corporate social responsibility activities it was doing for the communities, were located in garrison towns. These were towns that were held by the government in rebel-controlled areas. They were not accessible to ordinary persons who were in or near the concessions and they contributed to the Government of Sudan's counter-insurgency strategy.

A company that claims to support human rights and to be guided by the Universal Declaration of Human Rights can't legitimately argue--at least out loud--that philanthropy can be an excuse for engaging in or being complicit in egregious violations of human rights. This is the point about the constructive engagement argument. Some situations exist where corporations can't be neutral actors, and no argument can be made that it's better to have a Canadian company there, being complicit in human rights violations, than to have another company. As a matter of good public policy, we need standards and an accountability mechanism.

I would like to address one more argument if I have time. This is the argument that Bill C-300, if it is enacted, will violate the sovereignty of developing states. As an expert in international law, I need to clarify this misunderstanding.

International law gives states extensive authority and capacity to regulate the conduct that takes place outside of their territory, that is, in the territory of other states. Canada may regulate the activity of its corporate nationals: any companies that are incorporated in Canada or headquartered in Canada.

In fact, Canada does already regulate the activities of its nationals extraterritorially in a variety of circumstances. It has done so in a number of circumstances: for instance, to implement treaty obligations, such as the convention against torture, the Rome Statute of the International Criminal Court, and certain anti-terrorism laws.

But it has also extended its criminal jurisdiction where no treaty obligation was in place. So before the protocol to the Convention on the Rights of the Child came into place, Canada had already regulated the engagement of Canadian nationals abroad in sexual activities with children and in child prostitution. That had already happened.

In addition, common law civil liability also applies extraterritorially, so this is an absolute possibility under international law. Enacting this bill does not violate the sovereignty of developing states.

One final very short point is that the argument has been made in witness testimonies on Bill C-300 that the investigation mechanism will promote vexatious and spurious claims that companies will not be able to refute. Companies are already being tried in the court of public opinion, because there is no effective forum for assessing the validity of these claims. Companies need a credible and objective forum to promote dispute resolution and to help them to avoid and resolve conflict. Bill C-300, the mechanism that is proposed, could provide such a forum.

Thank you very much.

[Chris Albin-Lackey, Senior Researcher, Human Rights Watch, Harvard Law School]

My name is Chris Albin-Lackey. I'm a senior researcher with Human Rights Watch. We investigate and document serious patterns of human rights abuse in more than 80 countries around the world.

Less than two weeks ago, I returned from a month-long visit to Papua New Guinea. I travelled there to determine whether previously reported patterns of abuse by security forces around the mine at Porgera are accurate and, if so, whether they're a continuing problem. In fact, those abuses are a continuing problem, and they are also a very clear example of why the modest but meaningful regulations set down in Bill C-300 are so important.

I spent the bulk of my time in Porgera in the communities around the mine. I interviewed dozens of people who had been apprehended while trespassing on mine property--mostly people who eke out a living by scavenging for gold-bearing rock on the vast waste dumps around the mine. I also interviewed officials from Barrick Gold, community leaders, government officials, police officers, and mine security guards. We'll publish a full report of our findings and recommendations later in the year.

During our research, I found that the mine faces enormous security challenges, exacerbated by the failure of the Government of Papua New Guinea to maintain law and order in the area. PJV directly employs a sizable private security force to protect the mine and its employees, and we don't dispute the need for guards at that site. Our findings also indicate that Barrick does appear to be taking at least some serious measures to try to exercise stricter oversight over their security personnel and to respond appropriately to abuses that are brought to the attention of company officials.

Nonetheless, I documented serious allegations of continuing violent crimes by some security officers in 2009 and 2010. We documented several recent cases in which security guards appear to have used unnecessary or excessive force when trying to apprehend illegal miners and other individuals who were trespassing on mine property, but the most serious recent abuses that we documented were several gang rapes allegedly carried out by mine security guards, many of whom previously served as police officers. These brutal crimes mirror patterns of abuse that are all too common among the ranks of Papua New Guinea's police force, in which sexual violence is widespread.

Most of the alleged rapes adhere to a common pattern. The victims were women caught trespassing on the mine property by PJV security guards. In each case, the perpetrators told the women that if they tried to complain about the rape, they would be arrested on trespassing charges that carry heavy fines or jail time.

Victims of abuse by PJV guards told me that they did not know of any viable way of reporting these abuses. The police are feared rather than trusted, a problem that's compounded by the fact that most of the victims were committing the criminal offence of trespassing at the time they suffered the abuses.

For victims of sexual violence, the situation is even worse. Many fear reporting rapes because of a powerful social stigma that can often ruin a woman's life. None of the victims I interviewed knew who within the company they could complain to if they wanted to, and it does not appear that Barrick has made adequate efforts to establish clear and safe channels for such complaints.

Despite some important measures taken by Barrick, our research shows that incidents of serious abuse are still slipping through the cracks and that those cracks may be very wide. Barrick itself has not been transparent about the specific efforts it is making. The company has thus far not been able to provide us with specific information about the measures it has put in place to control and respond to abuse and has not allowed us to meet with the company officials who are most familiar with these issues. We hope this will be resolved as our dialogue with Barrick moves forward.

We do recognize that a big part of the problem is that the Government of Papua New Guinea provides no meaningful law enforcement around the mine other than the current deployment of mobile police squads that are largely supported by the company itself. The government also exercises virtually no meaningful oversight or regulation of the company security force.

This means that Barrick, like other companies operating in Papua New Guinea, is forced to rely almost entirely on its own mechanisms to monitor and discipline company security personnel. The example of Porgera shows that in a challenging and largely unregulated environment this task is simply too great for companies to accomplish on their own.

While robust standards set by companies themselves are important, they must be accompanied by robust government regulation. If that regulation is not present where companies operate, then it should be present here at home.

Canadian companies that are serious about respecting human rights in their operations abroad should welcome the additional scrutiny and the additional guidance that Bill C-300 would provide.

Thank you very much.

[Tyler Giannini]

Second, Mr. Chair, in its testimony, Barrick stated in regard to the police that “There has never been restricted access to the mine site”, and that our October 2009 testimony that police “indicated that their investigative efforts have been hampered by PJV security” is “simply untrue”. Barrick also stated that crimes on mine property are reported to the police and that “...PJV would conduct its own investigation...”.

In our written submission, we included documents authored by a police investigator claiming that he had been prevented from accessing the mine and obtaining the time sheets and duty rosters he requested. We spoke with this individual and showed him the documents. He personally authenticated the documents in our presence. Other police officers have similarly told us that they have been hampered from investigating and having access.

This clearly indicates the need for a thorough and independent—and I stress independent—investigation. To the extent that Barrick conducts its own investigations, they have thus far been done in an opaque manner. Barrick should release information on the nature and outcomes of its internal inquiries, information on how many guards were disciplined or dismissed, and for what reasons, and information on whether guards were referred for criminal prosecution.

Third and finally, there is the issue of abuses since 2006--in particular, killings. Barrick stated that “...there have been no fatal shootings by Porgera security personnel” since 2006. First, it's unclear what Barrick means by “security personnel”. However, the existence of witness statements, together with the previously referenced autopsy and police reports on the 2006 to 2008 period and killings, as included in our prior submissions, bring Barrick's statement into question and reinforce again the need for an independent investigation.

In conclusion, Barrick's responses to the serious allegations of gang rapes and killings since 2006, and the inadequacy of both government and corporate investigations to date demonstrate, as previously testified, that there's a vital need for a bill like Bill C-300.

We also strongly believe that human rights standards and the voluntary principles, as referenced in the bill, do give specific guidance that is clear and manageable for companies and adjudicators considering allegations. An alleged abuser cannot police itself, and there must be genuine independent investigation into allegations of human rights abuses.

[Sarah Knuckey, New York University Center for Human Rights and Global Justice, Harvard Law School]

Thank you, Tyler.

Chair and committee members, in October 2009 we provided testimony to this committee on allegations concerning gang rapes, physical abuse, and killings by security guards that we documented during three separate fact-finding missions to Barrick Gold's PJV mine in Papua New Guinea. Subsequently, we submitted a detailed supporting document, including extensive appendices of police and autopsy reports, which we encourage you to review.

Our 2009 testimony provided information on why independent, transparent, and comprehensive investigations by Barrick or the government of PNG have not yet occurred and are unlikely to take place. In 2006 the PNG government investigated deaths surrounding the mine, but four years later, it has yet to release the findings of those investigations.

We also testified to the existence of an MOU between the government of PNG and the PJV under which police reservists are part of the PJV security force, raising serious questions about the independence of any investigations by the police of Papua New Guinea.

Today, we respond to some of the claims made by Barrick Gold in its subsequent testimony to this committee, which further demonstrate the inherent problems of leaving a company to investigate itself and emphasize the importance of a bill like Bill C-300, which could help fill an alarming accountability gap.

First, let me address gang rapes. In response to our October 2009 testimony in which we documented numerous allegations of brutal gang rapes by guards on mine property, Barrick stated in its testimony that, to its knowledge, “no cases of sexual assault [have been] reported to mine management” and said, “It is not possible for the PJV to investigate an allegation it has never received...”.

Committee members, this exemplifies a “hear no evil, see no evil” approach to human rights abuses. Through our investigations, we quickly discovered allegations of sexual violence. Barrick would have been able to do the same if it had conducted any investigations at all.

Sexual violence by PNG police across the country is well known, as is the reluctance of women to report rape. Senior Barrick officials have been aware of general rape allegations at the mine since at least August 2006. Given such knowledge, Barrick should have, at a minimum, taken steps to proactively prevent sexual abuses, including by installing surveillance cameras on the waste dump areas where women were raped, and in the guard patrol vehicles; by doing community outreach to women to inform them of their rights and how to complain; and by creating a reliable internal complaint mechanism.

Further, while Barrick seems to imply that the rape allegations we testified to are false because women have “numerous avenues” to report an allegation of rape, this grossly misstates the realities on the ground. Most of the women I met do not know to whom at the company to complain or are fearful of retribution, community disapproval, being arrested, or suffering further abuse from the police.

[Gary Nash, As an Individual]

Thank you, Mr. Chairman.

My thesis will be that Bill C-300 will create some serious issues for the government and will not be of net benefit to Canada.

To begin, I want to clarify that there are not 4,000 mining projects abroad. There are likely fewer than 200 in developing countries; I received this information the other day from a consultant friend of mine. In his case, he shows about 182 as of 2007.

The second point I would make is that exploration companies can be quite small, as you've just heard, and these companies, as far as I know, do not draw on EDC funds, nor do they receive investments from the pension plans. As a result, they're probably outside the context of the bill.

Therefore, the real target of this bill is mining companies with projects abroad, but there are some questions about that.

To what mining projects will the bill apply? Does it apply to foreign companies investing from their Canadian subsidiaries? Does it apply to foreign companies that happen to be listed on the Toronto Stock Exchange? Does it apply to joint ventures where Canadian mining companies have a greater, equal, or minority interest in the joint ventures? Will the joint venture partners also be investigated if you decide to pursue it?

To undertake a case-by-case review can be costly and lengthy. It could require in-depth, technical, on-site expertise, and obviously the cooperation of the host government, which may take time for a decision, as well as a fair and transparent process, with oversight, to ensure that the investigative and administrative processes are carried out properly.

Without sufficient resources to investigate and to meet the famous Treasury Board guidelines for contracting, it could take some years to resolve a complaint, given a significant number of complaints, which is likely with the passage of this bill. The longer it takes to decide, the greater the likely negative impact on the company's reputation, its market value, and its ability to move forward on other projects that do generate some community benefits.

What happens if the minister cannot meet the eight-month deadline? And even if it's extended, what then, in terms of the negative impact on the company? Will there be need for an investigation to determine if the complaint is frivolous, especially if the criteria are not specific enough to avoid this need?

With the announcement of a review, the public will generally assume that the company is guilty. The fact that the minister publishes in the Canada Gazette the decision of innocence or that the complaint is frivolous is of little value. Who reads the Gazette in the general public, in Canada, or abroad? And do journalists in the implicated countries or here always follow up on the story? If so, do they get it right? You must have some experience with that.

Ministerial decisions also provide an opportunity for politically biased decisions in accepting to review a complaint or possibly deciding that the infraction wasn't significant enough to inform EDC, because you will run into those types of things. Each situation can be said to contravene procedural fairness, and you've heard from a constitutional lawyer on this. To minimize bias, should not the parties implicated be allowed to comment on the information and analysis received by the minister, obtained during the review, and prior to the minister's decision? Should they be allowed to appeal the decision?

There is no provision for protecting a complainant from local interests that might be negatively affected by a guilty decision of the minister, and I can give an example of a circumstance like that. In some countries, it is possible that a complainant might be at risk not only from affected local interests, but also from his own government, if he were to write a letter of complaint to the minister. This is possible if the government favours the mining operation or if the government was complicit in ignoring the infraction or rejects the right of any foreign government to interfere in its domestic matters.

What is the implication for the Canadian government should the complainant be killed? And what about instances where corruption or blackmail is prevalent? Threatening to complain might be used to gain additional funding or a bribe from the company. How will the minister determine the real basis of the complaint or an interest that encouraged the complaint?

What about the corruption of judges in some developing countries? We know of some. What if the minister finds that the complaint was unfounded, but the judge, possibly as a result of corrupt practices, finds otherwise? If, as a result, the consequences for this company are serious, then will Canada intervene in support of the company?

As far as corruption is concerned, complaints might be used by the government in the country concerned to withdraw a mining licence from a mining company. I can give an example. Should this occur, especially if the minister gave credence for the complaint, what are the consequences for the Canadian government? Will the minister seek and obtain the agreement of that government before undertaking a review? If that government opposes a review by the minister, will the minister then dismiss the complaint? If not, what will it mean in terms of the relationship with that country?

If Parliament approves a bill that provides for extraterritorial application of Canadian law, what are the consequences if it conflicts with the provisions of the developing country's law or regulations—and there are examples—and if the domestic law was legitimately not intended to accord with international standards or guidelines?

How will the government react if another government also decides on a bill that allows it to undertake reviews of complaints against its mining companies? As you know, Canada has a good number of foreign companies operating, from South Africa to China, India, and Russia, etc. Would the Government of Canada welcome the involvement of the United Kingdom or China in such a review of a complaint against their companies in Canada? It opens up a real issue if many countries decide to copy this bill.

Suppose that a mining company obtains a court decision in the country of concern in which it is found innocent of an environmental infraction. Then, suppose that certain persons in that country, or even in Canada, are not satisfied with the court's decision and submit a complaint to the minister. Would that complaint be accepted for review or just automatically be rejected? The bill does not provide for that.

If the minister finds the company guilty of an infraction and the infraction was known but ignored by the company, could the minister's decision lead to criminal or civil charges against the company in that country?

If the Canadian government decided in favour of a Canadian company, it might create some political opposition to Canada and to other Canadian interests in the country. If it favours the local or other interests and not the company, then, as you know, the government will have helped to injure the reputation of that company and its potential access to other opportunities that could have provided additional trade and benefits for Canada.

Also, since companies prefer certainty with regard to funding and insurance, this will encourage the company to seek support from other than EDC. This could cause a bit of embarrassment to the company, particularly given the fact that EDC often encourages the use of Canadian suppliers of goods and services.

The bill provides for complaints of a social/human rights nature, which need to be defined. Are we talking about family breakup, crime, working conditions, and hiring practices? But on the social side, to assess the impact on social changes in the community, a baseline study is required to know whether there is an increase in social problems that can be related to a mine. If there is more than one industry in that area, how will the minister distinguish who is at fault?

Overall, what will be the measurable standards based on human rights principles or guidelines? John Ruggie, Special Representative of the Secretary-General of the United Nations, has been working on this for nearly five years, and he is still working. Bill C-300 allows 12 months for the minister to establish corporate accountability standards pertaining to human rights guidelines. As you know, a guideline can have a number of different measurable standards.

As an alternative, I would agree with the prior advisory committee to the round tables that many issues need clarification and a proper analysis, some of which is detailed in my larger paper. An expert group could be established to consider the complications raised in the paper, as well as the necessary standards, procedural guidelines, and decision-making roles to improve corporate performance that maintains a positive image of Canada abroad. Again, details are in my paper.

Thank you, Mr. Chairman.

[Laureen Whyte, Vice-President, Sustainability and Operations, Association for Mineral Exploration British Columbia]

Thank you.

Thank you for inviting us to join you, and I apologize; I've had the trip on which everything that could go wrong has gone wrong. I'm running.

I work with the Association for Mineral Exploration B.C. I work out of our Vancouver office. What I really wanted to do today is bring a perspective to you from the exploration community, primarily in British Columbia, but also nationally and internationally.

The Association for Mineral Exploration was established in 1912. We represent over 300 corporate and 3,000 individual members. These are primarily prospectors and junior exploration companies. We also have the exploration divisions of some of the senior companies in our membership.

Our areas of focus are primarily health and safety, aboriginal and community engagement, and policy development. We also have a large conference, Mineral Exploration Roundup, where we do technical work.

The context for our members is that in some ways it is quite daunting for folks who are working in a small office or perhaps on their own to try to understand operationally what the guidance is telling them to do. In terms of the international work that has been happening, we've had to make a lot of investment in understanding and providing guidance to our members on how they can implement operational practices that will meet the tests of health and safety standards, environmental management, social development impacts, and, now, human rights.

I want to share some of my own involvement in this. I have worked with first nations for almost 25 years, both in the community as a social worker and in development initiatives as an industry employee. I think the challenge and the opportunity can both be underestimated in terms of what the presence of industry can mean to a community, and it's primarily the examples of first nations that have raised a lot of questions for our members about what the expectations are of them internationally.

As for some of the things we've been working on in British Columbia, we have been working with first nations in an area where there is very little of the province that's covered by treaty, so we're working in very uncertain kinds of situations, in a lot of conflict situations, and where there is a lot of uncertainty about decision-making and reaching consensus within the communities.

We work with the Prospectors and Developers Association very closely as well, and we've been deeply involved in the development of e3 Plus, on which I know Tony Andrews has shared some details with you already.

We also are participating as PDAC moves to its field testing of e3 Plus, and we've engaged two first nations in B.C. to participate in the field testing with companies operating in their area. I think that the connection to what we do domestically should not be lost. There is an awful lot that we've learned here, and there are a lot of similar kinds of situations that we've developed some expertise in managing.

Internationally, I think it's been recognized by all that the real performance challenge is being able to bridge the governance gap that has been created by globalization. But the current international human rights objectives were framed in relation to the obligations of states, not businesses.

At a practical level, there is also a lack for us of an understanding of the breadth and coherence of response. What I mean by that is that understanding who is responsible for what in any given situation on the ground is very difficult for people to do.

The way we experience success is by collaborating with government, with communities, and with non-profit organizations. I can cite several examples in British Columbia where we've done that very successfully in remote communities.

We can't do it alone. Nobody can do it alone. I feel very strongly that the way people learn how to manage these situations is not through sanctions, but by learning. It's by learning from each other, by having the responsibilities and the criteria set out for them very clearly in operational terms, and by being able to go to somebody who can provide them with some guidance.

I just want to speak briefly about what we're doing here in Canada. We have been following the work of the UN special representative very closely. In my experience in working in communities on a personal level, I am very pleased to see the scope and the comprehensiveness with which the UN special representative is approaching this work. It fits with my own experience of success and with the kind of guidance that I've provided to my members and that has been successful for them.

I also believe that here at home in Canada we've been providing a lot of support to the CSR counsellor and doing what we can to contribute to the CSR strategy, the centre for excellence, and a number of other initiatives. We have a very large group of people participating deeply in all of these consultations and discussions.

I want to speak briefly to the provisions of Bill C-300 in particular. I believe that the punitive measures that would be aimed at Canadian companies would divert significant resources away from the collaborative process that is under way now. We've made a huge investment in that. We're seeing results.

I don't want to see my members taking their time and resources away from the work we're doing now, which is helping, to something that would put them in a compliance mode. The compliance mode for them would be to do the minimum required, to not integrate that into their own corporate culture, and to not discuss with other people what their practices are. It becomes an issue of liability for them, rather than one of learning from each other.

It's very hard for me as an association staff member to get my members to speak openly about the challenges they face. They don't like making mistakes. They don't like it when they have done something wrong. They can come to me now, and we can bring opportunities to them for sharing and learning among each other; if they're looking at sanctions as the first line of response, all of that will disappear and I will have no ability to engage my members in these initiatives.

I also want to say specifically about Bill C-300 that I don't believe the IFC and voluntary principles give us enough detail to justify sanctions. They're too general. They don't tell people what they need to do operationally. I believe that sanctions should be applied after efforts to improve performance have been exhausted, not before.

The loss of the opportunity to improve is a loss for communities, host governments, and the competencies of industries. The ability to work things out with the communities is a really valuable thing for those communities as well.

I also don't believe that the bill accounts for the level of resources that would be required to implement its provisions. I have a great deal of experience with what it takes to implement these things effectively.

Thank you.

[David Stewart-Patterson, Executive Vice-President, Canadian Council of Chief Executives]

Thank you very much, Mr. Chair.

Thank you, members of the committee, for inviting us here to testify and to discuss Bill C-300.

The Canadian Council of Chief Executives represents the heads of large globally engaged enterprises in every sector of our economy. We have spoken clearly and often about the importance of good corporate citizenship at home and abroad, and I think it's fair to say that by any objective measure Canadian companies are among the most socially and environmentally responsible operating in developing countries worldwide.

Far from promoting more responsible behaviour by Canadian corporations operating internationally, we fear that Bill C-300 would result in Canadian corporations either choosing not to make beneficial investments in developing countries or losing business to corporations based elsewhere that will not have the same regard for environmental, safety, and human rights standards.

The council's main concerns follow.

The legislation is based on a flawed premise, since it assumes that Canadian companies are not to be trusted in their international operations.

As yet, there is no internationally recognized set of standards against which Canadian practices can be judged.

By suggesting that unilaterally determined Canadian standards should take precedence over the laws and regulations established by sovereign nations, Canada would be engaging in a form of extraterritoriality that it consistently has rejected when attempted by other countries.

On a more practical note, the mere threat of a withdrawal of export financing from Export Development Canada or a loss of access to investment from the Canada Pension Plan Investment Board could easily jeopardize projects in developing countries. We know of no other national legislation that would seek to discipline the international activities of its resident corporations in this manner, and thus competitors in other countries would have an unfair advantage over Canadian companies.

The bill purports to screen out vexatious or frivolous claims, and yet it provides no effective mechanism for doing so. Any person can request an investigation, regardless of whether they're personally affected, and without having to supply any credible evidence of inappropriate behaviour by the corporation in question.

The filing of a single complaint sets the process in motion, and the mere fact of an investigation, regardless of its eventual outcome, would likely prejudice the Canadian company. In a bidding situation, a competitor could easily arrange for a complaint to be launched and then lobby the foreign government to exclude the Canadian company from the whole bidding process, on this basis: “Look, they're even being investigated by their own government, so how can you possibly do business with them?”

Undertaking an investigation under the act likely would require the assistance of the government of the developing country, which may or may not be forthcoming. In any event, Canadian ministers responsible would not have ready access to the resources or detailed expertise they would need to easily determine the merits of a complaint. And all of this would lead to unacceptable delays and prejudice to the Canadian company.

Let me be clear on one point. We believe that Canadian companies should always operate in a transparent and ethical manner, both internationally and at home, and we fully support efforts to improve the governance practices of all companies operating in developing countries.

The federal government has been engaged with responsible Canadian companies for some time in an effort to develop sound corporate social responsibility standards and their practical implementation. We should allow these efforts to continue rather than short-circuit them through misguided legislation.

I think it's fair to say that for many years Canada has been seen as a centre of excellence in the mining industry, both in terms of a significant number of Canadian champions competing around the globe and with respect to our ability to provide world-class financing of mining ventures anywhere. In an era when national brand is increasingly important, this legislation is likely to tarnish our well-deserved reputation for good corporate citizenship in the extractive sector. It could also imperil the brand of many other Canadian companies operating in developing countries, beyond those in mining and oil and gas. Therefore, I urge members from all parties to vote against this bill.

Thank you, Mr. Chairman.

[The Chair, Conservative, Dean Allison]

Pursuant to the order of reference of Wednesday, March 3, 2010, Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries, we'll commence. We are now at meeting number 21.

To all the witnesses today, I want to say thank you very much for being here. Some of you have come from close by and some from farther away. We thank all of you.

I'm going to ask you to try to keep your remarks to eight minutes. I realize that some of you have been told a different amount; I'm not going to cut you off, so do the best you can.

I want to get started as quickly as we can because we do have a lot of witnesses today. A few have said that they would be a bit late. We will probably start questions and then go back to them, should that happen to be the case, just to give everyone a chance.

It's good to see Mr. Stewart-Patterson back again. Why don't we just kick off with the Canadian Council of Chief Executives? You have Mr. Dillon along as well, who is the vice-president of regulatory affairs and general counsel. We'll have you start and after that we'll get to questions.

Mr. Stewart-Patterson, the floor is yours, sir.

Mining Industry

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

Mr. Speaker, I have the honour to present a petition signed by a number of residents from London, Ontario, and a number of residents from Regina, Saskatchewan, with respect to the issues of Canadian mining companies.

The petitioners wish to draw to the attention of the Government of Canada that the alleged abuses of human rights and degradation of the environment by Canadian mining companies are a violation of the principles of fundamental justice. The petitioners feel it is the duty of Parliament to hold Canadian companies responsible for their activities when operating in foreign jurisdictions.

The petitioners ask the Government of Canada to create effective laws with respect to corporate social responsibility and to consent to the expeditious passage of Bill C-300.

[Bernard Patry, Liberal, Pierrefonds—Dollard, QC]

Thank you very much.

Ms. George, I have great respect for the Canadian Chamber of Commerce, but I have to say that your testimony this morning is a lot more negative than other representatives of your organization have given before this committee.

The Canadian Chamber of Commerce participated in the Interdepartmental Working Group on Corporate Social Responsibility. One of the working group's conclusions was to create an ombudsman position with investigative powers. I have to say that there is no punitive intent. It is important that that be said. But the Corporate Social Responsibility Counsellor position that has just been created is just an empty shell, in my view.

Has the Canadian Chamber of Commerce already done any research in developing countries on companies' social responsibility? From whom do you get your information, apart from the companies themselves? Have you already talked to civil society representatives in some of those countries? I am not talking about NGOs, but about real civil society representatives. For example, representatives from the conference of bishops from the Democratic Republic of Congo came here to see us.

Right at the beginning of your remarks, you said that Bill C-300 “would leave the problem unresolved”. So I gather there is a problem. Can you tell me how you see the problem?

[Shanta Martin]

I don't want to discount the possibility of the CSR counsellor having some positive impact, but my main concern is with the entirely voluntary nature of any activities she engages in with respect to companies saying they'd rather not. The second concern is that even if through that process she has recommendations as to what goes forward, those are entirely voluntary. There are no teeth. There's nothing to back up the recommendations.

I understand there is some concern among civil society in Canada regarding the way in which that counsellor will go forward. What I think is quite interesting is that Bill C-300 is hardly proposing much beyond what is already in play. What it does do is say there will be ramifications if a Canadian company does not respect human rights overseas. Now those ramifications are entirely within the capacity of the state to withhold or to provide, and in that sense it seems to me that it entirely makes sense that Bill C-300 is trying to regulate the extent to which public support will be given to companies when they may not respect human rights. And again, going back to the CSR round table--the ombudsman process that was proposed within the CSR round table, which had the consensus, the agreement of all parties to that round table, including industry--I think that what was proposed and what has since come out in terms of the CSR counsellor are quite different things.

[Karin Lissakers]

Thank you.

Under the extractive industries transparency initiative, for example, which has now been endorsed by the G-8, by the G-20, and has wide support, including from the Canadian government, which is contributing to the trust fund that helps countries with implementation of the EITI, there is a strong recognition of the value of the transparency of payments from companies to governments in resource-producing countries. This is a way to increase the accountability of the government's management of those moneys and to reduce the risk that payments are diverted for self-enrichment and other corrupt purposes. The logic for supporting this transparency is that if the revenues that are generated from the extractive resources are spent for the public benefit by the recipient state and government officials, the business environment will be better, the political environment will be better, and everybody gains--the consumers, the importers, the investors, and the citizens of the resource-rich countries.

I'm surprised.... As I say, the International Accounting Standards Board is working on an accounting standard. The U.S. Senate just considered setting transparency standards. The IFC already has a transparency requirement related to any of its extractive investments, co-investments with companies, and the U.S. Overseas Private Investment Corporation, OPIC, has this transparency requirement, using the IFC and the EITI standard as a reference point. It seems to me, then, that it would be logical to include this provision in Bill C-300, since it moves in the same direction of meeting international best practice and enforcing it when Canadian public moneys are at risk.

[Shanta Martin]

I believe there are two distinct differences between the Canadian counsellor and what is proposed under Bill C-300. One is that the counsellor hasn't actually got, within the scope of what she is undertaking, a requirement to articulate what the guidelines are the company would be required to abide by. The second is that the investigative mechanism that the counsellor has is without any capacity to compel the production of documents or testimony from a company, whereas certainly in relation to what Bill C-300 proposes, due to the relationship and the significant dependence that a lot of Canadian companies have on public support, there would at the very least be a significant basis for a lot of companies to comply with requests from the minister in relation to the production of documents and other testimony.

So where the counsellor has only the capacity, on a voluntary basis, to engage if a company wants to be engaged in a dispute resolution process, the ministers under Bill C-300 would have a fact-finding capacity and would also have the capacity to ensure that there is some follow-up, if they find that the way in which a company has behaved falls short of the guidelines.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

I'm only suggesting that if Bill C-300 is needed two or three years from now, if the CSR counsellor function is not an appropriate function or is not working well, perhaps we would have to take a look at something like Bill C-300. But unless I'm mistaken, from what I heard you say, you have just described the CSR counsellor that the Canadian government has set up as a result of the round table that we had in this country.

[Shanta Martin]

Well, certainly one of the things I mentioned just before was that, as I understand it, Bill C-300 is intended to do away with vexatious and false claims, that there is a requirement of due process in Canada, and that clearly this process that is suggested under Bill C-300 would be subject to those requirements of due process.

Now, if it appears to companies such as Barrick that there is an unfair aspect in terms of NGOs bringing information to the public domain, one way to deal with that is to ensure that there is an appropriate authority within Canada that is tasked with examining these issues, so that the company itself has the opportunity to present its information in a fulsome and clear way. Amnesty International's investigations have found there's often a lack of desire to fully share all of the information that would be necessary to get to the bottom of any concerns the company might have.

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

I am going to speak to you in French. I hope you can hear me clearly. Can you hear the simultaneous interpretation? Is it working?

Ms. George, I have some questions for you. You are going to participate in the debate today.

I feel personally involved in what you said. You know that, clearly, the public gets worried when they hear about the likelihood of a mine opening in one of our regions. You said in your speech that there were always unhappy groups when there is a plan to open a mine in a given region.

I think it is healthy for people to be able to express their concerns. In my region, there is a potential uranium deposit. Obviously, we are not going to let just anyone come in with big boots, take away the resources and leave everything stripped, causing environmental damage that will have an impact on people's lives, health and environment. I think it is entirely legitimate.

One thing is troubling. Exploration is under provincial jurisdiction and development is under federal jurisdiction. So there is a grey area.

I think there has to be at least a framework, an act, and I would like to hear your opinion on that. Perhaps Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries makes you afraid of certain things for certain reasons. But, as the other witnesses have told us, Canada must have rules, legislation to control those companies, both here and abroad.

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

I have one final point: that is, the companies assert strongly that somehow Bill C-300 will be used to game them, that NGOs will assert claims, frivolous and otherwise, against the good reputations of these companies. Ms. Martin and Ms. Lissakers, has that been your experience with the national contact point with the OECD and various other entities that currently exist?

I suppose the final point, particularly with respect to the Amnesty International assertions, is that, effectively, your report is being dismissed as hearsay.

Could you, within the last 30 seconds, comment on those two questions?

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

Ms. Martin, excuse me for a second. Unfortunately I have only seven minutes, and I'm down to three, and there is one other point I want Ms. Lissakers to address.

The issue has to do with Ms. George's assertion that Canada's companies will have reputational damage, that in effect they'll be forced to leave the country and seek a more hospitable jurisdiction for their activities. I'd be interested in your observations, given that you work rather closely with American legislators and you have a fairly broad international perspective as to where you think these Canadian companies that apparently don't want the inquiries that Bill C-300 might generate might go.

[Shanta Martin]

Thank you, Mr. McKay.

With respect to point four, that Bill C-300 would alienate developing countries and would impose the will of Canada on other countries, I don't see anything in the bill that actually specifies that or would result in that.

Basically, as I understand it, what the bill is intended to do is to make clear to Canadian companies that there are standards that they ought to abide by in relation to what they undertake in their operations overseas and that if they don't abide by those standards, there may be repercussions within the Canadian context. That effectively is outlining what Canada expects of its companies. It doesn't say it expects that the Government of Papua New Guinea will do X, Y, and Z. It basically says that there are international standards, that international human rights law does exist, that it is expected of states to require their companies to respect human rights, and this is one way of doing it. So I'm very unclear as to how that would actually be the case.

If I can just get back to this idea that the standards are not clear, what strikes me as anomalous is that on the one hand companies, including companies that are members of the ICMM, say they respect human rights, yet on the other hand say that the human rights expectations are too unclear to give them guidance. I don't understand how it can be one and not the other.

I think we need to refer to what the special representative has said in relation to human rights standards, that it is clear that companies can impact the full breadth of human rights. The legislation, as I understand it, proposes that the guidance elaborated by the ministers would be based on international human rights conventions to which Canada is a party and on international customary law. As I've mentioned, the special representative basically says there are few, if any, internationally recognized rights that business cannot impact. As such, it is entirely appropriate that any guidelines developed by the ministers would draw from international human rights law, including the international bill of rights.

There is significant guidance provided at the international level in the form of declarations, comments, jurisprudence, and recommendations from the treaty bodies, as well as from other mechanisms. It would also obviously be relevant to apply international labour law.

In response to that—

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

Thank you, Chair.

Thank you, all four of you, for joining the issue. I thought each of you made some pretty significant points, and I think this is an opportunity to get some dialogue between opposing views.

Let me start with the testimony of Mr. Hodge. I agree with you, as far as the ombudsman is concerned. It's a pity that report wasn't picked up and implemented by the government. But we have what we have, and Bill C-300 seems to be the only thing to be able to move things forward.

I want to address several points that Mr. Hodge made and ask Ms. Shanta Martin to comment on them. The first has to do with his point number four, which is that apparently Canada would alienate developing countries by imposing a regulatory regime. It would be imposing our will--I think that was the point he was making.

His fifth point had to do with the standards in Bill C-300 being unclear, although I'm not quite sure how they could be unclear when they're set out in the guidelines. There's that, and the related point, which is that if Canadian companies withdraw they'll do more harm than good to the indigenous population.

I'd be interested in your comments, Ms. Martin, in light of both your general findings and how you would apply those arguments to Papua New Guineau.

[Shirley-Ann George, Senior Vice-President, Policy, Canadian Chamber of Commerce]

Thank you very much, Chairman Allison.

It's a pleasure to be back in front of this committee. As you know, we represent the broad base of Canadian business, with over 175,000 members.

It is a pleasure to appear before this committee again on Bill C-300. We have resubmitted the presentation that was given by our president and CEO last November. I will not take you through all of that again. Rather, my presentation today will outline the key reasons why our views on this bill have not changed since we last appeared. In fact, we feel more strongly than ever about the harm this bill would cause while at the end of day giving no more protection to people in developing countries where Canadian extractive companies operate.

Bill C-300 would cut off companies from government resources when they are alleged--not proven, but alleged--to have behaved badly and when they most need help. Bill C-300 would leave the situation unresolved. It would leave the alleged parties no better off--and potentially worse off. It would leave the company in no position to take any measures to make things right if that were proven to be necessary. It would leave in tatters the reputation of Canada, the Canadian government, and one of our most important industries and economic contributors.

Also, we cannot ignore the impact of reducing the activities of our large extractive companies on the hundreds of smaller firms that serve them, including some companies that reside in your ridings. With the projects of larger companies curtailed, the spillover impacts on Canada will soon be felt.

Canada is a world leader in the extractive sector, and the Toronto Stock Exchange is the world’s largest mining sector capital market. Bill C-300 would change that. It would drive Canadian extractive companies, the vast majority of which do behave responsibly and are considered to be globally responsible leaders, to move their base of operations outside of Canada.

Their motivation would be not to escape the punitive measures of Bill C-300, but to allow themselves to operate on a level playing field with their international competitors. On this, they know they can compete. On an unlevel playing field, they know they cannot. Competitors will not have to be constantly looking over their shoulders to see where the next accusation is coming from.

Mining is similar to building a new highway across the middle of your hometown. No matter how much it's needed, and no matter how diligent you are in your preparations, there will be a group that will remain bitterly unhappy. And there are anti-mining groups who make hearsay accusations without the needed due diligence.

This bill provides a taxpayer-funded platform for organizations whose existence depends on their ability to make accusations against extractive companies and for those that wish to do mischief to Canadian companies. Our extractive sector companies’ international competitors could use the Bill C-300 process to damage the reputation of our companies and tie up their financing arrangements, as well as delay their entry into new projects and the takeover of existing ones.

Also, if Bill C-300 were passed, many Canadian companies would not take the risk of pursuing new ventures in countries with weak governance. This could be devastating to countries that depend heavily upon the economic contribution of Canada’s extractive companies.

In Africa, for example, Canadian mining companies had more than $19 billion in assets in 2008. These companies contribute many, many, many times more than the Canadian government does. The impact upon this region of the closing down of projects, or even their curtailment, would be hard and swift for the world's most vulnerable.

Canadian companies would also shy away from taking over operations where companies are behaving inappropriately and then bringing them up to international standards. Why would they do so when the prospect of penalties and reputation damage lies before them? And who would lose most? The very people that the bill means to protect.

Sanctions proposed in this bill could be very serious and potentially devastating for Canadian extractive companies and for their employees, both at home and abroad. It would also harm the projects and the people in the developing countries. To be cut off from EDC financing and political risk insurance, as well as being blacklisted for Canada Pension Plan investment, would mean the cancelling of projects and the cutting of jobs.

It is the view of the Canadian Chamber that Canada shows true leadership by working with companies to give them the tools to prevent getting into difficulties and, even more importantly, to continue working with them to help remedy the situation and preserve Canada’s reputation if they do. Cutting and running is not the answer.

Some have alleged that Canadian extractive companies want to cling to the status quo. This is not the case. Canadian extractive companies know the competitive advantage afforded to those with solid reputations for responsible conduct. What this is about is measuring companies internationally by the same existing high performance standards and not putting Canadian companies at a competitive disadvantage.

The standards that were cited by some of the other speakers are good standards. They were developed on an international basis and applied across all companies operating in those countries. They don't target companies from one specific country.

It's also about the reputational and economic harm of the process that invites allegations against Canadian companies without any risk to those who make them.

Bill C-300 is a classic example of a well-intentioned bill that causes massive unintended consequences. Because this bill was written by those who do not understand the extractive sector, it also will not achieve its purpose.

It is our recommendation that you take a step back and look at what should be done. This committee can meaningfully contribute to improving socially responsible behaviour. You can better understand the industry. My understanding is that this committee has not visited even one Canadian mining site in a developing country. You should go to see them. You should find out what's going on.

You could understand and contribute to international CSR guidance tools, such as the updating of the OECD guidelines for multinational enterprises that is under way today. You can review and support more CIDA projects to help build good governance in areas where Canada has mining interests. This would be a significant contribution. You can make sure that the CSR counsellor that was put in place--in part because this bill was tabled and the government responded by putting in place more than what they had originally intended--and the report that's given annually is important, by giving it your priority review each and every year and not forgetting it when you move on to the next thing, and by ensuring that the department provides adequate resources to that office. These measures will make a difference.

As we have said, while it is well-intentioned, Bill C-300 cannot live up to those intentions. It would cause significant harm to Canada's world-leading extractive companies, the broader business community, and Canada's overall reputation and economic competitiveness.

The Canadian Chamber of Commerce asks each of you to vote against this bill.

Thank you.

I would be pleased to answer any of your questions.

[Robert Anthony Hodge]

Thank you.

Argument three is that on its own, the remote ruling of Bill C-300 focuses on the negative and provides no incentive for ensuring that the interests of the parties involved are addressed—community, host country, indigenous people, or company.

Argument four is that Bill C-300 will alienate a number of developing countries at a time when the kind of leadership Canada has provided over the years is needed more than ever before. This is because its approach is based upon a model of the world where Canada will seek to regulate the behaviour of extractive companies over the heads of host country governments. This will be seen as undermining of national sovereignty and of a “west knows best” mindset. Frankly, we would do better to put funding into strengthening the enforcement capacities of some host countries in areas like environmental and social regulation, rather than substituting our own judgments for theirs.

Argument five is that while standards drive ICMM members’ performance, the standards to which companies would be held accountable under Bill C-300 are unclear and subject to development within 12 months of the bill coming into force. This leads to considerable uncertainty regarding the scope of what companies may ultimately be held accountable to. To complicate the issue, the IFC standards and guidelines and the OECD guidelines for multinational corporations are both currently under review. As a matter of principle, it is difficult to support legislation where it is not possible for companies to understand the standards and criteria to which they will be held accountable.

In closing, here are a few suggestions and thoughts about moving forward. Canadian parliamentary process must, of course, run its course. However, regardless of the outcome, Canada should use this as a catalyst for discussion with mining countries from the political north and south, and with partners in business and civil society, in terms of effective encouragement of corporate social responsibility. Corporate responsibility has a number of facets—ethical, legal, and economic. All these need addressing in a systematic approach that encourages positive change.

So my message is not one of inaction. Within Canada the CSR round tables generated an agenda for action and these should be taken forward. Meanwhile, Canada has an opportunity to be a prime mover in the international debates about accountability and providing redress for those whose rights are infringed. But we do not strengthen our voice by acting unilaterally. Rather, with initiatives such as John Ruggie’s final report to the UN Human Rights Council and the ongoing revisions to the OECD guidelines and the IFC performance standards, there is an active agenda for progress.

Over the past 20 months,I have been privileged to be able to travel broadly across the world, meeting and interacting with individuals from many countries and cultures. I'm always struck by the special reaction when I identify myself as a Canadian. Canada has a special role in the world arena. There is a remarkable respect out there and an expectation that we work with others, that we do not impose our will on others. I hope the results of this discussion will be consistent with that respect and these expectations.

Thanks again for the opportunity to address you.

[Robert Anthony Hodge, President, International Council on Mining and Metals]

Thank you very much, Chair, and honourable members of the committee.

ICMM was created in 2001 as a change agent within the industry. Our charge as a secretariat is to work collaboratively with members to improve environmental and social performance, guided by the principles of sustainability. We are not a lobby organization.

We have 19 corporate members now and serve as an umbrella for some 30 mining associations around the world, through which we have potential reach to another 1,500 companies. Those companies are not bound by the core commitments that bind our 19 core members.

Of particular relevance to this discussion are programs that strengthen the socio-economic contribution of mining activities at local and national levels, our work on human rights and grievance mechanisms, and strengthening relationships with indigenous peoples. The ICMM and its members are also active partners with governments, including Canada's, and civil society in initiatives such as the voluntary principles on security and human rights and the extractive industries transparency initiative. I've given you other notes about ICMM on my submission.

I very much appreciate this opportunity to address you. I believe that this discussion in Canada around corporate social responsibility provides a special opportunity to bring positive change and a special opportunity for Canada to demonstrate leadership in the international arena. I agree that the performance of a small minority of mining companies has been unacceptable. This is not representative of the overwhelming majority of the industry.

At the same time, I am sorry that the response of the federal government to the consensus-achieving CSR round table process was so slow. One result has been a significant increase in the acrimony of relationships in and around the mining industry in Canada, to no one's gain.

I have two overarching messages. One, we strongly endorse the notion of accountability. There is a role for appropriate mechanisms for resolving complaints and delivering remedies. Some of these may well be in the form of rules and binding standards. Two, the design as proposed in Bill C-300, however, will not serve to bring positive change as sought by the stated goal of the legislation.

I wish to put before you three key trends that affect the environment in which we are operating.

First, over the past two decades the world has seen a marked improvement in the way in which social and environmental implications of mining projects are managed, along with an acceptance of the concept of an unwritten social licence to operate based on early and ongoing engagement with affected communities.

Second, a significant and continuing shift has taken place in the global economy towards emerging markets in China, India, Brazil, and South Africa. These are major players, and they are frankly skeptical of initiatives that they perceive as western constructs unless they are part of the design process. They are no different, quite frankly, from anyone else.

Third, over the past four years a major process has been under way to construct a framework within which business impacts on human rights can be managed and accountability can be assigned. This work is led by the UN Secretary-General's special representative, Professor John Ruggie, whose “protect, respect, and remedy” framework has achieved a high degree of consensus in what previously has been a contentious area. His work on operationalizing the framework is due to be completed within the next year.

I have five arguments to make about Bill C-300.

First, our experience is that to be effective, any complaints mechanism needs to be embedded in a carefully and collaboratively designed system of dispute resolution. We are strongly supportive of Ruggie’s “protect, respect, and remedy” framework.

We have also learned that redress to concerns raised by citizens, communities, and others is essential at three levels. The first level is the local community and company level. This is always the first line of action, and the most effective. The second is the national level, and here Peru's ombudsman office, which includes 50 local offices to ensure connection to the community level, is a good example.

Third is at the international level, and I also mention the OECD guidelines for multinational corporations and the OECD national contact points; the compliance advisor and ombudsman of the International Finance Corporation; and the Multilateral Investment Guarantee Agency.

Recognizing the need to have an integrated approach, Ruggie’s work is pulling all of this together. Bill C-300 seems to be proceeding without cognizance of and out of step with this work and the internationally supported insights it embodies.

Bill C-300 risks being duplicative, perhaps undermining the above initiatives. In practice, will a hierarchy prevail if complainants register a complaint with all of these? If so, which will take precedence? If not, how should the Government of Canada or complainants interpret contradictory rulings? Bill C-300 answers none of these questions.

On argument two, the great majority of disputes are best resolved through mechanisms that have local ownership and where the means of investigating conduct are close to the affected community or region. The aggrieved people are more likely to feel properly involved, and the people or institutions involved in resolving the situation are more likely to understand the context and cultural dynamic that may be at work.

This raises the issue of what happens with marginalized groups that may be out of favour with a host government. This is a real issue, but whether or not Canada wishes to assume sole responsibility--as implied in Bill C-300--for protecting these groups and individuals is an issue that should be addressed explicitly.

[Technical difficulties]

[Shanta Martin]

I understand that my colleague Alex Neve, who’s the director of Amnesty International Canada, has already presented to the committee, so I don't want to go over old ground in terms of information he's already provided. What I would like to do is ground the discussion I would like to have with the committee around the international perspective in terms of, in particular, the position Canada finds itself in within this international context. Lastly, I'll just briefly comment on the benefits that would derive from the fact of inquiries being made by a Canadian government authority.

Turning to the first point, there's no doubt that Canada can and should introduce legislation that withholds public support to companies that fail to respect human rights abroad, and that doing so would be consistent with Canada's international legal duties. That includes the framework enunciated by the United Nations special representative to the Secretary General on business and human rights issues. According to the special representative, and I'm quoting here,

The root cause of the business and human rights predicament today lies in governance gaps created by globalization.... These governance gaps provide the permissive environment for wrongful acts by companies of all kinds without adequate sanctioning and reparation.

It’s in many respects in response to that predicament that the special representative has outlined a framework—the protect, respect, and remedy framework--which articulates the state duty to protect against human rights abuses from third parties, including by business; the corporate responsibility to respect all human rights; and the need for greater access to effective remedies for the victims of any human rights abuses.

Under international law, there’s no doubt that states are the primary duty-bearers, and given that this discussion is with parliamentarians, I'd like to focus my comments specifically on the pillar enunciated by the special representative, being the state duty to protect.

As I've just said, states clearly have a duty to protect against human rights abuses by non-state actors, and that includes business. There are a number of means by which states can actually undertake this activity, and there are a number of documents that already exist that provide guidance to states to pursue this duty or to fulfill this duty. In many respects, to help states interpret how to fulfill that duty, the UN treaty-monitoring bodies have recommended that states take all necessary steps to protect against such abuse, including to prevent, investigate, and punish the abuse, and to provide access to redress.

Clearly, and certainly as articulated by the special representative, the state duty to protect has both a policy but also a legal dimension. While policies that encourage corporate responsibility for human rights do have a role, so too does legislation. In elaborating the state duty to protect, the special representative has noted--and here I'm quoting from the special representative's 2008 report to the Human Rights Council:

There is increasing encouragement at the international level, including from the treaty bodies, for home States to take regulatory action to prevent abuse by their companies overseas.

In the advance copy of his most recent report, which will be delivered to the Human Rights Council in the next week or so, the special representative further notes that all states have the duty to protect against corporate-related human rights abuses within their territory and/or jurisdiction. It is not limited alone to territory.

He explains that there is a critical distinction between jurisdiction exercised directly in relation to actors or activities overseas and domestic measures, such as Bill C-300, that have extraterritorial implications. The special representative also emphasizes that states should make greater efforts to ensure that companies based in or conducting transactions through their jurisdictions do not commit or contribute to human rights abuses abroad, and help remedy them when they do occur.

What does this mean in the context of Canada? Well, certainly Canada has positioned itself as an extremely influential player in the global mining sector, and it should ensure that this role is fulfilled consistent with Canada's international human rights obligations, including promoting respect for human rights by Canadian companies and holding them accountable if they do not.

If I might, I would very briefly quote from the Canadian government’s own corporate social responsibility strategy:

Canada is a particularly strong player in the global mining sector. Canadian financial markets in Toronto and Vancouver are the world’s largest source of equity capital for mining companies undertaking exploration and development. Mining and exploration companies based in Canada account for 43 percent of global exploration expenditures. In 2008, over 75 percent of the world’s exploration and mining companies were headquartered in Canada. These 1293 companies had an interest in some 7809 properties in Canada and in over 100 countries around the world.

There's no doubt that the extractive industries are well known for having extensive potential and actual impacts on human rights. These include the impacts on the rights to health and water and the rights of indigenous peoples to free, prior, and informed consent. It's very frequent that the rights of women are disproportionately affected within these contexts. Given that situation and in light of the comments of the special representative, it is entirely appropriate that Canada should introduce legislation that would lead to repercussions for Canadian extractive industry companies that fail to respect human rights in their operations abroad.

Given the level of Canadian-listed or Canadian-based extractive industry companies, it may not surprise the committee to hear that the proportion of cases received by Amnesty International regarding alleged human rights abuses associated with projects involving Canadian companies is very high.

I have already provided the committee with a number of reports, urgent actions, and other publications wherein Amnesty International has raised concerns regarding such human rights abuses. In the order of the list I've provided to the committee, the cases relate to mining operations involving the following Canadian companies, usually through--

[Technical difficulty--Editor]

[Karin Lissakers, Director, Revenue Watch Institute]

Thank you very much, Mr. Chairman and honourable members of the committee.

I'm very pleased to be provided time today to address the committee. I believe that Bill C-300....

[Technical difficulties]

There are many voluntary codes for multinational corporations, including the UN's voluntary principles on security and human rights; the Global Reporting Initiative; the Equator Principles; the sustainable development framework of the International Council on Mining and Metals--and we have Tony Hodge from ICMM here; and the Kimberley Process for diamonds--to name just a few. Of course many companies unilaterally adopt corporate guidelines but strive to meet international best practice standards throughout their global operations.

The extractive industries transparency initiative--EITI--has attracted the participation of more than 30 countries and the support of many more. Canada indeed became an EITI-supporting government last year, seven years after the EITI was launched. Forty-nine major petroleum and mining companies actively participate in the disclosure process under EITI, and the initiative has the backing of investors who manage more than $16 trillion of funds.

There are many reasons for this global movement toward new standards for extractive companies. First of all, the people in resource-rich countries no longer remain silent in the face of abuses of their rights. You have seen the protests against abusive labour practices or environmental damage, from Sudan to Peru to Ecuador. Because the people are more aware and more engaged, politicians are more sensitive. In the recent presidential election in Ghana, the strongest theme was perhaps the need for Ghana to set strict environmental and social and transparency standards for the management of its new oil sector.

Large institutional investors such as public pension funds--you can take the sovereign wealth fund of Norway, the California pension fund, and so on--increasingly discriminate against companies with a reputation for social or environmental abuse. The governments of capital-providing countries do not want to appear to or actually condone or support abusive practices, because doing so damages the long-term national economic and political interest.

Thus, OECD countries develop common standards that are then applied statutorily in each member country, for example, outlawing bribery of foreign government officials by their own multinationals that are trying to advance business. A similar process takes place through the EU in setting standards. For example, its raw materials initiative seeks both to secure access to raw materials for Europe and to apply high standards to those investments.

Of course many large multinational corporations recognize that reputation risk is high. Following best practice is in fact better for the bottom line over the long term. It is clear that it's not just American, Canadian, European, or Australian companies that have come to that realization. We see now that Chinese extraction companies are seeking partnerships with top-tier western mining and oil companies. It is not because they need access to capital, but because they certainly want to learn the technology skills of those companies. We have also been told by a number of people that because they seek to enhance their own reputation in the international markets they want to be seen as first-class investors in extractive companies.

One of my legal team members at Revenue Watch just returned this week from an event hosted by the Chinese Academy of Social Sciences in Beijing, where the focus was on corporate social responsibility practices, particularly in extractive industries, and the EITI secretariat was invited to participate in the discussion.

Two weeks ago we were approached by a group of consultants who work in Russia who said that they had been approached by a number of large Russian mineral corporations that wanted to find out how they could do better on the corporate social responsibility front. They asked if we could help with some advice and with perhaps organizing some events.

So these ideas are taking hold, and the recognition that these good practices are essential to successful business is taking hold. Globalization means that the old model of a double standard for business maintaining one set of practices at home and another lower set of standards abroad is no longer viable. As the editor of the Oil & Gas Journal put it in an April 19 speech:

Here's a bedrock reality. For international oil and gas companies and service firms not owned by governments, the licence to operate isn't what it used to be. That condition changed and business as usual won't change it.

Many companies will argue that we should stick with voluntary principles. I believe that's one of the arguments that's been raised against Bill C-300. But that is not where the world is going. Voluntary principles are useful as a stage for developing consensus around what the good practices and standards should be. But once a majority recognizes the value of a public good—and that is what good practices are—a voluntary approach is impractical and inefficient. Moreover, I would argue that governments have both a right and an obligation to set rules for the use of public funds that reflect the norms and principles of their own taxpayers.

Even if you look at existing so-called voluntary initiatives, you will see that they have binding elements. The EITI, for example, is voluntary for countries but mandatory for companies operating in the implementing countries. The EITI has strict rules even for the implementing governments, backed up by a compliance review mechanism and penalities for non-compliance.

Voluntary standards that have been worked out among stakeholders in various fora become the benchmark for mandatory behaviour. The ICMM--International Council on Mining and Metals--sustainability framework is binding on each of its 17 member companies, with reporting and assurance procedures based on the Global Reporting Initiative's G3 sustainability guidelines, for example. This prevents free riding by companies that want the prestige of the ICMM brand but do not want to meet its standards.

The World Bank's investment arm, the IFC--International Finance Corporation--requires that companies with which it co-invests in extractive projects publish their payments to the government according to the EITI model, as well as following the bank's own environmental and social standards, of course. The U.S. government political risk insurance is available only to extractive projects in countries that have adopted EITI-like transparency standards for extractive industries.

The Initiating Foreign Assistance Reform Act of 2009 also requires that OPIC, which has many of the functions of Export Development Canada, adopt a comprehensive set of environmental transparency and internationally recognized work rights and human rights requirements that will be binding on OPIC and on the companies it supports. These standards may be no less rigorous than those of the World Bank, although it is a different standard.

On the transparency front, last week the U.S. Senate considered an amendment to the financial regulatory reform bill that would require all extractive companies listed in the U.S. to publish what they pay to governments, country by country and by type of payment. The amendment had the support of the administration and according to its sponsors had the support of well over half of the members of the U.S. Senate. The amendment was not moved on a technicality, but I expect it to be taken up by the U.S. Congress later this session.

The International Accounting Standards Board is developing a new financial reporting standard for extractive companies. The international financial reporting standards will be binding on companies operating in 110 countries, including China and, indeed, Canada.

Finally, the most recent development on this front: the Hong Kong Stock Exchange has just issued new rules for minerals companies. The new rules require that as part of their listing minerals companies disclose, among other things, project risks arising from environmental, social, and health and safety issues; compliance with host country laws, regulations, and permits; and disclosure of payments made to host country governments in respect of tax, royalties, and other significant payments, on a country by country basis. They have to report that they have sufficient funding plans for remediation, rehabilitation, enclosure, and removal of facilities in a sustainable manner. They have to report on the environmental liabilities of their projects or properties; their historical periods of dealing with the concerns of local governments and communities on the sites of mines, exploration properties, and relevant management arrangements; and any claims that may exist over the land on which exploration or mining activity is being carried out, including any ancestral or native claims. These new rules for the Hong Kong Stock Exchange will take effect on June 3.

I believe that Bill C-300 is fully consistent with this global movement toward setting minimum standards for responsible extraction of non-renewable minerals. I would say that it falls short in only one area, and that has to do with transparency. I'm quite surprised and disappointed, frankly, that Bill C-300 does not address the transparency of payments to government. That is a central feature of many of the initiatives I've mentioned, and is widely recognized as a way to reduce social and political instability and corruption in resource-rich countries. Your government's money is supporting investment with Bill C-300, and its future readings will be amended to address this shortfall.

Overall, I would say that Canada, as the leading provider of capital to extractive industries and home regulator of a large section of the international mining industry, has a responsibility and an opportunity to lead rather than to lag the global movement toward establishing sound standards for extractive industries.

Thank you very much.

[The Chair, Conservative, Dean Allison]

Welcome to meeting number 19. Pursuant to the order of reference of Wednesday, March 3, 2010, we're going to continue our work on Bill C-300, an act respecting corporate accountability for the activities of mining, oil, or gas in developing countries.

I want to start off by welcoming those who are appearing via video conference.

I'm going to start with Karin Lissakers, who is with Revenue Watch Institute. She's coming to us from New York. Karin, thank you very much for joining us today. We're then going to move to my next teleconference. I have Shanta Martin, from Amnesty International. Sitting next to Shanta is Robert Anthony Hodge, who is with the International Council on Mining and Metals. We'll finish off with Shirley-Ann George, who is from the Canadian Chamber of Commerce.

If you can try to keep your remarks under ten minutes—I believe that's what the clerk probably asked you to do—we can get your opening statements in, and then we'll be able to go around the room and have some questions and answers. We'll take as long as we need. If we need the full two hours, that's great. If we go for an hour and a half, that will determine the number of questions that are available here.

Karin, thank you very much for being here from New York. I turn the floor over to you to give your opening comments for ten minutes.

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

On May 25 you have five potential witnesses, one of which I think has already been a witness--the Chamber of Commerce. I could go back in my records.

I'm concerned about protecting that time because I want to go to clause-by-clause shortly thereafter. Will we still have a solid two hours for Bill C-300 on the 25th?

[Peter Goldring, Conservative, Edmonton East, AB]

Thank you very much, Mr. Chair.

Mr. Dade, in this paper, which I presume was by you, there's a comment where you observe that standards evolve.

We all want to improve and we look forward to standards eventually evolving. But there is a statement in here, which I presume is yours, about Bill C-300:

“...any other standard” is simply absurd. How would, or could, anyone deal with being held accountable now for a standard that...“will be determined later” and could constantly change?

Could you comment on that, please?

[Paul Dewar, NDP, Ottawa Centre, ON]

I guess that's the point. Where we are right now is this bill and I have concerns with the critique that if we were to bring this forward, somehow we'd actually be going backwards. I don't buy it. I don't see it from your presentation. I don't see how you can provide evidence on something that hasn't actually been brought into force.

You've looked through the bill. Certainly we've heard from people who say that it's not fair-minded and it would undermine.... But when we've had those folks come forward and say there would be a problem, we've also had other folks who say, in their legal opinion, it wouldn't. The point is that we are seized with it now, and for many of us--and I think for Canadians and Canadian companies--the time is now.

And to see this opportunity depart brings concerns that nothing is going to happen, frankly, because the government has brought forward a counsellor.... And I just have a couple of things on that. The counsellor isn't even set up to take in any concerns at this point. You know the process, right? She can take it in, but it takes two to dance. If the company says it doesn't want to take part, it doesn't have to. You're aware of that. So I don't see that as being helpful, and I think you'd probably be of the same mindset. If you're going to have a process, you must have a process.

Finally, on EDC, when we've asked.... I've asked at the committee and I've asked them in meetings if there has been one instance, just one instance, where they have investigated and found there were concerns among their partners, where they've actually said “you'd better do something or we're going to withdraw”, or where they've actually removed the funding. There were none, so apparently we don't have any problems and this is all some sort of weird conspiracy. I don't think you believe that, because you've intimated that there are some concerns and we need to deal with them.

Mr. Dade, if it's not this--and you've put forward what you think it should it be--isn't it possible to actually have a process that would conform with the general architecture we're talking about? You have concerns about BillC-300. Fine. But what about using this opportunity and this infrastructure to actually change it to adopt those principles you mentioned, to have EDC in the game, and to make sure that when Canadian companies go abroad, there isn't controversy?

Frankly, I think we're entering a time where litigation is happening anyhow. If we don't do something, we're going to be like big tobacco was, really. That's happening. It's already happening. You see it. Do you not see an opportunity here to actually take Bill C-300 and frame the architecture such that it would be helpful?

[Carlo Dade]

That's a very interesting point. You raise something of significance and potential significant impact.

Allegations that are handled at the point of origination of a financing entity or the entity that's working directly with the project, such as the International Finance Corporation or Export Development Canada, are viewed one way on the ground in the countries. This is tied to the project. It's tied to the specifics of the engagement, of the investment, of the company's actions.

When it is advanced to the level of minister, especially in the case of Canada and a government that's viewed abroad as Canada is, the charges take on a whole new realm: that there must be something there if the government is investigating.

We spoke about weak governance in several of these countries. There's an issue. If the local government brings charges, it's always assumed that it's political, that someone's uncle is getting back at someone else's uncle or something. But that's not the view with Canada. With Canada, it's viewed as, “My God, this is good governance, this is the seat and font of good governance, so if the government is investigating, there must be something serious here, and there must be something that rises to the level to change a charge”, It does damage, especially if other countries, our competitors in the U.S. and Australia, are relying on current best practice and current mechanisms, and we suddenly put this in.

The other problem with the bill is that the IFC has 15 people on staff in their compliance unit who investigate cases. The IFC does about 450 to 500 deals a year. Of those, I don't know what percentage are extractive. But the number of projects they potentially have to investigate and move on is handled by a staff of 15 dedicated professionals. With Bill C-300, you're looking at a counsellor who would be splitting her time between looking at what is the best practice and looking at this, with one foreign service equivalent working for her.

You have the potential to have these things drag on and on and on. And the longer they do, the more damage is done. For the activist NGOs, the NGOs that spin the stories we hear, this is a godsend: charges against the minister; this company has been charged 16 times; the minister is investigating 16 charges by this company; or these charges have been going on for years.

You have better mechanisms, more efficient and more effective mechanisms to be able to have people's voices heard, to have their complaints taken seriously by organizations with the resources to address them, to respond and to deal with them effectively.

Again, it puts us in a bad situation, and it doesn't improve things on the ground.

[Carlo Dade]

I was at the round tables too. I spoke and I put forward some ideas. I think it was in Montreal last November, if I remember correctly. I was one of the people invited to the round table. I remember—

there was opposition. What came out of the round tables was the enhancing of the Canadian advantage, the idea for a strong ombudsman, if I remember correctly, who would be well funded and equipped to be able to respond quickly and efficiently to the complaints. That, unfortunately, is not what we see here. There were also discussions about supporting the work that Canadian companies were doing on the ground, and I don't see that here.

I also know that the Prospectors and Developers were here and they were strongly opposed to this. Tony Andrews was one of the heads of the round tables, and I know that they do not support Bill C-300. So obviously something has broken down between the round tables and the submission of Bill C-300.

I understand the frustration, the need to do something, and we support that something needs to be done in terms of not losing competitive advantage, enhancing the positive aspects, and doing more to prevent, limit, and mitigate damage. We're fully in line with that. Our disagreement is that we don't think this will do it. I think in the private sector, from what I've seen of testimony in the committee—I do get the blues and look at them—they also appear to be opposed to it.

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

Mr. Dade, this whole question of companies' social responsibility did not arise after someone had a nightmare one night. In Canada, we have been talking about it for years, of course. This resulted in the round tables that went across Canada and in which people participated of their own accord. People from civil society organizations did too, and national organizations, and mining companies. There were people from all walks of life, actually.

The consultation was followed by a report providing recommendations that were presented to the government. The consultation even resulted in a consensus.

Bill C-300is very weak in comparison with what was in that report. Wouldn't it be nice if, one day, a member introduced a bill containing all the recommendations...? You come here to tell us that Canadian society wants companies to be made accountable overseas, and there are no tools to do that at the moment because everything is voluntary. That is what came through in all the consultations. There really is a need and Canadian society really feels that companies operating overseas must be made accountable.

Why are these companies so afraid if they are following the rules, if they are responsible and if they are living up to their environmental responsibilities? Why are they so afraid of this bill if they are doing nothing to contravene the principles of social responsibility overseas?

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

Mr. Dade, if I have an issue.... There are some folks sitting behind you who have some serious issues with Canadian mining companies. They have a problem, because if they sue or try to get redress to their grievances in their own country, that's going to be unsatisfactory because of weak governance.

If they come here, they're dismissed because of forum non conveniens: what happens somewhere else has nothing to do with us. If they ask the Canadian government to involve itself in any way, shape, or form, they have no place to go because there's no legislation to do that.

You seem to want to have it so that (a) there is no ability to obtain redress and (b) you want to rely on voluntary compliance, when the folks sitting right behind you say these companies have not taken into consideration our human rights or the damage to our environment, and have not taken into consideration all kinds of things that are the social licence for these companies to operate.

Your position seems to be that you don't want them to have any access or recourse whatsoever, even through a modest venue like Bill C-300.

[Carlo Dade, Executive Director, Canadian Foundation for the Americas (FOCAL)]

Thank you very much.

It goes without saying that it is a pleasure to meet the members of this committee again. Last time, we discussed Haiti, I believe. Since then, things have moved a little.

It's indeed a pleasure to be here. I'd like to thank the committee for the invitation.

It is also a little disconcerting to be the only witness. I was told at one time that only ministers and people who are in serious trouble testify in the committee by themselves. I'm sure about not being a minister, and I trust the other part is not the case either.

Indeed, thank you. It's a pleasure to be here this morning to discuss Bill C-300.

I'd like to frame my presentation. You learn much from several of your college professors, and not always things that are germane to what's being taught. An old college professor said that where you stand on an issue is determined by where you sit, so let me frame my presentation by talking about whence our analysis comes when we look at Bill C-300.

First, there was the Canadian Foundation for the Americas. This is Canada's only independent non-university-based think tank focused on Canadian engagement in the hemisphere. As such, we sit at the intersection of academics, civil society, the private sector, and government. We have a foot in each sector, understand each sector, and are able to work with each sector. We receive views from and have exchanges with each one of these sectors.

We also exchange and have the same sorts of relations with public policy institutions, our sister institutions, throughout the hemisphere. In every country throughout the hemisphere there is an institution with which we work very closely and which is structured similarly to how FOCAL, an independent policy research organization, is structured.

We have also had in the past, specific to the subject at hand, work on trade and development and work on indigenous governance and CSR in the extractive sector. This was a project we took over from the North-South Institute, which was led by an indigenous woman from Colombia who had very strong views about mining but was able to do some very interesting things to try to bring the three sectors--government, indigenous groups, and the private sector--together to talk about issues and to try to develop new frameworks for improved discussions.

We have also done surveys of CSR practice and investments--money, time, and resources invested--by Canadian companies in social, economic, and community development projects.

That is the background on the FOCAL side.

On the other side, personally I've worked for 10 years in CSR issues in the Americas. I had a very unique position before I came to Canada and before I joined FOCAL, a position that had me in three spots. It had me on the ground in poor and marginalized communities throughout Haiti, the Dominican Republic, and elsewhere, working with these communities to implement their own social development projects, often with mining companies and with private sector companies, and with banks. It was not just with multinationals, but with small and medium-sized enterprises within these countries, too, so there was a full range of CSR activities.

It also had me at the policy level within the U.S. government on the development of CSR policy, both in the missions in the countries in which I worked and in Washington with other agencies of the U.S. government.

So it was a fairly unique position, I think, that allowed me to understand the broad context, from the macro level to the micro level.

Very quickly, then, based on this analysis, we look at Bill C-300 as an attempt by this committee and by this Parliament to improve the impact of Canadian mining companies on the ground in the communities in which they operate. We look at the bill, what it proposes, and what it offers.

The analysis is that the bill will not offer anything that is not already on the ground and realizable through compliance officers and existing international mechanisms such as the Equator Principles. Indeed, it seems in some ways to have weaker teeth than those of the Equator Principles or some of the other mechanisms that are currently available.

At the same time, it has the potential to have significant Canada-only costs for Canadian mining companies, and this is an important point. In my previous work on the ground, I came across a great deal of the impacts of private investment and of how companies behaved, including their positive impacts and contributions.

We have stories of damage being done. We see this with mining companies. We see this in poor communities with slash-and-burn agriculture that destroys forests and destroys land.

It's a very complex situation on the ground, but for every example we've had of a Canadian mining company doing something harmful, I'm confident that I can come up with three examples of investments that have been made in communities: improved education outcomes, improved health outcomes, and improved livelihoods in communities.

It's a complex story, and if you're going to implement policy, effective policy cannot be based on the sensational from one extreme or the other. It has to be based on a rigorous and rational view of the situation as it exists.

Unfortunately, the bill emphasizes the punitive aspects, and again, I would say, ineffectual punitive aspects. In an attempt to improve conditions on the ground, it ignores the huge opportunities and the huge investments that are there to be leveraged by increasing the good work and the good practices done by Canadian banking companies and also by extractive companies, by the full range of Canadian companies.

I will point the committee to our experience with Talisman in Sudan as an object lesson in how we can get this wrong. Again, there are several factors here. Talisman was in Sudan. There were problems. They moved to address them with a very rigorous and serious CSR program. Increased pressure from activists and activist NGOs in Canada had them leave.

The Chinese and the Indians came in and took over. The first thing they did--the first thing--before they changed the signs on the door was to trash the CSR initiatives, not understanding the importance, not seeing any benefit from this. The oil still flows out of Sudan. The investment is being controlled by the Chinese. The people in the communities are, if anything, worse off than they were before. This is a scenario that has a possibility of repeating itself throughout the hemisphere.

Canadian companies are engaged, and we see them doing positive things on the ground. Again, I will match you story for story the positive things they are doing. But at the same time, by weakening Canadian companies, by imposing costs and risk to reputations, by taking things to the ministerial level, we have the potential to do serious damage.

The damage would be justifiable if you were going to have outcomes on the ground that justified this, if you were going to do something to significantly and quantifiably improve the conditions of life in these communities. But the bill offers nothing in that regard, so there's a real danger there. I can talk about this, too, in the first-hand experience with Falconbridge in the Dominican Republic in my previous job and what we did.

So the real danger here, I think, is that we have a good model in Canada, a model that's viewed throughout the hemisphere as one to be copied and envied in terms of CSR practice. I can talk anecdotally and I can talk quantitatively about this.

But very quickly, I was in Madrid about two years ago, speaking with my counterparts at one of the major think tanks, the Real Instituto Elcano, and Fundacion Carolina. These are two of the major Latin American think tanks. They have both just recently begun work on CSR.

A decision was made by the Spanish government and the Spanish private sector that Spanish companies and the Spanish government were suffering reputational damage, and also competitive disadvantage, from their bad reputation for CSR, so they moved aggressively to address this. My counterparts at the Spanish think tanks were asking if we could share the Canadian experience, because, they said, Canada is viewed widely in the region as having good companies and has a good reputation. They asked if we could share this experience with them.

My first thought was that they had to be nuts. They have a competitive advantage over us with language, with culture, and with immigration. Our one competitive advantage vis-à-vis our Spanish competitors is really the reputation of Canadian companies. We may have been born yesterday, but we weren't born five minutes ago, and we're simply not going to hand that over. But there is room for cooperation in terms of the larger sphere of global CSR practice, and I'd be happy to talk about that.

Finally, there are options for getting this right. Several things could be done. Rather than creating another bureaucracy, another layer of reporting, another cost for the government, there are other mechanisms of which we can avail ourselves.

There's a compliance officer and a compliance office at EDC. Most of the money we're talking about coming out is coming through EDC. Why not simply look at beefing up that function? Give them something on a par with the International Finance Corporation or the Inter-American Development Bank in terms of staff and resources to investigate things more quickly.

It makes little sense to have one review at EDC, a second one at the ministerial level, and then another one at Canadian pensions.... It makes more sense to strengthen them at the point of impact, at the point of origin.

There are also possibilities for work with the Equator Principles. This puts all companies across the globe, regardless of national origin, on the same playing field.

Again, in terms of effectiveness, if I'm a mining company and I can't raise my own money, if I have to raise money from the private sector, am I worried about losing EDC money? To some degree, yes, I am. Or am I more worried about losing money from EDC, the Australian Export Finance and Insurance Corporation, and every major commercial bank from the Arab African International Bank to Banco do Brasil, Bank of America, City, CIBC, BMO, RBC, and Scotia, all the way to Wells Fargo?

That's what the Equator Principles have behind them. These are the more effective mechanisms that we need to look at, that are tested and have more resources behind them, so I would suggest that there are alternatives. I'd be happy to talk to them.

The IFC and the Prince of Wales Business Leaders Forum have put out a new road map for integrating human rights. I would suggest that in terms of time and investment this is where our money would be better spent, not in creating a new bureaucracy that won't improve conditions on the ground, but in working with effective and tried mechanisms that are truly multilateral and that will improve conditions on the ground.

I'll end it there. Thank you.

[The Chair, Conservative, Dean Allison]

My sense is that I don't have that consent, so we'll have to discuss it at another time. It is on the table. We could possibly discuss it at the next meeting. It's going to take 48 hours to work it into the routine, as I see we don't have unanimous consent, and we are seized with Bill C-300 right now.

Madame Deschamps, do you have a quick question or point of order?

[Prof. Richard Steiner]

This is an interesting nexus with what Bill C-300 would do. Had Bill C-300 been law five years ago, ten years ago, then this project that Mr. Schnoor talked about in the Siria Valley in Honduras, the San Martin project, would have been operated more responsibly.

Here's how it bleeds across borders. The people in Cabañas in El Salvador went and visited this site, the San Martin mine. They saw the atrocities that occurred there. They came back to El Salvador and said, “There is no way that we want this kind of damage done in El Salvador”. This spread throughout the nation. The new president said, “This isn't worth it and we're proposing to ban all metal mining within the country”.

Yes, as far as I know, it would be the first country in the world to do such.... Think about the competitive disadvantage that places on other legitimate Canadian mining companies that may want to do mining in El Salvador someday.

So that's why this is a very prudent piece of legislation, I think, in the interests of economic development.

[Prof. Richard Steiner]

For the Nautilus project, the company was based in Vancouver at one point, then Toronto, so there's some Canadian mining interests in it. I think Barrick might have some interest in the project. I'm not very clear about how the corporate conglomerate is comprised, but the project has proceeded. There have been a number of questions locally along the coast of Papua New Guinea regarding civic engagement. Many of the people do not feel listened to.

It's the same old situation where Nautilus, the company, has gone through selected individuals to pay to then purport that the project is okay, that it will not cause any damage. In my view, they've co-opted the government process there, and in developing countries, it's quite easy.

Actually, in developed countries, in the United States, it's quite easy for these very savvy extractive industry companies to co-opt the government process. It's even easier for these companies to do so in governments in developing countries, such as in Papua New Guinea. It's easy to corrupt. It's easy to bribe. It's easy to co-opt process and that's what's gone on there.

I don't think the environmental impact statement.... I wrote a long technical review of it and it simply is not fit to purpose.... If Bill C-300were in place, the local people in Papua New Guinea, could file a complaint that transparency, civic engagement, and free prior and informed consent have not been achieved, and they do not have the social licence to operate yet. Then your ministers would take a look at that and assert that either those claims are valid or they're not, and then propose mitigation for such.

I also wanted to mention on the question you asked—

[Paul Dewar, NDP, Ottawa Centre, ON]

I think we'd be interested in that. Maybe we'll figure out a way of doing that. I suppose I could write a letter to find out what is the point of view. We need to have a balanced point of view, and if we're seen to be tipping the hat to one side or the other...including you.

If the ambassador saw your evidence, he shouldn't go out and promote your film just because you provided your point of view to him, nor should he do it for the other side. That's just straightforward diplomacy. So I find that of concern, particularly when we're spreading our reach in Latin America and seemingly wanting to promote business interests over others.

I want to turn my questioning now to Professor Steiner.

I'm interested in your comments about the Nautilus project. In light of recent events that have occurred, why we should care about this, and why should Canada in particular care about this, and how would Bill C-300 actually have any effect on that project and your concerns?

[Prof. Richard Steiner]

Yes, I believe that the American standards do require adherence to the international human rights conventions and best practices. I would also say that the U.S. Ex-Im Bank, the Export-Import Bank in the United States, already uses ISE guidelines. EDC has its own set of environment standards and guidelines, but as we are saying, if there's no problem with that, then they should not have a problem with this additional layer of ministerial review.

That's basically all Bill C-300 proposes. It's very reasonable and prudent and, I think, a quite modest step in the right direction.

So these IFC--International Finance Corporation--guidelines are certainly better than the OECD guidelines, which are also not being adhered to by companies from the United States and from Canada. So it's not too much to ask that we raise the bar on extractive industries throughout the world. We can do better, and I'm confident that when companies are motivated to do responsible corporate behaviour--all companies--it evens the playing field and makes it more competitively advantageous for those that are already doing that.

Thank you.

[Prof. Richard Steiner]

I would respectfully disagree, sir. I think the U.S. standards are not up to what Bill C-300 is proposing. I think, again, if the companies have great confidence in their CSR portfolios and profiles overseas, they should have no worries whatsoever with Bill C-300, and likewise the government. If the ministers have great confidence in the Canadian mining companies working overseas, as you have just mentioned--

[Prof. Richard Steiner]

Thank you, sir.

First off, to the previous gentleman's comment that the mining companies that we've discussed today, including Barrick and Pacific Rim, etc., have a chance before the committee, I think we can well script.... We can understand exactly what they will say. They will deny any wrongdoing. They will say they have the utmost international best practice.

We know that's what they're going to say, and that's fine, but what I would suggest, sir, is that if you're going to invite them in front of the committee, then some local people living around the mines, who have these issues, should be brought in as well to comment about their perspective about this.

On the second point, the second gentleman's question about the U.S. initiative to increase corporate social responsibility overseas, the U.S. government has been, I think, slower than the Canadian government. I think Bill C-300 would be a step beyond where we are right now, but as I mentioned, the Overseas Private Investment Corporation, OPIC, somewhat analogous to EDC, does have their own CSR guidelines. They are revising them.

As we speak, I think their new guidelines are due out May 20, just a week or so from now. That's exciting. I've been trying to fold some ideas into that, but I don't know what they are.

But again, the only advantage I see currently in the OPIC guidelines is that this applies to all industries, not just extractive industries--fisheries, forestry, pharmaceuticals, investment banking, transportation, and agriculture--all these other international investments that the United States companies have. I think that's an advantage. The disadvantages are, again, that there's really no compliance mechanism; there are no mandatory sanctions within OPIC guidelines right now. They only apply project-specific...so if a company, for instance, has a problem in one project, that's the only thing the OPIC guidelines will focus on, rather than the company's activities as a whole.

So there are disadvantages in regard--

[Peter Goldring, Conservative, Edmonton East, AB]

Thank you.

Gentlemen, I want to mention that the Canadian government has not been in strict isolation on this. It actually announced in March 2009--and incorporated--a strategy for corporate social responsibility and it is in fact working on this actively. The Canadian mining industry has an excellent reputation worldwide and probably has that reputation partially because...and it has built their businesses worldwide.

I have to agree with my colleague that just in the space of a very, very few short minutes, the witnesses commented disparagingly about Goldcorp, Pacific Rim, the ambassador himself, according to these sheets, HudBay Minerals, Skye Resources, and Inco. I'm sure that if we had more time we could add to that list considerably.

My concern here is back towards Bill C-300. I suppose I would ask the following of Professor Steiner, being an American from Alaska. Obviously if this is a highly supported initiative here in Canada, there must be a comparable initiative in the United States, too, so perhaps you could comment on how the United States is looking at this. Then, too, I'd like to point out a couple of the points in here that are of particular concern.

Professor...?

[Prof. Richard Steiner]

Living in Alaska, a state that is very politically dominated by resource development, there are positive and negative sides to that. We just have to be honest about it.

But we have heard this threat for years that if the state government raises oil taxes, the oil companies are going to pick up and go elsewhere. Well, the fact of the matter is that in any place with rich natural resources where companies want to operate, there is such a profit margin that they're not going to pick up and leave. If the headquarters left Canada, where would they go? They are certainly not going to come to the United States. So I think that's a veiled threat.

Also, regarding the companies who are telling people that Bill C-300 is so egregious they would simply leave if it passes, what does that tell you about their commitment to and confidence in how well they are applying their corporate social responsibility guidelines? It tells me that they know they're not doing it.

So to any company who says they would pick up and leave if Bill C-300 were passed, I would say, please do, because I wouldn't want them in my country either.

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

The answer that those who are opposed to Bill C-300 get is that mining companies that have their headquarters here in Canada will move elsewhere.

Do you really think that will happen if Bill C-300 is passed?

[Prof. Richard Steiner]

I concur with what Mr. Schnoor has said.

The discretionary aspect of these is concerning. To some extent, Bill C-300 allows discretionary review by the ministers, and there's no way to get around that. A lot of this will be a judgment call.

Once the ministers, acting independently on behalf of the people of Canada, look at the facts in a particular complaint—say for the Marlin mine in Guatemala, or Pacific Rim in El Salvador, or Porgera in Papua New Guinea—it will be their judgment call in independently using their discretionary abilities to make a judgment as to whether or not this company is or is not living up to the guidelines that the government...that they have developed.

There's always some discretionary aspect to this, but I think it's another level of independent rigour that you'd be applying.

[Steven Schnoor]

If I may, I'll quickly respond to your first question.

One thing I find rather curious...let's not forget that the advisory group's report to the round table was written by an agreement between civil society and industry. If industry was at the table and signed on to the advisory report, it's somewhat curious that industry is now saying they want nothing to do with Bill C-300.

The only thing I would say about the Equator Principles or the IFC guidelines is given that they have such discretionary measures built into them in terms of how they are specifically applied, and given the fact, at least in Export Development Canada's case, that there's no transparency in terms of how these mechanisms are actually applied, I find it difficult to believe that this is actual accountability, because mechanisms can actually achieve accountable behaviour.

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

Thank you, Mr. Chair.

Before Bill C-300was introduced, there were major consultations all across Canada. There was a round table at which civil society organizations and experts participated, as did mining company people.

Steven, if I may—I do not know how to pronounce your surname—did you follow those consultations?

And Mr. Steiner, did you participate in any way?

[Prof. Richard Steiner]

First of all, actions speak louder than words, as you have alluded. There are all these CSR guidelines and all the companies say that they ascribe to international best practices and so on.

If that is true, then why would they oppose this independent Bill C-300 to simply affirm that this is so? Obviously, to the extent that a company or a government member is opposing this very prudent, reasonable, modest piece of legislation, it simply indicates their lack of confidence that this is indeed the case, that companies are indeed being honest and forthright about their compliance with CSR standards. If they felt there was no problem, then Bill C-300 would almost be irrelevant to them.

There are many of these, and the proof is in the pudding, as they say down in the south of the U.S. It's the extent to which the government provides oversight. As I said, Canada and the United States are both OECD members. They both signed on to the OECD guidelines, yet the atrocities continue. Porgera and Papua New Guinea and Pacific Rim never would have occurred had the governments really been truly doing their jobs and providing oversight.

Bill C-300, in my book, is excellent. It's far superior to the current OPIC guidelines being developed in the United States, for three particular reasons. One is that Bill C-300 applies universally, as we mentioned before, to all extractive industry companies, whether they have government support or not, and not just on a project-specific basis. That's a positive. That's a good idea.

Second, Bill C-300 requires an investigation and mandatory sanctions for non-compliance, such as withholding credit or insurance or whatever the government role in the company is, and embassy support, as we heard there, and loss of support by Export Development Canada. That is a very good idea.

Third, Bill C-300 requires the Ministers of Foreign Affairs and International Trade independently to develop and enforce these standards and to apply these standards, and it requires that they conduct an investigation for non-frivolous complaints. It's a very simple, straightforward mechanism of governance and jurisprudence, I think.

It would really shift the dynamic, and those companies that are behaving well overseas will appreciate that those that aren't and that are cutting costs and have “an advantage” right now by doing that will no longer have that advantage. So those companies that are -behaving well are going to have a competitive advantage through this.

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

Thank you.

I just want you to comment further on all of these guidelines that exist out there--the Equator Principles and those of the IFC and OECD and a whole bunch of other organizations--to which all of these companies put their hands over their hearts and talk about how wonderfully obsessed they are with corporate social responsibility principles. They produce wonderful general annual reports with happy little people doing happy little things, and yet these allegations that you speak to, for which you will be roundly criticized, are brushed under the table.

Tell me, what would Bill C-300 actually bring to the dance that would move us off this endless allegation stuff?

Professor Steiner.

[Prof. Richard Steiner]

My reaction would be that the committee, the government, and the people do not have to take Mr. Schnoor's word and my word for it. The whole purpose of Bill C-300 is to impose another independent level of review by your two ministers to either confirm or deny what these complaints are all about. That's the point of Bill C-300. Don't take my word for it. If they receive a legitimate, non-trivial complaint, let your Ministers of Foreign Affairs and International Trade investigate to see if there is substantial evidence to support or refute it. On the projects I've just been talking about in Porgera and Pacific Rim, there is little question, and I suspect that is the case with Mr. Schnoor's discussion in Guatemala as well.

That's the whole point of Bill C-300. You have complaints. This is a mechanism whereby people can file complaints. I would hope that if Bill C-300 were to be passed.... One amendment that I would suggest to it is look at all companies, not just extractive industry companies. That's the sole advantage in OPIC's revisions to the environmental handbook here in the United States. One of the things OPIC has over Bill C-300 is that it will apply to all companies; however, it's project specific, and Bill C-300 applies to the company regardless of whether it is the specific project that is of concern.

I would just want to say, “Don't take our word for it”.

[Prof. Richard Steiner]

Good morning, Mr. Chair and honourable members.

I'm Richard Steiner. I've been a professor at the University of Alaska for about 30 years. I'm a conservation biologist and a member of the International Union for the Conservation of Nature's Social and Environmental Accountability of the Private Sector Working Group--that's a mouthful.

I've worked extensively around the world on extractive industry issues and environmental social issues, including, in the past few years, in northern British Columbia with the local people there. I have a deep admiration for Canada: the people, the environment, and the government.

I returned yesterday from a week and a half down in the Gulf of Mexico where I was working on the Deepwater Horizon oil spill and doing a rapid assessment of that event. I find that a tragic and poignant example of what can happen when an extractive industry company does not receive adequate oversight by government and then essentially is left to self-police. I think that's just a very recent example of what can happen.

I strongly support Bill C-300. I think you should all be very proud that it has been formulated and introduced. I respectfully recommend that it be forwarded to the floor and passed.

It has a very straightforward, noble intention to ensure that mining, oil, and gas companies from Canada act in a manner consistent with international environmental practices and with Canada's commitments to international human rights standards. Most companies say they do this anyway, so I'm curious as to how they could oppose a bill that would simply help ensure that this is the case.

The truth of the matter is that many don't live up to these standards, and I think you've heard the eloquent testimony of Mr. Schnoor before me. That's the unfortunate truth. This is true of U.S. companies and companies throughout the world--not simply Canadian companies.

Of the several thousand Canadian mining projects around the world, several are extremely problematic. You've heard of a few in Guatemala from Mr. Schnoor. There are many in Mexico, Peru, Panama, the Philippines, India, Tibet, South Africa, Tanzania, and the Democratic Republic of the Congo. We can list them all and talk about the issues with all of them.

The three I'm most familiar with, in working around the world, are: the Porgera mine in the western highlands of Papua New Guinea; the new Nautilus deep-sea mining project by a Canadian conglomerate offshore in the Bismarck and Solomon Seas off Papua New Guinea; and Pacific Rim's El Dorado project in El Salvador.

The Porgera project—and this is Barrick Gold, the largest gold mining company in the world, based in Toronto—is simply one of the worst environmental and human rights atrocities I have ever witnessed. I was brought there by the Porgera Alliance two years ago to look at what was going on, meet with people, and recommend what needed to happen.

There have been many extrajudicial killings that local people relate directly to the security forces hired by the mine. Many locals were displaced from the mining site to build the mine in the first place.

They've destroyed hundreds of miles of the Porgera, Lagaip, and Strickland rivers, with millions of tonnes of waste a year disposed of in what is euphemistically known as “riverine tailings disposal”--just dumping the waste from the mine into the local rivers. There are several metres of sediment and toxic tailings on the bottoms of many of these rivers.

This is a company that purports to support best environmental practices and social and labour practices. Obviously, it doesn't.

The Nautilus project is the first ever deep-sea mining project in human history. It has not been developed with free, prior, and informed consent. There is an inadequate environmental impact statement, which I was asked to review on behalf of the local people. Again, this in Papua New Guinea. I feel that there's a very seriously co-opted government process that Nautilus has engaged in there; they've resisted the notion of a legitimate citizen's advisory council to engage citizens on a more equal footing in Papua New Guinea.

Finally, the other project I'm most aware of by a Canadian company is the Pacific Rim El Dorado project. I was brought to El Salvador on behalf of the International Union for the Conservation of Nature for a fact-finding mission this past January. There had been several extrajudicial killings that the local people relate directly to the influence of Pacific Rim, a Canadian- and U.S.-based company.

Several local people who were opposed to the mine were murdered just last year. Locals feel that Pacific Rim is behind all of this in one way or another and that they are financing local officials on a campaign of intimidation and violence towards to the opponents of the mine. I think Pacific Rim likely violated OECD guidelines for multinational businesses in regard to combatting bribery, and many other provisions.

It's important that neither the United States nor the Canadian governments have done their due diligence in providing compliance reviews with the OECD guidelines they have ascribed to. These guidelines are great, but they're only as good as the governments' and the industries' reviews in compliance with them.

Finally, on the Pacific Rim project in El Salvador, there is such public resistance to it that the new president of El Salvador, Mauricio Funes, has called for a ban on all metal mining in the country. This is what can happen if a company, from whatever country, does not behave truthfully and honestly by the international best practice standards that they say they are ascribing to.

That could be a detriment and a disadvantage to all other companies, including Canadian companies, that wish to operate in these countries, so there's a strong positive benefit in Bill C-300.

All of these Canadian mining projects that we've referenced have profoundly negative elements: human rights abuses; poor labour practices; forced displacement of local people; violence and murder of local people, whether sponsored directly or indirectly; corruption and bribery of local officials; serious and long-lasting environmental damage; and betrayal of promises of sustainable development in local welfare.

To be honest, many of these projects have lost their social licence to operate and, as Mr. Schnoor mentioned, it really tarnishes the image of Canada in many of these places. The fact of the matter is that host governments in developing countries simply lack the technical and financial capability to provide adequate oversight to these projects; therefore, they allow the companies to run the show. That is not an effective way of doing business.

Canada is better than this. We are all better than this. There are many CSR standards throughout the world. There are the World Bank policies and the OECD policies, to which every OECD country ascribes. The U.S. Ex-Im Bank uses IFC guidelines right now. JBIC, the Nippon Export Investment Insurance organization, has their guidelines. All the multilateral development banks have them...the Equator Principles. And all the extractive industry companies themselves have CSR guidelines.

The sad fact of the matter is that they're not working. Without this additional step that Bill C-300 would provide for the government independently to get involved in providing review and compliance certification, we're not going to get there. Actions speak louder than words. People see the slick, glossy websites of companies that say how wonderful they are, but when it comes right down to it, they see it's not working. There is a number of comparisons of overseas private investment corporations in the United States and Bill C-300...I can go through it at some point, if you'd like.

But the bottom line here is that Canada can provide leadership in enhancing and improving corporate social responsibility with this bill. It's exciting. A number of people in the international community are following this debate. They look forward to Canada's leadership.

It's a great step forward. It evens the playing field for all Canadian corporations. It gives a competitive advantage to those companies that are already ascribing to these standards, and very well, and those that aren't are cutting costs. They have an advantage now. This will even that playing field. It will raise the bar for the U.S. companies working in these places. I think that's a good thing.

It will also raise the bar for host governments. It will give them a better idea of what is meant by international best practice and help raise their compliance review.

It's a clear and precise bill. It's very prudent. It's modest. It's not overreaching by any stretch of the imagination. If this bill had been enacted and a law had been in place, the Porgera atrocity in Papua New Guinea would never have occurred, plain and simple. And in Pacific Rim's case, you might not have an effort by the Government of El Salvador to ban all metal mining in the country if this law were in place and if Pacific Rim had put in some effective mitigations to the problems seen there.

There are several amendments that you could consider, but I think that effectively Bill C-300 is very straightforward, and I would respectfully urge you to pass it along. That's all I have for right now. I would be delighted to entertain questions.

[Steven Schnoor]

Thank you.

I'll just conclude on that point by telling you that I never intended, originally, to sue. It was only after the embassy and the government failed to address any concerns that I decided a defamation lawsuit may be the best way to defend the truth of my video and my reputation, but I will leave it at that.

Now, Bill C-300 may help to address this type of problem, as it would allow the Canadian government to withhold embassy support from companies that have been found to have breached human rights and other norms. It could also ensure that the Canadian embassy is not in the awkward position of promoting and defending the interests of mining companies that may breach human rights standards.

Now, as a Canadian citizen, I'm also deeply troubled by how our nation's reputation is being tarnished as a result of the practice of Canadian mining companies operating abroad. In fact, I have a small anecdote for you.

A few years ago while working in Guatemala, I lost my hat. A travel companion of mine gave me his hat, but it had a Canadian flag embroidered on the back. I found this to be a problem. I felt unsafe wearing the Canadian maple leaf and I can tell you that I went out and purchased a black permanent marker and blacked out my own flag. I did this for my own safety.

The current approach that both industry and the Canadian government have proposed, instead of measures like Bill C-300, strikes me as entirely inadequate: CSR policy is in voluntary mechanisms with no measures to ensure compliance. Such voluntary mechanisms strike me as little more than a smokescreen that distracts from better mechanisms that would ensure true accountability.

I want to stress here that I am not anti-mining. I am certainly not anti-development, but I am anti-exploitation, and I'm definitely anti-exploitation that masquerades as development. I am pro-accountability. The conduct of Canadian mining companies and embassies abroad is hurting people and it's hurting our reputation and it's unacceptable.

I also think that Canadians are gradually waking up to this issue. Some of the harm caused abroad is so outrageous, so unacceptable to the average Canadian, that I firmly believe that if they were to consider that our elected representatives opposed accountability mechanisms like Bill C-300, at the obvious behest of the powerful mining lobby in this country, they would rightly be rather upset.

Bill C-300 will not destroy our economy. It will not destroy our mining industry. Bill C-300 will not cause every mining company to pull up stakes and leave the country. I think we should respect the intelligence of the average Canadian and stop parroting this rhetoric and do the right thing.

As I conclude, I doubt that there is anyone in this room right now who would be comfortable with the conditions that we are exporting abroad, that we're imposing upon people who generally live in poor countries with weak governance. These states are often corrupt. They lack any will to protect the interests of those who are most vulnerable and disenfranchised among them. Canadians expect binding standards and accountability mechanisms for companies that operate in Canada. We should not expect less for people living abroad.

Before I end, I would like to conclude with one more example of why I believe we need accountability mechanisms to hold Canadian companies responsible for their actions perpetrated abroad.

On September 27, 2009, near El Estor, Guatemala, Adolfo Ich Chamán, a schoolteacher and community leader who often spoke out against HudBay's Fenix mine, was beaten, macheted, and shot to death, allegedly by security forces employed by HudBay Minerals, right near where I made my documentary. Witnesses have attested that Mynor Padilla, HudBay's head of security, was amongst the men who killed him.

To date, there has been no investigation. There have been no arrests and no charges, and there has been no accountability. This is not surprising. The UN has recently reported that the impunity rate for murders in Guatemala is 98%. If Canada does not do anything, there will never be accountability for such murders. We may not even find out what actually happened.

Canadian accountability mechanisms are badly needed. Bill C-300 is a step in the right direction.

Thank you.

[Steven Schnoor, As an Individual]

Thank you, Mr. Chair.

I'm a Ph.D. student from Toronto. I'm here because I believe we have a very serious and systemic problem. I also believe that Bill C-300 is a step towards addressing this problem.

For the past five years I've been researching activities surrounding Canadian mining companies operating abroad, with a specific interest in Central America. I've travelled to Guatemala and Honduras several times over the years, and I have found that people there are being seriously harmed by the activities of Canadian mining companies operating in their regions. This is engendering anger towards Canada and Canadians.

I have also produced documentaries to raise awareness about this problem and to represent the views of marginalized communities whose voices are not often heard, many of whom are very upset about the negative impacts they say they've felt as a result of the activities of Canadian mining companies operating near their homes.

My interest in this area began just over five years ago, when I found myself on the receiving end of rage. I was volunteering in Guatemala with a very small Canadian environmental NGO that establishes clean water projects in the developing world.

While there, three other Canadians and I were mistakenly presumed to be secretly working for a Canadian mining company. They thought we were pretending to be working for NGOs as a means of accessing their land to explore for possible mineral deposits. They were incredibly angry.

On this particular day, a local farmer had been killed in a protest against the Canadian-owned Marlin mine. In their eyes, we were representatives of a Canadian mining company. We were blamed for the death of this farmer and for forcing mining upon them. We almost became the target of an angry mob in a country where vigilante justice unfortunately still exists. Our lives were in danger and we were very lucky to escape. I am happy to provide further details if you're interested.

The following day, I contacted the Canadian embassy in Guatemala City to report that my colleagues and I were almost killed by virtue of being mistaken for representatives of a Canadian mining company. I asked what Canadian mining companies could possibly be doing in the region to cause such outrage.

I was told in no uncertain terms that Canadian mining companies have actually done no harm whatsoever; rather, they've been the target of misinformation campaigns initiated by radical left-wing activist environmental NGOs that brainwashed the poor, ignorant, illiterate campesinos into thinking that the Canadian mines will give them AIDS and unleash a monster from the lake.

This surprised me. I stated that I heard nothing about AIDS from the Guatemalans with whom I had spoken, and I certainly heard nothing about a monster coming out of the lake. What I had heard from local Guatemalans was that a Canadian open-pit gold mine was being constructed in the western highlands of the country. This is the Marlin mine, now owned by Goldcorp. People were outraged by the fact that they had not been previously consulted, as legally required.

I'd also heard that the Canadian company constructing this mine—it was Glamis Gold, which is now Goldcorp—had the same type of mine operating in neighbouring Honduras, the San Martin mine in Siria Valley, Honduras. I'd been told that since that mine opened, people reported dramatic changes in the region where the mine was operating. Due to the incredibly water-intensive mining process, rivers and wells had completely dried up. This devastated the primary economy of the region of 40,000 people, agriculture, and it caused a flood of young people to leave the region and to find work in the U.S.

People also told me that the water that had not dried up had become heavily polluted with cyanide and heavy metals. They blamed this for a rash of health problems, which they attributed to the new pollution since the inception of the mine. This included a dramatic increase in the rate of miscarriages both in people and in livestock.

People also feared the serious long-term consequences of ingesting water intoxified by heavy metals over an extended period of time. That includes cancer and liver disease. Many of these people, I should note, lacked access to adequate medical services and the means to buy purified water.

When I told the woman at the embassy about these concerns, I was told that it was all completely untrue. She told me that she had just returned from the region and had seen the mine with her very own eyes, and she could confirm that it was all perfectly fine. I inquired about the concerns regarding cyanide, which she dismissed by assuring me that cyanide really isn't that that harmful. She even said that it's found naturally in almonds.

When I hung up the phone, I felt more troubled than before I had called, because the problem now seemed to be bigger than the very serious allegations against a Canadian mining company. The problem seemed to include a Canadian government position that entirely supported Canadian industry while delegitimizing the concerns of affected communities.

The next year I returned to the region with video equipment to document what would transpire, to document the conditions in the Siria Valley in Honduras. What I saw was a far cry from what the Canadian embassy had told me. Everything was not at all fine. I encountered compelling evidence for virtually every concern that I'd heard raised by local Guatemalans. In fact, many of these concerns have subsequently been documented by world-renowned scientific authorities, including environmental engineer and hydrogeologist Professor Paul Younger from Newcastle University in the U.K.

As a Canadian citizen, I must tell you, I am deeply disturbed that the Canadian embassy was virtually indistinguishable from the PR outlet of a mining company. I began to understand why people in the region, whom I had met, often bitterly referred to the Canadian government as little more than an advocate for Canadian mining companies in the region that seemed to care very little about the well-being and legitimate concerns of the affected communities. “If they do care,” I was repeatedly asked, “why don't they do anything to address these serious problems?”

A documentary film of mine that is critical of Canadian mining was subsequently the target of a misinformation campaign from this very embassy. In January 2007, I filmed the forced evictions of five indigenous Mayan Q'eqchi communities from their ancestral lands in El Estor, in the eastern part of Guatemala.

The forcible evictions were carried out by hundreds of state police and military at the behest of Canadian mining company Skye Resources, which has since been purchased by Canadian mining company HudBay Minerals. Mining company employees took chainsaws and torches to people's homes while women and children stood by watching. In my written brief, I have further details about these evictions.

Skye Resources claimed that they maintained a peaceful atmosphere during this action. They deny any responsibility for any violence that may have ensued over the two-day evictions.

My video served to show that the evictions were anything but peaceful. It's now played at film festivals around the world and to date has been viewed online by over 150,000 people.

Shortly after the video began circulating online, the Canadian Ambassador to Guatemala at the time, Kenneth Cook, began spreading misinformation about it. Ambassador Cook stated that the video lacks credibility because the impoverished Mayan Q'eqchi woman in the video who complains about the forced evictions was actually an actress whom I had paid to perform in this manner, and furthermore, the photographs that I show in the video—some showing people's homes being burned to the ground and people in abject despair as they witness this destruction—were not at all from the evictions, as I claimed them to be, but rather, they were old photos from the internal conflict, which ended in 1996. He claimed that he had seen them many times over the years in many different contexts.

These allegations are very serious and they are entirely and unequivocally false. They portray me as a manipulative propagandist. They defend the mining company's position and they discredit the long-standing land claims, development, and human rights needs of the impoverished local Mayan Q'eqchi people. I am deeply concerned that his actions may be an example of a government that privileges the Canadian extractive industries operating abroad over concerns and well-being of local communities.

I should tell you that I'm currently suing the former ambassador for defamation. I should also tell you that I did not originally intend to sue. It was only after the embassy and the government failed—

[The Chair, Conservative, Dean Allison]

I want to get started. We welcome you to meeting number 18 of the Standing Committee on Foreign Affairs and International Development as we discuss Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries.

I want to make sure that everything is working.

Professor Steiner, can you hear us okay?

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

First, I want to publicly note your support for Bill C-300--and I appreciate it--during this past year and a half of battling the forces of evil.

[Paul Moist]

On the last question, I think the Liberal amendment is a retreat from what was a consensus among all opposition parties not two years ago.

On your first question, I think the committee should hear from the International Pre-Electoral Observation Mission that went to Colombia. The stats I cite for you are taken from the judiciary in Colombia. People who hold elected office are facing charges. Those charges are not for jaywalking.

I think you should take the time to hear from witnesses about what those elected officials who have been convicted were convicted of. You should ask the questions.

I also implore you to.... I think Bill C-300 should be adopted. I just read a report last night, MiningWatch Canada's “Land and Conflict: Resource Extraction...and Colombia”. Bill C-300 is a good bill. Why can't we set up a framework? I was astonished at the amount of attention being paid to Canada in Colombia, because Canada is paying too much attention to Colombia and the rest of the world isn't.

[Peter Julian, NDP, Burnaby—New Westminster, BC]

Thank you. Obviously it would be hypocritical to vote for Bill C-300 and vote for Bill C-2 without the protections in place. One has to be consistent.

I'll turn things over to Mr. Moist. I appreciate your comments that “The connection between the government and paramilitaries and narco-traffickers has been documented and it paints a very disturbing picture of a failed state that is increasingly controlled by criminals”, and later on about the “involvement of illegal armed groups...including paramilitaries and drug traffickers, who benefit from campaign financing as well as determining outcomes”.

This has been an issue all along: President Uribe's links to the Medellín cartel, President Uribe's links to the drug cartels, and the fact that his regime has open corruption that is being investigated, as well as it can be, by what's left of the independent Colombian judiciary.

One has to ask how Canadians on the street react when they see a government that has a supposedly tough-on-crime agenda actually cozying up to a government that has obviously such clear links with criminal gangs.

I'm wondering, then, given your testimony, whether you are concerned about that aspect as well as the aspect around the forced dissolving of the labour movement. Do you think Canadians are becoming increasingly concerned about this regime and its human rights violations?

And my final question: in a word, how would you describe the Liberal amendment? We've had previous testimony saying that it lacks credibility and that damage from this non-credible process could be high. Would you agree with that statement?

[Alex Neve]

Well, I think it's important to link this issue with the issue of corporate social responsibility. In our view, the best way forward here would be not only to ensure that the prior independent human rights impact assessment is both carried out and addressed, but also that the Canadian Parliament adopt—Bill C-300 being a perfect example, since it's before Parliament right now—a corporate social responsibility framework finally, to govern the actions of Canadian companies when they go abroad. The fact that at this point neither is in place—neither the human rights impact assessment nor a binding framework of some kind on the corporate social responsibility side—is of grave concern.

Yes, there are great corporate citizens who represent Canada well, including in Colombia, but there are many who do not. The concern that both the lack of CSR standards and the lack of a human rights impact assessment will exacerbate that is a real concern.

[Peter Julian, NDP, Burnaby—New Westminster, BC]

Thank you, Mr. Chair.

Thanks to our witnesses. I believe you've all underscored the importance of having full and comprehensive hearings and hearing from the aboriginal community, hearing from labour movements, hearing from human rights groups. We have yet, as a committee, to hear from the Colombian labour movement, except from the government-sponsored unions, which by their own admission represent less than 10% of what's left of unionized workers in Colombia. I think you've all stressed for the record, and hopefully all members of this committee have heard you loud and clear, that there shouldn't be any closure or cutting off of witnesses. We should have full and comprehensive hearings.

I wanted to ask Mr. Blackburn and Mr. Neve a question around social responsibility. There's no doubt that SNC-Lavalin has a very good reputation, and many Canadian companies operate in a socially responsible manner, but there are Canadian companies that do not. That's part of the debate around Bill C-300, sponsored by my Liberal colleagues, that you have companies that have caused and have been part of human rights violations and environmental violations in places like Central America, South America, and Africa.

You're certainly aware of these violations. Do you not think that it besmirches Canada's reputation overall when companies operate that way? And does it not, in your case, Mr. Blackburn, give you pause when you have report after report after report saying that this agreement could well contribute to Canadian companies being even more complicit in the kinds of human rights violations we're seeing in Colombia?

Now, that wouldn't be SNC-Lavalin, but I'm saying there are bad apples, and Canada has a responsibility, and the Canadian Parliament has a responsibility, to ensure that Canada's reputation is not besmirched abroad.

Corporate Social Responsibility

[Brian Masse, NDP, Windsor West, ON]

Mr. Speaker, I am honoured to present a petition from petitioners in the Windsor-Essex County area with regard to corporate responsibility.

The petitioners are asking that Canadian mining companies observe and be responsible in relation to human rights as well as the environment, making sure there is no degradation. They call upon the government to do two specific things: first, to create effective laws regarding corporate social responsibility; and second, to pass Bill C-300.

I am proud to say that the originator of this work was Ed Broadbent, who brought it to this chamber.

[Alfred Lukhanda]

Paul Kagame and the people who want to exploit the Congo's wealth. Those people are certainly not in Africa. In fact, Paul Kagame is only the armed branch of the large multinationals. That has been archived and documented. The report issued by the United Nations expert group is clear in that regard. We can provide a copy. The multinationals are the ones benefiting from crime. And Paul Kagame also benefits, because he has been--

It is all because of the missile fired at President Habyarimana. That is where the whole thing began. We know what the path of that missile was. It left the Soviet Union, and went to Uganda and then to Kigali. The people who fired it were trained, and we know their names. We also know in which taxi the people who fired the missile travelled. We know where they stayed, before the missile was launched. Everything is there. We can provide you with the evidence. Canada has to act now, because the evidence is there. With Bill C-300, Canada is acting based on a plan. The evidence is so clear, and we are prepared to provide it to you.

[Bob Rae, Liberal, Toronto Centre, ON]

Mr. Kabeya, I want to thank you for your important presentation. I think it is essential to call attention, once again, to the extraordinary level of violence that your country has suffered for 20 or more years. Members of Parliament recognize that this is, indeed, the most violent part of the world, and has been for quite some time. As a country, whatever the party in office, we continue, in cooperation with the United Nations, to try and create opportunities for greater stability in the Congo.

I would like to begin by expressing one thought. The dilemma we are facing is that a sovereign government is in power in the Congo. That is a reality. The Congo is a member of the United Nations. It has a government and a president. There is a political reality in the Congo, and it is not possible, either for a country such as Canada or the United Nations, to claim that such a government does not exist. There is a government in place.

Your recommendations lead me to believe that there is no government in the Congo. Yes, there are mining companies, but there is also a government which is responsible for legislation, the environment and the activities of those companies within its own borders. We are currently discussing Bill C-300, an Act respecting corporate accountability for the activities of mining, oil or gas corporations in developing countries, which deals directly with the issue of mining companies' activities. Naturally, Liberal members of Parliament support the important principle of the social responsibility of large Canadian companies and corporations. At the same time, we have to give some thought to the current reality. If there are currently U.N. troops in the Congo, they are there with the support of the Congo government. If the government of the Congo said it did not want troops in its territory, there would not be any. It would be very difficult for the United Nations to be there without being invited by the government. It is very similar to the situation in Afghanistan. We are in Afghanistan at the invitation of the President of that country, even though many people have questions about Mr. Karzaï's government.

I would like to receive a clear response from you on this. Am I to understand that you and your group do not recognize the legality of President Kabila's government? This is an important question.

[Bernard Patry, Liberal, Pierrefonds—Dollard, QC]

We have Bill C-300 also. We cannot start everything.

[Mary Ann Mihychuk]

I often try to translate how the career can attract anybody. I recently spoke to a grade five class and asked them, who wants to travel around the world and make an enormous amount of money and find a diamond mine? Every kid in the class had their hand up; they wanted to travel, see the world, and have a fabulous career. That's mining today.

Women are better communicators. We work with a lot of scientists. They could use improvement; let's just put it that way. Women have that skill set. Gaining a social license for Canadian companies, which is Bill C-300.... We are the best in the world, and there's always room for improvement. Often it's a question of our ability to communicate how we're safe and clean and sophisticated in a mining industry, and that voice coming from a woman can be often much more powerful than the traditional methods that we've used may be.

There are many jobs—financial, being CEO, being that communicator, going to the darkest jungles of Africa—and a mining project changes their world, and for the most part in a positive way, bringing wealth, development, schools, medicines. We can be very proud of our industry, and I think there are many different jobs that are of great interest to women. We just need some help getting on TV spots, getting the media to be interested. They want to hear about disasters; they want to hear about mistakes. That's inherent in how the media works.

That's where government comes in. You have programs, you have educational institutions, you have NRCan. We need to use those tools to be able to present the industry—engineering, mining, the RCMP—in a way that we understand it: wonderful, well-paying, successful, and opening the doors to the world.

[Peter Goldring, Conservative, Edmonton East, AB]

Thank you, Mr. Chairman.

I would like to say a few words on what my colleague was just talking about, the other important issues. Rights and Democracy should certainly have a thorough airing itself too, but I'm looking at the draft schedule here, and I'm seeing five instances of “Bill C-300 or...”. Those “ors” can really mean no Bill C-300, if you want to interpret it that way.

I want to underscore the importance of reviewing Bill C-300 and having an airing and consultation on it, because I believe one matter was overlooked in the previous hearings. I want to bring out this one short comment here from one company. It underscores the importance of having discussions not only with the mining industry, but also with the other ancillary industries that are contributing to the economy. This company has one paragraph that says:

Canun International is a Canadian-owned Canadian-based company. We are not a mining company per se however the equipment we supply is made in Canada and is sold to the mining companies. There is no doubt that should this bill proceed in its present form it will be used to attack the Canadian mining industry. This will result in the corporate offices, of those mining companies under attack, leaving Canada. Their leaving will, in turn, result in the total loss of our business and the loss of the twenty-nine jobs dependent upon that business.

I want to underscore the importance of continuing with the consultation on Bill C-300 and bringing in some of these ancillary companies for their viewpoint on it, too, to see if this isn't a common thought and a common concern, not only of the mining industry corporations themselves, but of many other Canadian industries.

At this time of concern for the economic well-being of our country, I think we have a duty and responsibility to thoroughly discuss that. So rather than looking at the “ors” on Bill C-300, I would think we could take the time to plug in sufficient time for Bill C-300 and to be sure we allow sufficient time for the rest of this session.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

I'm only 30 seconds away from that cusp.

The point I'm trying to make is that because of the unintended consequences of Bill C-300, the management decisions that the EDC, which is a crown corporation, would be forced to make, and their decisions on whether they are going to be releasing money, cannot be overridden by this committee. That's my 30 seconds.

The point is that you cannot have a committee micromanaging a minister or a ministry. That is not the way our parliamentary system works, nor should it. To take it a step further, you cannot have this standing committee micromanaging the EDC, the CBC, or Rights and Democracy. That is the essence of this thing.

The essence is that the opposition members in this committee--for raw political reasons, I suspect--have decided that because they have the numbers and can force the issue, they are going to force the government to hear certain witnesses at this committee. It is the position of the government that it is unparliamentary and it's really worse than just not being of value. It's a lot worse than not being of value, because it breaks down what I've been speaking about for the last few minutes, which is the relationship of the government of the day to the committees of the day, to the respective ministries or the respective crown corporations.

If we want to talk about micromanagement, let's move from the widow of Mr. Beauregard to the unions. Obviously when the unions make whatever their testimony may be, these representations would be best suited to a labour-management negotiation, and they would not be best suited to an open public forum. Unions serve very valuable purposes, and I'm not speaking negatively about unions for a second. I'm simply saying that there is a time and there is a place for dialogue and for discussion, and that discussion, in my judgment, should not be in public, but behind closed doors. Once they arrive at a conclusion or fail to arrive at an accommodation, then that can go to the public to bring public pressure on whatever it is that union and management are going to do.

Basically I visualize that bringing the union here would have a result something like this: I see the union making a recommendation--any number of recommendations--outlining the way they would like to see the staff relations and the entire Rights and Democracy organization run. Simply because of numbers and because we're in this minority Parliament, a majority report would come out of this committee vis-à-vis Rights and Democracy that would then take up an awful lot of the issues that had been put forward by the union--to what value? The union can make those representations in private or in public now. What value is there in making their representations to this committee in this forum? I fail to see what value this committee is bringing to this situation.

I'm going to get to the staff in a second, but I want to step aside from this for a second to go back to something that I report that I said in another meeting of this committee. I pointed out that there are, I understand, upward of five million women in the world who, in maternity, end up losing their lives. I pointed out that upward of half a million children never see the fifth year of their lives.

I pointed out the number of difficulties there are in which Canada is involved, whether it be Haiti, whether it be Chile, any of these situations, the horror stories we get from Sudan, or our necessity as a sovereign nation to put on the international public record exactly where we are coming from with respect to the Arctic, for example. It just goes on and on, the number of things, should the committee choose to have these meetings in the extended manner being talked about and with the number of witnesses. The committee is basically walking away from the responsibility we have to those situations that I just suggested, and there are literally millions more.

I think any government that does not listen to committees, that does not listen to reasonable, responsible testimony and reports of committees, is shortchanging the people of Canada, and I say that as a member of the government of the day. Committees have an exceptionally important value in the democratic process and in the governing of this great nation.

The difficulty I am having--and it is an immense difficulty, and honestly, it is a sincere difficulty--is the fixation over Rights and Democracy. I am not suggesting that what has happened in terms of Rights and Democracy has not been vexatious and concerning. Of course it has. It would have to be, to any responsible and reasonable adult. But to be saying that those vexatious issues here in Canada with one institution in fact are more important than dealing with what Canada's position should be at the G-8 and the G-20, with the opportunity this committee has to offer that kind of advice and counsel to the government in public, if the government chooses not to take the advice coming from the committee, that becomes part of the political dialogue we have in Canada.

The government is asking for input from this committee on the G-8 and the G-20, but this committee, the opposition members, are choosing to fixate on one issue. I must admit that I find it very disappointing.

Coming back to the union, the relationship of the union as a public union is a very interesting one, one that I dare say very few people in this room could appreciate in terms of the nuance, all the intricacies of the relationship.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

I will tell you where I'm going, and you can watch me get there.

The inclusion of Mr. Beauregard's widow as a witness, the inclusion of the unions, and the inclusion of the fired staff is, for this committee, to micromanage. That's where I'm going. I will now go back on that path.

As I mentioned, the difficulty is that we are quite frequently driven as politicians to be responding to the call of the day. We are sometimes driven by news media. We are certainly driven by public opinion. When we are driven by that public opinion, there are times when--simply because of the momentum caused by the news media and by the chatter in a Tim Hortons--that direction isn't necessarily in the best interest of whatever the issue may be.

You then come from the ministers and the ministries. You then take a further step to a crown corporation. Let's name the EDC. Actually, let's name the CBC.

In the case of crown corporations, of course, there still has to be some oversight and some accountability on behalf of the taxpayer and on behalf of the people of Canada by the Government of Canada. That very wisely is achieved by the power the Prime Minister and the cabinet have in selecting the directors and the presidents, the officers of those corporations.

In the case of the CBC, for example, where you have the Government of Canada actually taking upward of a billion dollars from the national treasury and giving it to the CBC for them to actually manage.... I must admit that when I was the heritage critic, I would say it was probably every 18 months that somebody, somewhere, on some issue, would actually start to try to micromanage the CBC.

I recall one instance in particular when if it hadn't been so time-consuming, it might even have been a little bit humorous. It basically had to do with the programming of CBC Radio 1. We had many representations about four or five years ago--maybe it wasn't that long ago, but in that timeframe--when the new CBC management decided they were going to change the format of CBC Radio 1. Pardon me, it was CBC Radio 2. The reason why this was particularly significant to lovers of classical music was that up to that point the majority of the programming had been classical music.

It must be said that the CBC had made the decision that they were not only going to be playing classical music, they were in fact going to be producing classical music. So there was a following of Canadians--if I recall the numbers correctly, it was in the neighbourhood of 2%--who were following CBC Radio 2. When they were told that CBC Radio 2 was no longer going to be strictly a classical music station, there was a great tumult. There was a great exercise on the part of the listeners and certainly on the part of some of the members of the standing committee.

We ended up actually having closed-circuit television between Ottawa and Vancouver, and I can't recall the other locations where the other witnesses came from. It was really quite interesting to follow this, but it turned out to be, if I may say so, a little bit of a waste of time. The reason why I say it was a waste of time is because at the end of the day the CBC politely listened, and then the CBC politely went ahead and did what they were going to do in the first place.

In the meantime, what the committee had done, and this is instructive for this committee, was they had used up, if I recall, at least five committee meetings, at least five. We actually used up a fair amount of money in terms of the closed-circuit testimony. We ended up pontificating as a committee and doing whatever we thought was best. At the end of the day, the CBC politely went ahead and did what it was going to do anyway. Now, remember that the CBC, as with Rights and Democracy, is governed by people who are appointed by this Prime Minister and by the cabinet. So they ultimately at the end of the day are the people who directly answer to the subscribers, the viewers, the customers, the clientele of the CBC.

However, the attempt on the part of the standing committee in fact was rather vacuous, and of course that was the position that I and the other Conservative members took throughout the entire exercise. I don't think this committee wants to take vacuous steps with respect to Rights and Democracy or steps that will possibly be best handled in a court of law. The widow of Mr. Beauregard has access to courts of law and has access to all sorts of remedies. Certainly I'm not a lawyer, so I have no idea of how many, but I do know there would be remedies that would be available to her to be able to take care of her concerns.

I suggest that what would happen if she did come to this committee is there would be an awful lot things that are extraneous to her basic fundamental requirements that would be handled, and would be handled in such a public way as perhaps to even be detrimental to her position.

I would like to have the opposition answer this question. If she did come to this committee and if she did make testimony, how would that advance her situation? If she did come to this committee and she did make testimony, how would that advance the ability of this committee to be able to change what regrettably has occurred? That's why I said at the outset of my comments here that I'm concerned about even raising this issue. I'm trying to raise it in as unemotional and as dispassionate a way as I possibly can. That said, the only thing that I can really visualize happening is that if she did come there would be an emotional reaction to a situation over which this committee has absolutely no control.

I've spoken about the CBC and it being an arm's-length organization. Let me speak about EDC, for example. EDC also is an arm's-length organization. They were given a tremendous amount of money, many billions of dollars, from the federal treasury from which they work. The interesting thing about EDC is that they have actually found themselves in a position in Canada of being a major supporter of our mining industry as well as obviously all of our export businesses.

With EDC we have seen with the testimony on Bill C-300 that if Bill C-300 were to go forward, EDC would actually be precluded from being able to carry out the kind of funding that they presently are doing on behalf of mining companies. This would represent a lack of funding support in the magnitude of about $22 billion to $23 billion, which were the figures from last year.

I can't imagine what that would do to the mining industry in Canada. They would be forced to make the decision on the basis of Bill C-300. Because what Bill C-300 actually calls for is that if things change, if there is a material change in the relationship the mining company has with the national government or with respect to the bureaucracy in the host nation, and there are questions that may arise, they would actually, according to my reading of Bill C-300, have to withdraw their tens of millions of dollars, or maybe hundreds of millions, from a given project.

That being the case, if they had to withdraw that money, the question on behalf of any prudent financial manager would be, “If I may have to withdraw this money because of something that may happen in the future”--

Mining Industry

[John McCallum, Liberal, Markham—Unionville, ON]

Mr. Speaker, the second petition is signed by approximately 400 individuals who wish to create effective laws regarding corporate social responsibility, particularly in the area of mining. They ask that we consent to the expeditious passage of Bill C-300.

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

Mr. Speaker, this is a petition signed by quite a number of folks in Canada, calling the Government of Canada's attention to alleged abuses of human rights and degradation of the environment by Canadian mining companies.

Whereas the petitioners feel that it is a duty of Parliament to hold Canadian companies responsible for their activities when operating in foreign jurisdictions, the petitioners humbly call upon the Government of Canada to do the following: create an effective series of corporate social responsibility laws and consent to the expeditious passage of Bill C-300.

Corporate Social Responsibility

[John Duncan, Conservative, Vancouver Island North, BC]

Mr. Speaker, I have the honour to present two petitions on the same subject. The petitions represent about a hundred of my constituents. They strongly support Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries.

Business of the House

[The Speaker, Liberal, Peter Milliken]

I would like to make a statement concerning private members' business. Standing Order 86.1 states that all items of private members' business originating in the House of Commons that have been listed on the order paper during the previous session shall be deemed to have been considered and approved at all stages completed at the time of prorogation.

In practical terms, this means that notwithstanding prorogation, the list for the consideration of private members' business established at the beginning of the 40th Parliament shall continue for the duration of this Parliament.

All items will keep the same number as in the first and second sessions of the 40th Parliament. More specifically, all bills and motions standing on the list of items outside the order of precedence shall continue to stand. Bills that had met the notice requirement and were printed in the order paper, but had not yet been introduced, will be republished on the order paper under the heading “Introduction of Private Members' Bills”. Bills that had not yet been published on the order paper need to be re-certified by the office of the Law Clerk and Parliamentary Counsel and be resubmitted for publication on the notice paper.

All items in the order of precedence are deemed to have been considered and approved at all stages completed at the time of prorogation. Thus, they shall stand, if necessary, on the order paper in the same place or, as the case may be, referred to the appropriate committee or sent to the Senate.

At prorogation, there were 11 private members' bills originating in the House of Commons adopted at second reading and referred to the appropriate committee. Therefore, pursuant to Standing Order 86.1: Bill C-290, An Act to amend the Income Tax Act (tax credit for loss of retirement income), is deemed referred to the Standing Committee on Finance.

Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries, is deemed referred to the Standing Committee on Foreign Affairs and International Development.

Bill C-304, An Act to ensure secure, adequate, accessible and affordable housing for Canadians, is deemed referred to the Standing Committee on Human Resources, Skills and Social Development and the Status of Persons with Disabilities.

Bill C-308, An Act to amend the Employment Insurance Act (improvement of the employment insurance system), is deemed referred to the Standing Committee on Human Resources, Skills and Social Development and the Status of Persons with Disabilities.

Bill C-309, An Act establishing the Economic Development Agency of Canada for the Region of Northern Ontario, is deemed referred to the Standing Committee on Industry, Science and Technology.

Bill C-310, An Act to Provide Certain Rights to Air Passengers, is deemed referred to the Standing Committee on Transport, Infrastructure and Communities.

Bill C-391, An Act to amend the Criminal Code and the Firearms Act (repeal of long-gun registry), is deemed referred to the Standing Committee on Public Safety and National Security.

Bill C-393, An Act to amend the Patent Act (drugs for international humanitarian purposes) and to make a consequential amendment to another Act, is deemed referred to the Standing Committee on Industry, Science and Technology.

Bill C-395, An Act to amend the Employment Insurance Act (labour dispute), is deemed referred to the Standing Committee on Human Resources, Skills and Social Development and the Status of Persons with Disabilities.

Bill C-442, An Act to establish a National Holocaust Monument, is deemed referred to the Standing Committee on Transport, Infrastructure and Communities.

Bill C-464, An Act to amend the Criminal Code (justification for detention in custody), is deemed referred to the Standing Committee on Justice and Human Rights.

Pursuant to Standing Order 97, committees will be required to report on these reinstated private members’ bills within 60 sitting days of this statement.

In addition, one private members’ bill originating in the House of Commons had been read the third time and passed. Therefore, pursuant to Standing Order 86.1, the following bill is deemed adopted at all stages and passed by the House.

Bill C-268, An Act to amend the Criminal Code (minimum sentence for offences involving trafficking of persons under the age of eighteen years). Accordingly, a message will be sent to the Senate to inform it that this House has adopted this bill.

As they are no longer members of this House, all the items standing in the name of Ms. Dawn Black, Mr. Bill Casey and Mr. Paul Crête will be dropped from the order paper.

Consideration of Private Members’ Business will start on Friday, March 5, 2010.

To conclude, hon. members will find at their desks an explanatory note recapitulating these remarks. I trust that these measures will assist the House in understanding how private members' business will be conducted in the third session. In addition, the table can answer any questions members may have.

[The Chair, Conservative, Kevin Sorenson]

It's not debatable.

Merry Christmas, everyone. I hope we all come back in good spirits. When we do come back on Tuesday, it is my intention that on that first Tuesday we move to clause-by-clause. About five minutes ago we received some amendments for Bill C-300, so we would then move to proceed with Bill C-300 on the Tuesday.

The meeting is adjourned.

[Peter Goldring, Conservative, Edmonton East, AB]

Thank you very much, Mr. Chairman.

As it's been a little bit of time since we had that meeting and discussion, I just wish to reiterate some of my comments to bring us up to date. This is relevant to the motion put forward by Mr. Dewar.

I'll just read that motion so that we have clarity on the issue:

That, in the context of its study on the treatment of Canadians abroad, the Committee report the following recommendations to the House of Commons calling on the government to: recognize its constitutional duty to protect Canadians abroad; enact legislation to ensure the consistent and non-discriminatory provision of consular services to all Canadians in distress; and create an independent ombudsperson's office responsible for monitoring the government's performance and ordering the Minister of Foreign Affairs to give protection to a Canadian in distress if the Minister has failed to act in a timely manner.

I also want to reiterate my concerns for this motion. My concerns for this motion are on multiple levels.

First and foremost, to the first point, “to recognize its constitutional duty”, I disagree. I do not believe there is any reference in the Constitution of Canada, from its latest to its most primary elements--the capitulations of Montreal to the capitulations of Quebec City to the Treaty of Paris, furthermore, taking it all the way back to its basic, core roots. I intend to demonstrate that as best I can.

Also, on the “constitutional duty to protect Canadians abroad”, once again, I find no reference, from the information that I have, in the written Constitution or the implied Constitution, going back and channelling all the way back through all the written documentation. I'm going to be presenting and reviewing quite a bit of this.

The other concern I have is that on the basis of what I believe is misinformation, it also calls for “ordering the Minister of Foreign Affairs to give protection”. I take great umbrage to the idea and the concept of ordering constitutional application when it is not there and ordering the Minister of Foreign Affairs to somehow subscribe to something that is not there.

I believe, in the context of this motion, that my concern is for the greater good. And I hope that people don't feel that I'm making an objection to this and raising this as a frivolous and vexatious factor. I'm taking that wording, of course, from the other bill we're working on, Bill C-300. But I do want to draw the parallel with that. The parallel is that as a government, and certainly one in a minority government position, we are vulnerable to motions and bills that have serious problems. Of course, being in a minority government situation, I hope people can understand that we have a duty to the citizens of Canada to stand up and speak out and try to effect change as best we can in a minority position. With that, I want to be at least very thorough in the discussion and in the discussion about my concerns with this motion.

There is an object lesson here, too, for Bill C-300 as well as for some of the other bills, frankly, that are in front of Parliament. They are bills that under a majority government would never see the light of day. But in a minority government situation, they might be forced through by an overly eager cabal of opposition parties in an attempt to embarrass the government more than to bring forward good legislation. We certainly have been witness to and have been talking to many witnesses on Bill C-300. here in committee. We're hearing not only from witnesses from the major mining sector but also from people who represent the major mining sector and were very prominent politicians in their own right.

I refer, of course, to the ambassador to the United States, a Liberal, and Pattison, who was a Liberal minister. They abhor what is happening in the opposition party's ranks in trying to bring through Bill C-300., which is so flawed as to be dangerous to--

[Paul Dewar, NDP, Ottawa Centre, ON]

I'm trying to find the bridge here. I think we have one, and at the best moments in the debate in this committee we actually got to the point where people saw that bridge to cross to bring people together.

Mr. McKay's bill does not have the ombudsman in it. My private member's bill does, but I would have had to drop it, likely, if I had my number called and if the bill were brought forward, because it requires a royal recommendation.

Mr. McKay would like to have the ombudsman. You understand the limitations of legislation here. When we heard from people from industry, they said they liked the idea of an ombudsman who is a third party, who is not prejudiced, who would receive the information and then be able to go forward. That was something in the recommendations from the round table.

In light of that, if we saw that Bill C-300 had that structure with the ombudsman, do you think that would be something you could support? I know I'm asking you to put a little extra into your analysis here, but it's something that was out there before, in terms of the round table. Could you accept that process of an ombudsman, a third party being able to oversee this process?

[Toby A.A Heaps]

Sure. It stands for the International Finance Corporation Compliance Auditor/Ombudsman.

Of those 110 complaints, 80 have been perfunctorily dismissed. If you go to their homepage, it's right there: “How to file a complaint”. Anybody can complain. Anybody in the whole entire world can complain. You or I can complain right now, and there have been 110 in 10 years. It does have some weight when they come down with it. Its teeth are not quite as sharp as those of Bill C-300, but it has weight. So it's not credible at all that we're going to have billions of allegations.

Further, perhaps our colleague from SNC-Lavalin did not mean what he said, because if I heard correctly, he said that if there were allegations of wrongdoing in a project they were involved in, they would divest. I don't think that's true, because of those 110 allegations that were levelled with the International Finance Corporation CAO, I'm almost certain that SNC would have been involved in some way with a couple of those projects. I don't think allegations are enough to make companies run away, because if anyone can make an allegation and you're willing to run away from a billion-dollar investment, that just doesn't pass the smell test.

In terms of the other remarks, I think it's natural for companies to sometimes say that the sky is falling. When we had labour, safety, and environmental regulations, those claims were all made, and they all proved to be blatantly false. In the end, companies were a lot more profitable because of them. I don't think this sort of notion of Chicken Little crying the sky is falling holds a lot of water. I don't understand when people ask why they need this if their companies are leaders in the world. Why do we have labour laws and environmental laws and other standards that are backed up by legal remedies in our country? You need an accountability mechanism. Why do we have referees at the hockey game? We need somebody who can put people in the penalty box when it's needed and help to hold order.

I hope the committee doesn't take these statements that are being made too seriously. In terms of your question of how we can brand Canada as a leader, how do we differentiate ourselves as Canadians when we're operating a mining company abroad? We do have a good reputation, but it's running on fumes to some extent. I remember being in Colombia, talking to the U.S. ambassador. She told me that there was a Canadian company operating in the heartland of FARC, that a U.S. company could never operate there, and that doing so was a privilege our country's companies enjoyed. If we want to continue to enjoy that privilege, we can't just rest on our laurels. We have to have something that gives real quality assurance, and this bill would offer a good starting point of a semblance of quality assurance.

If I'm in Africa, living in a community in the Congo and something is going wrong--and maybe nothing's going wrong--at least I know that if something is going wrong, there is real due process through which someone will listen to my complaint and hear it out if it is valid. That says a lot to countries, and that sort of thing would differentiate us so people could say when you deal with Canadians--

[Paul Dewar, NDP, Ottawa Centre, ON]

You guys might, but I'm in reality land.

Mr. Heaps, you were very clear in your support of the idea of Bill C-300. You said you wished some other facets could be put in place. I guess what you were getting at, and I've read your magazine, is you want to brand Canada in terms of its companies, as a sensible way for other countries to do business, to have Canadian companies come to their country.

What are some of the other things you think we should be doing on top of Bill C-300? I guess what I'm looking for is this dichotomy that was mentioned, a false one, between those who are in support of the idea of Bill C-300 and seemingly being against mining. I'd certainly take issue with that.

If all of us are trying to do the same thing, how can we take Bill C-300 and use it to improve our reputation overseas to ensure that our brand, as a country, is solid, is welcomed, and is advanced and promoted?

[Peter Goldring, Conservative, Edmonton East, AB]

Thank you, Mr. Chairman.

Mr. Blackburn, all companies want to do better and the intent of this bill, although well-meaning, is problematic. The Canadian mining business has an excellent reputation, nationally and internationally. This has been confirmed by some of the witnesses.

There was a comment that sounded outrageous--namely, that there might be up to a billion complaints that have to be responded to. The language of this bill is instructive: the minister “shall receive complaints” from “any Canadian citizen or permanent resident or any resident or citizen of a developing country”. This implies investigating as well, not merely receiving the information.

Around here, we all know that from time to time we get thousands of pieces of information, inquiries, complaints, and instructions. So it is conceivable that there would be a billion responses to be made. This affects not only DFAIT and EDC, but also your own firms. If there are mass mailings, computer-generated mailings or whatever, they have to be deciphered to see what information there is behind them.

So it's not just the legal system of EDC and DFAIT that would be expanded. This would also affect your own firm. You mentioned that you have 10,000 projects internationally—$7 billion in Canadian business. It was mentioned earlier that the TSX will breathe easier because of Bill C-300. I'd like to know your response. Would you concur that the TSX would breathe easier? What happens to these large numbers of Canadian businesses? Will there be a departure from Canada? The alternative is to insulate yourself from this type of legislation, and the best way to do that is to relocate.

[Robert Blackburn]

Then what's the point of Bill C-300 if it's already done?

[Bob Rae, Liberal, Toronto Centre, ON]

Just to be clear, the financing wouldn't fall through because of an allegation, any more than the financing would fall through because of an allegation before the counsellor. The counsellor, under the current rules....

Let's be adults here. The Senate is going to have a Conservative majority in six weeks to two months. Whether this bill will go through or not, we don't know. But a lot of the complaints I hear from the corporate sector about Bill C-300 would be equally directed to what is happening with the counsellor.

I don't hear the corporate sector saying that the counsellor's processes are unacceptable. It's unimaginable to me that EDC would not take into account a conclusion of the counsellor on the conduct of a company. In that sense, the game is up. This question of corporate social responsibility has been resolved. It's clearly in place. Companies that act--

[Bob Rae, Liberal, Toronto Centre, ON]

I'm sure you understand that the timing of the legislation is that the legislation was proposed by Mr. McKay before the government told us what their position was on corporate social responsibility. We had a debate in this committee, a discussion in this committee, a report from this committee, and then we had a long period of delay. Then Mr. McKay brought forward his measure and then the government brought forward the counsellor process.

Many of the things that you've described as part of the problem that would be associated with Bill C-300 also apply to the counsellor process. Anybody can complain, anybody can go to the Internet, to the world, to wherever they want to go and say this activity has gone on, it's terrible, it's awful. The company's reputation is affected by that decision of whatever group to come forward.

The counsellor receives the complaint, and the counsellor then asks the company, do you want us to proceed? The company might object. They might say they don't like this, they object to it, so they'll put out a big press release.

The point is that part of what I find in your presentation and also dans la présentation de Monsieur Gascon is we have created a process in Canada now and many other countries are doing the same thing. The reason we've created a process is because there's a perception of a problem.

[Toby A.A Heaps, Editor-in-Chief, Corporate Knights Forum]

Thank you, Mr. Chair.

Mr. Chair and members of the committee, it's truly an honour to be here today, at the heart of one of our country's most important deliberations. Before introducing myself, I'd like to make one point crystal clear: the fact that you might be for Bill C-300 doesn't mean you're against Canadian mining and oil companies; in fact, I think it can mean quite the contrary.

I have a company called Corporate Knights. I'm the president and editor of Corporate Knights. It was co-founded in 2002, and we're founded on the premise that in today's global landscape, companies must be at the heart of our big solutions or there are no big solutions. We also believe there's a strong self-interest for companies to engage in commerce in a way that strengthens social and political stability, because no company can succeed in a society that fails.

In short, we are big supporters of Canadian companies, their leadership and innovation, and their potential to drive Canada's prosperity in ways that can make us all proud. Over the past eight years, we have tracked corporate Canada's performance on social and environmental matters through our annual surveys, such as the best 50 corporate citizens in Canada, the global 100 most sustainable corporations in the world, which is announced each year in Davos during the World Economic Forum, as well as investigative reports assessing Canadian companies' performance against the International code of ethics for Canadian business and other international responsible business standards. Our work has taken me to the bottom of giant open-pit mines in the Congo, to the vast plains of the Gobi Desert, right to the middle of oil pipelines in Ecuador.

Companies by and large respect and give credibility to our trademark, which is fairness. This credibility is something we've earned that provides us access to company executives and company sites. It's also why mining and oil and gas companies have purchased hundreds of thousands of dollars of products from our company.

I would like to use this opportunity to cover two main points. The first point I'd like to cover deals with some of the global currents that define the context of the marketplace in which our Canadian companies operate today. The second point I would like to make concerns the difference that Bill C-300 could make.

On the first point, today the size and power of companies paints a whole new swath of grey between states and enterprises: 29 of the world's 100 leading economic entities are companies, according to the UN Conference on Trade and Development.

The majority of the world's untapped resources lie in unstable states. The quest for resources is increasingly becoming a foreign pursuit for Canadian companies and companies everywhere. As Canada's resource levels recede, our firms have a choice: go where the resources are or go out of business. According to the United States Energy Information Administration's International Energy Outlook, roughly 80% of the world's oil supply will come from non-OECD countries by the year 2025. Many of those countries rest in weak governance zones.

Today, as we're all familiarly aware at this committee, 75% of the world's exploration and mining companies are headquartered right here in Canada. We also have a revolution in information and communications technology, which has put companies under the microscope—or YouTube, as the case may be—and what happens on the other side of the world in a remote jungle in the morning can be beamed onto your computer screen or TV that afternoon.

The fifth thing that defines the global context in which we operate is that the corporate accountability mandate has achieved an increasing traction. Over the past decade there has been a raft of international corporate performance standards and guidances, ranging from the IFC performance standards to the voluntary principles on security and human rights, to the calls for corporate accountability laws by Supreme Court Justice Ian Binnie, to the meticulous work by John Ruggie, special representative of the Secretary General on human rights and transnational corporations.

If you look at these things, you see a consistent pattern of an increasing articulation of what is expected from companies these days, and nowhere is this truer than in Canada. Bill C-300 lands smack dab in the middle of all this.

These are the four differences I think Bill C-300 can make, and these differences are all positive differences for companies, in my view. First, I think it could help clear the air for our most honourable companies. The fusion of NGOs and the ICT revolution produces many allegations. A credible mechanism that would make informed decisions would help to stop false accusations in their tracks, helping to protect the reputations of Canadian companies.

Second, right now it is assumed that if you buy a junior mining company or oil company, you're buying the assets as well as the liabilities, meaning the social and environmental liabilities. These liabilities have a big price tag. The presence of a credible accountability mechanism and administering body would offer tremendous incentive for Canadian junior companies to more closely adhere to international human rights and environmental standards, which would mean less value being destroyed and less time lost. It is a win-win for the juniors, who could sell their assets for higher prices, and for the majors, who would not have to deal with the headaches often embedded in their acquisitions of junior properties.

Third, this bill could offer a maple leaf quality assurance premium to investors. Let me explain. After the recent financial meltdown in which up to $50 trillion of wealth vaporized, investors have become increasingly risk averse. The downside of this risk aversion is that there's less capital flowing to emerging markets, as presently most investors just paint all companies with the exact same risk discount based on sovereign risk no matter what their practices are, but the major liability issues at most sites are related to the way the company operates, not the context in which it operates. This is something that checked out in my experiences and those of other experts I've talked to, who examined hundreds of sites around the world.

The current investment practice, aside from unfairly tarring leading responsible companies that happen to be operating in a difficult environment, leads to suboptimal risk-adjusted rates of return for investors. With a credible accountability standard for companies listed on the TSX, investors could be willing to pay more than, say, for a comparable company listed in the London exchange, because they would have more confidence that they were not buying a poisoned bag of goods.

Fourth, I think this bill could offer a maple leaf quality assurance premium to host countries and their stakeholders. We are the world's miners. Mining is not about technological advantage. Any company can do it. In the scramble for resources, what distinguishes a Canadian company from a Chinese company is that a Canadian company has a competitive advantage when it comes to safety, social issues, respect for human rights, community engagement, contribution to local employment, and environmental protections.

Bill C-300 is not perfect, nor is it enough, but by making a move to a credible accountability mechanism, it sends a strong signal that Canadian companies will be on the winning side of the seismic shifts shaping our global economy.

Thank you.

[Jean-François Gascon]

I am going to give my presentation in French. I will leave 15 seconds for those who need simultaneous translation.

My name is Jean-François Gascon. I work for SNC-Lavalin Environment as a Project Sustainability Leader. Through our division, SNC-Lavalin puts sustainable development programs in place during the implementation phases of projects, particularly in mining and other resource sectors.

As my colleague told you, the ultimate goal of Bill C-300 is very commendable. We share that objective, as do many of our clients and partners in Canada. However, I think that the means being used is probably the worst way of meeting that goal.

The biggest problem with the bill is that there is a sense that it is based on three premises which make me rather uncomfortable. The first is that Canadian companies are not good corporate citizens, particularly in developing countries. My experience in more than three dozen countries, especially developing countries—because I lived in developing countries for many years—tells me that the opposite is in fact true. Canadian companies, particularly in the resources sector, actually have a good reputation, especially in comparison to competitors from foreign countries. I am therefore bothered a bit when I see that that is a premise underlying the bill.

The second premise is that the current legal environment is unable to address the problems and meet the objective, which is to encourage companies to be better corporate citizens in developing countries. I do not think there is a need for a protracted debate on that point. The legal environment is more than sufficient today, whether it is banks or export credit agencies like EDC, which are subject to a set of rules, including the Canadian Environmental Assessment Act, which has to be applied to projects outside Canada, especially when there is Canadian funding. I think the current legal environment is more than capable of permitting Canadian companies to manage mining projects in developing countries quite effectively.

The third premise is the one I find the most upsetting, especially for those who have travelled in developing countries. The premise is that developing countries do not have sufficient legal capacity or are not mature enough to solve problems, in particular, problems related to human rights or failure to respect the environment. I think this premise is very harmful. A lobby group or an NGO can say things like that publicly, but when the idea forms the basis for legislation tabled by the Government of Canada, I, as a Canadian citizen, am deeply concerned.

Why is this bill aimed only at projects in developing countries? The answer to that question is obvious. People think developed countries are able to solve these problems and developing countries are not. This is a major issue. Developing countries do not want to be treated like children. I think that paternalism is probably the last approach we as Canadians want to use when it comes to addressing these very significant concerns.

I would like to end with a rather telling example that also indicates a change in the way Canadian companies approach foreign projects, particularly in developing countries. Companies talk a lot about community relations. They talk about the celebrated “social licence to operate”, an approach that on the whole is rather passive. They try to solve problems as they arise. However, Canadian companies are increasingly proactive in their approach. For example, there is a very big mining project, one of the biggest in the world, in Madagascar, the Ambatovy project, in which SNC-Lavalin has invested as part of a consortium that includes a Japanese company, a Korean company and another Canadian company. For the implementation and construction phases of the project, three training centres were set up to train more than 6,000 local workers, which helped maximize local employment for the project. Today, the project employs 10,000 people, 85% of them local workers, which is almost unheard of in the mining industry.

A strategy has also been put in place to maximize local procurement, and to date, companies have bought more than $750 million worth of goods and services produced locally or through a local intermediary. Some of the strategies that have been put in place are designed specifically to not only ensure that project implementation, but also to maximize the local benefits of that type of project. I believe this approach should be promoted ahead of the approach where minimum standards are set and companies that behave badly are punished. We welcomed the Canadian government's announcement of the creation of a corporate social responsibility counsellor position, and I think we have to move toward promoting best practices instead of punishing the worst offenders. Thank you.

[Robert Blackburn, Senior Vice-President, SNC-Lavalin International, SNC-Lavalin Inc.]

Thank you, Chairman and standing committee members.

I'm Robert Blackburn, senior vice-president of SNC-Lavalin International, and I'm accompanied by my colleague, Jean-François Gascon, who is the leader of our project sustainability group and environment. We're going to jointly make a very brief presentation.

SNC-Lavalin is one of Canada's largest engineering construction groups. Our key sectors of activity are mines and metallurgy, chemicals and petroleum, power, and infrastructure construction, ownership, and management. In 2008 half of our revenues of $7.1 billion were for work outside Canada, of which, interestingly, only 3% came from the United States, and 13% came from Africa, which has traditionally been our principal geographic market outside Canada. We're currently working on every continent, with approximately 10,000 projects under way in 100 countries. We have an employee workforce of about 22,000 around the world.

I want to make six main points, after which Jean-François will brief you on his experience and observations in dealing with project sustainability issues in Africa and elsewhere.

First, we're sympathetic to the objectives of Bill C-300. However, we have serious reservations about the need for and proposed approach of the bill. Contrary to what seems to be an underlying assumption of the bill, Canadian mining and oil and gas companies generally have a very positive record and reputation internationally. The uncertainties created by the proposed bill would place their activities in jeopardy, and they would be at a severe disadvantage with their competitors in global markets.

Next, Bill C-300 would affect SNC-Lavalin, because although we're not a mining or oil and gas company, we provide services to Canadian and foreign clients in these sectors in developing countries. In addition, we sometimes take small equity stakes in clients' projects, thus aligning our interests with theirs. Our investment in Ambatovy in Madagascar is an example where we're following industry-leading Canadian Mining Association voluntary guidelines—very strict guidelines.

In his testimony, Jim McArdle of EDC—Export Development Canada, that is—referred to 139,000 Canadian jobs sustained in 2008 alone by EDC export support and investments in the extractive industries. Several thousand of these are SNC-Lavalin employees in Canada and around the world.

Thirdly, it is important that the rules affecting Canadian companies be comparable with those observed by competitors based in other countries. Any project that benefits from export credit financing, as well as any project financed by most large banks following the Equator Principles, must meet stringent rules for environmental and social assessment of projects, as set out in the OECD recommendation on common approaches to the environment. They must also observe ongoing requirements during implementation and operations phases as set out by the same OECD and World Bank guidelines. Not only does the project proponent have to meet these criteria, but the financing agency requires that the proponent issue regular progress reports explaining how the commitments are being met. The EDC typically conducts audits for performance as well.

Finally, the EDC and World Bank regimes require the disclosure of a considerable amount of information in the form of environmental and social impact assessment reports, and often ongoing progress reports. The way in which a Canadian mining or oil and gas company develops and implements a project receiving such financial backing is thus very transparent. The same cannot be said for companies from countries that do not adhere to the OECD common approaches to environmental and social policies, and we can think of some, in Sudan and elsewhere.

My fourth point is that complaints and sanctions proposed in the bill would pose significant threats to companies' reputations, since with or without substance, each complaint calls for some level of ministerial investigation. There seem to be no sanctions against frivolous or vexatious complaints that could conceivably be launched not only by individuals but even by disgruntled competitors. Many of the complaints that you may have heard in this committee or elsewhere in print are not only inherently unprovable but cannot reasonably be defended against. The launching of a ministerial investigation would harm a reputation, whatever the outcome. Furthermore, it is not clear what resources and host government cooperation would be necessary for such investigations. These countries do have their own laws, as has just been stated, which are usually very effective.

In any case, the process would seem to be a duplication of the recently announced federal CSR strategy, with a CSR counsellor and the national contact point for the OECD and MNE guidelines .

My fifth point is a comment: that in the past twenty or so years, considerable progress has been made in Canada to bring industry and NGOs closer together and away from the adversarial zero-sum game of old. Examples include the National Round Table on the Environment and the Economy, an EDC consultative process regarding its environmental review directive.

Ultimately, Bill C-300 may well do little good for the environment and local communities where projects are implemented in the third world. It will certainly not boost Canada's competitiveness.

Finally, I think that the burdens and uncertainty of the bill's approach to standards and international enforcement would militate against Canada's hope of expanding into new and fast-growing markets around the world. Our bottom line was well stated by Jim McArdle of EDC, when he said:

If this bill becomes law, we believe that our opportunities to be on the field would be severely limited. Instead, we as Canadian companies and EDC would be on the sidelines hoping that the other companies who remain in the market do the right thing from a CSR perspective.

Thanks for your attention. I'll now ask Jean-François Gascon to share his experience with you.

[Professor Daviken Studnicki-Gizbert, Associate Professor, Department of History, McGill University]

Good morning. Thank you very much, Mr. Chair and the members of the committee. I appreciate the opportunity to share some of the research we've been doing at McGill with the committee this morning.

The statement I am going to present is based on the collective work of a research group that I coordinate at McGill. It's called MICLA. It examines the different projects across Latin America that are organized by Canadian mining companies. The testimony I'm giving is also based on my personal experience in the particular case of Cerro de San Pedro, which is a mining town on the outskirts of San Luis Potosi, in Mexico.

The issue of proof and documentation has come up a number of times in this committee, so I should say here that our research is based on a broad range of sources. These are documents released by the mining companies, technical reports from engineering firms, press files, legal documents, as well as reports filed by NGOs, international organizations, and national governments. These documents have been supplemented by field interviews with people living near a Canadian mining project, and interviews with community delegations that have come to Canada over the years, and with mining executives, NGOs, and scientists.

My comments today focus on Mexico. Mexico is the host of the largest number of Canadian mining projects in Latin America, and it's the country where the data is the most complete.

I'd like to focus on three points. The first is that Canadian mining in Mexico is a high-risk form of economic activity. The second is that while conflicts have arisen between Mexican communities and Canadian mining companies, these are surprisingly few. And third, the Canadian government, especially as represented by its consular staff, appears ill-equipped to address the growing public backlash against our companies in that country.

I believe it is important to get a better understanding of the context in which our companies currently operate. If you consolidate project data with data on the environments and communities around them, you quickly get a profile of a high-risk industry. It combines a form of operation that has a high impact on its surroundings with the presence from one end of Mexico to the other of a densely populated area characterized by multiple uses, complex land tenure and significant social strife.

Canadian mining companies first entered the Mexican mining sector in the 1990s. They brought with them billions of dollars in equity. Because our companies dominated the sector, they currently own approximately three-quarters of the projects. They have arguably been the main driving force for the recovery of the mining industry in Mexico. Investment aside, they cleared the way for significant modernization of mining techniques. The biggest change is probably “large tonnage, low grade” mines, which are usually open pit.

Most of the projects carried out by our companies are gold, silver and copper mines. The majority of those mines are open pit. I do not want to praise nor do I want to criticize this type of mining, but first off, it is new; second, it has significant long-term impact on the land and water around it; third, there are contamination risks; and fourth, it requires huge investments. We are talking an average of a hundred million dollars for every project. These rural communities, many of which are very poor, are literally awash with money.

There are currently 519 mining projects developed by companies registered in Canada. They hold large concessions of many hundreds to thousands of hectares each--the average is about 15,000 hectares--and when you put this together we get a significant portion of Mexico's national territory.

I put this out because I want to talk about the actual social geography in which these companies operate. It's a social geography that's very different from that of mining in Canada. Mining projects are situated in areas where the average population density is about 49 inhabitants per square kilometre. To give you a reference for that, it's about equivalent to the area around Chelsea, so fairly densely populated but quite rural. The people who live there are predominantly small-hold farmers, which means that they depend on land and water for their livelihoods. In areas like Guerrero, Oaxaca, and Chiapas, many of these farmers are indigenous, which means that they have special rights to consultation under ILO 169, to which Mexico is a signatory. But it also means that they have special liabilities, which means that those rights are often ignored. The majority of the projects that we've surveyed, close to three-quarters, overlap with what are known as ejido lands. This is a collective form of land tenure accorded to rural communities after the Mexican revolution, and the laws regulating ejido lands are very strict. They make ceding land, changing land use, or even renting land very difficult, and this can trigger conflicts within as well as between communities.

Finally, in a general way, the Mexican countryside is currently facing its most serious crisis in generations. The violence surrounding the drug trade is on the rise. There's been an upswing in guerrilla activity and in the militarization of the hinterland. The number of cases of alleged corruption at the local and state level is also growing. So this is the context: a large number of projects that will impact heavily on the resources needed by local communities, competing claims on land use that are legally complex but which must be resolved in the context of deepening violence and recourse to extra-legal means of “getting things done”. And this is what I mean by high-risk enterprise.

Public debates over mining have tended to turn around conflicts that emerge between mining companies and local communities. An important line of our research has therefore been to better understand the factors and dynamics that lead to these conflicts. Surprisingly, in recent years only 13 projects operated by 11 Canadian mining companies have been embroiled in open conflict. We need to compare this with the over 500 projects in development across Mexico. The Mexican pattern generally holds across Latin America as a whole. For some 1,300 Canadian mining projects ongoing across the region, we count around 50 with attendant conflicts.

These 13 cases in Mexico depict a range of trajectories. We have seen communities put up blockades to stop mining operations and force the company to negotiate. In some cases, negotiations was successful in resolving the dispute. In others, the company called in the police to take down the blockades and arrest the organizers, often with excessive violence.

The violence has sometimes taken the form of attacks. These attacks have been perpetrated by people linked to the company against people opposed to the mine. We are talking about assault and, in two cases, murder. The latest one just happened. Last Saturday, November 27, Mariano Abarca Roblero, a manager from the community of Chicomuselo in the state of Chiapas, was gunned down in front of his house by two assailants.

A few days before he died, he requested state protection because he had been publicly threatened. The threats were allegedly made by two representatives of Blackfire, a company registered here in Canada. Before he was murdered, Mr. Abarca organized several public consultations in communities near the Blackfire project. After the communities rejected the mine, Mr. Abarca coordinated a number of blockades. That was in June and July past. He died because he wanted to protect his community.

What is the significance of these findings? I find three.

First of all, while Canadian mining in Mexico is a high-risk enterprise, the numbers show that the Canadian companies are so far capable of managing this risk. I've personally met with people from Mexican communities who recognize the good faith in negotiations of Canadian mining managers and are happy to work with the company. In this respect, the government's existing CSR strategy can only help our companies improve their track record on community relations and environmental impacts. This is the kind of preventive work that absolutely needs to be done if companies and communities are to interact in a healthy and peaceful way.

I find that there's been a false dichotomy that's crept into the debates in this committee, one that pits Bill C-300 against the government's existing CSR strategy. We obviously need both of these things, and they need to work together.

Second, this committee has heard concerns that Bill C-300 would expose the Canadian mining industry as a whole to hounding by communities and their allies seeking redress, that the number of complaints would overwhelm DFAIT's capacity to address them in a satisfactory manner, that the CPPIB would not be able to maximize earnings for pensioners, that the TSX would lose a significant percentage of its equity, that the Canadian industry would lose its reputation and its competitive advantage.

Each of these arguments assumes that Bill C-300 will somehow open the floodgates of woe and complaint. With over 500 projects, Mexico represents a major chunk of the Canadian mining industry's overseas activities. Thirteen cases over the last five years is hardly a flood of problems. I think the industry and the TSX can breathe more easily.

More importantly, Mexicans are pragmatic. If they can find satisfaction through successful negotiations with a company or through appeal to the Mexican courts, they will do so and they have done so. So even though there were 13 cases, most of them are resolved locally, without appeal even to government authorities in Mexico.

Third, there are on occasion serious problems that arise from the activities of Canadian mining companies in Mexico. This needs to be made absolutely clear. We have to stop pretending that every single project and company is beyond reproach, that NGOs are making up vexatious and fraudulent claims in order to save their jobs.

Yes, the conflicts that arise are complex in their origins and in their unfolding. Yes, there are many sides to the story. But there are also certain incontestable and documented facts. People have been killed; people have been physically aggressed; people have suffered damage to their property, their lands, and their water without adequate compensation or redress. People have been dispossessed of their rights.

I would like to lay out in more detail one such case.

[The Chair, Conservative, Kevin Sorenson]

Good morning, colleagues. This is meeting 44 of the Standing Committee on Foreign Affairs and International Development on Thursday, December 3, 2009.

Our orders of the day include a return to our committee's study of Bill C-300, an act respecting corporate accountability for the activities of mining, oil, or gas in developing countries. We have a number of people who are going to testify before us today. We have votes at 10:15, so we've asked the guests if they are willing to appear together and they have agreed.

Committee members, you should have a steering committee report in front of you. On Tuesday morning your steering committee met and a number of items were discussed. I'm going to give you one moment to take a look at that report, which we put before you for your consideration today.

On the first point of that report, you'll note that the steering committee recommends that the minister of CIDA appear before our committee on the supplementary estimates. She has been invited and is scheduled--

Bill C-470

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

Mr. Speaker, one of the things that I think that we should be taking a look at, bearing in mind that of course we are governed by the documents that are currently on the Table, is the issue of the additional expenditures that would be required by a given department from time to time, as a result of private members' legislation.

Let me give an example. We presently have Bill C-300 before us at committee. If we were to take a look at the documents on the Table of this House, there may be some question as to whether that bill, should it succeed to come back to the chamber, would require a royal recommendation. Perhaps within the documents on the Table, there are a number of questions about that.

There is no question, however, with respect to that bill, and perhaps with respect to my Liberal friend's bill, that there will be either a complete reordering of finances within a given department in order to take care of the requirements of being able to enact a piece of legislation that again is not specifically covered by the documents with which we govern ourselves.

Mr. Speaker, I know that you are a very knowledgeable traditionalist, in terms of taking a look at what has gone before and what the rules of the House are. I invite you to take a look at the additional aspect with respect to a royal recommendation where, for example, if I may use the example of Bill C-300, we received testimony just this morning from the Department of Foreign Affairs and International Trade, that in order for that bill to be enacted, it would require many millions of dollars of expenditure by the department.

In other words, Mr. Speaker, that is not covered by the specific rules that you have on the Table in front of you, and perhaps the advice that you would normally receive by the Table.

However, the fact of the matter, nonetheless, is that there will be a further expenditure, either that or a starving of current programs that are run by DFAIT or run by my minister, the Minister of International Cooperation.

So, Mr. Speaker, when you are looking at this intervention by my Liberal friend, I do invite you to take a look at it in the broader picture. Because there are other private members' bills that are going to be coming back to this chamber, which may or may not be successful. However, in the event that they are successful, you are going to be challenged with the fact that, in spite of the specific wording within the given bill that comes back, nonetheless, the government's hands will be tied and the President of the Treasury Board and the government will have to make other financial considerations other than what is currently contained on the Table.

[Catherine Duhamel]

No, no. I would clarify what I just said in my presentation:

“As to the way in which complaints are dealt with, the rules of procedural fairness and natural justice apply to all administrative bodies established by a Canadian act. It is assumed that Bill C-300 complies with the Constitution and with the principles of procedural fairness.“

[The Chair, Conservative, Kevin Sorenson]

Welcome back. We'll call the meeting to order again.

In the second hour, we're continuing in our study of Bill C-300. We're very pleased to have, from Alternatives Canada, Catherine Duhamel, an international human rights lawyer.

Ms. Duhamel, I welcome you to our committee this morning and invite you to make your initial presentation. We hope that you will have the time as well to take some questions from our committee.

Welcome.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

I think it's interesting; your department is taken very seriously by all Canadians, and certainly by this committee, and I'd just like to read, again, the closing statement of your presentation:Insofar as the analysis undertaken of the potential impact of Bill C-300 on DFAIT, it could restrict our ability, in areas where we most need to engage, to influence a positive outcome and ultimately limit the ability of this department to make positive contributions in the area of corporate social responsibility.

In other words, in spite of all its good intentions--everyone in this room, including me, support the intentions of the bill--the fact of the matter is that you have given us a shopping list of items where you would have tremendous difficulty in continuing to do the good CSR work that DFAIT is undertaking. I did want to underline that, because I take your testimony as being expert testimony.

I give the floor to Mr. Goldring.

[Francine Lalonde, Bloc, La Pointe-de-l'Île, QC]

In the absence of any other framework, you already make sure that you identify the wrongdoing to the extent that you can and you consult a number of people about it. You already have a mechanism that allows you to establish responsibility.

What else would you have to add in order for you to be able to comply with Bill C-300?

[Grant Manuge, Director General, Trade Commissioner Service, Operations, Department of Foreign Affairs and International Trade]

Thank you very much, Mr. Chair.

Thank you for inviting the Department of Foreign Affairs and International Trade-- “DFAIT”, as we refer to it--to return to this committee.

Today we would like to build upon previous testimony made by this department and comment on the potential implications of implementing Bill C-300, the challenges of the quasi-judicial process it would create, and the CSR-related activities in which DFAIT is currently engaged as part of our mandate when it comes to fostering the expansion of Canada's international trade and commerce and coordinating Canada's international economic relations.

Officials at the department have been following closely the committee's study of Bill C-300 and have carefully reviewed your comments and questions, as well as the testimony provided by the many witnesses and stakeholders who have appeared since the department last appeared in June.

During that appearance, officials spoke of the new corporate social responsibility strategy tabled by the government in March, the work of the national contact point and the network of foreign service officers around the world. It was also noted during that appearance that departmental officials had some concerns with the proposed implementation of this bill. That appearance was followed with a written submission outlining these concerns and questions.

Since that time, many issues have been raised by the various stakeholders. You have heard from the industry, civil society organizations, Export Development Canada, the Canada Pension Plan Investment Board and some of our partner departments.

Rather than focusing on areas that have already been substantively addressed by others, DFAIT would like to use its time today to raise a number of issues that would have considerable impact on this department and on its work. These issues include the use and operation of the Special Economic Measures Act; the question of applying international human rights standards to non-state actors; the way in which DFAIT provides CSR support to Canadian companies, including those in the mining, oil and gas sector; and the foreign policy implications of the bill.

To highlight some of these issues, it might be useful to undertake a close examination of the implications for this department of setting up and conducting an examination process as it is set out in the bill.

As the department that would ultimately be responsible for implementing and applying many of the provisions of this legislation, we needed to look carefully at what would be asked of us should this legislation pass. In so doing, we felt it was important to carefully examine the provisions of the legislation as it currently stands and to assess the various implications, some of which I will mention here.

Bill C-300 asks the ministers of the Department of Foreign Affairs and International Trade to draft a set of what appear to be mandatory regulations using a number of internationally recognized, voluntary guidelines and one policy that is internal to the International Finance Corporation. This is challenging, because these instruments are currently drafted as guidelines, and not regulations, so that they remain flexible enough to embrace the wide range of complex circumstances and conditions under which firms from Canada and other countries operate in countries around the world.

The bill also asks the ministers to incorporate human rights standards and “any other standard consistent with international human rights standards”. In this regard, Dr. John Ruggie, special representative of the UN Secretary-General on the issue of human rights and transnational corporations and other business enterprises, noted in his report of April 22, 2009, that “human rights instruments were written by States, for States. Their meaning for businesses has not always been understood clearly by human rights experts....” It would be difficult to determine which international human rights standards to apply and how those standards should apply to non-state actors prior to the completion of the work of Dr. Ruggie.

This point also serves to highlight the fact that Bill C-300 would require DFAIT to build or acquire the capacity to investigate and adjudicate claims of human rights abuse and environmental degradation. In addition, ministers would need to take into account not only the legal risk of making a determination, which could be subject to judicial review, but also potential impacts such a determination might have on local communities, host governments, Canadian companies, civil society organizations, and other stakeholders.

As noted in our earlier submission, the link between the actions of a Canadian extractive company and grave breaches of human rights by states is unclear and does not seem to be consistent with the purpose of enhancing corporate social responsibility abroad.

Bill C-300 requires the Department of Foreign Affairs and International Trade to set up a quasi-judicial process. That process would need to meet all the requirements of due process, procedural fairness, and natural justice. Foreign Affairs and International Trade currently does not have the ability to function as a quasi-judicial body. There is no provision within the DFAIT Act to house such a mechanism.

In order to set up a process to accept or reject complaints, conduct examinations, and make decisions based upon those examinations, a carefully drafted framework would be required, firmly respecting the principles of natural justice. This extensive regulatory framework would be required to ensure that rights are being protected.

The issues outlined above also raise questions as to whether or not DFAIT officials have the right skills or will have sufficient resources available to train or recruit individuals with the appropriate professional competencies to do this work.

It may be helpful to review the current practice of the department when DFAIT officials are presented with allegations of wrongdoing by a Canadian company abroad. When the department learns of such allegations, we take these very seriously and try to play a constructive and helpful role. Our heads of missions and foreign service officers in Canada and abroad consult and work closely with companies and the affected communities, and with governments, indigenous peoples, and civil society organizations to facilitate an open and informed dialogue among all parties.

In the event that the territory in which the alleged activity took place is not a signatory to the OECD guidelines for multinational enterprises and does not have their own national contact point, or NCP, we would offer the services of Canada's NCP to the affected individuals, communities or their representatives.

The Department of Foreign Affairs and International Trade currently chairs the interdepartmental committee that is Canada's national contact point (NCP) for the OECD guidelines. These guidelines are a key element of Canada's CSR approach.

The NCP promotes the guidelines, handles inquiries, and can foster a constructive dialogue between stakeholders when issues arise. If the allegations fall outside the scope of the OECD guidelines, the department could offer the services of the newly appointed Extractive Sector CSR Counsellor to the affected communities for issues that fall within her mandate.

The department's approach to engaging with stakeholders in the event of such allegations is one that reflects the principles that guide Canada's foreign relations and the observance of Canada's commitments under international agreements and obligations, including respect for the sovereignty of states.

It is an approach that is consistent with the way states in general work with one another when issues such as these are raised. It also demonstrates a commitment not only to help companies perform better and act in a socially responsible manner but also to work with host governments and local communities to enhance their ability to manage natural resources and benefit from the development opportunity afforded to them by such endowments.

When amending the DFAIT Act to put constraints on the kind of support officials are able to provide to Canadian companies in certain circumstances, it might be useful to note what some of those activities are. It will be challenging to draw a distinction between the activities of DFAIT officials that promote and support Canadian companies, and would have to be withdrawn in the case of a negative determination by the ministers, and activities that could be considered improving overall CSR performance.

These activities include hosting sustainable development and CSR conferences, seminars, and workshops; assisting Canadian delegations of indigenous peoples to meet with groups of indigenous peoples in other countries to talk about CSR and natural resource development; visiting mining sites and speaking with stakeholders; providing information about Canadian policies and programs to foreign governments; assisting in bringing foreign delegations to trade shows, such as GLOBE and PDAC, to meet with Canadian companies and learn about new technologies and approaches to natural resource development; advising companies with respect to the local cultural, political, and social environments and encouraging them to develop CSR best practices; participating in dialogues with civil society organizations and other stakeholders to better understand the range of issues and concerns and to adapt our policies and practices accordingly; sharing advice and information with partners across government and working together to create a whole-of-government approach to promoting CSR; actively supporting the creation of the CSR centre of excellence; and engaging on CSR at the bilateral and multilateral levels in a vast array of fora and through a wide range of instruments.

In summary, the experience of this department has demonstrated the value of seeking to facilitate dialogue to identify shared objectives among multiple stakeholders and build a consensus about how they can be most effectively realized. This requires flexibility, creativity, balance, and readiness to adapt approaches to specific circumstances, particularly in light of the highly complex political and economic situations that exist in many developing countries. This is particularly true if the goal is not only to promote respect for human rights but also to work toward remedy where the potential exists for behaviours inconsistent with the proposed guidelines.

Insofar as the analysis undertaken of the potential impact of Bill C-300 on DFAIT, it could restrict our ability, in areas where we most need to engage, to influence a positive outcome and ultimately limit the ability of this department to make positive contributions in the area of corporate social responsibility.

[The Chair, Conservative, Kevin Sorenson]

Good morning, colleagues.

This is meeting 43 of the Standing Committee on Foreign Affairs and International Development, Tuesday, December 1, 2009. Our orders of the day include a return to our committee's study of Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries.

On our first panel today we have, from the Department of Foreign Affairs and International Trade, Grant Manuge, the director general of the trade commissioner service, operations; Mr. James Lambert, the director general for Latin America and the Caribbean; Sabine Nölke, director of the United Nations human rights and economic law division; and Ms. Sara Wilshaw, the director of trade commissioner service support.

We welcome you to our committee this morning. I'll invite you to make your opening statements, and then we'll proceed into the first and second round of questioning.

I want to remind the members of our committee today that we are going to try to adjourn this by 10:15 to 10:30, somewhere in there, and move into steering committee. We'll really be on the time clock today in terms of the seven-minute rounds for questions and answers.

Mr. Manuge.

[Alex Neve, Secretary General, Amnesty International]

Thank you, Mr. Chair.

Good morning, committee members. It's a pleasure to be in front of the committee again in the context of your study of Canada-South America trade relations.

I was before the committee back in April 2008 as part of your study of free trade negotiations at the time between Canada and Colombia. At that time, I detailed what we described as a disturbing human rights situation in Colombia, one that was nothing short of a crisis. During the 19 months since, Amnesty International has continued to carry out detailed monitoring of the human rights situation in different regions of the country, and we have had numerous on-the-ground fact-finding visits.

The evidence we've gathered continues to paint a dire picture, certainly not in keeping with claims by the Colombian government and others that the country has overcome its troubled human rights past.

Some indicators of conflict-related violence, such as kidnappings and hostage-taking, for instance, have improved. This means that the security situation for some has perhaps gotten better. However, other important indicators of conflict-related violence have deteriorated.

One of the most worrying trends is a dramatic increase in the number of Colombians forced to flee from their homes. As many as 380,000 people were forced to flee their homes in 2008 alone, an increase of more than 24% from 2007. That brings the total number of internally displaced people in Colombia now to somewhere between three and four million, amongst the highest in the world. Additionally, at least half a million Colombians have fled to other countries. Displacement has become an extreme crisis.

Many of those displaced have been deliberately targeted by guerrilla groups, paramilitaries, or state security forces as part of strategies designed to remove whole communities from areas of military, strategic, or economic importance. The great majority of those affected are small farmers, Afro-descendants, or indigenous peoples, many of whom live in areas of economic interest.

In particular, threats against and killings of indigenous people by all of Colombia's warring parties have increased over the last several years. More than 1,000 indigenous people have been killed in the last six years alone.

As the committee may know, in July of this year, James Anaya, the UN Special Rapporteur on the Situation of Human Rights and Fundamental Freedoms of Indigenous Peoples visited Colombia. His preliminary report repeats some of the conclusions described by his predecessor five years earlier, in 2004, particularly that “Colombia's Indigenous people find themselves in a serious, critical and profoundly worrying human rights situation” and that “this description still applies”, despite some initiatives by the Colombian government.

Among concerns he draws attention to are ongoing violations committed by FARC, such as the massacre of Awá indigenous people, which Amnesty denounced as well in February. He also warns that “extensive corporate interest in the natural resources in Indigenous territory often threatens the rights of Indigenous peoples”.

He highlights that lack of regard for free, prior, and informed consent, as stipulated in international law and Colombia's own constitution, remains a persistent problem.

Amnesty International has issued a series of recent urgent actions about threats and attacks on vulnerable Afro-descendant communities and indigenous peoples that appear aimed at securing control of areas of economic potential.

For instance, on October 9 we issued an urgent action after three indigenous leaders from two reservations in Risaralda received a threat that said “You have 5 working days to withdraw...otherwise we will kill your families”. It was signed the “Southern Bloc”. The threat from this paramilitary group came a few days after the Risaralda Indigenous Regional Council had launched a report in which the indigenous communities said they are being driven out of their lands by powerful people looking to exploit the area's significant mineral resources. The indigenous leaders fled from the area in order to protect the lives of their families.

Then, on October 22, a fax signed by the paramilitary group Black Eagles New Generation arrived at the Valle del Cauca office of the Trade Union Congress, known by its acronym CUT. It warned that members of the CUT in that area were now military targets. The threat stated, “it is necessary to expand the fight against those who hide in social organizations such as CUT Valle, human rights defenders, NGOs.” It specifically accused the trade unionists of stopping economic development and progress by opposing “entry for the multinationals”. The death threat named others as well, including the group the Black Communities Process, whose leader, Carlos Rosero, I believe you heard from on Tuesday of this week.

These and countless similar cases make it abundantly clear that paramilitary groups continue to operate in many parts of the country, sometimes in collusion with sectors of the security forces, despite government claims that they had all laid down their arms following a government-sponsored demobilization that began in 2003. In fact, Amnesty International's information suggests that these groups, which have adopted a variety of names, appear to have become more organized and consolidated over the last year.

We have also documented a worrying increase in the use of death threats against human rights defenders, again attributed mostly to paramilitary groups.

In March, a fax signed by the Capital Bloc of the Black Eagles paramilitary group arrived at the office of the internationally respected Colombian Commission of Jurists, accusing one of their lawyers, Lina Paola Malagon Diaz, of being a “bitch guerrilla working for the defence of trade unionists”. The note said that paramilitaries were looking for her and for members of her family. She was given this warning: “Leave or we will kill you. You have one day to leave Bogota and do not come back.” She did flee the country. Notably, she had produced a report about human rights violations against Colombian trade unionists by all sides in Colombia's armed conflict, which was used in a hearing in the U.S. Congress a few weeks before that.

More than a dozen human rights defenders and 46 trade unionists were killed in 2008 alone. The scope and gravity of ongoing attacks and threats against trade unionists or those who speak out about violations of the rights of trade unionists is clear. It does not come down to a mere matter of statistical analysis. I think much is always made of the numbers when we talk about these issues, but I would urge you to recognize that this is about quantity and quality, not just quantity. I would urge you to keep that in mind as you analyze arguments you hear from other witnesses, for instance, who do bring it down to simply a statistical consideration, many of whom do not have particular expertise in the area of human rights monitoring.

We and others remain gravely concerned about what the UN High Commissioner for Human Rights described in her March report, that “The worrying practice by some senior Government officials of publicly stigmatizing human rights defenders and trade union members, as biased and sympathetic to guerrilla groups, continued.”

This same concern has been highlighted following recent high-level UN human rights visits to Colombia, including by the special rapporteur on the situation of human rights defenders in September and the special rapporteur on extrajudicial executions in June.

The Inter-American Commission on Human Rights has also stressed that such comments from senior government officials not only increase the risks that human rights defenders face, but “could suggest that the acts of violence aimed at suppressing them in one way or another enjoy the acquiescence of the governments”. Indeed, death threats, attacks, and even assassinations have often followed such public statements.

As this committee will know, human rights defenders who are under threat have long enjoyed a comprehensive program of assistance from the government. But in April of this year, a media investigation revealed that the civilian intelligence service, the DAS, which answers directly to the Colombian president and was the agency responsible for providing bodyguards and other protection to human rights defenders, has for at least seven years carried out a massive illegal espionage operation—including surveillance and wiretapping—against human rights defenders and others, including opposition politicians, judges, and journalists, with an aim to “restrict or neutralize their work”. Members of the diplomatic community, the United Nations, and foreign human rights organizations, including Amnesty International, were also targeted.

There is much more at play as well. The “parapolitical” scandal continues with 80 congress people, most belonging to parties from the ruling coalition, under criminal investigation for alleged links to paramilitary groups. Several magistrates investigating that case have been threatened, placed under surveillance, and had their communications intercepted.

Revelations in 2008 that the security forces had extrajudicially executed dozens of young men have now led to investigations by the attorney general's office of some 2,000 extrajudicial executions carried out over the last two decades. However, lawyers working on these cases, as well as a number of witnesses and family members of those killed, have been threatened and attacked.

Those are the immense challenges of confronting impunity in high-profile cases. More widely, justice remains the exception and impunity the norm, giving a green light to those who continue to abuse human rights.

So considering all of these concerns--and there's much I've left out--in the context of the free trade agreement, Amnesty International's key recommendation has remained the same for several years. We believe it is of critical importance that the agreement be subject to an independent human rights impact assessment, certainly before passage of Bill C-23, and that any negative findings be adequately addressed before proceeding further with the legislation and the entry into force of the deal.

We were pleased that this committee also called for an independent human rights impact assessment in its June 2008 report. We also have recommended that the deal not be finalized and that Bill C-23 not be passed until we have in place enforceable standards for Canadian companies operating abroad, which we of course hope will soon be the case if Bill C-300 becomes law. I must stress that we do not consider the hearings you are conducting now nor the more comprehensive hearings on Bill C-23 that would follow second reading of the bill to constitute that independent human rights impact assessment. The assessment would be an expert process that would take place outside of the parliamentary context. We would, however, very much urge that any body conducting such an assessment report back to Parliament.

In the context of grave and systematic human rights violations in Colombia and a pattern of ongoing serious abuses in areas of economic interest, an independent human rights impact assessment of the provisions of the trade agreement is, in our view, an essential step of due diligence. While it is not yet standard practice, there is growing interest in this tool, and there is a growing body of practical examples, analysis, proposals, and academic work to draw upon. Notably, even at the World Trade Organization, there's now significant discussion about this. In September, there was a session at the WTO's public forum in Geneva, moderated by counsel at the office of the WTO director general, entitled “Human Rights Impact Assessments: A Pertinent Tool for Informing and Improving Trade Governance?”

In 2006, Thailand's National Human Rights Commission considered the potential future human rights impacts of the free trade agreement that Thailand had been negotiating with the U.S. In 2007, the Ecumenical Advocacy Alliance, in collaboration with the FoodFirst Information & Action Network, commissioned studies to consider the impact of trade liberalization on the right to food for rice farming communities in Ghana, Honduras, and Indonesia. The European Union systematically conducts economic, social, and environmental impact assessments of all major multilateral and bilateral trade negotiations. These are known as sustainability impact assessments. And over the last decade the United Nations Environment Programme has developed an impact assessment methodology that incorporates integrated environmental, economic, and social assessment.

Finally, I do want to highlight that Canadians are concerned about this. For instance, I have here a copy of a photo petition put together by a member of Amnesty International in Edmonton. She gathered the pictures of hundreds of Canadians from communities across the country, of diverse backgrounds, all of whom believe an independent human rights impact assessment is essential. This petition has already been sent both to the Prime Minister and to all three party leaders in the opposition.

In ending, I do feel I must signal some disquiet and concern about the way in which debate about the Canada-Colombia deal is progressing. It is certainly our hope and expectation that sessions held as part of this committee's general study of Canada's trade relations with South America will not in any way substitute for thorough and rigorous consideration of Bill C-23 itself when it is referred to committee. At that time, we urge that the committee hear from a full slate of balanced witnesses representing all relevant stakeholders, certainly including the most vulnerable sectors of Colombian society likely to feel the impact of this deal. Among others, Amnesty International would welcome an opportunity to appear at that time and offer specific recommendations with respect to Bill C-23 itself.

Thank you, Mr. Chair. Those are my comments.

[Paul Dewar, NDP, Ottawa Centre, ON]

That's where I'm going.

I think many people see that Bill C-300 isn't the end of CSR; it's not that we stop here and it's all done. It's actually in context, and the context is that there are other things being done. Everyone's talked about the things they're doing within their own companies, but to evolve the process as a government, many of us want to see governments—and I say plural because hopefully this will be adopted by others—to actually have a process that takes out the litigation.

I referenced in committee before to look at what's happened to big tobacco. No one wants to see that happen with mining. No one--not me, not you. So to protect from litigation, I think it's smart to come up with a process that was referenced in the round table.

[Paul Dewar, NDP, Ottawa Centre, ON]

Thank you.

I just want to go back to what we have in place right now with the counsellor. The evidence that was brought forward to this committee is that right now she actually isn't prepared to take in anything. She's in the midst of putting together her regime and regulations.

In fact, I asked her if EDC was obviously supporting a company, so it is well known, and there is a concern about a company, would EDC be compelled to cooperate with her? She didn't know because they're still developing the process.

In fact, she couldn't tell us when the process would actually get going. I just lay that on the table because there's an impression that this is up and running and that we have a process. In fact, right now we have none. Yet we still have concerns, which we've all talked about.

Where many people have seen this bill going—and the limitations of a private member's bill are known by all of us, and certainly by you, Mr. Peterson, as a former member of Parliament. If this bill was brought in, I think it's reasonable to say that an enlightened thing to do would be to do what the round table and witnesses from industry asked for, and that would be to have an objective third-party--an ombudsperson/ombudsman--appointed. I'm looking for a bridge to that common ground.

My question is, Mr. Peterson, would you not see that putting an ombudsman in place, as was recommended in the round table discussions by both civil society and by business, was a smart thing to do, that it could actually deal with some of the concerns you have regarding Bill C-300?

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

Thank you, Chair.

Jantzi Research recommends that Goldcorp be ineligible for socially responsible investing. They talk about a site visit to a mine in Guatemala at which various representatives of the local and international community were present—the Guatemalan and Canadian governments, etc. It didn't seem to be all that difficult to set up, and at the conclusion of it, they made the decision that Goldcorp would no longer be eligible for socially responsible investments.

Concerning Barrick, the Norwegian government, when it did its review, said that the 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. This is reinforced by the lack of openness and transparency in the company's environmental reporting.”

—not exactly a good report. They don't seem to have any difficulties conducting investigations wherever they need to conduct investigations.

We've had testimony from a former minister of the environment that her offices were firebombed, she was personally threatened, access was prevented to a national park, etc. We've had testimony from Harvard University, which has pointed out that “Numerous accounts of rape show a similar pattern.” This is in Papua New Guinea. “The guards, usually in a group of five or more, find a woman while they are patrolling on or near mine property. They take turns threatening, beating, and raping her.” And so on. Barrick Gold has a memorandum of understanding with the police force to basically pay for the police force. They pay for the uniforms; they pay for the salaries. To no one's great surprise, therefore, there's been no real investigation into these allegations.

All of these are allegations, and all of you are very upset about what's going on in the newspapers these days. But you seem to prefer the status quo. You'd rather duke it out in the newspapers, hire a phalanx of lawyers and consultants, and let the damage be where it is.

When the CSR counsellor was here—who seems a fine, qualified person and has many of the things that you want—and was asked whether she could investigate anything that was in the newspaper, the answer was quite clearly no, because none of you would ever consent; none of you would ever, under any circumstances, advise your clients to consent to an investigation.

So what you want, really, is status quo. You can say that you want the CSR counsellor, but you don't really want her. You don't want the good things that brings, because there is no possibility that this counsellor will ever investigate anything that appeared in the newspapers or any allegation that has appeared before this committee.

I put it to you that Bill C-300 is a very modest step that, when seen in conjunction with the CSR counsellor, actually gives her a possibility that she could investigate the things that make you upset.

[Paul Dewar, NDP, Ottawa Centre, ON]

I'm just wondering if anyone at the table is assuming that if Bill C-300 is passed they would actually pull operations out of Canada.

[Paul Dewar, NDP, Ottawa Centre, ON]

Okay.

I'm asking this because there is this notion that somehow this law would cause more complaints, and that right now there aren't concerns out there. I go back to the fact that we're trying to set rules so that there is a level playing field and actual protection for Canadian corporations.

The problem I'm having is the certainty that we've had from all presenters today that this will cause companies to pull out of Canada--I've been hearing that possibility.... When I asked someone before from the industry if he would pull out if Bill C-300 is passed, he said no--

[Lois Brown, Conservative, Newmarket—Aurora, ON]

Thank you, Mr. Chair.

Thank you very much for being here, ladies and gentlemen.

I first want to make a comment.

Given the two submissions we have here about the lack of consultation with the mining industry, and given, Mr. Peterson, your and Mr. Chrétien's expertise, both in government service and now in the mining industry, I am horrified that there's been so little consultation.

Both of you say here, “To our knowledge not one...company was consulted with respect of [the drafting of] the bill”, and the executive summary says, “We respectfully submit, however, that the Bill...was proposed without any consultation of any sort with any extractive company or industry association....” I find that disturbing, to say the least.

But what I want to ask is this. The other day we started on this in a way, but Mr. Chrétien, perhaps you can go on. The other day we heard what I would say were some damning accusations about Barrick Gold from one of the witnesses. They said the company was standoffish, resistant, aggressive, and dangerous:

I and my closest staff were personally and physically threatened.... My children were threatened, my office was wiretapped, my staff was bought, and the public officials who once controlled Barrick for me became paid employees of Barrick Gold.

It's inflammatory towards the companies, but my question is, if Bill C-300 were in place, what would happen to a mining industry wherein those accusations were brought forward?

Mr. Chrétien, perhaps you could go on to say what you wanted to say to Ms. Lalonde.

[Michael J. Bourassa]

Thank you.

I guess the question really relates to what's currently on the table with Building the Canadian Advantage as compared to Bill C-300. I think that's what it comes down to.

I just think the current bill is not workable. I don't know how you could even make amendments to make it workable without having to make drastic changes to the bill and make it a completely new bill. If you're talking about putting in some form of counsellor or ombudsman, you'd have to frame that in terms of abilities to do certain things. Of course, there would be expenditures relating to that, which you can't do with a private member's bill.

Fundamentally, the way the bill is now, having the complaints go to a minister under that whole process--that part's not amendable, from our point of view. We are completely against that.

In terms of Building the Canadian Advantage, which is what the government has put on the table, we think it's a very workable situation. It's a good start. It provides lots of other things besides the counsellor. It talks about centres of excellence and about programs to build some of the capacity within the countries where some of the Canadian companies are operating.

From our point of view, Building the Canadian Advantage is a far better approach. We think it will result in better practices. It will be better for the industry and better for CSR standards.

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

Good morning, ladies and gentlemen.

First, I want to tell you I am impressed to be addressing such a panel of experts. I will dare make my comments anyway.

I do not think anybody here is against mining companies. But personally, if there is one thing I am against, it is impunity. The situation is somewhat uncomfortable. For several weeks now, we have been examining Bill C-300. We hear many individuals and NGOs who talk to us about horrible things happening in Africa, in South America, and the Philippines. Whether we like it or not, we can relate very much to this evidence. It is not like it is anything new for the Standing Committee on Foreign Affairs and International Trade to make this kind of investigation. As early as 2005, it looked into this issue.

Its 14^th report was entitled “Mining in Developing Countries and Corporate Social Responsibility”. The government responded to the report, and here is what it had to say, “Consequently, issues of the type raised by the Committee are likely to increase in both intensity and volume in the coming years--”.

We are in 2009, just before 2010, and we are still debating this same issue. Since 2005, we had extensive consultations over a period of two years, and the result was a report with a number of recommendations. A wide consensus emerged between members of the civil society, experts, and people from mining companies.

Do you think we could design a bill that would include these recommendations from the report resulting from roundtables? Would that be better than Bill C-300? I gather from what you said that this bill is--

[Michael J. Bourassa]

I'm happy to start with that.

I think, Mr. Rae, what you've described with some of those institutions, EDC or the IFC, are processes that of course every company would take seriously. Those institutions would have their due diligence processes to go through, CSR standards, and the companies would have the opportunity to respond. It's a process. It possibly even could be a remedial process.

With Bill C-300, the damage is that it's basically a complaint to a minister that elevates it to such a high level. Once a minister has received a complaint--and you can refer to some of the news in the last few days--the ramping up of that rhetoric is huge. These are all allegations against companies. They're serious allegations. These are not fact, and nobody is--

[Michael J. Bourassa]

I would like to conclude by describing two different scenarios. The current economic environment in Canada in our successful mining sector is embodied in the following invitation to mining companies and investors: “Come to Canada, or stay in Canada, because we have developed mineral centres of excellence, and we'll help you obtain financing and provide you with technical support.”

Let's look at scenario A if Bill C-300 is passed. In addition to the invitation that I just mentioned, we'd be saying to them: “However, if you have a CSR problem, or if you have in the past, you could be the subject of complaints to the Government of Canada. If you are named in a complaint, you will not be given an opportunity to remedy or resolve your problems. The government will not work to help you to improve your performance. Instead, they could investigate you for your activities and you would be subject to serious sanctions, including the loss of financing and damage to your reputation.”

Let's look at the alternative, scenario B, one that is currently proposed by the government. In addition to the invitation I mentioned at the beginning of this conclusion, we'd be saying: “The government will help you when CSR difficulties arise by offering mediation and support and possibly by offering capacity-building expertise in the areas of the world that are having difficulties.”

Which scenario is going to result in a stronger and more vibrant industry for Canada? Which scenario is going to achieve higher CSR standards? Which scenario is going to result in more economic activity in Canada and developing countries?

Our respectful submission is that the collaborative approach proposed is the best option. This bill is well intentioned, but in our submission it's unworkable and will do significant harm to Canada's investment climate and Canadian mining companies.

Thank you very much for giving us the opportunity to present today. We'd be happy to take any questions you have.

[Michael J. Bourassa, Partner, Fasken Martineau DuMoulin LLP]

Thank you, Raymond.

Mr. Chairman, ladies and gentlemen, my name is Michael Bourassa. It's a privilege to be here today.

I feel very strongly about this issue. Canada has excelled in international exploration and mining. We are recognized by our competitors for that success. I'm concerned that this bill could jeopardize Canada's continued competitive position, might do very little for improved accountability in the CSR realm, and could harm economic activity in Canada and in developing countries.

The Honourable Jim Peterson has told you about Canada's strength and leadership in the global mining sector. In order for the Canadian mining industry to remain successful, companies need to be able to compete in the global market. If passed, Bill C-300 will undermine the competitive position of Canadian companies. It could cause an exodus of mining companies from Canada and could potentially render Canada a less attractive jurisdiction for mining investment.

The bill will apply only to Canadian companies that operate in developing countries. As such, Canadian companies will find themselves at a disadvantage compared to their competitors. Let me provide you with a hypothetical example. A Canadian company and a foreign company are both interested in acquiring a mine that has had some historical community relations issues. The Canadian company has a strong corporate social responsibility program and known successes working with local communities and governments to remedy such problems. However, the Canadian company would be subject to a bill that is retroactive in its application and is non-remedial in nature. If the Canadian company acquires the mine, it could immediately become subject to a complaint, possible investigation, and sanctions, including the loss of financing. The foreign competitor would not face the same risks and uncertainties. The competitive disadvantage to the Canadian company is obvious.

The bill could also disadvantage Canada as a mining investment jurisdiction of choice. So many mining companies headquarter and list in Canada because of the country's vast expertise in this sector. This is an expertise that is actively promoted by most provinces and the federal government. For example, over the past four years, I've attended an international mining conference in Vancouver, and every year the Premier of British Columbia has remarked that mining is the most important industry in that province. Quebec also actively promotes itself as a jurisdiction of choice for mining investment and is ranked, in a 2009 survey, as the top jurisdiction in the world for encouraging mining investment. Newfoundland and Labrador, Alberta, New Brunswick, Manitoba, Saskatchewan, and Ontario are all highly ranked.

If this bill becomes law, every Canadian company, or any company contemplating setting up in Canada, will have to undertake a serious risk- and cost-benefit analysis to decide whether to locate here.

[James Peterson, Counsel, Fasken Martineau DuMoulin LLP]

Mr. Chairman and honourable members, thank you very much. It's indeed a pleasure to be here. I had the privilege of serving some 23 years, and also as Minister of International Trade. I am now very pleased to be counsel to Fasken Martineau. With me today are two of my colleagues, Raymond Chrétien and Michael Bourassa.

Before joining Fasken's as a partner and strategic advisor, Raymond Chrétien served with great distinction in Canada's public service for 38 years. He was Canadian ambassador to France, the United States, Belgium, Mexico, and the Democratic Republic of Congo. He served as Associate Under-Secretary of State for External Affairs from 1988 to 1991.

Michael Bourassa is the coordinator and co-leader of our firm's Global Mining Group. He is also a director of the Prospectors and Developers Association of Canada and sits on the executive committee of the mining law section of the International Bar Association.

For the past five years, Fasken's has been recognized by the International Who's Who of Business Lawyers, a publication based in London, England, as the number one law firm in the world for mining. It is without question that Canadian companies must operate in a responsible and accountable manner. The federal government has been working with companies on this aim for several years. In 2005, the then Liberal government, of which I was a part, commissioned a report from this very committee. It instigated a consultative process that culminated in the release by the federal government last March of Building the Canadian Advantage.

The intentions behind Bill C-300 are laudable, as they focus on corporate social responsibility. We submit, however, that the bill is flawed in its construction and highly prejudicial to Canada's mining sector. As many of you know, mining and exploration are very important to our economy. They comprise 5% of our GDP, employ 351,000 Canadians, and in 2008 the industry paid $11.5 billion in taxes and royalties to the three levels of government. The industry also contributes significantly to R and D. In 2006, mining companies invested $648 million in Canada in R and D alone.

Canadian mining companies have exported their expertise to all comers of the globe, and Canada is now the world leader in the global mining sector. In 2008, over 75% of the world's exploration and mining companies were headquartered in Canada, operating in 100 countries around the world. As Mac Penney has indicated, Canada has emerged as a centre of mining finance globally.

The Boston Consulting Group reported that we now have a leading concentration of expertise required to finance mining, metals, and energy in Canada. Financing mining in Canada employs 7,000 financial sector people. Core to this activity are our stock exchanges. Of the world's public mining companies, 57% are listed on the TSX or the TSX Venture Exchange. Along with Vancouver, Toronto constitutes the world's largest source of equity capital for mining companies undertaking exploration and development.

Canadian mining companies, including the juniors, employ many Canadians and engage numerous industries and service providers in support of our international mining activities. These include equipment manufacturers, contractors, consultants, accountants, financial legal advisors, and our financial institutions.

There are 3,140 Canadian goods and services firms supplying our mining sector. We have centres of mining excellence across the country, in Bathurst, Quebec City, Montreal, Val d'Or, Rouyn-Noranda, Sudbury, North Bay, Timmins, Toronto, Mississauga, Yellowknife, Saskatoon, Edmonton, Kelowna, Kamloops, and Vancouver.

In conclusion, given the importance of mining to Canada, and given the country's leadership and expertise in mining activities abroad, we submit that a primary focus of the Canadian government and the Ministry of Foreign Affairs and International Trade, in particular, should be promoting our mining industry, both domestically and internationally, and working collaboratively with Canadian companies to continually enhance CSR standards.

Thank you.

Raymond.

[Dina Aloi, Vice-President, Corporate Social Responsibility, Goldcorp Inc.]

Thank you, Mac.

Honourable members, thank you for this opportunity to address you today.

I am Dina Aloi. I'm the vice-president responsible for corporate social responsibility for Goldcorp.

As background, I have a degree in rural sociology and I have a master's degree in anthropology. I became involved in the mining industry and joined Goldcorp after 15 years of working on human rights and international development issues with NGOs. My dedication to these important issues is unchanged, and I'm pleased to have the opportunity to bring my experience to a company where my commitment to human rights is mirrored.

This committee has repeatedly heard the rhetorical question: if it's true that Canadian mining companies conduct their operations in accordance with the highest standards of corporate social responsibility and are held to account for their mining practices abroad, why are they opposed to this bill? Our comments today will answer that question. The short answer is Bill C-300 will not actually get at companies that operate with low CSR standards, but will, instead, do serious harm to responsible Canadian companies. In all of our submissions today, we want to outline how and why this bill will harm responsible Canadian mining companies.

This bill does nothing to improve CSR or build capacity in foreign countries, something that we believe is critical to long-term success. This bill would create a new adversarial complaint and investigation process that is sure to be exploited by traditional opponents of mining. It would also expose responsible Canadian mining companies to stigma and reputational damage from a poorly conceived investigation process through a ministerial office ill-equipped for this purpose.

In order for the committee to understand why this bill is so harmful, it's critical for the committee to understand the environment in which we operate globally. Our industry is often confronted with false allegations of misconduct in countries in which we operate. Regardless of merit, once made, allegations have lasting impacts on our industry's reputation. In my experience, evidence that proves an allegation is false, or a retraction of a false allegation, is often ignored.

For example, an extraordinarily serious claim was made that a Canadian mining company was involved in the murder of 50 artisanal miners in Tanzania, all of whom were said to have been buried alive. At the request of an NGO, these claims were extensively investigated by credible independent sources, including the World Bank. The company acquired the property in 1999, three years after the incident was alleged to have occurred. In 2002, the ombudsman of the World Bank undertook to assess these allegations. A comprehensive investigation into these allegations was made and they were found to be completely without foundation. Although it was completely cleared, and indeed the ombudsman was highly critical of the lack of accountability of the NGOs that made the allegations, these serious and extraordinary allegations continue to be made against this Canadian company, including at these committee hearings.

I have two further examples of untrue allegations that, if this bill were in effect, would likely have ended up on the minister's desk and had to have been investigated. We were recently accused by a Canadian NGO of organizing a coup. We were also accused of contaminating water in another country with a chemical we didn't even use. Both allegations were completely false. If they had been subject to this bill and investigated by the crown, they would have been provided with false credibility, causing undue harm and alarm with our stakeholders and shareholders, our employees and our community partners, and it would have harmed our corporate reputation.

At this point, it's easy to accuse Canadian mining companies operating abroad of all manner of unethical and outrageous behaviour. Correcting the record, however, is very difficult. You may ask then, if we're already operating in an environment in which complaints get made and can live on in perpetuity, why would the complaints process under this bill cause us particular concern?

To be unfairly accused by an individual or an NGO in a press release or a blog causes harm. This harm is of an entirely different magnitude when this complaint is investigated by the minister of the crown, which suggests that the complaint has some merit, and, under this bill, requires an investigation by our own government.

The bill does provide a mechanism for the minister to dismiss a complaint without investigation if it is determined to be false, frivolous, vexatious or made in bad faith. However, for a serious accusation coming from a remote foreign country, it is impossible to conceive that a minister could dismiss the complaint without an investigation and the expenditure of resources. Equally troubling is that this bill does not contemplate any consequences whatsoever for an individual or organization that makes frivolous, vexatious, or untrue allegations, or which does so repeatedly. At best, a retraction from the minister will be printed in the Gazette many months later, not a widely read publication in many circles, after the harm is done, which will go entirely unnoticed.

The relationship between Canadian mining companies and host countries relies on mutual respect. This would be seriously strained through the complaints and investigation process. Canadian companies operating abroad strive to build respectful relationships with local stakeholders and the governments of the host countries. Weakening these positive relationships will only harm our competitiveness in the mining industry and our ability to influence non-Canadian companies to adopt high standards of CSR. Our non-Canadian competitors, many of whom operate at lower CSR standards, would be more than happy to take advantage of a decline in our reputation as good corporate citizens and to dislodge us from our assets abroad.

I want to emphasize that the Canadian mining industry is not afraid of scrutiny when it comes to being held to account for the way in which we operate at home and abroad, but we are concerned by this bill because it will damage us even as we operate at the highest global standards of corporate social responsibility. Each of the companies presenting today is fully committed to operating in an environmentally and socially responsible manner, to protecting human rights, and to making a positive difference in the communities in which we operate. As Mac said, we support the objectives of this bill, and we take seriously the demands and the complexities of corporate social responsibility. We expect to be and are held accountable. What we do not expect is to be subject to legislation that harms us, irrespective of how we conduct ourselves.

Thank you very much for listening to our submissions today.

[Mac Penney]

Thanks, Peter.

One of the many sanctions of the bill is the withdrawal of EDC financing. It's been said variously that this is a modest or a mild sanction. Somewhat paradoxically, however, proponents of the bill say that what makes this bill and the model approach to CSR superior to any alternative is that it has sanctions with real teeth. One of the toothy parts of the bill is meant to be the withdrawal of EDC financing.

I'd like to talk a little bit about the risk that creates for Canadian business, about how the way in which companies will actually operate to manage that risk will likely put the EDC on the sidelines for financing of Canadian projects overseas, and, paradoxically, how the bill in fact declaws itself because of the risk management strategy it will incent companies to follow.

The fact is that no extraction or development project or any joint venture between a Canadian company and another Canadian company, or between a Canadian company and a foreign company, can proceed without adequate and secure financing, and, in some cases, depending on the location, political risk insurance. Typically, Canadian companies will rely both on export development agencies, such as the EDC, and traditional commercial lenders, traditional banks, as sources for financing. The bill will clearly create a new financing risk by creating a sanction directly tied to one of those sources of financing, that being the Export Development Corporation. The severity of the risk will depend on a number of interrelated factors, such as the overall health of the credit markets and the creditworthiness of the companies involved. In constrained, risk-averse credit markets, such as those that our country and its businesses have experienced over the past year or so, access to credit agency financing becomes far more important and, in some cases, the most important source of financing, so loss of access or the threat of loss of access to this source of financing is a serious issue for business.

Because of these risks and uncertainties, Canadian mining companies and oil and gas companies overseas will find it difficult to rely on EDC financing for any of their projects. The risk created by this bill is that if we have EDC financing as part of a syndicate and we are found to be offside or inconsistent with these guidelines, which are yet to be developed, then we lose the financing. In that case, we're in trouble with our partners, and the project itself will be in trouble, because we don't have the secure financing to proceed.

To manage that risk, we'll have to turn elsewhere for financing, and the EDC may find itself riding the pine in terms of overseas development for Canadian mining going forward. The result is that either we'll have an investment that doesn't proceed at all, and Canada and the host country will be deprived of the value of that investment, or the project will be developed by a foreign competitor, or the project may proceed with the greater portion of its financing sourced outside Canada.

In all these cases, the project would fall outside the ambit of this bill in terms of the sanctions, since there's no EDC financing involved. Therefore we have now sidelined the EDC, defanged the bill, and done nothing to advance CSR. We see this as being a peculiar paradox inside the legislation.

I would also say that the bill would offer some threat--and I wouldn't want to overemphasize, but I'll just table it for the committee's attention--to Canada's status as a world leader in global financing. Recently the Toronto financial services working group reported that listings on mines, energy, and minerals in Canada create and support 7,000 financial services jobs. They've recommended a pretty ambitious goal: that Canada should try to achieve 70% of world listings in this particular market share by the year 2015. By their estimates--and these estimates were done for them by the Boston Consulting Group--a 70% share in this area would create an additional 4,000 to 6,000 direct jobs, create 10,000 to 15,000 indirect jobs, and generate GD impact somewhere between $1 billion to $1.5 billion.

We suggest to the committee that the sentiments expressed in Bill C-300 actually run contrary to, and would actually conflict with, what we see as a pretty ambitious goal to leverage an area in which Canada definitely has a competitive advantage and expertise.

We think that rather than signing on to the Bill C-300 approach to financing, Canada would be better advised to subscribe to and support, as the EDC does, the Equator Principles. These are principles of financing that were agreed to by multilateral and traditional lenders. Some 40 major institutions representing lenders that provide 80% of global financing in the sector subscribe to these, and as companies, if we want financing to do these projects, we have to ensure that we comply with those guidelines. We think the multilateral approach is a far better approach in this area.

With that, I'll ask Dina to conclude our presentation.

[Mac Penney]

Mr. Chairman, honourable members, my name is Mac Penney, and I am with Kinross Gold Corporation. I'm joined here today by Dina Aloi, the vice-president of corporate social responsibility for Goldcorp, and by Peter Sinclair, a senior director of corporate social responsibility for Barrick Gold.

As representatives of three of Canada's largest international gold mining companies, we appreciate the opportunity to share with the committee some of our concerns with Bill C-300, a bill that we believe is trying to do a good thing but in a very bad way. As companies, we have a fundamental problem with this bill because it proposes a model for corporate social responsibility that, based on our experience in the field, we believe simply will not work.

In our experience, CSR requires a collaborative, flexible, and multi-faceted approach, which is antithetical to the model proposed in Bill C-300. The committee has already heard from the Department of Foreign Affairs and International Trade, Export Development Canada, the Canada Pension Plan, the Mining Association of Canada, the Prospectors and Developers Association of Canada, the Canadian Chamber of Commerce, and a number of legal experts who have spoken about the bill's many substantive deficiencies.

We agree with these submissions, which highlighted among other things the absence of due process, the lack of procedural fairness, the problem of extraterritorial application, constitutional deficiencies, duplication and confusion of rules and processes, the neglect of capacity building, lack of remediation, the impact of targeting Canadian companies, and the lack of consultation with the mining industry.

You will be relieved to know we do not intend to revisit all these points this morning, but we'll focus on some of the practical problems this bill will cause for Canadian companies that deal with CSR every day. Let me make three points to set the context for our presentations.

First, mining companies operate under a very high level of scrutiny and accountability. Mining itself is a very heavily legislated and regulated activity, subject to high levels of oversight by lawmakers, regulators, special interest groups, CSOs, and the media in both the developed and the developing world. Scrutiny and accountability are part of our operating reality.

Second, the companies appearing before you today and Canadian miners generally are recognized internationally as industry leaders in CSR. For us, CSR is a core competency, as important to the success of our business as operational efficiency and safety. CSR is vital to securing and maintaining our social licence to operate. Any member who wants to review our CSR records can consult our CSR reports, which are appended to our formal written submission to the committee.

You will find that our records provide concrete evidence that we agree that Canadian companies should be held accountable for their business practices in conduct abroad. We accept and support the promotion of sustainable development in international human rights, and our support goes well beyond good intentions and rhetoric.

Third, our comments today are based on our collective experience in meeting the complex social, legal, and environmental responsibilities and challenges that confront companies operating in many different countries at many different stages of development with different legal and political systems and different cultures and values. Collectively, we operate some 45 mines in 16 different countries on five continents and directly employ more than 36,000 people, so this is a business we know something about.

Based on that experience, we believe the relatively simplistic, one-dimensional, and punitive approach to CSR proposed by this bill will not work. We believe the bill to be fatally flawed in its conception and in its construction. We believe the bill is prejudicial and harmful in its effects, not only on and to Canadian mining companies but also to the countries and communities in which we operate. Critically, we do not believe the bill will achieve its stated objectives.

To illustrate these points and illustrate why, in our view, the bill is counterproductive, unamendable, and should not be passed into law, Peter will focus on the guidelines, which are at the heart of the bill, and how they will expose even the most socially responsible Canadian company to undue legal risk. I will touch briefly on the financing implications of the legislation, not only in terms of project financing, but the impact on the role of the EDC and the broader implications of the bill on Canada's status as a leader in resource finance. Dina will conclude by speaking to the unfair and unwarranted impact of this bill on the industry in general.

With that, Mr. Chair, I would ask Mr. Peter Sinclair to contribute to the conversation.

[The Chair, Conservative, Kevin Sorenson]

Good morning, colleagues. Good morning all. This is meeting number 42 of the Standing Committee on Foreign Affairs and International Development on Thursday, November 26, 2009. The orders of the day today include a return to our committee study of Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries.

As witnesses on our panel today we have, from Barrick Gold Corporation, Peter Sinclair, senior director, corporate social responsibility; from Goldcorp Inc., Dina Aloi, vice-president for corporate social responsibility; and from Kinross Gold Corporation, Mac Penney, director of government relations. As well, appearing from the law firm Fasken Martineau DuMoulin, we have Michael Bourassa, partner; Raymond Chrétien, partner and strategic advisor; and the Honourable James Peterson, counsel to that law firm.

We have invited the guests today to share the panel for the full two hours so as to accommodate as many questions as possible from our members. I invite each of you to make brief opening statements, and then we'll proceed to the first round of questioning.

I believe I have a point of order from Madame Lalonde.

[Bob Rae, Liberal, Toronto Centre, ON]

--and they have serious ramifications for Canadian foreign policy. So I don't see how we can....

I'm glad to see my colleague, the parliamentary secretary for CIDA, stating today that the Conservative Party supports at least the intentions of Bill C-300, because I think we do have to go down a track, as a country, in saying we understand corporate social responsibility as being a very critical aspect of our activities in the world.

[Bob Rae, Liberal, Toronto Centre, ON]

First of all, Madam Evans, let me say that I wish you well in your work. We certainly don't see it as incompatible with whatever emerges from our discussions with respect to Bill C-300. I think your work is a vital part of the structure we need to create to get to a resolution of some of these significant issues.

You did point out in your testimony that in the two areas—one of them my colleague Mr. Patry has referred to, the consent of the parties, and the second one is the question of sanctions—if there were some modest changes to the bill that brought it into line with the language of the round table with respect to the process regarding sanctions, you would agree that it would be a fuller implementation of the round table recommendations than what the government has currently put in place.

[Marketa Evans, Counsellor, Office of the Extractive Sector Corporate Social Responsibility Counsellor]

Thank you very much.

Good morning, and thank you very much for giving me the opportunity to share my thoughts on this very important topic this morning.

My name is Marketa Evans, and about one month ago I took up the role of Canada's CSR counsellor for the extractive sector overseas. I'm not here to represent any position on Bill C-300; I represent neither the government nor industry nor civil society. I think my priority in my role is to contribute to an informed strategic public conversation that could capitalize on Canada's extractive sector dominance to make a more significant contribution to our human development objectives. I believe this positive potential has been largely untapped in any strategic or integrated manner. But I also believe there's actually a groundswell of support from a wide-ranging cross-section of Canadian stakeholders to make it happen.

In an effort to be most helpful to the committee I'll focus on two main points and then we can get to some questions. The first is who I am and a little bit about my mandate. The second is some issues for the committee to consider as it deliberates this bill.

First, I'll give you a little bit about my background and the role of the CSR counsellor.

I've never worked for the extractive sector in any capacity, nor have I ever worked in government. While I was employed at the University of Toronto, I conducted research on global corporate citizenship in general and on business-NGO engagement in developing countries more particularly. I examined in the course of that research and in some detail two case studies where Canada played a significant role. The first one was Talisman in Sudan and the second was the issue of conflict diamonds, which eventually resulted in the well-known Kimberly Process Certification Scheme. So my views here have been informed by my research work; by literally thousands of conversations that I have had with a very wide variety of stakeholders who generously shared with me their candid views and insights; by my students in a graduate course I taught for several years on this topic; by my involvement in the Devonshire Initiative, which is a co-created platform for NGOs and the Canadian mining industry to build trust and foster partnerships; and by visits to mine sites in emerging markets.

Most recently I was employed by one of the world's oldest and largest aid and development NGOs, one that works in almost 50 developing countries. So perhaps it won't be a surprise to you to hear that my benchmark of success in this role will be very clear: are the people in developing countries better off as a result of the presence of a Canadian company? In particular, the focus should be on the poorest, the women and the children, since not only do they bear the brunt of poverty, hunger, disease, and discrimination, but also because they are the most crucial change agents.

A few points frame my thinking on this. I didn't actually start off looking at the extractive sector. I was looking at business more generally, but I quickly came to realize that mining, metals, and energy are crucial to the realization of the millennium development goals. There is no improvement in basic living standards, no electrification, no water and sanitation, and no infrastructure without those industries.

Second, I realized that developing country governments are increasingly seeking out resource exploitation and investment as well as advice on how to best manage resources and revenue flows.

Third, private sector development is increasingly accepted as a crucial factor in poverty reduction and social development. Global best practice is moving very quickly to multi-party, multi-stakeholder work with, not for, the private sector. NGOs are seeing the potential benefit in shifting both the thinking and the practice of the extractive sector, and this is as evidenced in global partnerships now existing between CARE and Anglo-American, for instance, and Shell and International Alert, BirdLife and Rio Tinto, just to name a few.

But we all know that wealth creation is not sufficient. I believe Canada has an unprecedented opportunity to seize a leadership position in this sector and realize its potential as a constructive development actor. In mining alone, Canadian companies invest sums that are on par or exceed CIDA's investments in developing countries, and they have a long-term time horizon—10, 20, 30 years—conducive to making the kinds of changes that we need to see in developing countries.

The 2005 SCFAIT committee report, the round table's process, the advisory group report—all these contributed to launching what I believe is an important national conversation. The government took a long time to respond to the report, but much constructive progress was made in that two-year timeframe, even in the absence of a formal government response. You've already heard about most of these—the Voluntary Principles on Security and Human Rights, our participation in the Extractive Industries Transparency Initiative, the launching of the Devonshire Initiative, and e3 Plus.

Because many civil society organizations and others have emphasized the special importance of the human rights agenda in extractive industries, it is useful to flag once more the significant work of the UN Secretary General's special representative on business and human rights, Professor John Ruggie. He is now four years into his six-year mandate, and Canada was an early and strong supporter of what I believe has now become a serious and credible framework for moving forward on this crucial issue.

In early November, Professor Ruggie and I were present at a two-day consultation hosted in Toronto by Osgoode Law School. Many Canadian experts participated. My understanding from that consultation is that no state is currently proposing even voluntary human rights standards for business and that no guidelines for business exist at this time. The Ruggie framework, which was endorsed by the United Nations Human Rights Commission last year, concluded that the human rights obligations of a state do not translate literally for business. Business has responsibilities with respect to human rights, but these are different, and articulating them is the project of this phase of the Ruggie mandate.

I have a few quick words about my mandate. I'm appointed through an order in council for a three-year term. I report directly to the Minister of International Trade. Minister Day and I have agreed on the importance of keeping this role at arm's length from the government and from the department, and I take seriously the importance of establishing a credible, constructive office.

The order in council stipulates two elements of the role. The first is to review issues brought before the office by either NGOs or companies; the second is to advise all stakeholders on the implementation of the standards.

Much has been made of the fact that I am not called an ombudsman. I have carefully reviewed the recommendations made in the advisory group report, and I see little daylight between what was recommended in the report and my role.

The criticism that the role is toothless revolves around two elements. The first is the ability to compel participation in a review. The order in council explicitly states that both parties must agree to a review. I'm not sure how compulsory participation would operate in practice, but I have no particular position on such a requirement. My working hypothesis consists of two parts. In the first place, a quality review would be difficult to undertake without both parties' consent—and for such a review you need access to people, files, and premises. In the second place, significant incentives for parties to participate already exist. Being involved in the process means you have some say in the outcome, while the reputational fallout from failing to consent would need to be explained to investors, donors, and the media. Public reports are to be issued in all cases. Nevertheless, I could imagine some reasonable situations in which either an NGO or a company might be justified in declining participation, although I'm not aware of any actual cases right now.

The second critique centres on the lack of automatic sanction. I have no particular view on sanction. What I would need to understand more deeply is how and under what conditions sanctions can be an effective tool in prevention and performance improvement on the ground. In any case, I strongly recommend to the committee that sanctions should be as envisaged in the advisory group report—that is to say, measured, commensurate with transgression, allowing sufficient time and tools for remediation and action plans, as the culmination of a fulsome engagement process, and importantly, incremental to what is already in place. According to the advisory group report, only in cases where there was both “serious non-compliance” and a company that ignored remediation would there be a recommendation around possible withdrawal of financial and/or non-financial support.

I fully understand that some civil society organizations see the review process in the round table's report as a package deal, which is to say, an ombudsman with a tripartite review committee. But there's nothing in the order in council to dictate how the review process under the counsellor's office is to be established, and nothing to interdict the eventual creation of such a multi-stakeholder committee should one be desired or warranted. Indeed, there is a tripartite execute committee currently being established to guide and support the CSR centre for excellence.

I want to emphasize that there is no review process in place right now and there are no preconditions or preconceptions as to how it should be established or how it should eventually function. A serious, credible review process is one of my key priorities, and my commitment is to establish it in an open, fully participatory way, drawing on as much expertise as I can, benchmarking to existing review processes, and learning from those experiences. In my view, that process will be more productive and fruitful embedded in an enhanced conversation on a few other issues, to which I now turn.

The first is to ensure we have a full understanding of the problem. I think we've had some powerful case studies, some powerful indications of what is happening. In some cases these were instances that were quite specific and in some cases they relate much more generally to well-known linkages between resource exploitation and human rights abuses or environmental degradation. Some allegations go back 10 or 15 years.

I suggest we still have significant room for a diagnostic of why these events are happening. Are companies stupid, wilful, blind? Is there evidence to support the notion that the industry still has not gotten the message on CSR? Have they learned nothing? Is there evidence to suggest the problem is getting better or worse? A richer empirical diagnostic of the problem would ensure that we better understand root causes, lessons learned, dissemination techniques. We could get a better handle on our objectives and success indicators. In three, five, or ten years, what do we expect or want to be different? What results do we want and how would we measure progress? Such an approach would allow us, I believe, to chart a productive path forward and align our work on key elements that need to be tackled.

Second, I would recommend we ensure that we have sufficient information to make informed choices about potential unintended consequences. With increasing demand for natural resources globally, it is to be expected that where resources exist they will be exploited, if not by Canadian companies, then quite likely by someone else. Perhaps a Canadian divestment would spur more artisanal mining, which is often characterized by the worst forms of child labour and significant environmental degradation. Perhaps the property would be taken over by a state-owned company, companies that tend to have poor human rights records. Perhaps the concession would simply be purchased by a company that was not subject to media, shareholder, activist, or government scrutiny. Or perhaps the Canadian company would simply be bought by a sovereign wealth fund, as has increasingly been happening.

You heard Amnesty International testify before you that it did not intend for Talisman to pull out of Sudan. I had been told that, off the record, during my research interviews by several of the NGOs that were involved in the campaign against Talisman, but it was the first I'd heard of it publicly. Companies are capable of significant change in attitude and performance, and Talisman is now ranked among the top 50 CSR companies in Canada. So I believe we should make a further investment of what the implications are of Canadian divestment.

Third is to more actively leverage our efforts and, to the greatest extent possible, work in tandem with like-minded countries, donors, agencies, etc. We want all citizens in developing countries to have a voice, not simply those who happen to be located in the vicinity of a Canadian mining operation. We want them to be empowered on all the issues they face, and for that we need to work much harder on citizen empowerment, particularly for marginalized or underrepresented groups, much harder on education, on fostering local government responsiveness, on reducing corruption, enhancing accountability, and so on.

This is one of the main reasons I've long championed a much stronger NGO voice in this conversation, not simply to move the thinking of the corporate sector itself but especially because NGOs are absolutely crucial to the progress on the ground on citizen empowerment.

Finally, I caution that reviews are not a silver bullet. In practice, they can be extremely expensive and difficult to conduct. Rarely do they seem to mark a once-and-for-all conclusion to any debate. Review mechanisms exist today and some sit idle. While we can certainly build a better mousetrap, even a carefully designed mechanism will not necessarily deliver a crisp, clean, easy answer on whether a company is in or out of compliance on any particular standard.

Both the government's CSR strategy and Bill C-300 reference the IFC performance standards that were established in April 2006 and form the basis for banks' Equator Principles. There are eight IFC standards, covering social, cultural, labour, community, biodiversity, environment, and indigenous issues. Each standard is supported by many recommendations covering assessments, management systems, training, community engagement, monitoring, and so on. The eight standards themselves run to 34 pages, and the supporting guidance notes are a further 170 pages.

Because the standards have been created to be used in a wide variety of environments and by a large variety of companies, each requirement contains areas of subjective interpretation. I'll just quickly cite one example to give you a flavour.

[Denis Tougas]

Absolutely. When I talk about the governments of the Congo, I'm talking about the central government and the provincial governments that have a mining branch that is also very active. In the case of Anvil Mining, if an intervention by the Canadian government contradicted the military court judgment, the Congo would no doubt have absolutely opposed it or would have been angered. However, as regards legitimacy and transparency, I think the government would be absolutely delighted.

I'm trying to think what example I could cite you. These negotiations have been going on for two years, involving 61 mining contracts, 6 of which are Canadian contracts. The discussions have not been public, although the signed contracts have been made public. That's where we've seen how unequal and unfair these contracts were.

We don't yet know the outcome of all these revelations, but we will know soon. What we do know for the moment is that there are questions that have not been answered. There's the fact that unconscionable contracts, which should have been completely redone, were renewed. We'll see what happens.

I previously contacted civil society groups, particularly the Conférence Épiscopale Nationale du Congo, the CENCO, a committee of which is monitoring this situation very closely, studying it and will be giving us its recommendation as to what we can do here.

I repeat, there is still a real struggle between the Congolese government and two companies. I'll name them for you: First Quantum Minerals Ltd. and Tenke Fungurume, which includes the Lundin Group of Vancouver. The struggle continues internationally. If Bill C-300 were passed, we obviously would have been able to use it and to have a Canadian viewpoint on the matter.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

If 60% of the world's mining companies are registered in Canada and a certain percentage of them said they didn't like Bill C-300 but still wanted to continue to work in Argentina and so were going to change jurisdiction and simply pick up and pull out of Canada, as far as their head office was concerned, then there really wouldn't be any net positive result, from your perspective, in Argentina, would there?

[Romina Picolotti]

No, no. I'm sorry I didn't express myself very clearly. It's not my language.

As in many developing countries in the world—and I will set Congo aside, because really Congo is a different situation—those countries that are in the process of constructing democracy, in Argentina our institutions sometimes have not become strong enough to deal with these giant economic powers. This needs time.

What I understand is that the application of Bill C-300 will provide necessary help to these countries, because you control these companies at home. That will of necessity have an impact on how these companies behave abroad. This is what I'm talking about. I'm not talking about you coming to my country and taking over the jurisdiction to apply the law; this is not what I'm talking about.

What I'm saying is that applying this law in your own jurisdiction will necessarily have consequences in my jurisdiction. This is the case in many other areas too. If I control pollution on my side, that may have effects on your side: the application of the law in my jurisdiction will have a positive effect in your jurisdiction. That doesn't mean colonialism; it doesn't mean overriding jurisdiction. It's just the application of law in your own jurisdiction that has effects in others. That's normal, I think. It does not seem uncommon.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

Thank you to both witnesses for excellent testimony.

Ms. Picolotti, I'd like to enter into a quick question and answer so that we can get through a lot of material.

First, I'd like to point out that from the perspective of the Canadian government, we support CSR and the intent of Bill C-300. The intentions are valid and worthwhile. However, sometimes we end up with unintended consequences.

What is your expertise on Canadian law? And this is not.... I just want to qualify what it is we're talking about here.

[Denis Tougas]

Thank you.

I said that Canada's reputation was jeopardized. Yesterday, Canada was called neocolonial in a Kinshasa newspaper. I'll read you the headline: “Consequence of the mining contract reviews, Kinshasa taken hostage: Paris Club wants to impose unconscionable contracts.”

Then more than one article focused on the situation, and this appeared: How can Canada and the United States in the Club of Rome bring this kind of pressure, take the Congo hostage, because they are dissatisfied with the internal settlement between the government and the company?

I'm talking about the future, not the past. Bill C-300 would benefit the companies. Both the government and the communities on the ground would have outside recourse. You know it as well as I do that the governance of the Congo is not up to par; corruption is everywhere. This would make it possible to solidify Canada's efforts to support these businesses. I cited two cases, but there are a number.

Canada has taken a public position, and people have said that Canada was aiding and abetting something. If there was an organization such as that provided for by Bill C-300, a parliamentary organization or a Canadian organization could say whether the allegations are true or false. Canada would then have all the legitimacy to support these businesses more than it does now.

[Francine Lalonde, Bloc, La Pointe-de-l'Île, QC]

I'll take half a minute to say that what is going on shows that we should have taken much more time.

I'm going to start with Mr. Tougas. You described a situation that many Quebeckers and Canadians would not be able to believe is true if the witness who reported it was not extremely credible. This takes us back to a colonial situation that was denounced in every way when it applied to the development of the new countries of North America.

Explain to us how this bill would be advantageous. You finished your frightening presentation by saying that Bill C-300 would be an improvement.

[Denis Tougas, Coordinator, Table de concertation sur la région des Grands Lacs africains, Entraide Missionnaire Inc.]

Good morning.

Thank you for having me here this morning.

The purpose of my contribution is to demonstrate the benefits that would accrue from implementation of the complaints handling mechanisms proposed by Bill C-300, particularly its ability to assemble information from various sources, based on two specific cases in the Democratic Republic of the Congo, that have been mentioned here on a few occasions.

First, a few words on the expertise of Entraide Missionnaire, which represents many of the francophone Catholic missionary communities in Canada. Since 1988, Entraide Missionnaire has hosted an issue table on the Great Lakes Region. Its objective is to inform and sensitize the Canadian public and authorities to the complex realities of that country. The table focused more closely on the Congolese mining industry starting in 1997, during the first Congo war, when our Congolese partners asked us to inform them about the nature and objectives of the Canadian mining companies that were signing contracts with the parties to the conflict. Since then, together with our Congolese partners, we have been closely monitoring the changes in the mining industry in the Congo.

With regard to the Congo, I will merely remind you that the country was at war from 1996 to 2003, a war that nearly degenerated into a regional conflict when seven countries got involved in it. The wars resulted in millions of deaths, millions of refugees, millions of displaced persons and completely destroyed the country's political and administrative structures. Since the 2006 elections, the Congolese government has been trying to restore its authority and administrative services to the country as a whole, but has been unable to do so. It is in this context of violence and armed conflict, of major democratic deficit and widespread administrative disorganization that Canadian and other companies have come and established themselves in the Congo, at their own risk—a risk that they have not always been able, or wanted, to assess.

Here's the first case. In June 2000, when it became obvious that the illegal exploitation of natural resources was one of the primary reasons for the war, the UN Security Council established an expert panel to shed light on the links between the conflict and the exploitation of those resources. Until June 2003, the panel produced a series of reports identifying countries, companies and individuals joined together in “elite networks”, to use its expression, that were taking advantage of the climate of violence and insecurity to seize the Congo's wealth, and mining wealth first of all.

In addition to those “elite networks” directly involved in the conflict, the expert panel, in its second-last report of October 2008, identified nearly 100 foreign businesses, including seven Canadian mining companies, as being in direct violation of the OECD's guiding principles. In concrete terms, the expert panel accused those businesses of indirectly participating in the prolonging of the war and the resulting massive human rights violations, by continuing to do business with either a rebel group or the central government, and by paying mining concession acquisition fees, royalties or taxes, the proceeds of which were used to buy weapons.

In addition, based on supporting documentary evidence, it accused one of the Canadian companies of engaging in corruption involving persons close to the government in order to obtain certain concessions. In view of the outcry raised by this accusation made by an instrument of the United Nations, the Security Council extended the panel's mandate so that it could receive explanations from the companies concerned. In its final report, the expert panel classified the cases of 43 of those foreign businesses, including the seven Canadian companies, as “resolved”, while stating that that in no way invalidated the information previously obtained by the expert panel concerning the parties' activities.

In addition, the President of the Security Council called on all states concerned to conduct their own investigations into the expert panel's revelations. It also stated that all the “restricted but non-confidential” documents relating to the investigations would be available to states requesting them.

The Belgian senate held a parliamentary commission of inquiry and the National Contact Points of Great Britain, the United States and Belgium reviewed the cases of 13 of their companies cited in the report. Authorities so requesting obtained the documents claimed from the UN Office of Legal Affairs. In general, these initiatives revealed a significant degree of laxism on the part of the companies in their relationship with Congolese political and military authorities. In Belgium, the Senate commission's revelations led to judicial inquiries into corruption and money laundering. In three cases, the National Contact Points issued news releases to state that there was a problem. No action was taken in response to those news releases. As for the Belgian senate committee, most of the recommendations contained in its report were forgotten. The senate committee had no power of sanction.

Here in Canada, from 2002 to 2004, groups in Canadian and international civil society, as well as Congolese groups, asked the Minister of Foreign Affairs and the National Contact Point to obtain this documentation and pursue these inquiries in accordance with the Security Council president's recommendation. In 2005, our National Contact Point announced its decision to take no action in response to the expert panel's report.

For your information, for the 2008 fiscal year, the Canada Pension Plan held $297 million worth of shares in six of the companies cited in the expert panel's report. In 2004, the Canada Investment Fund for Africa granted $15 million to a company cited by the expert panel. Today, the figure is approximately $5 million.

Here's the second case, which is known to you, I believe. Anvil Mining and its Canadian staff are suspected of aiding and abetting crimes against humanity. In 2008, the Canada Pension Plan held $20 million worth of shares in that company. In October 2004, six or seven rebels took control of the City of Kilwa, near the Anvil Mining mine. Company employees were requisitioned by Congolese authorities to transport military personnel by aircraft and truck to retake the city. The company also provided food rations to soldiers and paid their wages. The city was retaken in 48 hours, but its inhabitants had fled.

The UN observation mission to the Congo conducted an on-site investigation, which established that more than 100 persons had been killed during the military operation, including 28 by summary execution. According to witnesses, the soldiers had plundered the city, made arbitrary arrests, raped women and tortured prisoners. The report also indicates that Anvil Mining provided logistical support for the operation. Witnesses stated that the company had not only transported soldiers, prisoners and wounded, but had also conveyed the bodies of civilians who had been killed in order to bury them in a mass grave.

In the House of Commons in June 2005, Roger Clavet, member for Louis-Hébert, put a question on this subject to the Minister for International Cooperation. To date, that question has not been answered.

A military trial was conducted in the Congo in 2007. Three expatriate employees of Anvil Mining, including one Canadian, were summoned to testify. The court acquitted the company and its three employees on charges on aiding and abetting crimes against humanity. Four Congolese citizens were sentenced to life in prison, but on charges unrelated to the massacre. Louise Arbour, UN High Commissioner for Human Rights, who was in the Congo at the time, said this: I am troubled by the court's findings that the events in Kilwa were the accidental result of combat, despite the fact that there was substantial eyewitness testimony at the trial and material evidence that serious human rights violations had been deliberately committed.

She pressed the court of appeal to weigh all the evidence and consider the rights of the 144 victims. Ms. Arbour's long-awaited appeal was unfortunately dismissed by the military court shortly thereafter. Starting in June 2005, Canadian, Congolese and international organizations demanded that the government conduct its own investigation into the incidents. Those demands were forwarded to the ministers concerned and to the National Contact Point. Similarly, following the court of appeal decision, most of those organizations asked the governments of South Africa, Australia and Canada to investigate the company and their nationals who had been involved in the incidents, as it had become clear that the victims could not be heard in the Congo.

In response, Canada's National Contact Point said that it had met with the company and had made it understand the Government of Canada's expectations: that it comply with the OECD's guiding principles, particularly its human rights recommendations. No investigation would be conducted.

Here are a few lessons I invite you to draw from these two cases.

In our view, both cases illustrate the benefits that would have resulted from the passage of Bill C-300 for the companies, the Government of Canada and the groups and individuals who felt they had been adversely affected by certain mining activities.

In both cases, the complaints were not frivolous or vexatious. Investigations were conducted and members of the authorities, such as the President of the UN Security Council and the UN High Commissioner for Human Rights stated their opinion on the validity of the accusations. And yet no authority in Canada took action on those complaints. No one was accountable for those decisions.

No one took action in response to those requests to conduct an investigation and thus to confirm or contradict the charges, undermine the position of the companies or that of the Government of Canada.

On the ground in the Congo, as a result of the pervasive corruption and lack of transparency with respect to the conditions in which mining contracts are signed, the legitimacy of those contracts is still in doubt. In the current context of extreme poverty for the vast majority of the population, that could mean additional costs for the companies to increase security for their operations against the local communities that are not benefiting from the exploitation of their resources.

Somewhat as the previous witness said, Canada is losing its reputation.

Canada's diplomatic personnel have been and continue to be very active in supporting Canadian companies in the Congo, despite persistent doubts about the integrity of their contracts and behaviour. On a number of occasions, embassy staff and, on occasion, the ambassador, have publicly supported the companies despite their disputes with either the government or the local communities.

Even more important, Canada is purportedly blocking settlement of the Congo's debt to the Paris Club. That debt of approximately $4 billion or $5 billion was incurred as a result of Mobutu's pranks. That settlement is necessary for the country to have access to the International Monetary Fund's Poverty Reduction and Growth Facility, which the country very much needs. And that is because one of the Canadian companies cited in the expert panel's report is dissatisfied with the outcome of the renegotiation of one of its mining contracts. The Congolese government has decided to cancel one of those contracts.

Without the investigations called for in Canada and internationally, one wonders on what basis the Government of Canada decided to give such strong support to companies denounced in a UN report.

For many more years, the Congo will continue to be a democratically weak country and to have governance well below what constitutes a suitable business context. Political tensions can be expected to rise as the 2011 elections approach. Social tensions in the mining sector resulting in strikes, demonstrations and the eviction of manual diggers and local communities are already present and could last a long time.

In this context as well, the Export Development Canada has already announced that it intends to support the project of Tenke Fungurume Mining, one of whose partners, the Canadian company Lundin, was also cited by the expert panel.

In conclusion, in this specific unstable business climate, passage of Bill C-300 would hold out a definite benefit.

[The Chair, Conservative, Kevin Sorenson]

Good morning, colleagues. I will call this meeting to order.

This is meeting 41 of the Standing Committee on Foreign Affairs and International Development, Tuesday, November 24, 2009. Our orders of the day include a return to the committee's study of Bill C-300, an act respecting corporate accountability for the activities of mining, oil or gas in developing countries.

As a witness on our first panel today we have, by video conference from Córdoba, Argentina, the president and founder of the Center for Human Rights and Environment, Ms. Romina Picolotti. We welcome you this morning to our committee and are very grateful to have you with us today.

Also, from Entraide Missionnaire Inc., we have Denis Tougas, the coordinator. Mr. Tougas has appeared before our committee before, I believe, on the Great Lakes region study we did in regard to Africa. Welcome back. It's good to have you back here with us this morning.

Sending his regrets this morning is Robert Ouellette, the editor and chair of the Sierra Club Ontario. He is unable to be here.

We look forward to your comments, Ms. Picolotti. We would invite you to begin by opening with your 10-minute testimony.

[Paul Dewar, NDP, Ottawa Centre, ON]

Basically you're saying that the remedy right now for people who have concerns with the conduct of Canadian companies is limited to non-existent.

Mr. Hunt, I'll maybe go to you on this. I note that right now there are cases in court with regard to that limitation. We have litigation happening. You were very clear on the fact that you think this would actually not only raise Canada's profile but allow Canada to shine up its reputation, if you will. You see us as being able to do that a little bit with Bill C-300.

[Connie Sorio]

Let's take the case of the Cordillera Peoples Alliance in the northern part of the Philippines. Olympus, a Canadian mining company that is doing exploratory activity there, is not following environmental standards. But in the Philippines, you cannot expect the government to enforce its own environmental standards.

Basically, then, the community would hope to come to the Canadian government, where Bill C-300 would provide them with that opportunity or space to--

[Connie Sorio]

First of all, in a community where their human rights, environment, and livelihood are impacted, the first instance is to go to their local community and complain about it. But these complaints are not being redressed. The current economic framework of these countries is that their support is for multinationals who came to invest in their countries.

Basically, Bill C-300 would open up an avenue for communities to be able to come to the Canadian embassy and register a complaint, register a concern, hoping that the Canadian embassy in that country would look into it, would investigate, and would bring redress to these communities.

[James Lunney, Conservative, Nanaimo—Alberni, BC]

On the round table, you said you are waiting for a response. We appreciate the church community's wanting to help people in other nations. But this goes back to our discussion about the extraterritorial application of our laws. We simply can't impose Canadian laws on other nations. They have their own sovereign issues. Many of the abuses that are described are actually actions of the governments themselves. It is the lack of governing capacity that we're trying to address. We are trying to find ways to address that in Canada.

You mentioned Professor John Ruggie and the United Nations PRI. We have the Equator Principles. We have a whole evolution of CSR principles over the last decade. I'm just wondering if you're not concerned that the punitive measures that would be found in Bill C-300, if it were applied the way it is written, might not be responsible for the kinds of problems we had with Talisman. Here we have a responsible Canadian company being removed, another country moving in with less regulation than we have here, and the people suffering more than they were before.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

Your industry employs 350,000 people, and it has been suggested by EDC and by the Canada Pension Plan that the enactment of Bill C-300 would have a severe impact, as Mr. Beatty said this morning, on those 350,000 workers. Are you prepared to put them in jeopardy?

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

So, really, what you're saying--and I'm not trying to put words in your mouth, we need to find some agreement here--it seems to me, is that you see Bill C-300 as a way for the Canadian government, armed with this bill as enacted, to be able to bring those standards to the Chilean or the Peruvian or the Ecuadorian governments and have those Canadian standards imposed on those countries.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

But this is Bill C-300. Your idea is that with the Canadian legislation, Bill C-300, should it pass, your union would see that as being a way of establishing the kinds of standards you're talking about in other countries.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

So would I be more accurate to say you see Bill C-300 as a way of establishing certain labour standards in other countries through Canadian legislation?

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

I'll start, and then Mr. Lunney will follow.

Mr. Hunt, just to establish my own personal credibility with you, as you did with us this morning, I understand exactly what you're talking about with respect to Westray. I visited there shortly after and was pleased to be involved with Alexa McDonough and what turned out to be an all-party movement to get the legislation through.

I have had a very productive relationship with your union in my constituency, and where we have differences of opinion, we manage to find areas of commonality. So I'm very supportive of what you're doing.

That said, we are talking about Bill C-300. If I understand correctly, the basic tone of what we've heard from you is that you see Bill C-300 as being a way to establish Canadian labour standards or even bargaining practices in other countries. Would that be a fair characterization?

[Connie Sorio]

We have a KAIROS partnership coordinator for Latin America, and Colombia is one of our priority countries with regard to human rights and also resource extraction.

I'm not very familiar with our work in Colombia in that area, but I know that just two weeks ago partners from Latin America, from Honduras and Guatemala, were here in Canada and met with some members of Parliament expressing their support for Bill C-300.

If I can just respond to previous questions, the partners overseas look at Canadian mining companies as leading the industry, and the fact that the Canadian government has this opening for organizations, industry, and NGOs to present and have their input on a particular bill shows our democratic process. Partners very much appreciate that because in their countries they don't have that space.

So when we talk about Canadian mining companies impacting communities, they want to come to us and say, your company is doing this--and it's eroding Canada's reputation, from our perspective. So passing legislation that would make companies more responsible would increase Canada's reputation overseas. This is not to say that other mining companies from other countries--for example, Australia--are not being lobbied because of their conduct and behaviour.

[Serge Cardin, Bloc, Sherbrooke, QC]

Thank you, Mr. Chair.

Thank you, gentlemen, madam, for being here.

Mr. Beatty, CEO of the Canadian Chamber of Commerce, was telling us that those who support Bill C-300 do so on the basis of a specific ideology. In answering my colleague, he stated that this ideology is to be opposed to mining.

Mr. Hunt, you are a perfect example of someone who supports Bill C-300 while at the same time supporting the mining industry. In fact, you only want the workers of this industry to be protected and to be safe, to be able to live with dignity from their work and to respect the environment. That is what you said. Furthermore, you have some international experience. You have seen various countries. You have seen many mining companies operate in various regions under varying conditions.

We have been told that close to 60% of all mining companies are registered in Canada, which seems rather strange.

Would this be an indication that the situation in the other countries that have mining companies, as far as social responsibility is concerned... How does the social responsibility of Canada towards mining companies compare with that of other countries? Is that why so many companies want to register in Canada, to be able to operate mines all over the world?

[Ian Thomson]

It's almost to the point where what the government is doing is actually better done by many of the industry associations that participated in the round tables. In some ways I feel that it is a bit of an abdication of the government's rightful role, to create a centre of excellence, which is now going to be housed in an industry association anyhow, to have a counsellor to advise companies. These are things that often better left to the industry itself.

What we really want to see Bill C-300 introduce is a fair process whereby Export Development Canada, CPP, and the foreign service can, in a consistent manner, apply human rights standards and corporate social responsibility expectations when they offer assistance to our companies. I think the strength of the bill, in having a broad and consistent across-the-board approach, is just that: Canadian companies, and other companies, quite frankly, that are seeking assistance from the Canadian government will know what they're dealing with, and it won't be left to different policies or even conflicting policies with different state agencies. The strength of the bill is really in having a broad approach, a consistent approach, across these different jurisdictions.

If we look at environmental policy, clearly the industry has come a long way on the environmental front, and it has been in part not just by leaving things strictly to voluntary implementation. It has been about having consequences and actually attaching some of those environmental expectations to the public dollars that companies need to pursue projects. That is an important lever that the government is not currently using and that Bill C-300 allows us an opportunity to leverage.

[Stephen Hunt]

I think Bill C-300 would. It would be my opinion, but it's pretty light. It doesn't go far enough.

I do think that Canadian mining companies, first off, export wonderful technology. We know how to mine. We really do. We've got it together. And our expertise and developing mining equipment and mining technologies and processes are probably number one in the world. We have a huge mining industry here. We're really proud of it, and we're really proud of the work we do.

One of the things we learned over the years, as Canadian miners, is that you have to really watch Canadian mining companies. If you let them get away, they hurt people; they do bad things. Not all of them, but there's a bad reputation. We had Elliot Lake, we had Westray, barium in Quebec, asbestos throughout, lead in Trail. We had the biggest penalty assessment in British Columbia history against Cominco for exposing workers.

We're the most regulated industry in Canada when it comes to protecting workers and the environment. We could really lead. The Canadian flag could go way up on the flagpole, to say if you want to invest in a foreign company, you should go to a Canadian mining company, because not only do they have the technology, but they also have the will and the ability to protect workers, the environment, and communities around those mines. That's where we could do it. That's where I think the mining companies would shine. The very responsible ones will do that anyway, and there are many of them.

I think it would really take care of some of the juniors that fall off the edge sometimes. I said this earlier: sometimes it's just economic heroin. If you go into one of these countries, or a community in Canada, and say you're going to open up a mine and you're going to create a whole lot of jobs that will be big paying jobs, people will bend over backwards to accommodate that industry. And sometimes we leave some of the most important things behind. We clearly have the technology to extract, but the important parts that come with the people are oftentimes missed.

[Glen Pearson, Liberal, London North Centre, ON]

Thank you, Chair.

Thank you for coming.

Mr. Hunt, I was born and raised in Calgary, Alberta. My father and brother were both in the extraction industry. On the other hand, my life has been spent on the ground in different third world areas, so I'm really wrestling with what's happening as this debate is going forward.

It seems to me that the more we discuss things, corporations are being presented as dragons that are going to break all sorts of laws, and NGOs are being presented in local indigenous communities as groups that would use any excuse imaginable to try to cause grief for companies. So the words “frivolous” and “vexatious” continue to come up.

I have a practical question to ask you, because I know that you know both sides of the industry.

Earlier, Mr. Beatty from the Chamber of Commerce said that what will happen to the Canadian extraction industry overseas...if this bill is passed, it will provide a competitive advantage to our other international competitors. He said that work could be done amongst NGOs in the various regions where the extraction industry is, and they could be working with NGOs on the ground to try to bring forward these frivolous and vexatious complaints. None of us have any interest in seeing that, if they're not justified, but I would like to ask you, do you think that is a real possibility? Also, if Bill C-300 were passed, would it speak to that? Would Bill C-300 have that effect?

[Ian Thomson]

Thank you, Mr. Chair. My name is Ian Thomson. I coordinate our work on ecological justice and corporate accountability.

I think Connie has conveyed to you what motivates Canadian churches for their work in this area. It is a response to a call from the south that we hear repeatedly day in and day out from not only human rights organizations and community organizations but also from our church counterparts in the south--bishops from the Philippines, an interfaith commission from Tanzania. These are where the calls are originating for Canada to take responsibility, for action to happen here at home. They are doing what they can to bring about change within their own context, within their own countries.

But it's incumbent upon us. And this is where I think the bill that's before us today is a chance for Canada to rise to that challenge. Church leaders are speaking out on this issue. Churches participated in the national round tables on corporate social responsibility. This is one of the most pressing ethical questions Canada faces on the foreign policy agenda, and it's one of coherence.

Will we, on the one hand, be promoting human rights and trying to do peace building and addressing the problems in conflict zones, while on the other hand some other Canadian actors may be working at cross-purposes and may be receiving support from our own government in some of these activities? This is not to say that all industry players are problematic--far from it. And we've heard that in the testimony earlier today.

Bill C-300 has the full support of KAIROS and all of our members from eight Christian denominations, as Connie mentioned. The bill addresses some of the shortcomings in the CSR strategy, which was announced earlier this year. Actually, it was announced after Bill C-300 was tabled, I'll remind you.

But I think the two can work well together. If we look back to the standing committee report of 2005, there was an explicit call for using financial and diplomatic assistance from the Canadian government as an incentive, as a tool to drive corporate responsibility. Bill C-300 makes this possible by creating a linkage between performance and government assistance.

You'll also find support for the bill in the work of Professor John Ruggie, the UN special representative on human rights. He's a UN diplomat. And he was very diplomatic in his report to the Human Rights Council last year. You had to hunt hard to find a concrete recommendation directed at states.

He does identify export credit agencies as one area, as arms of the state that could actually help states fulfill their obligation to protect and promote human rights. He does say that export credit agencies should be requiring clients to do due diligence around human rights. And he goes on to say that in his informal discussions with several export credit agencies around the world, many said they were looking to their government overseers for specific authority to move in this area. Bill C-300 grants EDC that room.

Now, this isn't unprecedented terrain for parliamentarians. When an environmental review directive was added to the Export Development Act, EDC complied and developed an environmental review process, and it's in effect today. I think when Canadians look back on the standing committee report from 2005 and the deliberations of this committee over the past few months, they will draw parallels here with the introduction of the environmental standards, the environmental assessments that industry now takes as standard practice.

We are moving into a new field here, which is giving EDC, the Canada Pension Plan, and our foreign missions abroad an explicit mandate to build up their capacity and their policy in the area of human rights and social responsibility. This is, in effect, what the bill can achieve. That is why I would urge all members of this committee to support the bill, to bring about these changes, to find that target that the round table consensus brought us to, as a member of this committee alluded to earlier, which is not where the current CSR strategy that the government introduced earlier this year has brought us. I know it's new, but I think we know, looking at it, that it doesn't address the problems that were raised in the round tables. They will persist under this current strategy.

To hearken back to the national contact point, if there was consensus at the round tables, it was that the current mechanisms are not working and we need new mechanisms. There was consensus around that.

So I urge you to support the bill. I think it does introduce those new mechanisms that will lead us in the direction that Canada is inevitably headed, and can make Canadians proud that our export credit agency, our pension fund, and our embassies abroad are promoting responsible business practices everywhere in the world.

Thank you very much.

[Connie Sorio, Program Coordinator, Asia Pacific Partnerships, KAIROS: Canadian Ecumenical Justice Initiatives]

Thank you. Mr. Chair and members of this committee, good morning.

KAIROS, Canadian Ecumenical Justice Initiatives, unites 11 faith-based organizations and seven denominations. It works for social justice here in Canada and overseas.

One of the key areas of our work is supporting partners in the global south to increase their capacity to defend and promote human rights. Basically, as coordinator of the Asia-Pacific program of the global partnerships, I was in countries in Asia, where I visited partners and consulted with communities. One of the things they wanted me to bring to your attention is their resounding support for Bill C-300.

I understand that some of our partners wrote letters to this committee expressing their support for the passing of the bill. I can mention JATAM, the mining advocacy network in Indonesia, who wrote a letter signed by 50 organizations representing human rights defenders, civil society groups that are faith based, and also environmentalists. Also, in the Philippines, the Cordillera Peoples Alliance wrote a letter expressing their support for the bill. This letter was signed by 198 organizations that are more or less impacted by mining activities in their region.

I also would like to mention the support of the Center for Environmental Concerns in the Philippines on the passing of the bill. And I would like to mention the presence of our partners from the south, from Marinduque in the Philippines, which was affected by Placer Dome, and also from Papua New Guinea.

What I would like to speak about is the concerns and the stories of partners who are impacted by the activities of Canadian mining companies in their region. Many of these communities suffered or experienced human rights abuses at the hands of the military, who are protecting the interests of these mining companies. Many of these communities were displaced and their livelihoods destroyed because of the mining operations.

In the Philippines, for example, the Cordilleras just recently experienced a devastating calamity under Typhoon Pepeng, but it was not really the typhoon that brought that calamity. It was the subsidence of the soil caused by mining. I have here a briefing note from the Cordillera Peoples Alliance mentioning the different Canadian mining companies operating in the region and more or less causing this destruction.

The partners that KAIROS supports in the global south are not anti-mining organizations. They are human rights organizations. They are sectoral organizations of people who just want to live a simple life and be able to stay in their communities and develop sustainable communities. But because of the mining that comes to their place and the irresponsible behaviour of the mining companies, they want their voices heard at this table. They want to register their concern.

If I may remind the committee, it was this very same committee that made the recommendation in 2005--after hearing the case of the Subanons from Mindanao and the case of TVI--to the government that a parliamentary investigation be conducted on the alleged human rights violations committed by the military in complicity with the mining companies and to look into those allegations. Round table consultations on corporate responsibility were conducted in 2006, and many partners from the south came to participate in those round tables, to express their concern, to register their stories, on behalf of what was created by this operation. Up to this point they are waiting for this committee, for this government, to provide leadership in ensuring that Canadian mining companies are behaving responsibly, that the lives of the communities are respected, and that their ability to say yes or no to the mines is respected as well.

My colleague will talk about the overall KAIROS recommendation. As the person who has just come from visiting the partners and talking with communities, this is what I would like to bring to this committee. These communities overseas are supporting the passing of Bill C-300.

[Stephen Hunt, Director, District 3, United Steelworkers]

Thank you, Mr. Chair and panel.

Good morning. Thank you for the invitation to speak today about this very important private member's bill.

My name is Stephen Hunt. I'm the elected leader of the United Steelworkers, District 3, which is all of western Canada, from the Manitoba border west to the Pacific Ocean and the it involves primarily the extractive industries.

We represent many, many miners, forest workers, and people who work in the oil and gas industry. Many of those people I've just identified would be affected directly by Bill C-300.

Before I begin, I want to tell you where I came from. I joined the steelworkers union as a very young man and worked at Utah mines, an open-pit copper mine at the north end of Vancouver Island. I also worked at Afton mine, a mine owned by Teck Corporation, outside of Kamloops, British Columbia.

I have been closely linked to the mining sector for about 30 years, primarily in health and safety practices in the mining industry. I've travelled extensively offshore to visit Canadian mining operations. I've worked in Peru to help miners fight the new disease of silicosis in Peru. It's something that we eradicated in Canada years ago, but it's now developing in Canadian-owned mines in Peru. I've travelled to Chile to work with miners at Canadian-owned companies who are exposed to high altitudes and suffer terribly from high-altitude diseases.

Also, I'm acquainted with a Canadian mining company in this connection: I was an expert witness in the Westray inquiry. I testified and gave evidence as to why the explosion happened at the Westray coal mine in Stellarton, Nova Scotia, where 26 miners died instantly. Eleven miners are still trapped underground. Their bodies were never recovered. A Canadian mining company....

As you know, the Westray inquiry led to rank-and-file lobbying by the steelworkers to make changes to the Criminal Code of Canada to strengthen it and incorporate corporate responsibility with respect to health and safety when it comes to workplace injury and death.

Now that you know who I am, it will come as no surprise to you that I support Bill C-300 and I support mining, because we represent workers in the mining industry. By definition, that's who pays my bills.

We often refer to ourselves as Canada's mining union. We care about the industry. We care about how well our employers uphold our rights. That's why we have collective bargaining in the first place and why we care about how those same employers uphold rights of workers in communities in developing countries.

But just as we don't think companies should operate here without the balance of collective bargaining to protect rights, nor do we think companies should operate in other countries without formal checks and balances on their treatment of workers, communities, and the environment. We believe that workers' rights are human rights, and that's the context of our support of Bill C-300.

I have one more note about myself. I have been certified by the DeGroote School of Business as a chartered director. I'm qualified to sit on corporate boards in the United States and Canada. The role of these boards has expanded in the 21st century to include not only the interests of shareholders, but those of stakeholders as well. That means workers, communities, and defenders of the environment must be included in the sphere of corporate decision-making.

The steelworkers did not suddenly wake up and discover that there was a Bill C-300. The steelworkers union participated in the national round tables on corporate social responsibility that were carried out in 2006. We anticipated that the Government of Canada would take the consensus report of 27 recommendations and establish a stronger regulatory framework to hold Canadian companies accountable for human rights, labour rights, and environmental protections in their operations in developing countries.

It was not to be. It took almost two years and the government response was as if the round tables had never happened.

The so-called corporate social responsibility, or CSR, strategy was a slide backwards to voluntary corporate self-regulation by corporations, and it suggested that weak host governments in developing countries, not corporate behaviour, are at the root of the problems in the extractive sector.

Mining and oil and gas companies are the face of Canada abroad. They gain further credibility and identity as part of official Canadian policy through the co-financing they enjoy from the Export Development Corporation and the support they receive from Team Canada missions and local Canadian embassy facilities.

Yet, when steelworker members employed in the mining and mineral processing carry out labour exchanges in countries such as Argentina, Chile, Peru, South Africa, and Guatemala, we find a huge disparity between the corporate behaviour of these companies at home and their corporate behaviour abroad.

Our union has negotiated long and hard to establish decent wages and pensions, safe workplaces through joint health and safety initiatives, and environmental measures to protect surrounding communities. The companies claim to take these best practices with them when they go to developing countries, but our experience on the ground shows differently.

Our members employed by Teck, for example, have worked for several years with union members from Teck-owned mines in Chile and Peru. These miners work at operations typically located at 4,000 metres above sea level. Despite an abundance of readily available research studies on the long-term effects of working at altitude and the constant lobbying by worker representatives in both Chile and Peru, Teck refuses to recognize the long-term exposure to high altitude as an industrial disease. Practical solutions are ignored or they are declared too expensive. These conditions mean workers suffer from headaches, loss of appetite, and an inability to sleep. Exposure leads to significantly increased risk of heart attack and pulmonary and cerebral edema. There is no compensation for workers unable to work to retirement, leaving them unable to provide support for their families. We oftentimes call that “economic blackmail” or “economic heroin”, where workers work because they have to work and they have no choice.

While Canadian companies continue to resist protection for high-altitude workers, Export Development Canada has supported the Antamina mine in Peru with $650 million in political risk insurance.

Earlier this year, in Argentina, the United Steelworkers received a request for solidarity action in response to the unjust dismissal by Barrick Gold Corporation of Jose Vicente Leiva, a labour leader at Barrick's Veladero mine. It received $75 million in project financing from Export Development Canada in 2004 and $125 million political risk insurance. Veladero is another high-altitude operation, where workers live in tents without winter gear, while temperatures can reach minus 20 degrees Celsius. Rock slides are a regular occurrence, and two workers were killed in 2006.

Mr. Leiva travelled down 4,600 metres to meet Barrick management with a list of proposals to improve safety practices, and he was told to come back in a week for an answer. He returned, only to be met by management, reinforced by Argentinian officials, with no willingness to address the issues.

Backed by an Argentinian law allowing free association, Mr. Leiva and the other Barrick workers set out to form a new independent union and sought affiliation with the Argentine workers centre, the CTA. Even before the application for recognition was fully processed, Mr. Leiva received notice from Barrick that he was terminated without cause. The cause was that Mr. Leiva and his members had exercised their rights and contested unfair practices at the Barrick mine. Mr. Leiva was recently reinstated, not through any sudden epiphany on the part of Barrick, but because national and international pressure was brought to bear.

The story of Jose Leiva and his members once again proves the adage that we have turned to time and time again as we have fought for dignity and safety in Canadian mines: a mining company is only as good as its opposition. Without a tool like Bill C-300, there are no checks, no balances, and only a fiduciary mandate.

The fact that our mining companies have gone abroad has prompted us to go global as a union. We have followed our managers to countries like South Africa, Chile, and Nicaragua. We are building global networks with workers who share common transnational employers.

The knowledge we have gained of corporate practices and labour conditions in other countries is helping us as we deal with the new challenges brought by foreign ownership in mines in Canada. Yesterday’s mining giants, like Inco, Falconbridge, and Noranda are now replaced by companies like Vale Inco and Xstrata. Three of Vale’s four nickel operations in Canada have been on strike for more than three months, fighting back as this company tries to introduce two-tier wages and a much weaker pension plan.

Bill C-300 is neither punitive nor restrictive for extractive companies. It simply provides a transparent framework for accountability and can only be invoked when violations become apparent. It refers to internationally recognized standards and ensures that financial and diplomatic assistance is contingent on good corporate behaviour. It is a social contract that allows companies to prosper and thrive, but not with an absolute lack of scrutiny by Canadian taxpayers, who are facilitating their offshore activities.

I want to thank you for the opportunity this morning, and I obviously would really like to answer your questions.

[The Chair, Conservative, Kevin Sorenson]

In the second portion of our meeting today we're going to continue our study of Bill C-300.

Appearing before us on this panel we have, from KAIROS, Canadian Ecumenical Justice Initiatives, Mr. Ian Thomson, who is the program coordinator for ecological justice and corporate accountability, and Ms. Connie Sorio, who is the program coordinator for Asia-Pacific partnerships. As well, we have from the United Steelworkers, Stephen Hunt, who is the director of District 3.

I understand that each organization has an opening statement. We look forward to your comments.

I'll invite Mr. Hunt to make the first presentation.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

Thank you for attending, Mr. Beatty.

I'd like to point out--and this has no reference whatsoever to the previous questioning. I wanted to put on the record that it's fashionable in some quarters to not speak too highly of organizations like the Canadian Chamber of Commerce, as if they are some kind of a bogeyman, or whatever the case may be. The fact is that your organization represents the heartbeat of the economy of Canada. I know many of my colleagues have a tremendously high respect for your organization, as we do for you, since you earned an excellent reputation as a former minister of the crown, and I thank you for being here.

The question I have for you is, could you give us your best guess as to the percentage of equity on the Toronto Stock Exchange and on the Vancouver Stock Exchange that would be represented by extractive companies that would potentially be affected by Bill C-300?

[Jean-Yves Laforest, Bloc, Saint-Maurice—Champlain, QC]

That is not at all what I said. I only said that we have seen such situations and that a piece of legislation such as C-300 would allow us better to control the operations of those companies, especially in countries where we have seen such situations. I am not saying that companies have contributed to this, absolutely not.

[Jean-Yves Laforest, Bloc, Saint-Maurice—Champlain, QC]

Thank you, Mr. Chair.

I do want to say that I find it extremely unfortunate not to have the text of your statement. That would have allowed us better to understand your arguments and to follow your reasoning as well as to ask our questions. That being said, I will question you on the basis of my understanding of your statement.

You started by saying that Chambers of Commerce are generally supportive of economic, environmental and social development and that, unless I am mistaken, your members believe that Bill C-300 will be a significant barrier to their economic development. You also stated that your members are environmentally and socially responsible and you also referred to other methods.

After having looked at the Bill as a group representing business, are you able to tell us if there are in this legislation any environmental or social standards or protections--as well as relating to human rights-- which would not be better than the status quo or than the other methods that you have referred to? Is there really nothing good in this piece of legislation?

[Perrin Beatty]

What they would be able to get with Bill C-300 is that a formal investigation is under way, under Canadian legislation, that could result in the lifting of all government support for this company. Guess what gets the publicity? The allegation gets the publicity—Canadian mining companies or Canadian petroleum companies accused of human rights or environmental abuses. The finding, some weeks or months down the road, that these were frivolous or that the allegations were put up by commercial competitors gets very little publicity, as you know, as a result, and the damage is done in the meantime. We need to find mechanisms that, yes, move ahead from where we are today in terms of trying to ensure that we all follow the highest possible standards, but do so with the minimum of damage to the companies involved.

The other element of your question was whether or not Mr. McKay's bill goes above the standard that the consensus agreed upon and the government falls below that. I guess my answer would be that if we believe that Mr. McKay's bill may be damaging to the Canadian interest, it may be damaging to the host countries as well. Let's hold off from doing things that we think could be damaging.

If the government's approach is found to be deficient once we've had experience with it, by all means let's make improvements to it; let's bring it up to whatever standard we feel is appropriate at that time, but based on concrete experience. The key issue for me, and I'm sure for you as well, is to ensure that we move carefully in an area like this, that we improve the standards of everybody involved, and that we avoid reckless or frivolous damage to the reputations and the welfare of everybody involved.

[Perrin Beatty]

Thank you very much, Mr. Rae, for a very thoughtful question.

Let me start first with the issue of Talisman. You're quite right, the Talisman situation existed before Bill C-300 was even tabled in the House. So even in the absence of this sort of formal mechanism, which in our view will encourage frivolous or vexatious or unfair allegations to be made against Canadian companies, Canadian companies were at risk of having their reputations damaged, with enormous loss for everybody involved. Our concern is that this bill would make that situation even worse. It would actually build in an incentive for the commercial competitors to Canadian companies, whose standards may be well below those of Canadian companies and certainly whose standards would be well below the standards that we would assume we'd want Canadian companies to aspire to, to make these sorts of complaints. It would encourage them to do that.

You're right. There is a provision in the bill, in clause 4, that says the minister may decline to examine the matter, but a decision not to examine the complaint would be subject to judicial review, and generally the standard to prima facie dismiss a complaint in these criteria would have to be very high. The minister could not just frivolously throw it out himself and say, this is a group that is known to recklessly damage the reputation of people; I don't take seriously the allegation they make.

There would be a process there. One could easily see the incentive built in when a Canadian company was looking at opening up operations abroad, for example, if it was looking for licences in a country, for its commercial competitors to encourage a series of complaints to be made against Canadian companies on the grounds that they have violated environmental standards or human rights standards or a range of other international CSR concerns, perhaps in another country.

[Bob Rae, Liberal, Toronto Centre, ON]

It's good to see you, Mr. Beatty. I would just say to the committee that my friendship and association with Mr. Beatty goes back a very long way, and I'm always glad to see him in the committee.

I hear you. I think you've made your points extremely strongly. You mentioned the example of Talisman. You mentioned other examples with respect to the reputational impact. Surely you would agree that there wasn't a Bill C-300 when the issues around Talisman were raised. We now have a counsellor who is going to be hearing cases that will be publicly known. It will be in the papers and on the Internet and on the web.

Do you really think it's fair to...? There's an alternative line one could take, and that is to say that at least what Bill C-300 does is it establishes a forum where a company can be completely exonerated by a statement by a minister. You stated that it would take a long time.

Looking at clause 4, under subclause 4(3), it states that if the minister decides that:

the request is frivolous or vexatious or is made in bad faith, he or she may decline to examine the matter. Otherwise, he or she shall examine the matter described in the complaint and assess compliance

The implication of that would seem to me to be that the minister could pretty quickly... There would have to be a process established under which the minister would receive these complaints and deal with them, and I would assume that the process would involve the counsellor, but I'm just not sure that it's necessarily the case that the intention of Bill C-300 is to go way beyond the government's position as set out in its own recommendations on CSR.

The other point I would make is that it seems to me that what Mr. McKay has done is perhaps go a little bit beyond the consensus that was arrived at, but I would also argue that what the government has done is well less than what was agreed to. What we ought to be looking for as a committee is a way to find the balance, frankly, that strikes right at the heart of what the consensus was that the parties, including the mining companies and the unions and the environmental organizations, agreed was where we should go.

So what concerns me about the government's strategy is it's less than where we want to go, and I do think we could make improvements to this measure that would allow us to hit the target.

[Perrin Beatty, President and Chief Executive Officer, Canadian Chamber of Commerce]

Thank you very much, Mr. Chairman.

I want to thank you and your colleagues for your warm welcome today. We're delighted to be able to be here. We look forward to having a chance to have an exchange with the committee.

As you mentioned, my name is Perrin Beatty. I am president and chief executive officer of the Canadian Chamber of Commerce. With me this morning is Susanna Cluff-Clyburne, our director of parliamentary affairs.

The Canadian Chamber of Commerce is the organization that is the most representative of Canadian business. Thanks to our network of 325 local Chambers of Commerce, we speak for 175,000 Canadian businesses, of all sizes and in all parts of the country.

The Canadian Chamber of Commerce includes many oil and gas and mining companies among its members.

Our members are very aware of the principles of socially responsible behavior and of the commercial value of sustainable operations. This includes taking account of the economic, social and environmental impact of their operations. They also understand that a single bad apple can spoil the reputation of all Canadian businesses anywhere.

Mr. Chairman, businesses and governments worldwide have been working to meet the increasing social and environmental expectations of their operations at home and abroad. The result has been the establishment of internationally accepted norms, of which committee members are all very well aware.

In support of our members' efforts, the Canadian Chamber has provided considerable input into the Business and Industry Advisory Committee's contribution to the OECD Guidelines for Multinational Enterprises, the International Chamber of Commerce's work with the United Nations Global Compact, and the United Nations Special Representative John Ruggie's investigation into human rights and transnational corporations. The Canadian Chamber has also been an active player in Canada's contribution to the development of the ISO 26000 guidance standard for social responsibility.

The Canadian Chamber of Commerce's long-standing policy on responsible business conduct has been that socially responsible behaviour should continue to be promoted and supported by government. A process of working with companies before they run into problems, then continuing to work with them to solve any issues that arise, ensures that Canada and Canadian companies are seen as world leaders. To be seen to comply with the highest possible standards is a business benefit to us, Mr. Chairman, which the Canadian business community recognizes.

The Canadian Chamber of Commerce has been expressing our members' concerns with Bill C-300 to members of Parliament in writing or in person since it was tabled in February. So I am certain that the members of the committee are familiar with our position.

Building the Canadian Advantage is consistent with the view of the Canadian Chamber and its members in the extractive industries sector that Canada leads best by working with companies to give them the tools to prevent themselves from being drawn into difficulties in developing countries. And if they are, it is even more important to continue working with them to help remedy the situation and preserve Canada's reputation. Simply cutting and running is not the answer.

The government's strategy acknowledges the critical role of host regimes in developing countries and commits to providing additional resources to them through CIDA, Natural Resources Canada, the Department of Foreign Affairs and International Trade, and international bodies such as the extractive industries transparency initiative.

Mr. Chairman, as a former Secretary of State for External Affairs, I believe this is the right approach. For exactly the same reason we would object to foreign interference within Canada, sovereign nations would not appreciate Canadian officials conducting investigations into projects in their territories or having our laws dictate which companies shall and shall not operate in their countries. Bill C-300, if passed, will negatively affect Canadian foreign policy.

The newly appointed CSR counsellor strikes a balance among stakeholders while maintaining the primacy of DFAIT's national contact point in promoting the OECD Guidelines for Multinational Enterprises. Some have argued that the counsellor will be able to conduct investigations only with the agreement of all parties. But we know that credible investigations would be impossible without the cooperation of not only the company in question, but, equally importantly, of the host government. It is our understanding that any lack of cooperation by any party would be included in the counsellor's annual report to Parliament and would rightly be criticized. It would hold any party refusing to collaborate up to public attention. This provision is an important incentive to assist in the investigation.

The role of the CSR counsellor significantly differs from the independent ombudsman recommended in the round tables' report and from what is proposed in Bill C-300 only in that the office does not have the power to recommend that government resources be withdrawn from companies found to be behaving deficiently. Again, this is the right approach. Our goal should not be to punish. It should be to ensure that all companies adhere to the highest possible standards. Our goal is to set standards that lead the world, to encourage people to comply with them, and to work with companies to ensure that this is achieved. By doing that, we can have the most significant benefit for everybody involved.

One of the unfortunate aspects of Bill C-300--which will haunt any government forced to implement it--is that it poses an unreasonable risk for the finances and the reputation of extracting companies. This is a very capital-intensive industry which operates on a very long-term basis and is generally active in some regions that are located very far from developed and developing countries. Each project might be challenged, even if the company is acting in a very responsible manner. Those who believe that any type of extracting activity is unacceptable will challenge practically all types of operations. This is the case here in Canada and we have also seen it in other countries. Let me add that their policies are often contrary to those of the communities that benefit from those projects.

Bill C-300 would provide an avenue, based on a piece of legislation, to those organizations the survival of which depends upon their capacity to make allegations against extracting companies. Complaints based on ideology rather than performance would entail huge costs for taxpayers as well as companies.

Mr. Chairman, the auditing function proposed for the Department of Foreign Affairs and International Trade in Bill C-300 would tie up dollars and people that the department desperately needs for other purposes. One can only imagine the fallout resulting from one partner in a joint venture losing its Export Development Canada financing. Lawyers would be the only ones to get more wealthy as a result.

Will Canadian companies ever be able to satisfy critics who are opposed to their activities in principle? Likely not. It's hard to see how they could. Yet they'll face the spectre of having to constantly look over their shoulders to see who is, or who possibly could be, launching an attack via the mechanism that Bill C-300 would institutionalize. Does this represent a competitive disadvantage for Canadian businesses? It definitely does. Will any ministerial investigation satisfy the party that submitted the complaint? Probably not. As a former cabinet minister, I have to say that the loosely defined investigation process outlined in Bill C-300 concerns me. On the other hand, the government's strategy outlines a well-defined five-stage process that includes initial assessment, informal mediation, fact-finding, access to formal mediation, and reporting.

Mr. Chairman, in criminal law we're scrupulous in adhering to the principle that people are innocent until proven guilty, and we take considerable care to ensure that their good names are not recklessly damaged. However, under Bill C-300 the damage to the company accused is done as soon as a complaint is submitted and publicized. For those who wish to prevent Canadian companies from being able to do business abroad--including and most importantly our foreign competitors--there's a powerful incentive to make allegations. The publishing of a finding in the Canada Gazette, several months after the fact, that a complaint was frivolous and/or vexatious will be too late for the company's reputation and possibly for the financial viability of the project in question.

Such a finding will definitely not receive the publicity in Canada, let alone in a developing country, that the original accusation did. And the company may face years of unnecessary reputation rebuilding. In the meantime, their foreign competition will be doing the business. Talisman Energy is an example of the impact that Bill C-300 would have. Its name is still associated with unfounded allegations of appalling human rights abuses in Sudan, several years and tens of millions of dollars in legal costs after it has been exonerated by the courts. And perhaps most tragically for the Sudanese citizens involved, all agree their circumstances did not improve when this highly regarded responsible Canadian company sold its stake in the project.

The fact is that the vast majority of Canadian extractive companies behave responsibly and are considered global corporate socially responsible leaders. Earlier this year, Talisman Energy was named by Maclean's magazine and Jantzi Research as one of Canada's 50 most socially responsible corporations. Another Canadian extractive sector company, Barrick Gold, was named to the Dow Jones Sustainability World Index in 2009 for the second consecutive year. The index, which is one of the world's foremost indices of corporate sustainability practices, tracks the long-term economic, environmental, and social performance of 2,500 leading companies worldwide, using objective benchmarks to identify the top 10% of performers. It provides a very important touchdown resource.

It's important to acknowledge the sustainable benefits that extractive companies bring to communities. Just as they do here in Canada, these companies create economic and social opportunities for the citizens in the countries in which they operate. They also significantly contribute to the host countries' gross domestic products, infrastructure, tax revenue, training and skills pool, as well as sustainable economic development. The positive economic impacts that these activities and investments have are often overlooked.

You've heard from Export Development Canada how Bill C-300 would affect its ability to enter into financing agreements with Canadian extractive companies. You've also heard how government interference in the investment decisions of the Canada Pension Plan Investment Board would affect its mandate to operate at arm's length from government to maximize earnings for those Canadian employers and employees who contribute to it. It would also require amendments to CPPIB's governing legislation.

Some have asked how serious being cut off from EDC financing and/or Canada Pension Plan investment could be. After all, extractive companies are large, with significant financial resources. EDC financing and institutional investments like the Canada Pension Plan are essential financial resources to Canadian businesses, extractive and otherwise. The sanctions proposed in this bill could be very serious and potentially devastating for the companies and their Canadian and foreign employees, as well as for the projects in developing countries involved in the allegations. To be cut off from EDC financing and political risk insurance, as well as being blacklisted for Canada Pension Plan investment, would mean the cancelling of projects and the cutting of jobs. Faced with the uncertainty of being measured against undefined guidelines, many Canadian companies would simply not take the risk of pursuing new ventures in developing countries.

Bill C-300 would affect not only the large extractive companies, but also the dozens of smaller firms that serve them.

One of the greatest ironies is that while we all express concerns about the takeover of Canadian companies and say that we would instead like to see our businesses buy foreign companies, by discriminating against Canadian businesses, this legislation would do exactly the opposite. Bill C-300 would deter Canadian companies from acquiring firms operating inappropriately in developing countries and bringing their operations up to international standards. Why would they do so with the prospect of penalties and reputation damage lying before them? And yet those who would lose most would be the citizens of the developing countries who would have to settle for companies from countries with lower standards.

Canada's extractive sector companies are experiencing the economic downturn head-on. Their challenges have been exacerbated by having to live with uncertainty in the years since the release of the round tables' report and concerns with the government's response. Bill C-300 adds to the interminable uncertainty under which these companies have been working. Even after passage, there would more uncertainty while guidelines are being completed. This is a sector that plans in decades and requires as much certainty, consistency, and clarity in policy and regulations as possible.

The Canadian Chamber of Commerce believes that any Canadian company operating abroad must comply with high standards of social responsibility. Our message to parliamentarians is that the government should work with companies and with governments in developing countries before problems arise to ensure that Canada and Canadian companies are seen as world leaders. It is in all of our interests to see this as part of the Canadian brand.

Bill C-300 could result in an environment of minimal compliance rather than one in which competition motivates companies to attain best practices. For companies that get into trouble because of a lack of experience or circumstances beyond their control, being cut off from government resources when they are alleged to have behaved badly leaves the situation unresolved, the allegedly injured parties no better, and potentially worse, and the company in no better position to take measures to make things right, if that's proven to be necessary. It also leaves in tatters the reputation of Canada, the Canadian government, and one of our most important industries and economic contributors.

I don't quarrel for a moment with the motivation of the bill's authors or of its supporters. The author of the bill, like the rest of us, would like Canada and Canadian businesses to have the reputation of following the highest ethical standards in the world. And, like us, he would like to see Canadian companies succeed in the global economy. And yet, ironically, Bill C-300 would push us in exactly the opposite direction by encouraging reckless and untrue allegations and by giving competitors with lower standards a weapon to use against Canadian companies.

Canadian businesses need support from the government in good times and bad. They do not need more bureaucratic burdens, disincentives to invest, and encouragement to move their operations elsewhere.

The government's CSR strategy is barely seven months old and it needs time to be fully implemented before it's judged to be deficient. Once it's had a fair chance to make itself felt, by all means, let's review it and decide whether we should make changes. If improvements should be made then, let's make those changes based on experience. But let's at least give it that chance before we start tinkering with it.

On the face of it, Bill C-300 is good politics. However, upon closer examination, Bill C-300 cannot live up to its intentions as it lacks some important context that could do more damage to the extractive sector than it intends. That's why, Mr. Chairman, we urge the members of the committee to vote against the bill.

I thank the committee for its courtesy in hearing us today, and I would be delighted to answer your questions.

[The Chair, Conservative, Kevin Sorenson]

Good morning, colleagues.

This is meeting 40 of the Standing Committee on Foreign Affairs and International Development. It is Thursday, November 19, 2009. Our orders of the day include a return to our committee's study on Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries.

On our first panel today is a witness who's certainly no stranger to West Block--or to Centre Block, or to any of the other buildings on the Hill--and that's the Honourable Perrin Beatty, President and Chief Executive Officer of the Canadian Chamber of Commerce.

We also have Susanna Cluff-Clyburne, Director of Parliamentary Relations for the Chamber.

Welcome to our committee this morning. We look forward to your presentation. We will move to a round of questioning, or hopefully a couple of rounds of questioning, following your presentation.

We thank you for your attendance here today.

Canada-Colombia Free Trade Agreement Implementation Act

[Paul Szabo, Liberal, Mississauga South, ON]

Madam Speaker, I have to accept the representations of the members of the House of Representatives at face value. In their letter to us they also said they consider approval of these agreements to be a step in the right direction to help us face the challenges that we face. They said that was to help us. They understand that this is an opportunity.

As well they go on to say that these instruments are entirely suitable to successfully face the ever-changing future. All countries face an ever-changing future, but the health and well-being of a nation cannot be legislated simply by not doing anything. We have to take steps. We have to take a risk.

There is a risk that this agreement will not do anything substantive to alleviate human rights abuses. However, we will be there, and we will be models to the Colombian people to show that we can have sustainable, fair and safe trade, and economic commercial activity with Colombia if we pass bills such as Bill C-300.

[Paul Szabo, Liberal, Mississauga South, ON]

Madam Speaker, I want to put on the record a couple of points.

First of all, it is pretty clear to all hon. members, I am sure, that if private member's Bill C-300 were adopted by this House, it would provide the framework to indicate that businesses doing business abroad would have to fall within international guidelines for the protection of human rights and ethical standards for doing business. I wish that bill were in place right now because it would make this debate a lot easier for many people.

We are discussing this bill on the assumption that free trade will lead to greater influence over the human rights situation in Colombia. It is a hope. It is an assumption. It is not guaranteed, but it is a possibility in the right direction.

However, other countries are aware of the facts and are revoking their support for the Colombian regime. Recently the U.K. ended military aid to Colombia because of systemic crimes committed against Colombian people, so Canada is not sitting out there all alone and wrestling with how to deal with this. Certainly in the absence of human rights issues, the trade deal would have bilateral benefits. It is useful and if Canada were a player, that certainly would be helpful.

I referred earlier to the Amnesty International report of 2009 on the Americas. I would like to read into the record the section entitled “Insecurity”. It says:

In Colombia, many of the human rights abuses committed in the internal armed conflict--including killings and enforced disappearances--are aimed at displacing civilian communities from areas of economic or strategic importance. Many indigenous communities live in regions rich in mineral and other resources on lands legally and collectively owned by them. Such communities are often attacked in an effort to force them to flee so that the area can be opened up for large-scale economic development.

It elaborates on the point, but it argues strenuously about the reason a bill such as Bill C-300 is necessary, because these displacements are also a form of human rights abuse. We need to deal with that.

Finally, I wanted to add to the debate some extracts from an open letter from members of the House of Representatives from Bogota, Colombia to Canadian members of Parliament. They wanted us to know their opinion as the legislators. They said:

First of all, we would like to inform you that...[we are] responsible for exerting political control on the Government and the administration. It is also our duty to approve or not to approve the agreements the Government wishes to subscribe to with other States, by issuing a law.

As members of the national legislative entity and the representatives of the people of Colombia, we consider that the Free Trade Agreement between Canada and Colombia is a major factor in the establishment of stable, transparent scenarios for commerce and investment, which generate employment, allow for the improvement of living conditions of our citizens and block...paths to drug trafficking.

I think that is very powerful of the members of the House of Representatives of Colombia to give us their view. There is no simple solution to a problem when there are human rights abuses around the world. We could look at a number of countries, which I would argue would probably include China and others with whom we trade, with which we do not stop trying to advance trade opportunities.

We are not just Boy Scouts. We are a model to the world in terms of who we are and our values. The Colombian House of Representatives is reaching out to say they need to be more like Canada. They understand that. There needs to be commercialization and freer trade between our countries in order to protect and ensure the rights from a cooperative perspective. That means coming together.

In this letter, they also refer to the fact that this trade agreement includes a chapter on strengthening commercial capacities and essential elements to ensure that the benefits and opportunities given by this instrument and two parallel agreements to the development and evolution of a free trade agreement have been contemplated.

There is also an environmental cooperation agreement, which includes a commitment by the parties to sustainable development and mutual support in environmental practices in the formation of trade policies. There is a labour cooperation agreement which sets forth an effective inclusion of the fundamental rights of workers and international legislation of the parties.

Looking at this, I personally have been very concerned about the human rights situation in Colombia and whether or not there was something that we could constructively and affirmatively do. Asking for a human rights assessment on Colombia is asking for something that is obvious on its face. There are problems there. However, we have the tools in Bill C-300 to demonstrate the need for ethical conduct of Canadian businesses abroad. We also have the commitment of the House of Representatives from Colombia, that it understands these problems and it is not ignoring them.

Yes, there are human rights abuses, but having assessed this on all bases and notwithstanding the fact that I continue to have a very strong concern about human rights abuses in Colombia and in other places around the world, I think the only affirmative action for Canada to take is to be there and to demonstrate how business can be conducted abroad on an ethical basis.

On that basis, I cannot have it both ways, but I believe we have to deal with this matter in a constructive and responsible fashion and be affirmative in what we believe we can bring to the table in terms of our relations with Colombia. Accordingly I have decided that I will be supporting the bill.

[The Chair, Conservative, Kevin Sorenson]

Thank you very much, Mr. Dewar.

Again, to Mr. Rosero, please feel free to make a written submission. Mr. Dewar kind of left it wide open there for you to voice your concerns, and be assured that our committee would have access to that.

We want to thank you for your attendance of our committee today and for your perspective of Bill C-300 and your comments in regard to corporate social responsibility.

We're going to suspend and reconvene in one minute with committee business.

[Diane Bourgeois, Bloc, Terrebonne—Blainville, QC]

Thank you, Mr. Chair.

Good morning, Ms. Weitzner. We appreciate you being here very much because you remind us of the situations in the world where our Canadian mining companies are responsible and where we absolutely have to act. With all the examples that you gave us, we could also have talked about the Siocon Subanon Association in the Philippines, about which there were complaints a few years ago.

I am very happy to see that the representatives of the organizations who were at this table just a few minutes ago to tell us about their concerns with Bill C-300 are still in the room. You are telling us about specific facts and I feel that these extremely brilliant people are going to think about what you have just told us.

I think that Bill C-300 can be made better. Every bill can.

As a member of this committee and a Bloc Québécois MP, I would appreciate it if everyone who came here this morning to tell us that we will start to behave responsibly towards the communities whose resources we are extracting as a result of dialogue and voluntary measures would have a word with the promoters of Bill C-300. I would appreciate it if they would promote responsible investment and tell us how to improve the bill so that people are not harmed and so that aboriginal rights and human rights are respected in the countries whose resources we are extracting.

Thank you, Mr. Chair.

[Viviane Weitzner]

Thank you for reminding me.

If even the world's largest and most well-endowed companies are not implementing their own voluntary commitments, there's little likelihood that Canadian juniors or companies will do so.

In the case of countries experiencing armed conflict, like Colombia, or countries like Suriname with large governance gaps, relying on voluntary mechanisms to protect human rights and the environment is simply not sufficient. While Bill C-300 cannot purport to address these realities in their entirety, it does offer an important mechanism with which to strengthen the current Canadian CSR strategy. Notably, Bill C-300 provides recourse to an investigation for communities that may have been subject to human rights violations by a Canadian company, whether or not the company consents to the investigation. This is currently not possible for the CSR counsellor, who is not authorized to investigate cases and can review them only with the consent of the company in question.

It also offers the Canadian government the possibility of withdrawing government, political, and financial support should an investigation lead to the conclusion that human rights violations did occur. In other words, it provides a mechanism for government accountability to the Canadian public and a stronger incentive for companies to respect human rights and environmental protections, particularly if they have received government funding, in contrast to the purely voluntary regime recently announced by the Canadian government.

It also offers the Canadian public some assurance that taxpayers' money will not be used to support extractive activities violating human rights and environmental protections, at least over the long term. Where a company is found to have violated human rights or environmental protections, it is not deprived of the chance to correct this behaviour and reapply for government funding.

Ultimately, Bill C-300 embodies the spirit and intent of the recommendations in the consensus-based document produced by the multi-stakeholder advisory group established under the Canadian round table on CSR process. If passed, Bill C-300 would bring the current government strategy in line with the outcomes of this public and democratic process. In addition, it would put in place mechanisms that would hold our overseas companies to account, as recommended by the UN Committee on the Elimination of Racial Discrimination. Finally, it would place Canada as a front-runner, rather than a laggard, in addressing issues of corporate and government accountability.

Thank you.

[Viviane Weitzner, Senior Researcher, Trade and Natural Resources, North-South Institute]

Thank you very much.

It is a privilege to share with you today the North-South Institute's views with respect to Bill C-300, proposed legislation that takes critical steps towards Canadian government accountability in the extractive sector overseas. By way of background, the North-South Institute is an independent, non-partisan think tank that conducts research designed to inform policy development, stimulate public dialogue, and support efforts to reduce poverty and inequality.

Since 1998, the institute has been involved in research examining issues at the crossroads of corporate social responsibility, human rights, and the extractives. In light of growing investments by Canadian extractive companies in Latin America and the Caribbean in the late 1990s and increased reports of severe conflicts in areas that are the homelands of indigenous and tribal peoples, in 2000 the North-South Institute launched a collaborative research program highlighting indigenous and Afro-descendant perspectives respecting appropriate processes for consultation and decision-making in this region.

My talk today will draw on this extensive research program. I will use two specific case studies to highlight the need for the mechanisms established in Bill C-300 and to show that this bill takes some important steps forward in light of the challenges and realities faced by the communities affected by the Canadian extractive sector overseas.

The first case I will talk about is that of Colombia. I want to acknowledge the presence here today of Carlos Rosero, of Proceso de Comunidades Negras, a national Afro-descendant organization that is one of our research partners in Colombia. I encourage you to address any questions about the Colombian situation to Carlos during question period; we have provided translation services for this purpose.

On paper, Colombia has one of the most progressive regimes in the world with respect to constitutional and legislative protections of indigenous and Afro-descendant rights. In practice, however, indigenous and tribal rights are violated on a regular basis. Indeed, despite official reports that the Colombian armed conflict may be lessening, the reality is that for indigenous and Afro-Colombian communities the conflict is intensifying. There appears to be a direct link between increased violence in indigenous and Afro-descendant communities and interest in natural resources, particularly minerals and metals. Here are concrete and recent examples involving the communities and organizations NSI is partnering with.

On October 22, a paramilitary group faxed a written threat identifying organizations and several leaders of Afro-descendant communities in the municipalities of Buenos Aires and Suarez as targets for military action in light of their "not letting in multi-national companies that will bring benefits to the communities".

Far from being anti-mining, these are communities whose primary economic activity is artisanal mining, but whose lands and work areas are being concessioned or sold off to large-scale companies, and who are facing in-migration from small-scale miners, including demobilized paramilitaries. In the wake of new changes to the Colombian mining code, black communities undertaking artisanal mining in this area since the 1600s are now facing the possibility that their mining will be declared illegal and that they will be forcefully evicted.

I know of at least one Canadian junior whose activities are adding to the pressures in this area and whose activities have not involved prior consultation with the Afro-descendant communities, as required by ILO Convention 169 enshrined in Colombian legislation, or free, prior, and informed consent, upheld as a minimum standard in the UN Declaration on the Rights of Indigenous Peoples, which is supported by Colombia.

Indigenous communities and their leaders are also the target of increased violence, even at the hands of local police. For example, on October 26, the Resguardo Indígena de Cañamomo Lomaprieta—an indigenous reserve, and one of our research partners—was subject to an attack in which four masked and armed men interrupted an afternoon soccer match and shot and wounded an 84-year-old and a 26-year-old man. Later, it was revealed that these armed men were members of the local police, who were later released. This event demonstrates not only the lack of protection by the police force, but the abuse of human rights indigenous peoples suffer, despite their clearly protected rights through legislation and special measures put in place by the Ministry of Defense.

Importantly, the collective territories of this reserve, together with the lands of the Afro-Colombian communities with which we are working in Cauca area, are within a large exploration concession area granted to a South African multinational that is in a joint venture with a Canadian junior.

Between March and April 2008, the indigenous communities of Cañamomo Lomaprieta experienced one month of fly-over exploration, including over sacred sites, without any form of prior consultation or consent. This created a variety of immediate negative impacts, including fear for personal safety.

Why am I telling you all of this? I am purposefully painting a detailed picture of the realities faced by indigenous and Afro-Colombian communities to highlight the extremely complex situation that doing business in Colombia entails from a human rights perspective. With the negotiation of the Canada-Colombia free trade agreement and active promotion of Colombia as a safe place to do business, there will be increased investment by Canadian extractive companies in Colombia, and the pressures and violence experienced by communities in Colombia will no doubt increase further.

The current CSR strategy of the Canadian government simply does not provide appropriate tools for navigating this complex situation. The voluntary principles on human rights and security target only one among a multitude of potential human rights violations in which Canadian extractive companies, and by extension the Canadian government, might unwittingly become complicit, despite best intentions.

The second case I want to touch on very briefly is that of Suriname. This is actually a stark exception to the claims Mr. Wisner made that all countries have in place detailed systems for accountability. Suriname is the only country in the western hemisphere where there is no recognition or protection of indigenous or tribal rights; it also has no legislation mandating environmental and social impact assessments. In short, Suriname provides a perfect litmus test from which to gauge the feasibility and effectiveness of voluntary initiatives in addressing human rights and environmental protection.

Since 2004, the North-South Institute has partnered with the Association of Indigenous Village Leaders in Suriname to support indigenous communities affected by proposed large-scale bauxite mining and related activities. The original proponents are members of the International Council on Mining and Metals, an industry association representing the world's largest multinational companies.

Our research has documented numerous instances in which these companies failed to implement their own or ICMM's policies and commitments. To cite one of the most egregious examples, the companies undertook advanced exploration in 2,800 square kilometres of primary rainforest, the traditional territory of the Lokono people, without any environmental and social impact assessment, contrary to company policies. The company has made several public apologies for this large oversight. However, saying “sorry” for not adequately protecting and mitigating social and environmental impacts in advanced exploration is simply not acceptable. It's also a harbinger of potential future practices and behaviour.

Our research in Suriname leads to two conclusions. First, left to their own devices, companies will try to get away with as little due diligence as possible, despite their own policies. Second, voluntary measures are simply not an effective means for protecting the environment or human rights.

[Anthony Andrews]

Yes, I want to respond to Mr. McKay's comments. He alluded to a connection between the launching of e3 Plus and Bill C-300. In fact, e3 Plus had a predecessor called e3—you may not have known that—which was launched in 2003.

In terms of the six allegations per year, all we were doing was trying to put this problem into context. This whole debate, which started with the SCFAIT prior to the CSR round table report, is being characterized by a lack of a systematic fact base. That was our attempt to put some data around this. It's six allegations a year, not complaints, that we feel could adequately be taken care of by an ombudsman function, without assuming the risk that the Bill C-300 process would involve.

One thing I would like to point out on the issue of consultation is that the advisory group report of the national round table process had a very important recommendation. It was the very last recommendation, and that was on the formation of a multi-stakeholder advisory group to continue the process. A specific role they would play would be helping to take these concepts that came out of the report to try to operationalize them. This process certainly wasn't applied to Bill C-300. Bill C-300 recommends something entirely different from an ombudsman. It really is against the spirit of the advisory group report, and it's very disappointing.

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

I appreciate PDAC's work. I'm pleased that you've instituted these e3 things, and I'm happy to note that your institution of this e3 proposal comes a month or two after Bill C-300 was deposited on the floor of the House.

What I found curious about your testimony, Mr. Andrews, was that it only constitutes six complaints a year. I don't know, but to my mind that is a lot of complaints. To take a poor analogy, should we have no legislation about shootings because in the city of Ottawa, a million people, there are only six people a year who are actually shot? I wonder how you arrive at six a year, because I have eight here, and we haven't even worked anything up. I'd be interested in your comments on that.

[Anthony Andrews]

I think it does. But I think a much more complicated issue is how are you going to conduct an investigation and hold companies in compliance with respect to guidelines in situations that are very flexible and change from one site to another? That's the most difficult situation I can imagine with this Bill C-300.

People need to recognize that companies are held accountable on a number of different levels. You can start with the international laws, agreements, and conventions that exist, the financial institutions, and the equator principles that I know everybody around here is familiar with.

We've been talking about host country governance laws and regulations. Regional and municipal governments hold companies accountable where they operate. Local communities hold companies accountable as well.

If a local community is objecting to your project--you have not brought them along with it--they can slow it down very seriously. They can force you to walk away from your project. Communities have this power. They hold companies accountable, and there have been examples of this.

And finally, there are investors. Investors hold companies accountable as well. If, for instance, a company doesn't do its community engagement properly and there are delays to the project or the company has to walk away from it, the investors will punish the company through withdrawal of investor loyalty and their share prices will drop significantly. That's what I call accountability.

These companies are accountable on many different levels.

[Anthony Andrews]

Thank you, Mr. Chairman.

We have heard from some of our members that they consider Bill C-300 serious enough that they would contemplate relocating their head offices elsewhere if this comes into law.

[Robert Wisner]

First of all, let me try to answer your question about the translation. I do apologize. There is a written text, but it is still being translated. I have been told that a copy will be distributed to the members of the committee by the weekend.

I'll speak in English because I'm going to refer back to my notes.

As I made it clear, I don't believe there's any contradiction at all between the remarks that I presented and Mr. Andrews' remarks. We both agree that host countries' governance capacity can be improved. So we're both on exactly the same page as far as that goes.

I did not suggest that giving countries assistance to enforce their own laws is somehow a violation of their sovereignty. On the contrary, I encourage the Canadian government to continue to pursue that policy, which they have set out to do. My comments were that Bill C-300 does not actually provide them with assistance to increase their governance capacity. It couldn't do that as a private member's bill, as it can't allocate the funds. What Bill C-300 tries to do is something else, which is it tries to actually set laws that apply in other countries, and that is a different thing.

In terms of whether I live on the same planet as everybody else, there was a distinction in my remarks between laws and the degree to which they are enforced. In terms of the laws, I can refer you to a survey, and it's referred to in my written submission, on 32 jurisdictions around the world. It's a summary of their laws, including many countries in Africa and poorer countries. It describes the detailed laws, including environmental, labour, and other standards, that are applied in those countries. Now, there is a distinction, as I mentioned, between the laws in the books and the degree to which the government officials have the technical capacity, political ability, and financial ability to enforce those laws. If that is what the issue is, the solution to it is to provide them with the assistance to do that.

[Donald Raymond]

Mr. Chairman, I would be happy to respond to some of the comments.

First of all, the CPP Investment Board is a relatively young organization. I joined in 2001 and there were 12 people. This has been an evolutionary process in building out our capabilities. We had a socially responsible investing policy when I joined and then as a result of us actually taking quite a leadership role within Canada, and even internationally with working with the UN to develop the United Nations principles, we actually have been a leader in Canada in developing responsible investing policies. We are very concerned about these issues, in large part because we believe that companies that perform well on environmental, social, and governance issues tend to make better investments over the long run. So in this regard our interests are very much aligned with the interests of Bill C-300.

We do, as the member pointed out, take this from an investment risk and return perspective, and that's required by the Canada Pension Plan Investment Board Act. In fact, it states quite clearly our objective is to maximize return without undue risk of loss, and furthermore that we cannot undertake any other inconsistent activities. It's a very fundamental investment premise that screening companies, in other words removing companies from your possible set of investments, will either increase risk or reduce return. On that basis, we believe that screening--in fact many NGOs and others in the social investment arena would agree with this statement--is less effective than engagement with companies, because when you sell a company, when you sell their shares in the first case you're selling them to someone else, so it doesn't actually affect the company at all, and secondly you lose the right to have any voice with the company.

[Bernard Patry, Liberal, Pierrefonds—Dollard, QC]

I just wanted to add to this. First of all, I will ask you some questions.

Do you agree to submit to the committee the letters that you sent to these companies and the response, if there was any, from these companies?

Now, Mr. Dale just pinpointed the website. On the website, I can see all your votes and some things like this, but it's nothing really. You vote against the nomination of some people. You say a lot of things. It's really on the business side of the view that you're voting against. We talk about the environment, social, and good governance. This is the idea of Bill C-300, and I would like to get some answer on this Bill C-300.

Now, you say that you're looking at what's happened over there, but how do you do it? Who gave you the response over there? If a company in Guatemala.... There are not that many companies in Guatemala. Do you know which company you're thinking about? What are you doing in Guatemala?

I want to have some real answers about this, not just to say to go on a website. A website is not sufficient for me.

[Bernard Patry, Liberal, Pierrefonds—Dollard, QC]

Thank you.

Thanks also to our guests.

Mr. Raymond, the committee notes your recommendations on Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries, including the one about removing the reference to yourselves. I read your 2009 report on responsible investing. In your opening remarks today, you tell us that you intervened last year specifically in Guatemala, Burma, and the Democratic Republic of Congo. Your words were: “[...] to encourage improved transparency and risk management strategies.”

Mr. Raymond, can you provide the committee with copies of those letters as well as the responses from the companies, if any, and tell us if you have done any follow-up with those mining companies? I would like to know who does this follow-up, how it is done, if the companies move forward, and, if not, what you see as the next step.

[Robert Wisner, Partner, McMillan LLP]

Thank you.

Members of the committee, it is a great honour to appear before you today to talk about the legal problems that Bill C-300 causes.

The international law and fairness issues that I will discuss today are set out in more detail in a written submission that we prepared at the request of the PDAC that and will be distributed to members of this committee later this week.

From my perspective as an international lawyer, Bill C-300 will do more harm than good to the worthwhile causes that it seeks to promote. That's because it suffers from three fundamental legal flaws that cannot be remedied by minor amendments.

First, the bill will hamstring the ability of the Canadian government to promote Canadian values abroad because it will be seen by developing countries as an interference into areas that are their exclusive jurisdiction under international law.

Second, the obligations in the bill are so vague that they will create a high degree of legal uncertainty for Canadian mining, oil, and gas companies.

Third, the bill lacks guarantees for even a minimum level of procedural fairness for the companies that will be accused of wrongdoing. That is a problem that, as I will explain, is inherent in a private member's bill, which cannot allocate funds to provide the necessary level of procedural fairness. This uncertainty and lack of procedural fairness will deter even the most responsible Canadian companies from investing abroad. That deterrence of foreign investment harms not only the Canadian economy, but developing countries as well.

Let me begin with how the bill will make it harder for the Canadian government to promote Canadian values abroad.

It's important to understand here that the issue is not one of voluntary or mandatory standards. The voluntary CSR guidelines that PDAC and other groups have developed are intended to complement rather than substitute for mandatory legal standards. Rather, the issue is about who should decide what the mandatory legal requirements should be. Should it be the governments of the states where the activities are actually taking place, or should it be a government thousands of miles away?

The underlying assumption behind Bill C-300 is that all developing countries, as they are defined in the bill, suffer from a legal void in terms of environmental, labour, or human rights rules. That assumption is simply incorrect. As you'll see in my written submission, every relevant jurisdiction for Canadian mining companies has detailed laws and regulations to hold corporations accountable in these areas, laws that are usually drafted with the help of UN agencies or international financial institutions.

What proponents of Bill C-300 are really doing is asking the Government of Canada to pass judgment on how other countries are enforcing their own laws. At the same time, Bill C-300 doesn't distinguish between governments that have the capacity to enforce their own laws and those that don't. So for example, in testimony before this committee that I've seen, disputes in democracies such as Chile and Argentina have been lumped together with disputes in conflict zones that are emerging from civil war.

We all agree that some developing countries could benefit from assistance in building their enforcement capacities, which is something the Canadian government has agreed to provide them with. The question, however, is whether we should ignore a developing country's own enforcement decisions simply because of Canadian ownership of a corporation in its territory. Under international law the answer to that question is no. With limited exceptions, Canada's Parliament and its government agencies cannot exercise jurisdiction outside of Canadian territory. These limits arise from the very foundation of the international legal order, which is respect for state sovereignty.

On other occasions, I've heard Mr. McKay suggest that Bill C-300 avoids any extraterritorial jurisdiction because it merely imposes conditions on Canadian government assistance. If this were so, the bill would be redundant, because as you've heard this morning, CPP and other government agencies do set conditions and do screen the assistance that they provide, but the heart of this bill sets standards and calls for investigations of companies that may not receive a single penny of government assistance. Furthermore, these companies do not even meet the definition of a Canadian company under international law.

Bill C-300's violation of international law is exactly the same as what Canada protested when the United States tried to regulate Canadian subsidiaries of U.S. companies that trade with Cuba. We even passed laws, under the Foreign Extraterritorial Measures Act, blocking these companies from complying with those directions.

Imagine, if you will, what would happen if the Minister of Foreign Affairs of Brazil or his representative were to show up in Canada one day, start examining witnesses in Sudbury, for example, hold hearings there, and then put pressure on a Brazilian shareholder of a Canadian mining company to close his operations because they don't comply with that minister's view of appropriate environmental standards. I don't think Canadians would view that as an appropriate exercise of Brazil's jurisdiction.

This breach of international law will make the promotion of human rights and the environment by our own diplomats much more difficult. It will be hard for us to be listened to if we're seen as being selective in our own application of international law.

Let me turn to some of the specific problems with the way the bill imposes rules on Canadian mining, oil, or gas companies. Bill C-300 doesn't actually set out what those rules are going to be. Rather, it directs the ministers to develop standards based on two types of documents.

First, you have more than 260 pages of voluntary guidelines that cover just about every aspect of corporate conduct. Now, these are valuable and important documents, but they were not drafted with the intention of being binding legal rules. They were supposed to be guidelines that help management make better business decisions. That means they're not written in accordance with legislative conventions and they lack the clarity and specificity that you normally see in legislation.

To give you an example of this, it's like the difference between a manual on safe driving put out by a driving school and the Highway Traffic Act. The manual on safe driving is a very useful, important document, and it helps people to be better drivers, but it won't have the clear rules and definitions that you usually see when legal penalties are being applied.

The second set of documents incorporated into the bill is made up of international human rights conventions to which Canada is a party. These rules are indeed binding legal rules, but they're designed to be binding on states, not on private persons. As a result, they have no clear meaning when they are applied to corporations. It's as if, overnight, the Canadian Charter of Rights was extended from governments to private citizens. If that happened, there would be a great deal of uncertainty as to what exactly was the meaning of the obligations that were being imposed.

When you take standards that are designed for one purpose and simply transpose them into another area, you raise a whole host of questions about their meaning. This bill therefore makes every Canadian mining, oil, and gas corporation operating in developing countries, no matter how responsibly run, a target for costly and unpredictable investigations.

Finally, because it is a private member's bill and cannot create any new offices, the bill lacks the procedural fairness safeguards that must accompany any ministerial investigation into alleged wrongdoing. For example, in the Canadian Human Rights Act, we create a Human Rights Commission to examine complaints, and then an independent Canadian Human Rights Tribunal to hold hearings into whether standards have been violated. Bill C-300 is completely silent on all of these elements of procedural fairness, because including those in the bill would render it out of order.

Having said that, I note that even if this type of administrative tribunal were created, it would still expose Canadian companies to the stigma of government investigations and second-guess good faith decisions by Canadian agencies and diplomats. This is completely different from the non-governmental bodies that were recommended by the advisory group report following the national round tables on corporate social responsibility.

We've already had some experience with this type of plaintiff diplomacy, and it hasn't worked very well. A Canadian company, Talisman, was sued in the United States based on nothing more than the fact that it paid royalties to the Government of Sudan and upgraded infrastructure. After several years of litigation, that complaint was thrown out of court because of lack of evidence. By that time, the damage was already done. After enduring the adverse publicity generated by the legal complaint, Talisman sold its interests. The ultimate dismissal of the complaint went virtually unnoticed by the media and the cause of corporate social responsibility was hardly advanced by the new owners.

Bill C-300 creates very similar risks. Indeed, witnesses appearing before this committee have already alleged that simply by paying royalties to bad governments or by building roads that can be used by government forces, Canadian companies are committing human rights violations abroad. If this is a standard to be applied, no Canadian company can avoid being investigated, and that will mean that many worthwhile projects will not go forward. That's not just bad for Canada, it's bad for developing countries as well.

Thank you.

[Anthony Andrews, Executive Director, Prospectors and Developers Association of Canada]

Thank you, Mr. Chairman. I appreciate the opportunity to be here today to talk about this important subject.

My name is Tony Andrews. I'm the executive director of the Prospectors and Developers Association of Canada. My colleague Bernarda Elizalde, before joining the PDAC, spent a number of years advising mining companies on how to apply CSR practices in Central and South America, so she has an interesting perspective to add to the discussion today.

The PDAC is a national association focused on mineral exploration. Our 7,000 members work all over the world and include a large number of junior exploration companies. The Canadian juniors lead the world in numbers of companies and proportion of total funds they raise and spend worldwide on exploration and development. They are small businesses dependent on the capital markets for raising funds. Normally, they do not avail themselves of debt capital from banks and financial institutions. Our members are world leaders in the financing and technical areas and also in the emerging field of CSR. However, we are still in the early stages of understanding CSR development, and there is much work that will be done. It's an evolving process.

I was a member of the advisory group of the CSR national round table process along with a member of our board of directors. The association publicly supported the advisory group report, with some commentary and recommendations. PDAC is in the business of creating leading practice. It has recently launched what we call e3 Plus. It's a comprehensive, online framework for responsible exploration, and stands for excellence in three areas: social responsibility, environmental stewardship, and health and safety. It has an information-educational component consisting of principles, a guidance document, and three comprehensive tool kits. This was launched in March of this year. It also has an accountability component, which is in development at present. This will consist of performance objectives, reporting guidelines, and a system of verification.

As we understand it, the issue before this committee is how to ensure two things: the continuous improvement in CSR practices, and the accountability of Canadian companies operating in developing countries. We believe that the most effective way of accomplishing this will be on the basis of a systematic, integrated approach that will involve a combination of both voluntary and mandatory mechanisms, basically similar to the recommendations of the national CSR round table advisory group report and the CSR strategy recently introduced by the Canadian government. In our opinion, the legislation proposed by BillC-300 would not contribute to the objectives of either improved CSR practice or accountability. In fact, it will pose significant risk to the Canadian industry.

Over the next few minutes I'm going to do three things: I'm going to review some key realities that define CSR at present; I'm going to measure these against the approach contemplated by Bill C-300; and I'm going to define what we feel are key opportunities for making progress in CSR performance and in accountability.

Here are some current realities about CSR. Over the past 15 years, the focus in public priorities has shifted from environmental issues to social issues and, most recently, to an emphasis on human rights and ethical practice. The mining industry has made significant progress with environmental and social issues. Social issues are much more complex, given that they are centred on human relations and human behaviour and complicated by different cultures, values, beliefs, perceptions, and needs—often competing needs.

Environmental matters lend themselves to a prescriptive regulatory regime. Matters of corporate social responsibility do not. Any standard or guidelines for CSR must be comprehensive enough to satisfy public expectations of corporate behaviour. At the same time, they must be scalable to the size and the nature of the company and the project as well as to the stage of exploration or development.

Standards must be flexible to accommodate the wide variety of geographical, cultural, and environmental circumstances where projects occur. The reality is that what will work at one site will not necessarily work at another, so the successful application of CSR will be based on the experience and judgment of industry managers at the site.

What is our level of understanding of CSR? Well, it's a relatively new phenomenon that is still being assimilated. It involves rapidly evolving expectations and uncertainty about how to deliver on those expectations. Until recently there were no comprehensive international guidelines that attempted to define for the exploration business what CSR is and how it should deliver on those expectations. E3 Plus, which I described before, is an attempt to accomplish this.

Most companies are trying to apply CSR. They believe that they are applying CSR, using common sense, oftentimes, and homegrown approaches, but they have nothing against which to benchmark their practices. Therefore, there is wide variability in the manner and approach of their applications. This is where guidelines and assistance to our members come into play.

It is not only about human rights. Human rights are central to the issue of CSR, but it is not only about human rights. CSR involves broad dimensions of social responsibility, environmental stewardship, and health and safety, all encompassed in government regulations, industry good practice, and international instruments and conventions. It's a very broad and complex area.

How many allegations have been made against Canadian mining companies? Research conducted this year by the Canadian Centre for the Study of Resource Conflict revealed that over the past ten years there have been a total of 171 alleged CSR violations by mining companies. These are reported from around the world and from all sources. About 50% of these allegations were reported by advocacy NGOs. Of the 171 allegations, 56 involved Canadian companies. That is an average of fewer than six alleged cases a year.

Since its inception in 2000, the IFC compliance advisor ombudsman, the CAO, has received and processed a total of 110 complaints. Of these, there were eight complaints involving four mining companies. Of these, one was Canadian and another was partly Canadian owned.

I'll just add that as of June 2008, just prior to the global financial crisis, there were about 1,000 Canadian companies working in over 100 countries on 5,000 projects outside Canada. I think those numbers put this into context.

Given these realities, how does Bill C-300 measure up as a practical, effective system of applying accountability? It is an investigative, punitive system based on assigning blame and imposing sanctions. It will be dependent on the difficult process of collecting evidence in foreign jurisdictions. It will try to discriminate between right and wrong.

How can this approach be rationalized in a situation that is so fluid and variable and that is complicated by differing cultures, beliefs, perceptions, and needs? How will companies be judged against a set of guidelines that will need to be scalable and flexible? How will companies know where the boundaries of compliance are? How will the minister determine whether a contravention has occurred? Why would we introduce such a negative, high-risk approach in a situation that cries out for information, education, and assistance and that involves so few cases of proven intent to harm? Why would we introduce such a punitive approach prior to the establishment of fundamental definitions, basic information, and clarity of expectations?

These are fundamental problems that cannot be corrected through the artful rewriting or amending of Bill C-300. There are additional significant legal issues with the bill, which I'm sure my colleague, Mr. Wisner, is going to describe.

Canadian mining companies are already accountable in many different ways and on many different levels, but we believe there are some areas where accountability can be improved. The first and most important one is host country governance capacity-building. This is a highly significant area. This is the seat of accountability for Canadian companies and it lies with the host government where they are working. So attention and resources should be focused on governance capacity-building in those countries where governance is a critical issue.

The second area I would suggest we have a look at is access to capital and strengthening the requirements in securities regulations around materiality. This is related to disclosure and reporting of CSR matters to investors and the public.

Significant improvements for industry need to occur in the area of due diligence and risk assessment, as well as community engagement. That's our own assessment. This will contribute to accountability as preventative mechanisms.

Finally, applying the fundamental building blocks of accountability to industry good practice guidance makes a lot of sense to us. This includes performance measures, reporting requirements, an ombudsman function to take care of a grievance, and a form of verification. To us, the advantage of this kind of approach is that it's focused on the preventive, it helps companies perform better, it's broad in scope so it will capture a large part of the industry, and it's upfront and integrated into the business practice.

Thank you very much, Mr. Chairman.

[Donald Raymond, Senior Vice-President, Public Market Investments, Canada Pension Plan Investment Board]

Thank you very much, Mr. Chairman.

My name is Donald Raymond and I'm the senior vice-president of public market investments at the CPP Investment Board. I'm joined by my colleague Mr. Dale, senior vice-president of communications and stakeholder relations.

Thank you for the opportunity to speak to the committee on Bill C-300.

The CPP Investment Board was created by the federal and provincial governments in 1997, the result of comprehensive reforms to the CPP in the mid-1990s. These reforms were implemented following extensive public consultations with business, labour, senior organizations, and Canadians across the country.

Federal and provincial policy-makers established the CPP Investment Board as an independent professional investment management organization--accountable, yet arm's length from governments--responsible for investing the CPP contributions not needed to pay current benefits.

One of the main concerns expressed by Canadians in 1997, which persists today, is that governments would interfere with the investment decisions of the CPP fund. Our independence, established in the Canada Pension Plan Investment Board Act, addressed these concerns and has contributed to our success. Our long-term goal is to contribute to the financial strength of the CPP, arguably one of Canada's most important social programs, and to help sustain the future pensions of 17 million Canadian contributors and beneficiaries.

We have a high degree of accountability to the federal and provincial finance ministers, but the reformers of 1996-97 built important protections around the CPP fund and the CPP Investment Board. For example, the assets in the CPP fund are segregated from government assets and are not tax dollars, as they are contributed directly by employers and employees.

The mandate of the CPP Investment Board, as set out in the act, is simple and fundamental to all of its activities: to maximize the investment rate of return without undue risk of loss. Under the terms of the act we may engage in no other activities. In the pursuit of this very focused mandate we have taken a leadership role in the development and implementation of a policy on responsible investing. This policy articulates how we integrate environmental, social, and governance factors, also known as ESG factors, in how we invest, including Canadian companies in the extractive industries.

As you will hear, the proactive efforts of the CPP Investment Board parallel the intent of Bill C-300 and make its inclusion in the terms of the bill unnecessary. In addition, the bill provides for government ministers to direct investment decisions at the CPP Investment Board. This runs counter to the public policy intent of the federal-provincial reforms of the CPP in 1996-97. Also, because of the provisions of the act, the bill cannot come into force without the required consent of the provincial governments.

Accordingly, we respectfully request that Bill C-300 be amended by this committee in order to remove reference to and, more specifically, direction to the CPP Investment Board.

In considering our approach to responsible investing, it is important to understand the unusually long investment horizon of the CPP fund, which is being invested for decades and generations. While other investors measure their progress by quarter, we look at decades and the quarter century. Being a patient, long-term investor is relevant to our policy on responsible investing because ESG factors tend to play out over longer time horizons.

Secondly, to effectively deliver on our promise to help sustain the CPP, we invest in more than 2,900 public companies around the globe, including more than 600 in Canada. Of that number, approximately 400 are in the extractive industries. As a long-term owner and investor, we believe that responsible behaviour regarding environmental, social, and governance factors by these companies can have a positive influence on their long-term financial performance and therefore to our investment return.

In keeping with our mandate, we view the ESG factors only in terms of investment risk and return. Simply stated, it is in the best interests of the CPP fund when the companies in which we invest meet high standards of disclosure and performance on ESG issues. Our approach to ESG issues is guided by two important documents that have become powerful agents for change, not only for us, but for institutional investors around the world.

The first document is the “United Nations Principles for Responsible Investment”. We contributed to the development of the UNPRI and were in the first group of signatories to this ground-breaking accord in 2006. I was privileged to represent the CPP Investment Board, and was the only Canadian investor involved in the development of this far-reaching initiative. I can report to you today that there are more than 500 signatories to the UN principles, representing more than $18 trillion in assets under management. Like our own policy on responsible investing, the UNPRI reflects the view that effective disclosure and management of ESG factors can positively contribute to the long-term financial performance of investments.

The UN principles are implemented through a collaborative approach coordinated by the UNPRI engagement clearing house, where we work with other global funds to engage companies on ESG issues. In January 2009 this group wrote to 130 companies that had voluntarily committed to standards of disclosure on human rights, labour, environment, and anti-corruption practices—part of the UN global compact.

The CPP Investment Board's own comprehensive policy on responsible investing predates but parallels the UNPRI. Framed by our mandate, this policy articulates how we address these important environmental, social, and governance issues in our investments. A copy of this policy has been provided to this committee.

The implementation of our policy on responsible investing takes a number of forms, including activities that proactively address issues identified by Bill C-300. The first activity is engagement. This involves communicating with the senior executives and board members of companies in which we invest, as well as regulators, industry associations, and other stakeholders.

Our direct engagement activities are highly focused. Most of the companies we select are Canadian. We concentrate on three areas: climate change, executive compensation, and extractive industries—oil and gas, and mining companies. We seek enhanced disclosure and transparency from these companies. Disclosure allows all investors to see and understand the potential risk posed by ESG issues. Disclosure of these risks is the first step to addressing them, and we encourage companies to adopt best practices in the management of ESG issues to improve financial performance.

In the past year we have engaged with Canadian and international companies operating in high-risk countries, including Burma, the Democratic Republic of Congo, and Guatemala, to encourage improved transparency and risk management strategies. It is important to note that this is our initiative, undertaken proactively in the best interests of the CPP fund. It is not in response to any government requirement or specific complaint from a third party.

Influencing corporate behaviour, as you know, takes time. Engagement is a long-term strategy, but one ideally suited to our long-term approach to investing.

Parallel to our engagement processes, we encourage the investment industry to produce enhanced research and analysis of environmental, social, and governance issues. This research from investment dealers and other research sources helps all investors integrate relevant ESG factors into their investment decisions.

Our policy on responsible investing also informs our voting on shareholder issues via our published proxy voting principles and guidelines. Proxy voting by large investors is effective in enhancing disclosure, transparency, and improved behaviour on environmental, social, and governance issues.

As owners we vote on proposals at public companies' annual and special meetings. Proxy voting allows us to engage with all public companies in our portfolio. In the course of the 2009 proxy voting season we participated in more than 3,000 shareholder meetings, including 555 here in Canada. That count includes companies in the mining and oil and gas industries, both Canadian and international.

We voted on nearly 18,000 agenda items. In 15% of those items we voted against management. We make these results public. A summary of our proxy voting activity is included in our 2009 report on responsible investing, and the results of all proxy votes appear on our website.

As a respected global investor, our actions are closely watched and our voice is heard, not only by the companies in which we invest, but by the broader investment community. We also work with other investors, and a relevant, collaborative approach is our participation in the extractive industries transparency initiative. The EITI brings together companies, investors, non-governmental organizations, and governments, including the Government of Canada. Its focus is on oil and gas and mining companies, precisely because they deal with a range of ESG issues that must be managed effectively for long-term financial performance.

Let me explain how this initiative works. Through the collaborative efforts of EITI signatories, more than 40 of the world's largest oil and gas and mining companies are now actively supporting better transparency in 29 candidate countries. Signatories commit to disclosure of company tax and royalty payments, as well as government revenues from oil and gas and mining. This is key to illuminating sources of corruption in those countries.

Our proactive approach and industry leadership have been recognized internationally. The Social Investment Organization of Canada acknowledged our policy on responsible investing and related engagement approach as positive examples of responsible investing activities. We have been cited by the UNPRI for our disclosure of proxy votes. Our policy on responsible investing and proxy voting principles and guidelines have been named as global best practices.

In summary, the CPP Investment Board was created by the federal and provincial governments to invest at arm's length from governments. Our mandate is to generate investment returns to help sustain the future pensions of 17 million Canadian contributors and beneficiaries. The terms of our legislation state that the act may not be amended without the consent of both federal and provincial governments.

Through our policy on responsible investing we have been recognized as a global leader for proactively addressing environmental, social, and governance issues. For these reasons we respectfully submit that Bill C-300 be amended to remove both reference and direction to the CPP Investment Board.

We appreciate the opportunity to appear before this committee today, and we look forward to answering your questions.

Thank you.

[The Chair, Conservative, Kevin Sorenson]

Bonjour, chers collègues.

This is the 39th meeting of the Standing Committee on Foreign Affairs and International Development, on Tuesday, November 17, 2009. Our orders of the day include a return to our committee's study of Bill C-300, an act respecting corporate accountability for the activities of mining, oil, or gas in developing countries.

As our witnesses on our first panel today, we have, from the Canada Pension Plan Investment Board, Ian Dale, the senior vice-president, communications and stakeholder relations, and Donald Raymond, senior vice-president, public market investments.

Welcome to you.

Also, from the Prospectors and Developers Association of Canada, we have Anthony Andrews, the executive director, and Bernarda Elizalde, the program director for sustainable development.

We also have Robert Wisner appearing as an individual.

I'm not certain if any or all of you have attended committee meetings before, but we look forward to your opening statements and then we'll move into different rounds of questions that the members of this committee may have for you.

Perhaps I'll just open up the invitation to Mr. Dale and we'll proceed from there.

Mr. Raymond.

[The Chair, Conservative, Kevin Sorenson]

The motion just has to be for this debate to be held during committee business.

Now, because of the timelines, I again refer to the table. You still have the choice of bringing forward Bill C-300 and then including time for committee business where we would return to this debate.

We have a motion to suspend debate today. All in favour—

[Bernard Patry, Liberal, Pierrefonds—Dollard, QC]

Mr. Chair,

I just want a point of clarification following Mr. Obhrai's comments. If we continue until 11 today, what is going to happen at the next meeting? Will it be finished today, or will we start again with Bill C-300 at the next meeting?

[The Chair, Conservative, Kevin Sorenson]

Yes, we can. The problem is we're working on Bill C-300, where we have very clear timelines. If this means we go back to the debate on this motion, then I don't know how that works with Bill C-300.

We have a very clear directive from the House to return Bill C-300. We have a very limited amount of days that we can listen to those witnesses on that bill, so here is where it becomes difficult.

We are now going to entertain the motion to suspend this debate.

[The Chair, Conservative, Kevin Sorenson]

It didn't necessarily come up, but my understanding is that we'll get back to it when Bill C-300 is done.

All right. So we're all in favour of number one.

Number two is that in accordance with the motion adopted, we invite Peter Kent to appear before the committee as soon as possible.

[The Chair, Conservative, Kevin Sorenson]

No, we've had the departments here, and we've had a number of mining associations, and we've had Mr. McGuinty—who was on his own exploration group—and we've had the EDC. We're trying to bring balance to this, but there are a number of other witnesses. I'm told by the clerk this is not just to extend the study of Bill C-300, but to extend this for witnesses.

If we need extra time for clause-by-clause consideration in January, we'll do that, but this is really four extra hours. So it's two days, albeit four hours. I'm told by the clerk this would be sufficient to hear from the witnesses on the paper right now.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

If I may, Chair, I think we need at least an additional two meetings. I'm just wondering, by passing this report, if it's going to then constrain us to two meetings. The reason I say this is because we have been hearing, on Bill C-300, all the way through, from dominantly people who have been in favour of Bill C-300. I think the first time, to my recollection, that I recall any really cogent argument against Bill C-300 was in one half meeting, namely EDC.

[The Chair, Conservative, Kevin Sorenson]

No. Committee business is public unless we request to move in camera for some item.

Has everyone received a copy of the steering committee report?

I am just double-checking on this. The steering committee meets in camera. They deliver a report. If you choose to go in camera you can, but it is public unless you choose.

We have four items on the steering committee report for which we would ask your support in passing. The first one is that the committee has scheduled two additional meetings to Bill C-300. This would take away from your schedule the two meetings that we had on Africa. That would be on November 24 and 26. This would also allow us the opportunity in December to then go clause by clause on Bill C-300.

Mr. Abbott.

[Deepak Obhrai, Conservative, Calgary East, AB]

Thank you very much, Mr. Chair, and thank you very much to EDC for coming.

I would like to raise two points that I would like your expertise on.

The previous speakers who came before us brought along their expertise in development and human rights. Although I was very concerned about Mr. Alex Neve saying “I don't really care whether there is something...” when they said this is the approach Canada takes. Canada takes, as you rightly pointed out...to work together. But their expertise is in this, and your expertise is in business.

I want to go on to what Bob Rae said about the investment process and the business that you've been doing, which is giving money, and the impact, which you rightly pointed out, of the mining industry in Canada. But we seem to have forgotten one serious factor. My colleague from the NDP keeps talking about DRC because he made a trip to DRC. I made a trip to Tanzania and to Zambia, where the copper industry is going on, and to Papua New Guinea and all these places, and as my colleague said about Mongolia, a tremendous investment is being done and impacting the local economy. Papua New Guinea's ambassador to the UN said 12,000 people in Papua New Guinea are not living on dollars a day, which he's talking about, but are actually making a fantastic living out there. So we have this whole economic factor out there.

I have two points on the issue you brought out here. One, what impact, which you're already talking about, will it have on the Canadian companies moving out? For example, we know China is going out to Africa and signing all these deals out there, and there are no standards as far as China or other countries are concerned. They are moving right in there. Now, I'm not saying that Canada should not have standards. That is why we were at this year's round table conference, and we came out with very good suggestions with every stakeholder there. It was very good. The companies, the NGOs, and everybody took part in that. That should be the first stepping stone.

The second factor is the international standards that you're talking about—human rights. As you rightly pointed out, the three environmental ones that came out of the World Bank are applicable to everyone across the world. Why can we not then, at that given time, wait for those international standards to develop through the pressure that the NGOs are talking about, going to their members and going to all these things, using the same pressure to come out so that there is an international standard out there, so that everybody has a level playing field, including China and everyone? Nobody is talking about China. My friend talked about Talisman out there. Let's go to Africa and see what is happening with the investment that China is making out there, in absolute disregard of everything here.

My question here would be about the impact of Bill C-300, the chilling factor on investment, not here but abroad, as well as on the international standards, which are not a level playing field.

[Bob Rae, Liberal, Toronto Centre, ON]

I think you've certainly whacked away at the bill. But if there were a change to the wording of the bill, for example, if we were to suggest that the ombudsman or minister, or whoever's making the determination, would have to find a serious breach of the guidelines, I wonder whether that would not be out of line with what you're in fact already doing. It's just that you have your own standards and your own internal operations. You make your own decisions, which are not reviewable. We can't decide, as we don't know which companies are applying or not applying—and that's entirely appropriate—but we don't have any external mechanism to know what those standards are and how they're applied. I'm not being critical of EDC; I have a very high regard for EDC from my own professional work.

But I'm just wondering, do you not see the concern that we need some sort of process? It sounds to me like the process that's being suggested in Bill C-300 is not completely different. It's not as if you're rejecting the importance of CSR or saying that you don't actually turn down companies you don't think meet your standards or that you're not prepared to do that.

I don't know why we feel we have this huge chasm between what's being proposed in Bill C-300 and what is already under way. I regard Bill C-300 as a modest extension of what's already in place. I think with a little bit of work that's how it could in fact operate.

[Jim McArdle, Senior Vice-President, Legal Services and Secretary, Export Development Canada]

Thank you, Mr. Chairman, and thank you to the members of the committee for inviting me to speak to you today about Bill C-300 and the impact it would have on the Canadian companies EDC serves if we were to be included in it.

I am here today both as Senior Vice-President for Legal Services and as the executive responsible for CSR. As such, I have worked on CSR issues both on the policy level as well as in the context of the transactions I have worked on as a lawyer.

As I’m sure you already know, EDC provides financing, insurance, and risk management solutions to help Canadian exporters and investors succeed in the global marketplace. Our mandate is to support and develop Canada’s export trade and Canadian capacity to engage in that trade, and to respond to international business opportunities. In this way, we work to ensure that Canadians have a level playing field when competing against exporters from other countries.

In our opinion, including EDC in Bill C-300 would put Canadian companies at a significant disadvantage to exporters from other countries and severely inhibit EDC's ability to support Canadian companies and apply our CSR procedures and processes. Let me state clearly, however, that EDC supports the intent of Bill C-300 and shares the belief that Canadian companies should conduct their business in a socially responsible manner, no matter where in the world they operate. However, we believe that the best way to both promote human rights and ethical conduct and to improve environmental conditions related to projects around the world is by working with companies to proactively help them build their capacity in a responsible manner. Where there are established and clear international standards, we hold companies to these standards often in challenging environments.

I think it is important to note, though, that our experience confirms that the international community is struggling with how companies can integrate human rights issues into their daily global business practices, and currently there is no consensus on internationally recognized human rights standards for financial institutions to apply. However, I'm pleased to say that EDC is a very active participant in the international dialogue in this area. For example, EDC is a main sponsor of—and I will be a participant in—an expert meeting next week with John Ruggie, the special representative of the UN Secretary General on business and human rights, entitled “Opportunities and Challenges of Using Corporate Law to Encourage Corporations to Respect Human Rights”.

At EDC, leading-edge corporate social responsibility policies and procedures guide our activities every day. Over the past decade, we have worked hard to develop one of the world’s most comprehensive CSR programs among export credit agencies. EDC has been evolving its CSR standards consistent with international best practices. Our corporation actively supports a number of international commitments, including the Equator Principles, which only two other export credit agencies have signed on to. Being an EDC customer means that your transaction will be seen as having met some of the highest standards applied by any export credit agency.

For our corporation, CSR isn’t about checking boxes; it is an integral part of how we operate and is an ongoing process with our customers. EDC conducts CSR assessments when our support is in relation to sensitive markets or projects in order to ensure that the project and company in question meet our CSR requirements. If there are areas in which we believe a company is not up to those requirements, EDC gives direction and advice to the company on how they should improve. If a company does not meet our strong requirements after this, they will not receive EDC support.

By engaging with companies in this way, EDC is able to provide a balanced approach to CSR: to help build the CSR capacity of Canadian companies as well as ensure that they meet the internationally recognized standards we apply, while still providing the financing and insurance solutions they need to succeed on the international stage. We believe Bill C-300 would severely jeopardize our opportunities to engage with Canadians this way.

Including EDC in this bill and imposing compliance standards, several of which standards are, as noted earlier, still in the process of being defined and agreed upon by the international community, would require EDC to exit a relationship with any Canadian company the moment a CSR violation has been determined. This approach has at least two direct negative impacts. First, it restricts us from working with the Canadian company to remedy the issue and improve their standards; and second, we believe it will mean they won't access capital from EDC in the first place.

We believe that the uncertainty caused by the application of this bill and the standards would also impact other lenders’ willingness to provide financial intermediation to Canadian companies. If this happens, the void left by the Canadian companies will be filled, more than likely, by other international players with less regard for CSR.

Let me explain how this would occur. According to the wording of this bill, if a determination is made that a company has breached the guidelines during the period of a loan or an insurance policy with EDC, EDC would be required by the bill to terminate that loan or policy whether or not EDC has the right to do so under the contract. Therefore, we would have no ability to work with the company to have them remedy the situation in question.

Secondly, EDC cannot allow itself to be in the position of being required by the bill to terminate our support without having the right to do so under the contract. Our experience tells us, however, that Canadian companies, as well as other lenders, would be unwilling to accept such an EDC right in the contract, as its application would be out of their control and in the hands of a third party. That means that if Bill C-300 becomes law, EDC's ability to provide lending and insurance as well as to apply our rigorous CSR standards to projects and companies in the extractive sector will be seriously compromised. And given that the bill captures all business activity with a connection to the extractive sector regardless of size or product, all Canadian businesses along the supply chain would be negatively impacted by EDC's forced departure from the market.

The significance of this departure would be deeply felt here in Canada. In 2008, for example, EDC facilitated $27.4 billion of exports and investments in the extractive sector. EDC's support in this sector helped generate $21.4 billion in Canadian GDP and sustain 139,000 Canadian jobs in communities across the country.

EDC enables Canada to be a leader on CSR without tilting the playing field against Canadian companies. What we do at EDC is reviewed and regularly benchmarked, including by the OAG. To impose standards out of step with the rest of the world would not, in our view, improve CSR. It would only hurt Canadian companies and take them out of the game.

We believe there is a big difference between being a leader and a cheerleader. A leader is on the playing field, working with the team and using their skills and resources to reach the goal. A cheerleader is on the sidelines, hoping for the best. Today EDC is on the playing field, working with Canadian companies, influencing them, and building their CSR capacity. If this bill becomes law, we believe that our opportunities to be on the field would be severely limited. Instead, we as Canadian companies and EDC would be on the sidelines hoping that the other companies who remain in the market do the right thing from a CSR perspective.

Thank you very much. I'd be happy to take questions.

[The Chair, Conservative, Kevin Sorenson]

Thank you, committee.

In the second portion of our meeting today, we're going to continue in our study of Bill C-300.

We have appearing, from Export Development Canada, Jim McArdle, the senior vice-president, legal services and secretary. Again, you were here for the opening hour. We'll give you an opportunity for opening comments, and then we'll move into the first round of questioning.

Welcome, Mr. McArdle. We look forward to what you have to say.

[Michael Casey]

I'll be very brief.

We fully support the comments of Mr. Neve on this. There has been a disappointing lack of evidence that voluntary compliance works. We feel it is necessary that there be more teeth put into compliance mechanisms and enforcement, which we feel is the necessity for Bill C-300 to go beyond the recommendations that were in the round table's report.

[Paul Dewar, NDP, Ottawa Centre, ON]

Thank you, Chair.

Thank you to our guests for their presentation today and for lending a voice to human rights, both here in Canada and abroad. I applaud the work they've both done, not only in their interventions here but in connecting with Canadians about the importance that we as a country demonstrate in walking the walk. We are the country of Mr. Humphrey's UN Declaration of Human Rights, which everyone around this table is proud of and, as Canadians, we should all be proud of. But it matters little if we don't actually get behind those words and do something.

One of the things that have disturbed me is the lack of coherence when it comes to human rights protection. I say “coherence” because I'm not going to get into the invectives and the cleavages that might be attractive in this debate. I'll give you the example of the Congo, from last spring.

We have 75% of the population living on a dollar a day. We have Canada's reach, through its mining intervention, responsible for about $300 billion in assets. We have people making money off this, in other words, and that's what companies do. No one's going to challenge that thesis. So when you look at these equations, a dollar a day--and by the way, the amount of money that the Congolese government receives from mining is about 60% or 70% of their budget. Yet when you look at the revenues they derive, it's about 5% of what comes out of the mining industry, so 95% goes, I guess, for operations, but probably a little bit to profit.

I think what people are looking for is some coherence. What is our responsibility? I see Bill C-300, as many of us would like to see, doing a little more. The tripartite approach is something that we would like to see, but Mr. McKay can't do that because it's a private member's bill.

So I hear from those who say, well, the voluntary approach is what we're doing and that's okay--and we're probably going to hear that from the EDC. Then I see the results of what I just laid out, a disproportionate redistribution of wealth but also the outcomes. And I won't get into that. People can read it for themselves, and I just hope that they get into it.

I'm not giving a speech; I'm laying some facts out, Mr. Goldring. I think it's a matter of people understanding that we do have a responsibility here.

I'll start with Mr. Neve. Do you see whether there is any other way, other than legislation, to ensure that human rights are actually going to happen? Do you know of any other jurisdiction or any attempt through voluntary methods to ensure that human rights are protected, and if so, where?

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

Don't you think that's rather important? I mean, let's take as an example.... I was very pleased to see recently, as I'm sure most of us were, that there had finally been an agreement between a Canadian mining company in Mongolia and the Government of Mongolia respecting issues regarding royalties and that kind of thing so that the company should go ahead. One of the few other companies in the world that would be big enough to be able to handle that particular extraction in Mongolia would be, say, a firm like Rio Tinto out of Australia, who will not have to comply with Bill C-300.

Going to Mr. Neve's point, if this were to proceed, there would likely be a substantial difference in the availability of financing to a Canadian company, as well as other restrictions that a firm like Rio Tinto, because of their jurisdiction, would not have. Therefore, I postulate that a Canadian company would not have been able to enter into this kind of gigantic mining project that they're talking about in Mongolia, and for Mr. Neve to turn around and say that's irrelevant I find really quite cavalier.

[Alex Neve]

I'll be honest with you. Amnesty International had not called on Talisman to leave Sudan. We didn't say that they should stay; we didn't call on them to leave. We certainly were pressing them to adopt stronger human rights policies in the way they were operating in Sudan and to use the opportunity of being in the country to better promote human rights reform within the Sudanese government.

We agree with you, therefore, that in many respects it's a setback. It has been difficult to maintain and exert pressure on the Sudanese government with respect to the operations in the oil fields. But I don't think that means that Bill C-300 is a flawed approach. Bill C-300 isn't calling for Canadian companies to leave countries; Bill C-300 is calling on companies, requiring companies, to live up to human rights obligations. I think that if Talisman Energy had had those at the centre of their operations back in the mid- to late 1990s as they were moving into Sudan, they would have moved in a very different way. They would have had different policies and programs in place and would have been able to make a much more positive impact early on. Probably a lot of the controversy that later erupted, including problems they ultimately had with their own share prices because of that controversy, would have been, if not avoided, at least minimized. And they may not have been required to leave in the end.

[Alex Neve]

I'll take 30 seconds.

I think the requirement that there be new Canadian standards that explicitly incorporate Canada's international human rights obligations is absolutely key. It's missing in the current strategy. Yes, of course Bill C-300 doesn't propose the creation of the ombudsman or the tripartite compliance committee, which the round table process had. But the powers given in Bill C-300 to ministers to ensure that there will be proper investigation of allegations of a failure to conform to those standards, leading to public findings, are absolutely essential, as are repercussions and implications with respect to eligibility for various forms of government assistance.

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

Thank you.

First of all, I want to express my sincere thanks to both Amnesty and Development and Peace for their enormous support in moving Bill C-300 to this stage and hopefully beyond.

Sometimes we sit here inside of some kind of objectivity bubble and talk about human rights. We talk about all kinds of initiatives at the UN and various other places. We don't actually get a feeling for what this is like on the ground.

Last week I talked to a man from Guatemala who had seven bullet holes in him, apparently courtesy of--I won't get into the facts--a Canadian mining company.

Again last week I talked to the former environment minister for Argentina, who talked about the ugly face of Canadians in Argentina and how it's actually destroying our reputation with that country.

I'd like you, Mr. Casey, but also Mr. Neve, to give Canadians examples of where mining operations in particular have gone wrong, whether it's Guatemala, Honduras, Papua New Guinea, Argentina, or Chile, where it is your personal experience, or the experience of your organizations, to give witness to those things.

The second question, if you can answer it, is to make the linkage between those particular companies, those particular issues, and Canadian financial support of those companies.

I wonder if you could possibly start, Mr. Casey.

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

Thank you, Chair.

Before I ask the witnesses a question, I have to register an objection to this format, Chair.

We have EDC representatives sitting in the room here. For some bizarre reason--this was last week and now this week--you choose to not put the two together. There should be a conversation between those who are in favour of Bill C-300 and those who are against it.

I'm a guest to this committee, but I do want to lodge that objection. There should be a reasonable debate. Otherwise, we just end up talking--

[Alex Neve, Secretary General, Amnesty International]

Thank you very much.

Yes, it's been a happy morning, having my computer fail me, but I'm very pleased to be here with you. I welcome the opportunity to share Amnesty International's views and recommendations with respect to Bill C-300.

Certainly for many decades the crucial global struggle to better safeguard and protect the human rights of women, men, and young people around the world has been very much focused on governments, both in the sense of governments being the ones who violate human rights and in the sense of governments being the ones who have to take action to protect human rights. However, in the past 10 to 15 years, there has been a multitude of ways in which the international system has recognized that it's vital to move beyond that sole focus on governments and to look at the various ways in which a range of non-state actors, certainly including companies, impact in very significant ways on human rights.

That's certainly very true when it comes to companies. On both sides of the coin, if they act responsibly, companies can in many important ways help promote and safeguard human rights and can strengthen human rights culture in the countries in which they operate; but when companies act in an irresponsible manner, we know only too well that their activities can and do, both directly and indirectly, cause or, at the very least, very significantly contribute to grave human rights violations.

Over the past decade, therefore, much has been done, a great deal of it in the broader context of trying to advance notions of corporate social responsibility. This takes us also into the realms of environmental protection and labour rights, for instance. To look at this issue of how to better ensure that we're getting the former company activities that will help promote human rights and avoiding the latter company activities that will cause or contribute to human rights violations, companies themselves have taken individual action, governments have launched some initiatives, and at the international level, initiatives like the UN Secretary General's Global Compact, work being done within the UN Human Rights Council, at the International Finance Corporation and other settings, things are being done as well.

What virtually all of those initiatives have in common are two significant shortcomings.

The first is that the human rights aspect of the various standards and principles that are being developed and adopted are, at best, vague, certainly almost always very general, and frequently even non-existent. For instance, the International Finance Corporation's performance standards, which are central to the government's new CSR strategy, are silent when it comes to human rights.

The second is that there is virtually nothing mandatory or obligatory about the expectation that companies will conform to these standards. The approach taken, rather, is to hope that companies will voluntarily choose to do so. As such, monitoring and enforcement mechanisms, where they exist, are generally weak and have no power to order or require companies to comply, but rather have power to suggest or advise.

In the broader human rights system, we've long learned that hopeful promises and voluntary commitments are not enough. It doesn't deliver the goods when it comes to protecting human rights. We, of course, want people, governments, to volunteer, but that doesn't get us to that end point of strong human rights protection. We know that only too well by looking at the international system. It's no different, and there's no reason it would be any different, when it comes to companies.

Much is at stake here. Company security forces, if not held to careful standards, can and do operate in ways--for instance, to dispel protests by indigenous communities in and around their operations--that lead to injuries and even the killing of protesters--the right to life at stake. Any irresponsible approach taken to how mining companies deal with their tailings and industrial waste may contaminate the local area and lead to serious violations of the right to health. Inappropriate use of company infrastructure by local security forces or failure to carefully monitor how company royalties are used by a government may simply exacerbate terrible wars and conflicts in regions where companies operate, again leading to civilian casualties.

So much is at stake, and clearly more is needed. That is why Amnesty International has so actively participated in all recent efforts to review and strengthen Canadian law, policy, and practice going back to 2005 when your subcommittee conducted its study. Certainly in 2006 we were an active participant in all cities that the round table process visited. We welcomed and endorsed the report prepared by the advisory group to that process and then, like many, waited anxiously for two years to see what the government's response would be.

While we do recognize and acknowledge that the government's new CSR strategy is a step forward, we are fundamentally disappointed with it with respect to the two key challenges I just mentioned earlier.

The first is the issue of standards. The new CSR strategy essentially takes up existing standards, the International Finance Corporation's standards, for instance, that I referred to earlier and a number of others that, combined, really give no more than scant or selective attention to human rights. The round table recommendation had called for new standards, very explicitly incorporating Canada's international human rights obligations.

The other concern is on the level of enforcement. The CSR strategy, of course, doesn't take up the call for strong, meaningful oversight and enforcement; gone is the idea of an ombudsman; gone is the idea of a tripartite compliance review committee. Instead, we have a CSR counsellor whose powers are really to advise and guide, and only to investigate if all are in agreement and with no real powers to sanction.

Bill C-300 offers Parliament an opportunity to move ahead on the human rights front, and as I say, it's very much needed. As such, Amnesty International certainly welcomes this initiative and calls on Parliament ultimately to pass it. There are ways in which we might have urged for it to be stronger, but we think it is the right step forward.

It's the right step forward when it comes to standards. It is so important that Bill C-300 calls for the development of international human rights standards, for instance, based on treaties that have been ratified by Canada, based on customary law. This is a crucial dimension that we think absolutely has to be key to any initiative in this area. We think that Bill C-300 moves us forward in a meaningful way when it comes to enforcement as well. The power and responsibility given to ministers to launch investigations when there are concerns about a company possibly falling short of these new standards and the associated possibility of that having implications for eligibility for EDC financing, for assistance from government diplomats and trade officers, and even of being a possible target for CPP investing, is all crucial.

So why not? What are the possible objections to a new approach that puts Canada's human rights obligations front and centre and endeavours to ensure there will be compliance with those standards? Most often what we hear is a fear that requiring Canadian companies to live up to what are sometimes described as cumbersome human rights obligations puts Canadian companies at a competitive disadvantage. Companies from other countries, goes the argument, don't have to live up to those obligations; forcing Canadian companies to do so costs money and means they can't compete.

In Amnesty's view, that is both overstated and shortsighted and it is ultimately irrelevant. It is overstated in that it is hard to imagine how putting in place measures to ensure that company personnel don't mistreat or even summarily kill protesters, or safeguards to avoid the possibility of company infrastructure being misused by government security forces to mount sorties in the region that would lead to civilian casualties is somehow so onerous and costly as to tip the balance between profit and loss.

Further, it overlooks and ignores the many ways that regard for human rights actually boosts a company's position, improves its reputation, ensures that there's a good relationship with the local population, and helps ensure stronger rule of law, all of which is beneficial in many ways to company operations and means that it is less likely that company will ultimately be a target, for instance, for boycotts or protests.

This argument is shortsighted in that it assumes that CSR improvements would somehow begin and end with Canada, that no other country is doing similar things or is likely to follow suit. Canada shouldn't shirk leadership but rather rise to it. We also should not assume that leadership is lonely at this point. Many countries are moving forward on this front. Canada can't be, shouldn't be, at the end of the line. We must be among the leaders and work persistently, bilaterally and multilaterally, to press others to adopt stronger laws and policies.

Lastly, as I said, this argument is irrelevant, as Parliament must ultimately recognize that Canada's international human rights obligations are on the line here. Human rights obligations do not only mean that government officials and agencies themselves must refrain from human rights violations. More is at stake. Governments are obliged to ensure that individuals, including individuals abroad, are protected from abuses at the hands of those over whom the government has some jurisdiction and authority. That is certainly the case with companies, which, after all, are incorporated under and regulated by federal and provincial laws and regularly benefit from various forms of government assistance and support. The government is obliged to act here.

Amnesty therefore very much believes Bill C-300 should be supported. It conveys the very important message that business can be good for human rights, but also that human rights can be good for business.

Thank you.

[Michael Casey]

I have one last comment.

The passage of Bill C-300 is a necessary step to ensure that Canadian companies respect environmental and human rights. This bill, as law, would make Canada a leader in corporate social responsibility in an era where the status quo is not sustainable. Its adoption would reflect not only the concerns of hundreds of thousands of Canadian citizens and the voices of those in developing countries affected by the operations of Canadian companies, but also the opinion and direction of the highest representatives of the Catholic Church in these countries. It would send a strong and timely message of leadership to the other leaders of the G8 and G20 in the months prior to Canada hosting this important meeting: that Canada has the means and the will to positively influence and lead behaviour in the industry.

Thank you.

[Michael Casey, Executive Director, Canadian Catholic Organization for Development and Peace]

Thank you very much, Mr. Chairman.

I'm just taking advantage here of a computer failure on the part of my colleague, who graciously offered us the opening slot to speak while he prepares his notes by hand from memory.

Development and Peace is the official international development agency of the Catholic church in Canada. We were founded in 1967 by the Catholic bishops, and we have two mandates. One is to support projects to fight poverty in countries of the south. The other is to promote awareness of development issues among the Canadian population. We're a membership-based organization, and we have approximately 13,000 members from coast to coast across Canada. We are currently active in 33 countries abroad, with approximately 200 partnerships in all the major continental regions: Latin America, Africa, Asia, and the Middle East.

I want to speak today about our education and public engagement campaign that focused on extractive industries, and particularly in support of Bill C-300.

Every year we conduct a thematic campaign related to particular development issues. We follow several key principles that are part of the values of the organization, looking to guide the awareness of the public in this campaign on resource extraction and management. The principles behind this campaign include a recognition of the sacredness of the earth, the need to share resources in a peaceful and sustainable manner that benefits the common good and respects the human rights of all, and the right of people to have control over decisions that affect their lives and communities.

We've intervened on this concern on a number of previous occasions. Over the past several years we've maintained a focus on the actions of Canadian mining companies in the global south and the need for mining companies to carry out their operations in a socially and environmentally responsible manner. In order to ensure that Canadian mining companies respect Canada's commitment to international standards for human rights and environmental law, we strongly believe that Bill C-300 should be adopted. Although this bill does not contain all the measures that were recommended by the final report of the national round tables in March 2007, it is the strongest answer to date that has been proposed to solve the problems that the process was attempting to address. We feel that this is a good and necessary step in the right direction.

As you are all aware from previous testimony, Canada is a major player in the international extractive industry, with significant investments abroad. The Toronto Stock Exchange is the most active mining exchange in the world. In 2008, 60% of the world's mining and exploration companies were listed in Canada.

Most of the Canadian mining companies behave responsibly. Those companies not only drive prosperity here at home; they also provide jobs, opportunities, and other benefits in local communities abroad. Unfortunately, some other companies give little or no importance to the impact of their operations on the living conditions of people in the south. There are documented cases of egregious disregard by Canadian companies operating in many countries, and these have been presented in previous testimony to this committee, notably on May 25 by the Honourable John McKay, and on October 8 by Mining Watch Canada.

Development and Peace is not against mining or the extractive industries, but we are calling for these industries to be held to account. There should be some avenue of recourse--an open, democratic, and just means--for those companies that do not meet a certain and necessary standard of behaviour, having been given ample opportunity to do so, to accept certain consequences. We believe that the inherently higher risk, danger, and pollution of this industry must be accompanied by a higher standard of care, responsibility, accountability, and a necessary presence in the legislative framework of this country.

I'm here today to speak for our members and represent the voices of many of our partners in developing countries who would be in favour of this bill. It is not just Canadians who are calling for more legislation and legal mechanisms that ensure mining companies are held accountable for their actions in the global south. The issue of responsibility of Canadian companies in extractive operations is something that is consistently raised by our partners in the countries where we work. I'll give you a couple of examples.

In 2008, in Cerro de Pasco, a mining centre in the Peruvian highlands, where Development and Peace has been working for almost 25 years, a local group downloaded our materials for our action campaign, translated them into Spanish, printed them, and received more than 3,500 signatures on the action cards, as well as organizing street theatre, public seminars, and advocacy activities on the mining activities in their community.

The same year, 4,400 residents of Canatuan, a community in the southern Philippines affected by the activities of the Canadian mining company TVI, signed our postcards and urged us to continue to lobby our government to appoint an ombudsperson to monitor the activities of Canadian mining companies operating abroad.

In Honduras, the Entre Mares mine, a subsidiary of Goldcorp, has been using cyanide to extract gold from the mine. This process is less expensive for the company, but the local population pays the real price. This process has caused 14 streams and rivers to dry up, contaminating surrounding lands, and has led to increased disease among the inhabitants and their livestock.

Our partner, Caritas Tegucigalpa, has provided us with testimony regarding the state of the local environment and the health of the people in the communities surrounding the mine. The mine uses 80 million tonnes of water per year, enough to meet the needs of 20,000 inhabitants, or over half the local population. After having rung up significant profits when the price of gold was at its height in 2008, Entre Mares is now preparing to shut down the mine. Caritas Tegucigalpa is asking Entre Mares to decontaminate the water, reforest the land. It must pay the fines, taxes, and other money due to national and local governments that have accumulated over the years. The company will also have to ensure that people who were displaced have titles proving they own their new land.

Caritas Tegucigalpa and Development and Peace are convinced the company has the means to close the mine responsibly, but will it be willing to do so? If a Canadian legal framework on the social responsibility of mining companies had been in place, it would have been possible to protect the rights of the people of the Siria Valley and to prevent these human and environmental tragedies from being repeated.

I have a quotation here from His Eminence Cardinal Oscar Andrés Rodríguez Maradiaga, who is the archbishop of the archdiocese of Tegucigalpa, in Honduras, and president of Caritas Internationalis. His quote:

The increasingly frequent conflicts in different parts of the world between mining companies and affected communities, as well as the growing efforts of civil society organizations to demand stricter regulation, more rigorous monitoring, more responsible and transparent practices, are a sign that we can no longer continue to adhere solely to the logic of the business market that operates on the principle of the less invested, the greater the profits. We must move towards a vision of Corporate Social Responsibility, which cannot be reduced to corporate voluntarism alone but must be complemented by a social responsibility regulated by the state and international organizations. Such a redefinition is urgent, as the depletion of natural resources has been substantially accelerated partly because of the growing demand for precious minerals.

The passage of Bill C-300 into law would be a step in this necessary direction.

I want to speak for a minute about our campaign. Many of you members have likely received our cards or perhaps a visit by members of Development and Peace on this issue of corporate social responsibility. Over 500,000 Canadian citizens have demonstrated support for this bill by signing our action cards and letters as part of our public engagement campaign. These cards have all been delivered to the government. Over 120 meetings with MPs in their local ridings have been organized by members of Development and Peace across the country to discuss this issue. Citizens in all your ridings are concerned about this issue and would like to see the government respond adequately to the recommendations on the round table process on corporate social responsibility. This bill is the response they are looking for.

Our presentation today is the culmination of years of work and support from members of Development and Peace and those who have signed these cards. On May 12 of this year, Development and Peace delivered 38 boxes with action postcards addressed to Prime Minister Harper and signed through our recent campaign in 2008-09. Our supporters called on the Prime Minister to implement legal mechanisms to hold Canadian mining companies accountable for their actions in developing countries.

This last delivery of cards brings the total number of cards and letters delivered by us to the Government of Canada to more than half a million over the course of our three-year campaign. We began in 2006 and continued through 2009, each year accumulating between 150,000 and 200,000 cards.

With the last submission of cards, we asked that the Prime Minister create an independent ombudsperson office, appointed by Parliament, that can receive complaints about the activities of Canadian mining companies, investigate complaints, make recommendations in an effective manner, and operate in a transparent manner.

However, the hope that the round tables generated turned to disappointment as a result of the lack of response on the part of government to this collaborative, consensus-based report. Development and Peace decided to extend its education campaign on mining for one additional year to push that these recommendations be put into place. While we now have a response from the government, a corporate social responsibility strategy, we feel that it is not sufficient to adequately balance the opinions of all the parties involved. The passage of Bill C-300 would be a necessary step in the follow-up to this process.

We acknowledge that the CSR strategy constitutes the first steps in the implementation of the round table recommendations. It means that the government acknowledges the need for improvement in the behaviour of some extractive companies working abroad in developing companies. This is a good thing, but it is not enough. Bill C-300 would fill an important gap between what was recommended by the round table report and the government's response.

The Canadian government's response lacks teeth because it proposes voluntary action. It displaces the responsibility for irresponsible behaviour from mining companies to the governments of developing countries. In addition, the government's CSR strategy does not include strong sanctions for companies with damaging practices. Most importantly, there is no ombudsperson in the government's CSR strategy, as was recommended by the round tables; rather, there is a corporate social responsibility counsellor with limited functions, including hearing disputes and suggesting mediation if there is consent from all the parties. The position would be appointed by the Prime Minister's Office instead of by the Parliament of Canada.

There is no provision for an ombudsperson in Bill C-300, as private member's bills are not enabled to propose budgetary changes such as the creation of new positions. Development and Peace strongly urges the passage of this bill and strongly recommends that the government create a position of ombudsperson subsequent to the passage of the law, as was suggested by the round table report.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

Thank you.

I want to make sure I leave proper time for Ms. Brown.

Mr. MacLennan, I didn't quite catch the wording that Madame Lalonde gave you in that question. Did I hear you say that as director general of CIDA you agree that Bill C-300 would be a good bill?

[Bob Rae, Liberal, Toronto Centre, ON]

But what CIDA does is part of the broader political direction of the government with respect to development in Latin America. It's part of our foreign policy. It's not a separate entity unto itself. CIDA is part of the overall Canadian enterprise that we're looking at.

I'm just saying that if Bill C-300 says the minister gets a complaint and then considers the activities, surely the evidence.... What CIDA is doing and the evidence of what CIDA has with respect to a particular company would be entirely relevant to the Minister of Foreign Affairs. I would argue that it would be ludicrous to suggest that CIDA isn't going to be part of this puzzle. Of course it's going to be part of the puzzle. The counsellor who has been appointed for CSR is going to want to talk to you guys about what you're doing and what you're finding on the ground. Madame Giroux will have her staff in Latin America and they'll be reporting to her, as well as to the ambassador who is on site. Isn't that the case?

[Christopher MacLennan]

As I stated, and as you actually noted in your testimony, Bill C-300 doesn't directly bear upon the activities of the Canadian International Development Agency in terms of what we're actually doing in-country. So in terms of how well the bill will function, it actually affects the Department of Foreign Affairs and International Trade more, and as a result, I would think that question is probably more appropriately posed to the Department of Foreign Affairs.

So it won't affect CIDA's role under the CSR strategy.

[Christopher MacLennan, Director General, Thematic and Sectoral Policy Directorate, Canadian International Development Agency]

Thank you very much, Mr. Chairman.

I am pleased to have the opportunity to describe to the standing committee CIDA's role in the Government of Canada's CSR strategy, to provide some background information on the importance of the extractive sector to developing countries, and to give you an idea of the type of programming that CIDA has been doing and is planning to do.

As you've mentioned, my name is Chris MacLennan; I'm director general of thematic and sectoral policy. With me is Madame Hélène Giroux, who is the director general for South America; and Bill Singleton, who is CIDA's internal focal point on CSR. As members of the committee may recall, the government's CSR strategy required CIDA to create an internal focal point on extractive sector development issues, and Bill is currently serving in that capacity on an interim basis.

Before describing CIDA's role in the government's CSR strategy, I wish to draw the attention of the committee to one item in Bill C-300. In the interpretation section of the bill, subclause 2(1), there is reference to “the list of countries and territories eligible for Canadian development assistance established by the Minister of International Cooperation.” Such a list no longer exists. CIDA publishes in its annual report to Parliament the list of countries in which CIDA has actually made disbursements, but this is not the same as a list of countries that are actually eligible for development assistance.

That said, of course, the government, in February 2009, announced that as part of its aid effectiveness agenda, CIDA would concentrate 80% of its bilateral programming spending in 20 countries of focus. That is also not a list of eligible countries but simply where CIDA will be concentrating its efforts under the aid effectiveness agenda.

With this exception, Bill C-300 makes no direct reference to CIDA or its activities. However, because Bill C-300 is addressing issues in the same area as the government's CSR strategy for the Canadian international extractive sector, I would like to describe to the committee what CIDA is doing in relation to the extractive sector in developing countries.

As members of the committee will recall, the government's CSR strategy has four elements. One of these is entitled “Host Country Capacity-Building”, and it is this part of the strategy with which CIDA is directly concerned.

A large number of studies have been carried out about why mineral and hydrocarbon resources are all too often more of a problem than an opportunity for many developing countries. This is in contrast to the economic history of countries such as Canada, the United States, and Australia, which have been able to make productive use of natural resources as a source of economic growth, employment, and export earnings.

The common conclusion at which the various studies have arrived is that the most important single factor is the transparency and effectiveness of host countries' resource governance and management regimes. This includes the establishment of stable legal and fiscal regulatory frameworks to ensure sustainable resource management and development, and regulatory institutions and agencies responsible for regulating and overseeing sector activities.

In the absence of strong institutions, natural resources such as minerals, oil, and gas can become what, of course, is known in development as the “resource curse”. The curse can lead to a number of problems, including corruption, conflict, social unrest, and negative economic and environmental impacts. The revenues from the resources are volatile, which makes it difficult for governments to manage their spending. Finally, in some countries, revenues from minerals, oil, and gas have been used as a means of financing conflict, as many of you are aware.

The nature of the choices that developing countries must make are well known to Canadians: whether to extract the resources at all; how quickly to extract; whether to use national companies or rely on the international private sector; how to design the laws, regulations, and contracts that can produce the greatest benefits to the country and its citizens; and how to avoid or mitigate the environmental or social costs of extraction. Developing countries must also decide on policies and mechanisms for dialogue and stakeholder participation in extractive sector development. Each choice will have far-reaching consequences that can shape a country's development path.

CIDA's recent programming in individual countries in the extractive sector has been primarily in the Americas. In line with the principles of aid effectiveness, the orientation of this programming has been to support countries that have themselves set extractive sector resource management as a priority for their development planning.

In Peru, for example, CIDA has worked extensively with the national and regional governments and affected communities to develop and promote regulatory requirements for social and environmental management in the extractive sector. CIDA's support has included the provision of tools and expertise in the mining and hydrocarbon sectors and support for social, environmental, and multi-stakeholder dialogue, community participation, and conflict resolution.

CIDA has assisted Bolivia in establishing a tax collection unit. As a result, from 2004 to 2008, Bolivia realized a fourfold increase in revenue, amounting to well over $2 billion annually. Most of this money has been reinvested in public services and social supports.

In addition, CIDA is developing an Andean regional initiative, which will strengthen regional and local governments as well as community capacity to plan, develop, and implement sustainable development projects. The initiative will increase the well-being of the communities and enhance their capacity for engagement with extractive-sector firms.

At the multilateral level, CIDA is working on the extractive industries transparency initiative, or the EITI, in partnership with the Department of Foreign Affairs and International Trade and with Natural Resources Canada. The objective of the initiative is to introduce greater transparency into financial flows precipitated by natural resources in developing countries, with the objective of reducing corruption. CIDA has provided some of the funding for Canada's participation in the EITI multi-donor trust fund managed by the World Bank.

In addition, as laid out in the government's CSR strategy, CIDA is in the process of identifying an individual who will work with the World Bank on implementation of EITI in a number of countries in Africa.

For the future, CIDA's assistance to developing countries in their natural resource management will be carried out under the thematic priority of sustainable economic growth, which is one of the priorities set for the Government of Canada's international assistance envelope.

I've already described how natural resources can be a source of economic growth. Good resource management, especially in relation to environmental and social impacts, can help make growth sustainable.

We have made contact with our counterpart development agencies in other countries, such as Norway and the United Kingdom, to identify ways in which we might collaborate more effectively. In July, CIDA hosted round tables on CSR with the private sector and with civil society, and we are continuing that dialogue. We are working closely with DFAIT and NRCan on implementation of the other three elements in the government's CSR strategy.

I hope this brief description of CIDA's approach to the extractive sector in developing countries will assist the committee in its consideration of Bill C-300. Hélène, Bill, and I are open to questions you might have about CIDA's experience and how our work is contributing to the achievement of the government's objectives.

Thank you.

[The Chair, Conservative, Kevin Sorenson]

In the second portion of our meeting today we're going to continue with the study of Bill C-300.

We have before us, from the Canadian International Development Agency, Mr. Christopher MacLennan, director general of the thematic and sectoral policy directorate; Bill Singleton, senior economic policy advisor to the strategic policy and performance branch; and Hélène Giroux, director general for South America and Americas geographic programs branch. We welcome you.

I understand you have an opening statement. We will look forward to that, and then we'll move into the first round of questioning.

Mr. MacLennan.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

The devil is in the details in all these kinds of acts. The example I used in testimony two days ago is that we have two different flu vaccines because we have two different viruses. In other words, you have to be specific with a remedy. In this particular case, if we can pull that analogy over to Bill C-300, the devil is in the details. It might be that we need to be going after flu, whereas in fact we need to be going after H1N1 flu. This bill is not going to touch the H1N1 potential pandemic, if you understand my analogy.

I'm looking under the powers and functions of the ministers. I'll quickly read the clause I'm thinking of:

In carrying out their responsibilities and powers under this Act, the Ministers shall receive complaints regarding Canadian companies engaged in mining, oil or gas activities from any Canadian citizen or permanent resident or any resident or citizen of a developing country in which such activities have occurred or are occurring.

Do you not see that this is a big enough hole to probably slide the Queen Elizabeth 2 through? I mean, why couldn't there be people among the six billion inhabitants of the earth who would bring vexatious actions against Canadian companies? This is a gigantic hole. Or do you disagree with me?

[Karyn Keenan]

One of the complaints that I referred to was lodged by my organization. It was before I started working for the Halifax Initiative, but I'm aware of the case. It concerned a nuclear energy facility, and it was concerned with the review of that project. So it was Export Development Canada's due diligence when it reviewed the project and was making a decision about whether to support it or not.

The reason my organization was discouraged then from launching other complaints, or advising our colleagues who are impacted by EDC projects to launch further complaints, was because of the problems that I enumerated in my comments. That is, it's a very closed, internal process. In fact, I don't believe my colleagues were entirely clear on what the process was. At the end of the process, when we received a response, which was that the corporation was in compliance with its internal policies, that was the only answer we received. We did not receive information that explained how the officer had come to that determination, how they had made that determination, what the investigation consisted of, and so on.

It's very closed, it's difficult to access information, and, as I said earlier, even in the case of an audit that finds there's non-compliance, there's no obligation on the part of EDC to then take that up and make changes. Again, effective community civil society organizations have scant resources, human and otherwise, to take the time and energy to make a complaint before this kind of body, and knowing the chances of there being some impact at the end of the day, on balance it's not a worthwhile endeavour.

That's why we're excited about the mechanism under Bill C-300, because it's more transparent, because it's independent, because the process will be known and understood, the results will be released publicly, and there will be some consequence if there is a finding of non-compliance.

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

The most significant deficiency in the government's response is the inability of the counsellor to independently commence an investigation, or even complete an investigation once commenced, because it's dependent on the consent of the corporation involved. It's a rather glaring omission, yet Bill C-300 would fill that gap.

What is your view on a counsellor who effectively has no ability to investigate?

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

The environment in which Bill C-300 was put forward was, if you will, a bit of a vacuum. The vacuum was that there was no response to the round tables, the bill came on, and then the government responded with the CSR counsellor. The CSR counsellor has a mandate, many things of which are quite good and are helpful in this area.

So what we're essentially left with is the last two yards out of the hundred yards. I'd be interested in your comments on how you see Bill C-300 interacting with the CSR counsellor.

[Karyn Keenan, Program Officer, Halifax Initiative Coalition]

Thank you.

The Halifax Initiative is a coalition of human rights, environmental, faith-based, developmental, and labour organizations. Our objective is to transform the public international financial institutions to achieve poverty eradication, environmental sustainability, and the full realization of universal human rights.

My work focuses on the operations of public institutions that provide support to the private sector—in particular, the International Finance Corporation of the World Bank group and Export Development Canada. The latter, a crown corporation, is Canada's export credit agency and will be the focus of my comments this morning.

The extractive sector is the greatest recipient of support from Export Development Canada, and the crown corporation has plans to expand its assistance to extractive companies. Export Development Canada does not have a good record in this area. The agency has provided support to a number of mining projects that have generated serious environmental and social impacts for which affected individuals and communities have been unable to access compensation and other remedies.

Perhaps the most infamous case concerns the massive tailings dam failure that occurred at the Omai gold mine in Guyana in 1995. Three years following the disaster, a lawsuit was initiated in Canada by indigenous people affected by the spill. The Canadian court refused to hear the complaint, arguing that Guyana was the appropriate forum for the action. A subsequent case brought in Guyana was also dismissed, leaving the victims without recourse. Several other EDC-supported projects merit attention, including the Bulyanhulu gold mine in Tanzania. Local residents allege that over 50 artisanal miners were killed by Tanzanian troops in order to clear the mining concession to make way for commercial operations.

Indigenous people affected by the PT Inco nickel mine and smelter in Indonesia complain that they have lost prime agricultural land, that the local environment has been contaminated, and that they suffer threats and intimidation by the police.

In 1998 a large cyanide spill took place at the EDC-supported Kumtor mine in Kyrgyzstan. EDC also funded the Marcopper mine on Marinduque Island in the Philippines, where environmental contamination destroyed the source livelihood for local fishing villages. I understand this committee heard testimony earlier this week about that case.

More recently, the EDC-supported Veladero mine in Argentina was the subject of complaint before that country's national ombudsman. The office of the national ombudsman, which is independent of government, is mandated to protect legally sanctioned rights and freedoms, including human rights. Local actors who lodged the complaint regarding Barrick's mine were concerned about its impacts on the San Guillermo UNESCO biosphere reserve. The ombudsman accepted the complaint and in 2008 reported that the mine concession violates several national laws. He called for an immediate halt to mining activity in the reserve.

This year, an Argentinian environmental organization filed a complaint regarding the mine with the Supreme Court. The complainants, who expressed concern that mining operations are causing irreversible damage to local glaciers, asked the court to issue an order for an audit that would assess whether the company is in compliance with national laws.

Intense debate continues among Argentinian parliamentarians concerning the future of that country's glaciers. Last year, President Fernández de Kirchner vetoed legislation designed to protect glacial deposits. The law, which prohibits mining, oil, and gas operations in or around glaciers, received the unanimous approval of Congress.

EDC continues to provide support for Canadian extractive companies that invest in countries with weak regulatory frameworks, inadequate institutional capacity, and poor law enforcement. The crown corporation is currently considering support for a major mining project in the Democratic Republic of Congo, a country plagued by negligible governance capacity, widespread human rights abuse, and brutal conflicts associated with mined materials.

Moreover, EDC recently opened a new office in Lima, Peru, from which it plans to expand support for Canadian extractive companies operating in that country. According to the Peruvian national ombudsman, extractive investments constitute the most important source of social conflict in that country. Community members who resist the entry of foreign extractive companies on their lands are intimidated, beaten, and in some cases killed.

Earlier this year, indigenous people in Peru mounted a major protest regarding the adoption of new legislative provisions that further facilitate extractive operations in their territories. On June 5, the national police attacked the protestors, triggering a violent confrontation that ended with the deaths of over 30 people. The prime minister was forced to resign over the government's handling of the incident, and Congress repealed a number of the contested decrees.

To avoid complicity in the environmental and human rights abuses that are common in these contexts, Export Development Canada must apply robust and transparent environmental, social, and human rights standards to its clients. Currently EDC relies on the International Finance Corporation's performance standards and the Equator Principles. The latter instrument, which was developed by private banks, is largely based on the performance standards. The performance standards are widely recognized as the de facto standards set for multinational companies that invest in developing and emerging markets. However, they suffer from several important debilities. They are weak on human rights. With the exception of labour rights, the performance standards neither reflect nor reference international human rights norms.

The multi-stakeholder advisory group to the national round tables on corporate social responsibility and the extractive industry in developing countries, of which I was a member, recognized this important shortcoming. The advisory group used the performance standards as the basis of the Canadian CSR standards that were proposed for adoption by the Canadian government, but supplemented those standards with international human rights norms.

The second problem with the performance standards and the Equator Principles is that they are discretionary. Export Development Canada is under no obligation to apply them, to enforce them, or to sanction clients who fail to comply. EDC adopted the performance standards through an OECD recommendation that explicitly permits signatories to derogate, at their discretion, from the standards set. Compliance with the Equator Principles is also optional. Under the Equator Principles, companies are required to comply with the performance standards to the satisfaction of the implementing financial institution. Moreover, non-compliance is permitted as long as any derivation from the standards is justified.

No guidance is provided regarding the acceptable threshold for satisfactory levels of compliance or justified derivations from the standards. Bill C-300 remedies these shortcomings. It ensures that EDC's existing standards are consistently applied and supplements them with international human rights norms, to which Canada is a signatory.

This will strengthen EDC's due diligence, steering it away from projects that carry a high risk of generating negative human rights impacts. It will provide EDC clients with valuable guidance regarding their expected standard of operation. Finally, it will ensure that Canada is in compliance with its international human rights obligations in the provision of export credit.

As an agency of the Canadian government, Export Development Canada is bound by Canada's international human rights commitments. Currently there is no mechanism to ensure that its operations are consistent with those commitments. Bill C-300 will also bring EDC in line with recommendations on export credit agencies made by the UN Secretary General's special representative for business and human rights, John Ruggie.

In a report to the Human Rights Council, Mr. Ruggie argues that export credit agencies should require that their clients perform adequate due diligence regarding their potential human rights impacts. According to the special representative, such due diligence will allow these agencies to identify investments that require greater oversight and those where the risk is too great for state involvement.

Following the release of the special representative's report, EDC published a five-paragraph statement on human rights. EDC describes the statement as an articulation of principles. The statement does not provide for the level of due diligence that Mr. Ruggie advocates. It is silent on the issue of whether and how EDC assesses the potential for adverse human rights outcomes from client operations, on what it expects of clients in the area of human rights, and on how it ensures that clients meet those expectations over the life of a project.

I'd now like to speak for a moment about the investigation of complaints concerning EDC client operations. EDC is one of few export credit agencies that has a complaints mechanism. However, the office of the compliance officer has processed just two complaints since it was created in 2001.

Affected communities and some civil society organizations have chosen not to use this mechanism because it lacks independence, transparency, and power. The office is maintained and staffed by EDC. Compliance audits, when undertaken, are internal. Scant information is provided to complainants to explain the officer's findings. Moreover, the crown corporation is under no obligation to adopt any recommendations the officer may make at the conclusion of an audit.

The complaint mechanism established under Bill C-300 remedies these problems. The mechanism is independent of EDC and involves public reporting. Moreover, findings of non-compliance bring consequences. While the complaint mechanism will not provide individuals and communities who are affected by EDC-supported extractive projects with access to legal remedies, which is an issue that deserves the attention of this legislature, it will afford them the opportunity to have their case investigated and may result in a shift in corporate behaviour.

Moreover, the complaints mechanism under Bill C-300 is consistent with the recommendation of the advisory group to the round table process regarding the appointment of an ombudsman. As with Bill C-300, this office was to receive and investigate complaints regarding the overseas operations of Canadian extractive companies.

To conclude, Bill C-300 addresses shortcomings in EDC's due diligence policies and practices and weaknesses in its complaints mechanism. Moreover, the legislation is consistent with consensus recommendations regarding these issues made by the advisory group to the round table process.

The reforms contained in Bill C-300 will help to ensure that EDC no longer funds extractive projects that result in serious environmental and social harm.

Thank you.

[The Chair, Conservative, Kevin Sorenson]

Good morning, colleagues. This is the 34th meeting of the Standing Committee on Foreign Affairs and International Development, on Thursday, October 22.

Today we're going to return to our committee study of Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries. As our witness in the first segment today, we will have, from the Halifax Initiative Coalition, Karen Keenan, the program officer.

Welcome to our committee.

We have to pretty well stop for committee business at 10:30. That was the idea. We have two different witnesses. In the second hour, CIDA will be here. We may go until 9:30 or 9:45 and just see how much time we have.

Welcome, Ms. Keenan. We look forward to your comments. Then we'll have our questions for you.

Foreign Affairs and International Development

[Gordon O'Connor, Conservative, Minister of State and Chief Government Whip]

Mr. Speaker, I believe you will find agreement among all parties to adopt the following motion. I move:

That, notwithstanding any Standing Order or usual practices of the House, the motion to concur in the Seventh Report of the Standing Committee on Foreign Affairs and International Development (extension of time, pursuant to Standing Order 97.1, to consider Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries) be deemed adopted.

[William McGuinty]

Those are pretty basic business assumptions, but my biggest concern would be my ability after going through this process. Let's just use an exploration company's process. There is no sanction for a company not seeking financial gain in Bill C-300, so I go through this process. I'm guilty or I'm not guilty. I'm still in the community. If I'm guilty, I have a problem. There is a public outing of something I've done as an actor that is inconsistent with international law and human rights. I have an issue that I have to deal with. I'm still there. If I haven't done anything wrong, that issue still sits there in that community, and it's been exacerbated by a much larger external confrontation of that community.

My biggest concern with this process is how Canadian companies go through it and come out the other side, being able to validly and appropriately do their business on the ground in those countries.

[Carole Samdup]

I think the question here is why the voluntary standards are not sufficient. I would like to remind all the members that human rights are not discretionary policies and they're not aspirational goals: human rights are actually international law. There needs to be an accountability mechanism that's applied equally to all actors, and that mechanism should not be voluntary, just as it is not voluntary whether you obey the rules of the road.

I think this is an important thing to remember, and this is the contribution that Bill C-300 seeks to make.

[William McGuinty]

I think it's important to note that “frivolous” and “vexatious” come up a couple of times in various parts of that very short law.

What Bill C-300 lacks, and what I don't know if it can attain, is a way of developing precision about what it does and about what the minister can do. It really does lead to a very....

Somehow a case would have to have a significant merit for the minister to really make a decision. At the end of the day, if it's a complaint brought by a local community member or an NGO or another company--or another government, for that matter--there's no sanction for any of those people. The fact that they've been written up in the Gazette is not a sanction for any of these people. The only group being sanctioned at the end of the day is someone who might inevitably be found guilty of a charge of a human rights violation.

It's a question of the volume of complaints versus the validity of those charges. In my experience in working in small communities and in various countries, the timeframes for these discussions and the timeframes for the debate and the accommodations between a company and a host community are very long; the minister is going to come in with a very short timeframe to give an answer to the public, the complainant, and to make something very concise out of what is a very contorted position.

I don't know how Bill C-300 in its current form accommodates that.

[Tyler Giannini]

Thank you for the question.

First, I think I would answer that by saying that the review of a situation, such as what was going on in PNG, is an important first step. That review of the process will hopefully bring additional information to light from all the actors. Information is a key piece for eventually assessing what a government would do. That's what the review would hopefully do.

Bill C-300 lays out specific ways in which there may be repercussions in light of a review by the ministers. The details of how the review would be conducted would be laid out. Under international standards right now, there has not been a specific complaint involving this mine to an international body.

Again, to bring home who the main players are here, the actors on the ground are the PNG government, which has not pursued the investigation at the level you would want it to, and the corporations. The home country really can fill a void in terms of review and investigation, which would facilitate, hopefully, better solutions and deterrence of future abuses on the ground.

[Bob Rae, Liberal, Toronto Centre, ON]

Thank you very much.

I'd like to thank all the witnesses for their presentations.

It's difficult, but I want to try to draw it together by asking Mr. McGuinty a question, if I may.

Mr. McGuinty, you described in your presentation that you've already received a lot of complaints or issues being raised that you regarded as frivolous or vexatious or not having any factual basis. Is it not possible to look at something like Bill C-300—and we can all talk about how it might be improved—and say that it's the one mechanism that actually gives you the opportunity to get the minister to say that there is absolutely no foundation for this? As it now stands, you can say there is no foundation to this, but you're you. It's the same thing with me. If I've done or haven't done something and somebody says I have, I'm going to say that I didn't do it. You need somebody else to come in and say that there is no basis for the complaint at all.

Given the fact that now corporate social responsibility is an accepted premise and principle of activity, we have now a series of measures that the government has initiated that in fact provide for some modest accountability—not as much as many people think is necessary, but some. I'm not quite sure if I understand why Bill C-300 is seen by you as so revolutionary.

The fact is, these complaints are being made anyway. We've heard from Mr. Giannini and Ms. Knuckey that they themselves have gone down and interviewed people and have come forward with terrible accusations with respect to activities surrounding a mine in Papua New Guinea. Where do these complaints go if we don't create some kind of process that allows them to be considered and then say, yes, there is a foundation to this one, but there's absolutely no foundation to the other one? I hear your anxiety and I hear your concern, and I'm not insensitive to it. But I'm just wondering, given that there are going to be these complaints and that there is going to be anti-mining agitation around the world—we have it in Ontario and we have it everywhere—why would there not be some advantage to you in having a mechanism to deal with it?

[Sarah Knuckey, Lawyer, Center for Human Rights and Global Justice, New York University School of Law]

Mr. Chairperson and committee members, like Mr. Giannini, I avail myself of the parliamentary privilege.

Mr. Chairperson, we have documented allegations of grave human rights abuses--killings, rapes, beatings--by security personnel employed by Canadian companies. The seriousness of these alleged abuses and the absence to date of accountability point clearly to the need for a bill like Bill C-300, which would create an independent mechanism to receive and examine complaints by victims.

In the course of our work, we have interviewed more than 250 individuals, including alleged victims, witnesses, family members of alleged victims, local residents, local and international civil society, health officials, government officials, police, mine staff, and current and former PJV security guards. We have also reviewed medical and police records.

In Porgera, poverty drives locals to trespass on what is now mine property. Certainly, some of the cases of use of force by PJV's guards have likely been justified, either in the defence of property or of life. However, I would like to share with you today accounts of rapes we have documented that have been especially brutal and that are, of course, without any possible justification.

Numerous accounts of rapes show a similar pattern. The guards, usually in a group of five or more, find a woman while they are patrolling on or near mine property. They take turns threatening, beating, and raping her. In a number of cases, women reported to me being forced to chew and swallow the condoms used by guards during the rape.

Most of the women told me that they did not report the rapes for fear of retribution. Those who had stated that the police took no action. If a woman's family finds out about the abuse, she is often further shunned. In no cases were the women aware of any investigation, prosecution, or punishment of the alleged perpetrators.

I would like to highlight for the committee one particular incident that a 25-year-old woman reported to me in March this year. Her account went as follows.

She resided just a few minutes' walk from the mine and often went there to look for gold. She used the money she made from selling it to buy basic necessities, such as clothing and food, for members of her family. In 2008, five PJV security guards caught her while she was on mine property. She told me that the guards asked her if she wanted to go home or if she wanted to be sent to jail. When she replied that she wanted to go home, they said that they would rape her first.

She explained to me that she tried to run, but that they held her, tore off her shorts, tore off her shirt and her underwear, and threw her down on the rocks. She said that each of the five took turns raping her while the others guarded the road. They pointed their guns at her and threatened to shoot if she tried to escape. They beat her legs and hit her with stones. They held her head down with the butt of a gun. She showed me the scars on her shoulder and hand, which she told me were the result of struggling during the rapes.

A male relative of hers stated that he witnessed part of this attack and reported it to police, but they appear to have taken no action.

This is just one example of many cases of alleged abuse that we have documented. Security guards have themselves recounted to me abuses that they have either witnessed or committed. In fact, during one of my trips to PNG in 2006, I witnessed a guard yelling at a local woman that he had raped many women, and he was calling for her to come near him so that he could rape her too.

Mr. Chairperson, committee members, we have documented serious and consistent allegations of grave human rights abuses at a mine owned and operated by a Canadian company. Allegations date back nearly 20 years, and violence appears to be ongoing. Despite the seriousness of these allegations, little has been done to investigate.

But the victims have a right to have their complaints investigated in a transparent, comprehensive, and independent manner. Bill C-300 is a step in the right direction in providing an independent venue to which victims may complain. Importantly, the bill also has the potential to deter and prevent future incidents of brutal violence by promoting accountability for the actions of Canadian companies overseas.

Thank you.

[Tyler Giannini, Lecturer on Law, International Human Rights Clinic, Harvard Law School]

Thank you very much, Mr. Chairman and committee members, for giving us the opportunity to speak before you today. My name is Tyler Giannini, and I head the International Human Rights Clinic at Harvard Law School. I'm joined today by Ms. Sarah Knuckey of the Center for Human Rights and Global Justice at the New York University School of Law.

Before I begin, I wish to state my understanding that my presentation and my statements to this committee are covered by the parliamentary privilege, and to the extent I need to assert such privilege, I hereby do.

Ms. Knuckey and I are human rights lawyers with some two decades of combined experience documenting human rights violations. Since 2006 Ms. Knuckey has traveled to Papua New Guinea, or PNG, three times, and I twice, to investigate personally the impact of the Porgera Joint Venture, or PJV, mine, majority-owned and operated by Canadian mining interests since its inception.

Today we speak about security and human rights at the PJV mine and discuss why Bill C-300 is particularly important when independent investigations have failed to materialize despite consistent allegations of abuse. First, I will illustrate how Bill C-300 gives the Canadian government a critical role in promoting accountability by offering a venue for victim complaints when other actors fail to do so. This is especially true when host countries like PNG and corporations may have an inherent conflict of interest that inhibits the likelihood of independent investigations from taking place.

Secondly, Ms. Knuckey will discuss the serious allegations of violence that have persisted during the life of this mine in light of the failure to investigate the abuses adequately. The PJV mine began operations in the 1990s in a remote area of PNG, pursuant to an agreement between the PNG government and Placer Dome, a Canadian corporation. In 2006 Barrick Gold purchased Placer Dome and acquired the mine.

Dating to the 1990s, there have been reports of serious human rights abuses associated with the mine. Individuals we have spoken with have detailed allegations of the following grave abuses: rapes, including gang rapes; physical assault; and killings. The PNG government and the PJV mine have responsibilities to investigate such allegations; however, based on interviews and documents obtained in PNG, independent investigations by these parties appear unlikely.

First, according to many witnesses and victims, local police have repeatedly failed to investigate adequately allegations of abuse by PJV personnel. Police officers have also indicated that their investigative efforts have been hampered by PJV security officers who have restricted immediate access to crime scenes within the mine and, in their view, may have tampered with evidence.

In 2005, in the wake of local pressure and company acknowledgement of mine-related deaths, the PNG government created a committee to investigate the situation. However, despite completing its work in 2006, the committee report has not yet been released.

Secondly, we have concerns about the independent investigations because mine security forces are comprised largely of police reservists. Many of the abuses alleged to have been committed by mine security forces are attributed to these police.

During our March 2009 fact-finding trip to the country, we were able to view and transcribe a memorandum of understanding between the mine and the police force, which we have included in its entirety for the record. This document, which was shown to members of the Harvard team by a senior police official in PNG, authorized “the deployment of an agreed number of Reserve Police (who are employees of the PJV)”. The MOU also specifies that the mine is responsible for “all costs and expenses associated with the Reserve Police, made up of authorized PJV employees, including remuneration, training and the provisions of uniforms and equipment”.

Law enforcement offices we spoke with also indicated that the police reservists comprise the majority of the mine's armed security officers and take day-to-day orders from mine officials.

We were further told that the weapons and equipment used by the reservists--the weapons and equipment that may have been used to commit the alleged abuses--are purchased by the mine. On its face, the MOU raises significant conflict of interest concerns.

As it stands now, given that, one, the PNG government's failure to act or even make public its government committee report on deaths related to the mine; two, the existence of the MOU, which creates inherent conflicts of interest; and three, the consistent inaction on the ground, there is little possibility of a comprehensive, independent, and fair investigation of alleged abuses by the actors in PNG. In such a situation there's a clear need for an external party to conduct an independent review. That's exactly what Bill C-300 does. It establishes a mechanism that makes such an external review possible.

With what, I now turn this over to Ms. Knuckey, who will detail the gravity of the allegations and further demonstrate the need for a bill like Bill C-300.

[William McGuinty, President, OTD Exploration Services Inc.]

Thank you, Mr. Chair and members of the committee, for sharing your time with me today.

I come as an individual to present my concerns regarding the effects of Bill C-300. OTD is a family business. My wife and I have been working in the mineral sector for the last 20-plus years and have experience in the management and support of Canadian junior exploration companies working as corporate enterprises in Canada, and effective exploration operators in Canada and offshore.

As the Department of Foreign Affairs and International Trade points out on their website, there are about 7,000 to 8,000 mineral exploration projects in the hands of Canadian explorers in over 100 countries. This represents a large globally distributed number of communities where at least one Canadian plays a role in local development. The images from many of these places are striking, whether they appear on an exploration company's website or one belonging to an aid agency or to a civil society. They span the same range of natural environments, from pristine to overstressed, and they span that same range of human conditions. These are places where we would hope the mineral sector, civil society, and the Canadian government would consider mineral development to be part of the solution to improvement in the conditions of a host community and a host nation. They are also places where no other Canadian economic investment or development leadership may be available. They are also places where perhaps no other international or domestic leadership exists.

You might ask why I'm concerned if I work for junior capital exploration companies. Junior companies do not in general avail themselves of the financial mechanisms that are at risk of sanction from the minister. As an exploration geologist, I could work most of my career in mineral development and never see a project that would have to consider the financial facilities that Bill C-300 proposals to withhold. I am concerned because many of the examples being used in public positions taken on Bill C-300 are situations where junior exploration companies are identified at various exploration stages.

Bill C-300 doesn't outline a link between the minister's review of a claim and a candidacy for financial support. Any allegation can be submitted, regardless of the project's potential fiscal relationship to the Canadian government. The sanctions on a bad actor at the production stage are clear enough under Bill C-300. They will come at the end of what will be a long and difficult investigation and a decision by the minister. It also happens at the end of a longer process of development at the mine project. The company has a large historic investment and future measured benefits to defend, as well as its reputation.

A sanction may interfere with a host nation's plans or its development opportunity. It may force the company to abandon its intentions. However, a sanction at this point still will leave a project that someone may develop in the future, within the life of the affected community or that of a future generation.

The effect of what amounts to non-monetary sanctions on exploration projects will be more immediate. In many cases, due process might never reach the planned end in the Gazette. I used the word “project” and not “company” specifically here because the junior exploration company is usually shorter-lived than the project. The company may move on or possibly dissolve. It has component technical, financial, and administrative pieces that will come apart and eventually recombine somewhere else in the sector. This would not be out of the ordinary. It's a function of exploration and of financing exploration. Bill C-300 just provides another catalyst for it to happen. It kind of adds a 300-pound gorilla into the mix. The junior company may not survive the time of the minister's investigation, regardless of the merit of the claim against it. It may decide the dispute is not worth the time and effort, or that the defence will cost more than the current exploration value of the project. Perhaps that is the desired outcome of a claim in the first place.

Regardless, there is still a mineral project there. The minister's decision will be a beginning, and not an end, to a larger Canadian involvement in human rights claims in the resource sector. If Canada has decided that Canada should prevent an activity by a Canadian company or remove it from contention to operate a project, Canada must understand that by doing so it has an obligation to ensure that the situation we leave does less harm than the one we acted against. By taking action against a company, Canada will have picked up the reins of responsibility, and we must see that those we seek to protect are no worse off for our intervention.

The debris left behind after a minister's decision, either supporting or dismissing a claim, will remain with the project, that point on the planet where the company, two nations, civil society, and all those in the host community who took stands and fought for their interests and rights played out. It is hard to imagine that upon resolution the host community will feel the same closure as the minister may in his or her annual report. They may feel further abused by the externality of the process, especially if the adjudicator offers no suggestions or solutions to improve the company's position over its previous situation. If Bill C-300 were about justice, it would contain mechanisms to ensure this.

What would Canada offer to a host community to replace the lost opportunity and guide them to a better outcome once the fight is over?

Claims against Canadian exploration companies and projects at the early stage of enterprise will be numerous, hard to investigate, and often rooted in all-too-human frailties such as greed, ambition, and plain old politics. It is not presumptuous to say that 5% of 7,000 projects have a local complaint that could make its way to the minister. That would be a new briefing note for the minister every day, a new investigation beginning every day.

From my own experience, mining operations, especially those represented by a foreign actor, can attract suspicion and hostility on principle. Companies I have led through exploration projects have been accused of dumping cyanide in a river and exploring with helicopters at night to avoid protesters in El Salvador, stealing gold and damaging water tables in Argentina, and corrupting officials pretty much everywhere. All of these are untrue. I was not undertaking any work where my level of activity matched the accusation, even in theory. Despite the lack of any factual supporting evidence, these accusations appeared on the Internet, linked by Canadian and American sponsors who made no attempt to verify the claims or even speak to me before assisting in the dissemination of the accusations, nor have they since.

This is what the entry point can look like for the minister when a claim is made, if it has merit or it doesn't.

My personal favourite was being accused by the wives of my employees in Madagascar of making 70 of their men impotent. I will admit there was a lack of cultural acumen on my part. I was able to resolve it, but I'm sure it would have made a great sound bite on one of the CBC Radio morning shows.

I've tried to describe what I think are challenges for Canada in the decisions about Canadian exploration companies and host communities under Bill C-300. I'm going to try to be slightly cynical here for a moment.

In my weaker moments, I don't think Bill C-300 is about extractives at all. I think it's about challenging the Government of Canada's policies and actions on the international stage. This is about any member of society from anywhere attacking what they feel is a want in Canada's moral policy. This is about driving the interpretation of subclause 5(2), which was talked about earlier, about what is “consistent with international human rights standards” to where someone thinks Canada should be going. This could be about a weak foreign government sponsoring the removal of a Canadian company to replace it with one of its own, or one from another country with better state-to-state incentives.

In a weaker moment, I would ask the Canadian government if they were satisfied with the results of the previous ouster of Talisman in the case of the Somalis who were involved and what the minister's action would have looked like had Bill C-300 existed then.

Bill C-300 will make Canada liable for the results of the vacuum created by the exercise of our enlightened human rights determinations, while at the same time removing its best available tool, a fully engaged extractive company. Although designed to create another layer of accountability in Canadian actions abroad, this bill neither practically nor effectively accomplishes that, nor does it offer to define mechanisms for assuring justice for host communities.

In closing, members of the committee, I would refer you to the tools that my colleagues in the extractive sector will present to you during these hearings: the Prospectors and Developers Association's e3Plus, the Mining Association's Towards Sustainable Mining, and the Equator Principles. It is my impression that the extractive sector as a whole, including my piece of it, is coming to embrace their operational aspects and, more particularly, the motivations that created them in the first place. In fact, it was the operational aspects that were lacking. I participated in the development of e3Plus, and the shared concern for its design was that it place good operational tools in the hands of field personnel working with our host communities.

Now, e3Plus was designed during the time the industry and civil society waited for the government's CSR position paper, Building the Canadian Advantage, and for its policy, which is now on the DFAIT website. They're both in place. They're both still evolving. Being new initiatives, both are largely untested as bodies of practice or mechanisms to improve CSR. However, they're both aimed at improving performance of Canadian extractives in all aspects of their activities, including human rights. They will persist in doing so, while at the end of the day Bill C-300 will obstruct Canada's and the extractive sector's efforts to successfully resolve societal issues and mediate disputes in communities where they originate. It will do so in places where host communities will need it the most.

Thank you.

[Rémy M. Beauregard, President, Rights & Democracy]

Thank you very much, Mr. Chairman.

I wish to introduce to you my colleague Carole Samdup who is the program officer responsible for this file at Rights and Democracy.

I would like to begin by thanking the chair, Mr. Sorenson, as well as the committee members for their attention to the issue of corporate accountability and for inviting us today.

As you know, we were created by an act of Parliament back in 1988 to promote and defend human rights and democratic development internationally. For more than 20 years, we've been implementing this mandate on behalf of Canadians and have reported to them through Parliament. We will have an opportunity, about two weeks from now, to appear in front of you to discuss our five-year review.

We promote and defend human rights and democratic freedoms around the world. We support individuals, communities, and democracy activists. And we assist in the building of democratic institutions and processes that give effect to universal human rights.

One of the greatest economic challenges in the 21^st century consists in seeing to it that the increased movements of international investments and the activity of large corporations not stand in the way of our commitment to respecting human rights. This is not a rhetorical issue. It affects millions of people throughout the world. The arrival of a foreign business in a community can be a good thing for the population but it can also be a very bad piece of news.

Sometimes the project incorporates all of the components of a complex spectrum that goes from sustainable development to the respect of human rights. In those specific cases, local populations can derive a great deal from such an experience, and the investment then becomes a positive for their development. In other cases, things take a less fortunate turn. When projects are developed in countries where human rights are not always taken into account, investments may be made to the detriment of the host populations. Numerous cases of violations have indeed been reported and documented in several developing countries.

Moreover for a number of years the practices of businesses that breach human rights standards have been exposed by the media. In certain cases, the companies concerned were directly involved in breaching fundamental rights, for example by working conditions that run counter to the standards of the International Labour Organization, or by forcibly moving populations. In other cases, they became the accomplices of a system set up by authoritarian states by resorting to the use of government security forces to repress any opposition.

That is, in a nutshell, the debate behind the bill that is before you. How do we see to it that foreign investment by Canadian companies make a positive contribution to the host populations? How do we ensure the accountability of those businesses when international human rights laws are not respected? How do we ensure that the people and communities concerned have access to measures of redress when their rights are violated?

Since 1994, Rights and Democracy has been actively involved in various projects concerning corporate social responsibility as well as the impact of foreign trade and investments on human rights. As a member of the advisory group, we took part in the National Roundtables on Corporate Social Responsibility and Canadian Extractive Industry in Developing Countries.

In 2005, in cooperation with several civil society organizations in five countries, we assessed the impact of foreign investment projects. In doing these studies, we realized that the communities affected by these projects were often poorly equipped to make representations to the state, negotiate with the businesses, participate in decision-making and influence it, or even understand the national and international redress mechanisms at their disposal.

On the basis of those observations, we have developed a methodology that the communities now use, from Cameroun to Ecuador, to advocate for their rights in the face of foreign investment. More than ever, we have to see to it that the increased movement of international investments and of the activity of large corporations not stand in the way of our commitment and obligations.

As you debate Bill C-300 and the issue of corporate accountability more broadly, we hope to provide you with some of the principles we have come to view as essential for effective corporate responsibility over the last decade and a half. These principles can be divided into three categories, which John Ruggie, the UN Secretary-General's special representative on business and human rights, applies. They are called “protect”, “respect”, and “remedy”.

The first principle deals with the state duty to protect against human rights abuse by third parties, including business.

In our experience, developing countries have often ratified key international human rights treaties, but are either incapable or unwilling to fully implement them. This is particularly true for less developed countries or countries in conflict or under the control of dictators. Businesses operating in this environment are susceptible to being complicit in human rights violations or, more often than not, benefiting from violations committed by state authorities. In these situations, in which the host state is weak or corrupt, foreign companies and their home states bear an added responsibility to avoid infringing on the rights of others.

The Government of Canada and Canadians can and do contribute to building capacity in developing countries, and they encourage the implementation of human rights obligations, but this is not a substitute for ensuring our own actions abroad to not contravene human rights laws.

The second principle deals with the responsibility of business to respect human rights. This means that companies must take every precaution to avoid committing human rights violations or benefiting from them. In our experience, most companies are law-abiding and respect human rights, but some companies are in fact responsible for human rights violations. We cannot hide this fact. For these companies in the minority, regulations are needed based on human rights; voluntary measures are often not enough. They have some usefulness as a statement of intent, but they are not sufficient.

As John Ruggie recently stated:

A pure model of self-regulation beyond compliance with national laws lacks prima facie credibility. We live in a world of 192 nations, 80,000 multinational corporations, millions of affiliates and suppliers, and countless other firms, large and small. There is not enough magic in any marketplace, real or imaginary, to overcome the staggering collective action problems.

Human rights provide the framework of international standards that have been negotiated and adopted by states. As such, they serve as an international consensus. In addition, human rights norms are also directly binding on non-state actors. Human rights offer a well-established governance and monitoring framework through the various activities and procedures of the UN human rights system. Human rights provide a set of procedural principles that serve as a due diligence checklist for companies when evaluating potential future projects. These include non-discrimination, transparency, participation, and accountability.

Importantly, human rights do not impose any new standards or commitments other than those that are stated and agreed to already. It should not, therefore, be difficult for countries like Canada to build a regulatory framework based on human rights principles, nor prohibitive for companies to adhere to them.

Finally, the third principle deals with the need for greater access by victims to effective remedies. Those most affected by foreign investment projects are rarely, if ever, consulted. When things go bad and their rights are violated, they have no recourse to obtain justice.

Victims must be able to submit a claim to an adjudicating body when their rights are violated, and they must be able to do so without fear of persecution or reprisal. Complaint mechanisms or fair and impartial judicial processes are non-existent in many developing countries, but this must not be a licence for a company to operate in this vacuum and escape responsibility.

In this respect, the Government of Canada can play an important role. Our government has a shared responsibility under international human rights law to ensure that human rights are protected, even outside its own territory. Once Canada allocates public funds to an investment project, it has responsibility for its impact, no matter where the impact is experienced. Canada has a moral obligation to ensure its funds are not used in a manner that would be illegal in domestic law as a violation of human rights.

By instituting an enforcement mechanism with a mandate to investigate claims and make binding decisions, and to which victims can seek remedy for violations committed by Canadian companies overseas, Parliament would be taking an important step toward fulfilling the promise of corporate social responsibility. Consulting local communities before undertaking foreign investment projects and ensuring that the human rights risks are mitigated would be far more effective and beneficial to all actors. In order to level the playing field, an effective enforcement mechanism is required.

These three principles should guide your deliberations on legislation to ensure that Canada's actions abroad favour rather than hinder universal human rights.

Thank you.

[James Lunney, Conservative, Nanaimo—Alberni, BC]

I have a follow-up to Mr. Goldring's question about paragraph 5(2)(c), a part of Bill C-300that calls on ministers to issue guidelines to ensure that corporations operate in a manner consistent with international human rights standards.

Mr. Goldring raised this point with you. That's a developing issue, international human rights standards. There are all kinds of things out there, some of which many nations, including Canada, do not fully endorse. Was it clear that you were to get back to us on this issue, with respect to whether it would be problematic?

[Dr. Stephen Lucas]

I'd like to respond to a number of points raised in the question.

First of all, the Government of Canada, in adhering to and promoting the OECD guidelines for multinational enterprises, does have an economy-wide approach and the national contact point, representing a mechanism to both promote and address complaints associated with implementation of those guidelines by Canadian firms working in Canada, as well as Canadian corporations working abroad.

Secondly, as noted in my opening remarks, increasingly business—and in particular, businesses in the mining and oil and gas sectors working in Canada and abroad—recognize that their competitiveness in terms of access to resources and the ability to earn their legal and social licence to raise funds and be supported by shareholders requires not only economic performance but environmental and social responsibility performance against those international standards outlined by the IFC, as well as the specific laws of any country in which they operate.

In regard to your question on specific challenges in the bill, I return to the point I made that a number of carefully considered mechanisms are in place now that have arisen over the past number of years, as I noted, including the OECD guidelines and national contact point, work by industry, and then the four pillars of the government strategy, which we believe together provide a fulsome response to addressing the twin objectives of improving CSR performance, addressing challenges as they arise, and improving the governance capacity of host countries working in partnership with those governments.

The addition of a legislative approach such as envisaged in Bill C-300 would add a different dimension that we believe is inconsistent with the policy-based proactive approach to addressing those objectives, as I noted in the CSR strategy, which builds on a number of mechanisms already in place. So it's that concern that this mechanism and the complexity and cost associated with it will create the potential for confusion and duplication and not allow the collaborative, proactive approach of the strategy to move forward. It'll be really driven by meeting the minimum rules envisaged in that, as opposed to reaching for the bar of improved performance and addressing the root issue of the governance capacity challenges in developing countries.

One of the areas that the bill notes is in regard to respecting human rights and the role of corporations. Currently state conventions on human rights link the responsibility or outline the relationship between individuals and the state. The work of John Ruggie, which is still under way, mandated by the UN Secretary General, is looking at the issue of the role of corporations, but that work is not as yet complete. I think it would be very challenging for Canada to step into that area before that work is complete and addressed in a multilateral UN process that it originated from.

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

With your permission, I will be sharing my time with Ms. Lalonde

Good morning. A broad consultation was conducted over two years and a report was prepared. People were consulted from all walks of life—civil society, the mining industry and experts. The report recommends above all that non-compliers no longer be entitled to tax advantages, to loan guarantees or to other forms of government assistance.

On the matter of the government's accountability strategy, can you give us some examples of non-compliant companies? What is the government, or are the EDC people doing when they learn that a company is breaching the Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries where they are operating? For instance, in Peru, in 2004, some 40 cases of non-compliant companies were reported.

What is the reaction of Canadian government representatives in the face of these businesses that commit violations of human rights or environmental offences, for instance?

[Bernard Patry, Liberal, Pierrefonds—Dollard, QC]

Mr. Lucas, in my opinion, Ms. Evans has no power. And what the government has proposed is an empty shell.

According to your experience, would Canadian mining and gas companies that do business abroad leave Canada because of a bill such as Bill C-300? That is my first question.

[Bernard Patry, Liberal, Pierrefonds—Dollard, QC]

Thank you very much, Mr. Chairman.

Thank you, Mr. Lucas and Ms. Flood.

Last October 2, the Minister of International Trade announced the appointment of Ms. Evans to the new position of corporate social responsibility advisor. In other countries that also do business in the mining, oil and gas sectors, for instance the United States, the United Kingdom, Germany, France and Brazil, is there a complaint and investigation system such as the one that has just been proposed by the government, and related sanctions as proposed by Bill C-300?

[The Chair, Conservative, Kevin Sorenson]

I'm not sure you really answered his question. His question was specific to this bill and I think was driving at whether there is a way, through certain amendments or modifications, as Mr. Rae said, that we can still work with Bill C-300.

[Bob Rae, Liberal, Toronto Centre, ON]

Mr. Lucas, thank you very much for your presentation.

With respect to Bill C-300, is it not possible to see that Bill C-300 could work in a very collaborative way—with some modest changes—with the government's current approach? In other words, we recognize what the government is doing and we see the progress that's been made, but would it not be possible to see Bill C-300 as working in parallel with what else is happening on the administrative level?

As an example, the development of the standards that is taking place at the international level would clearly give the government guidance with respect to the standards and guidelines that the legislation anticipates would be brought forward. In fact, there would be nothing dramatically different in what the guidelines are; it would simply be that if somebody has a complaint, there's a process by which the minister can then determine whether the complaint is frivolous or not.

It shouldn't be seen that Bill C-300 is in some sense antagonistic to the approach that's already being identified by the government. Or am I seeing the world through rose-coloured glasses, as my friends opposite might sometimes want to accuse me of doing?

[The Chair, Conservative, Kevin Sorenson]

Good morning, colleagues. This is meeting number 33 of the Standing Committee on Foreign Affairs and International Development, on Tuesday, October 20, 2009.

Our orders of the day include a return to our committee's study of Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries. As witnesses in the first hour today, we are pleased to have, from the Department of Natural Resources, Stephen Lucas, assistant deputy minister, minerals and metals sector; and also Ginny Flood, director general of the minerals, metals and materials policy branch.

I invite you to make your opening testimony, and then we will proceed into rounds of questioning.

Madame Lalonde, you had asked for time in committee business at the end of the first hour, and we will definitely leave time for committee business. Did you want that for today and Thursday, or for Thursday?

[Kevin Sorenson, Conservative, Crowfoot, AB]

Mr. Speaker, I have the honour to present, in both official languages, the seventh report of the Standing Committee on Foreign Affairs and International Development requesting an extension of 30 sitting days to consider Bill C-300.

[The Chair, Conservative, Kevin Sorenson]

Thank you very much.

Unfortunately, our time is up here.

Thank you very much, Mr. Peeling, for your testimony today. You certainly answered many of the questions; there are others that we look forward to hearing other opinions on.

We will move now to committee business.

First of all, when we passed our steering committee report, part of that report asked that the committee pass a motion for an extension of 30 sitting days to consider Bill C-300.

I would welcome a motion on that.

(Motion agreed to [See Minutes of Proceedings])

[Gordon Peeling, President and Chief Executive Officer, Mining Association of Canada]

Merci beaucoup.

I'm Gordon Peeling, president of the Mining Association of Canada. I do represent the national organization of the mining industry, which represents the major producers of base metals, precious metals, diamonds, iron ore, steel-making coal, uranium, and oil sands, and also the integrated smelting and refining of metals. As well, we represent another 50 suppliers of engineering and environmental technology, service providers, and financial and small companies in the pre-production phase of development.

As an organization, we have a mandatory CSR program for our producing members, called “Towards Sustainable Mining”, which is mandatory for domestic operations. It's still voluntary for international operations. I'll come back to the strength of that a little later.

I'll also mention that I was a member of the advisory group for the CSR round table process. As noted by the earlier witnesses, yes, we did sign off. I personally signed off on it.

I want to talk about the round table and its process for a minute just to remind or inform those who didn't take part in this process about what transpired. When we started, there was obviously considerable mistrust and quite different starting points on the nature of finding a solution and making progress.

For many elements in civil society--and forgive me for generalizing--there was an immediate call for sanctions and remedy through extraterritorial application of Canadian law. For industry, there was a sense that improvements were required but that what was needed was an enabling environment that would help industry deal with very complex on-the-ground situations and help improve performance.

Out of those two end points over the course of the round tables, and in hearing from many experts like Mr. Janda, came some remarkable common ground. The advisory group report of recommendations to the government may have dragged all of us beyond our comfort zones at the end, or beyond where we thought we would end up, but that probably indicates that we were pretty much getting to the right point.

Let me turn now to a couple of those key outcomes, because they do bear on our views on Bill C-300. The round table recommendations did not embrace extraterritorial application of Canadian law or a legislative solution. The approach was a policy framework that was enabling for improved performance of industry and for assistance in capacity building for developing countries' governments, a key point for industry.

The “ombuds” type of function was housed within this policy framework, not within a legislative construct. It was at arm's length from government, and there were very specific reasons for doing that: because they didn't raise some of the issues that members have pointed to around this table.

From our perspective, capacity building was key to treating the disease as opposed to band-aiding the symptoms. If governments had the capacity to enforce environmental regulations, protect their citizens, live up to their international obligations on human rights and indigenous rights, and collect and redistribute taxes, including investing in social and institutional infrastructure, we would probably have nothing to talk about today.

Hence, for us, the most important part of the government response is the commitment to the extractive industry's transparency initiative and the voluntary principles on human rights and security, and a commitment to multilateral and bilateral processes to improve governance and capacity in developing countries as they struggle to manage the resource development process. That was all part of the round table recommendations, which we did sign off on.

Turning more directly to the government response, this may be where we have some differences of opinion amongst the advisory group in our process, but our expectations were not of the kind that thought we would get everything recommended in the report. Very few reports of this kind--indeed, even royal commissions--get everything they recommend.

In our view, the government response is directionally correct. And it is a starting point. We always have to start with those first steps, build upon them, learn from them, and make improvements as we go along. This we see as a first step, not an end point.

The Mining Association of Canada is committed to work in good faith with government and other interested partners to see this successfully implemented. It does put Canada in a leadership position. The path of progress starts with that first step, as I noted, and this, in our view, is an important first step. The government's recent announcement on the counsellor position, in just the last few days, adds further substance to that commitment.

Now let me talk a bit about Bill C-300. From my perspective, Bill C-300 takes us back to the divisive beginning of the round table, something I thought was behind us. From our perspective, the bill is not in keeping with the spirit or intent of the round table report. Also, at its very core, Bill C-300 is based on creating a legislative and punitive approach to corporate accountability that ignores the need for an enabling environment to improve performance.

By creating legislation, the bill also introduces many issues such as, in one sense, in our view, not demonstrating any sensitivity to intruding into the sovereign right of other governments to manage resource development to meet their national needs. MAC member companies remain committed to respecting sovereign right of governments as best placed to make the difficult choices in responding to their societal needs while managing the development of their resources.

There is also the confusion arising as it relates to standards out of Bill C-300, which, in our view, does not bring clarity to the question of standards but serves to add a new and possibly confusing perspective from Canada. MAC supports the federal government's commitment to the extractive industries transparency initiative, the EITI; the voluntary principles on human rights and security; and a commitment to multilateral and bilateral processes to improve governance capacity in developing countries.

Canadian companies need to operate on a level playing field with their competitors, and there are a wide range of international guidelines and standards that provide appropriate reference points for the CSR-related processes and issues.

The IFC is referenced, but the IFC already applies to us, as it does to everyone else. That in essence is a level playing field, but the IFC standards, you have to understand, weren't meant to be the equivalent of a regulatory requirement. That's an important point that maybe we can discuss further in the question and answer time.

On human rights, the Secretary-General of the UN has charged his special representative, John Ruggie, to interpret state obligations of international conventions on human rights for application at the corporate level. He has completed the first part of his work in three years and is in the midst of a further two-year assignment to bring down that detail into the corporate sphere of how a corporation should act to respect human rights that have been written on a state-to-state international convention basis.

That is why, even in the round table process, we did create space, because we all agreed that it was a gap that was, with the intention of Ruggie's work from the UN level, to be filled and to provide some guidance to companies as to how best to respect human rights in that regard. But that indicates that we're not at an end point in this process. Industry is still digesting the first part of Ruggie's report. It is trying to improve its complaint mechanisms itself and is waiting for the next stage in Ruggie's report.

In our view, Bill C-300 misses this dynamic. The bill makes no distinction between trivial and substantive compliance issues. They both presumably result in CPP selling off whatever shares it may have with those corporations and the loss of EDC financing.

The bill creates a huge disincentive to acquiring foreign assets by Canadian resource companies, because if there are problems they are inheriting as a result of past actions of the previous owner, they may well have no time to bring that performance up to standard should a complaint be launched and within eight months of some determination that results in sanctions.

So we see here damage without a lot of balancing aspects to the bill, and the reputational damage can be serious. Yet there are no appeal mechanisms in the bill, and we're not even sure what the evidentiary rules will be.

I want to turn to EDC for a moment. EDC support flows through to Canadian service providers. In other words, when Canadian mining companies engage EDC for a loan action, loan agreements, etc., often that money is a direct flow-through to the purchase of Canadian engineering services, service providers of technology, etc. What then does the EDC decision result in? A breach of all those contracts? Once that litigation starts, what company then would, in the future, seek EDC support? How could the supplier rely on it? Who knows whether that breach of the company might be trivial or substantive?

Now just let me talk about Canadian direct investment abroad in the minerals and metals area. Statistics Canada indicated that, at the end of 2008, $66.7 billion had been invested as Canadian direct investment abroad from this sector since 1990, and that was an $11 billion increase from 2007. These numbers are huge relative to official aid flows from Canada and they do much good. They create jobs. They lead to business development, local training, health services improvements, education, improvements in local areas. In our view, this bill puts certainly some of that at risk. So we do have very specific concerns about Bill C-300.

I want to tell you about CSR. We do recognize the voluntary challenges there, absolutely. We have not been idle in the field of CSR, and we have had a program in place for quite some time, albeit mainly with a domestic focus. We have always had the international aspect in mind, but it was getting our own house in order first and then turning attention to some of the international issues. At the end of the day, industry does recognize that you can't have one operating ethic in Canada and a different operating ethic outside of Canada.

TSM is a condition of membership. I'll just say what other people say about TSM. Five Winds is a major international organization that specializes in sustainable development processes. It initially did a contract for the Canadian government to look at a number of CSR processes across the retail council, forest products, etc. We were not included in that, so we asked them to include us. Our results are that we exceed best practice and we're consistent with best practice in all areas. In other words, we have no elements that are below best practice.

The Canadian Business for Social Responsibility recently profiled 11 different frameworks, ranging from the global compact to the OECD guidelines to the global reporting initiative to the IFC performance standards. CBSR--and this was done without our knowledge--ranked TSM the highest, as “more prescriptive, more guidance and stricter compliance provisions”. We are committed to continued evolution of this program with our members, just as we are committed to work with governments, the NGO community and others, to improve performance in all these areas, particularly environmental and human rights, social matters related to benefits to local communities, etc.

At the end of the day, though, we do respect the sovereign right of governments as the best place to make the difficult choices in responding to societal needs while managing the development of resources. We endorse the development of a policy framework that would enable improved industry performance and provide a capacity building for developing countries. We endorse a policy approach that is directed towards finding solutions through mediation, discussion, fact-finding, and problem solving. This was described in the CSR round table report, in which we think the counsellor position takes us some way along that line, as did the national contact point, in its first work.

Thank you.

[The Chair, Conservative, Kevin Sorenson]

I call the meeting back to order. In the second hour we have Mr. Gordon Peeling, president and chief executive officer of the Mining Association of Canada. We're certainly pleased to have him here.

We have designated a few minutes for committee business. My understanding is that the one motion that was presented just this past week has been withdrawn. Is there still a pressing need to move into committee business? We have a very short order in that we have to pass a motion in our committee to extend the meetings on the bill that we're debating this morning, Bill C-300, for 30 days. That passed our steering committee and it just calls upon this committee to have the motion. We'll do this later on. Maybe we'll go to 10:50 or whatever; we'll try to keep it to 45 minutes.

Mr. Peeling, welcome. I noted that you were present for part of the discussion in the first hour. We thank you for coming today. You can have approximately ten minutes as an introduction and then field some questions.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

Thank you to all the witnesses for being here.

One of the concerns I have is that in your testimony you have not told us specifically which clauses and specifically how Bill C-300 would help. I would suggest, particularly to Ms. Coumans, who is going to be giving us a written submission, which might be very helpful to come from MiningWatch Canada, particularly in light of the testimony that will likely follow, that this committee—and I would say this to all other future witnesses—is probably best served if we have specific references to specific clauses and specifically how it would achieve the objectives that the bill is intended for.

Mr. Janda, I was interested in your testimony about funding sources being stopped.

I need to understand, are both of your organizations at all familiar with the Equator Principles?

For the benefit of the committee, the Export Development Canada signed on to the Equator Principles in 2007. They require financial institutions to sign on and to rank projects by social and environmental risk. They also require borrowers to submit social and environmental assessments and detailed plans for ensuring that risks are mitigated and results are measured. EDC, in this case, will not be providing loans to projects if the borrower cannot comply with these policies.

It seems to me that these are the steps that are called for in Bill C-300, yet as we see, in 2007, the EDC signed on to those principles. So why in the world do we need Bill C-300?

[Richard Janda]

Firstly, Bill C-300 has not simply come out of nowhere. It is an attempt to implement the round table recommendations.

As I suspect the next witness will tell you, what frightens industry is the prospect of moving straightaway from a voluntary approach to a binding approach. They are afraid that the government will step in and legislate.

You need to look carefully at the exact wording of the round table recommendations. The message is clear: it is not simply that there should be a mechanism to allow for funding to be withdrawn when certain principles are violated, but, rather, that in such instances, funding must be withdrawn.

How can that be implemented? We need a framework. It appears that industry would rather see a discretionary approach, a non-transparent process. However, my interpretation of the round table report is that a framework is required to implement this recommendation. The bill does not aim high: it speaks of a complaint process and the implementation of guidelines for federal government agencies. It is, nonetheless, in keeping with the round table recommendations, and industry is mistaken to say otherwise.

Allow me to make one final comment. As an observer, and as a citizen, I am deeply troubled to see industry participate in an extensive consultation process, to see it support the outcome, but then, at the first opportunity, to flip-flop and implement only what suits it, simply discarding the rest.

Why are groups such as Ms. Coumans outraged? Because they get involved in these round tables in good faith, they agree to compromises, and then industry simply walks away saying too bad! It is verging on scandalous.

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

People from a whole range of backgrounds were involved in these round tables: representatives from NGOs; experts; and the mining and extractive industry. A huge consultation. Consensus was reached on the recommendations contained in the report that was tabled.

To my mind, Bill C-300 constitutes a step in the right direction, a sound idea from a member of Parliament. As parliamentarians, we are empowered to table a private members' bill in an effort to put pressure on the government.

However, Ms. Coumans, you have already pointed out that the bill does not have enough teeth. Is it sufficiently in keeping with the recommendations included in the report issued by the round table?

[Richard Janda, Professor, McGill University, Canadian Network on Corporate Accountability]

Thank you very much, Mr. Chair and members of Parliament.

It's an honour to participate in these deliberations with you on a matter of considerable importance.

With your permission, I would like to begin by acknowledging the work done on this report by my friend and colleague, Charles Gonthier, retired Justice of the Supreme Court. Sadly, Charles has now passed away, but I want you to know that when I asked him to collaborate on the report we have prepared for your committee he firmly committed to doing so, even though he was already in hospital. He wanted to be involved as this work goes to the heart of one of his most cherished principles. He believed that, in addition to the freedom to access markets and the need to ensure equality between all members, a sense of fraternity is also required. Our responsibility to others was Charles Gonthier's pet subject. He saw corporate social responsibility as an example of this sense of fraternity. I would therefore like to dedicate this report to the memory of Charles Gonthier.

The report you have received was prepared for the Canadian Network on Corporate Accountability, which is a group of 20 NGOs that cuts across faith-based groups, human rights groups, and unions. It represents a cross-section of civil society. The work we did, though, was independent, and it was conducted through the Centre for International Sustainable Development Law, for which I am a researcher. I want to underscore that although I am the signatory on the report, it was work that was done with a number of jurists, and the findings we came to unequivocally were considered after a period of some long deliberation.

We were asked to look at what we were told were the most serious concerns being raised from both a legal standpoint and from the point of view of fundamental policy concerns about the bill. We were able to conclude, with no equivocation, that the bill was sound and that it addressed, in a measured way, all the dimensions of the national round tables on CSR strategy that remain to be implemented.

I would like only to underscore four elements of the report. And I welcome your questions about specific further features of it. I think that these are the four ideas that have been most critical to your deliberations on Bill C-300.

First, the question can be put as follows: is there undue prejudice to Canadian companies from this measure that will subject them uniquely to a process of oversight that other companies don't share, either in Canada or abroad? The answer we came to on that question is straightforward. Far from there being prejudice to Canadian companies, we believe there is a very close connection between helping to build the reputation of Canadian companies abroad with respect to their human rights and environmental practices and in fact giving them competitive advantage. I must say that this is something about which I feel quite strongly, because it is the result of some years of research that led to a book I co-authored with Michael Kerr and Chip Pitts on corporate social responsibility.

The drivers of corporate social responsibility are not simply the NGO groups, like those represented by Catherine, that seek to hold corporations accountable. It's also the fact that all the dimensions of Bill C-300 are risk factors for corporations that affect their own picture as investment vehicles. So the ability of this legislation to provide something like distant early warning of risks Canadian companies face is a way of building a reputation for Canadian companies abroad and their competitive advantage.

The second main question that has been raised is related to the first one, and that is whether Canadian companies will face high transaction costs. Will they face an awful lot of trouble associated with the complaints procedure? Will they be subject to tiresome and costly attacks on their reputations? Indeed, will that lead them to perhaps leave the country rather than stay in the country if they are facing such transaction costs? Will they pick up their stakes and move elsewhere? The answer we came to on that question was equally clear but somewhat nuanced, and it is as follows: no, that should not be the result of this legislation. In fact, if anything, the legislation will provide a context within which credible and legitimate airing of public concerns can take place, bearing in mind that Canadian mining companies are already subject to precisely this kind of scrutiny from abroad.

There is such a thing as a court of public opinion internationally. As you know, that court of public opinion internationally has translated into, for example, the Norwegian pension fund withdrawing its investments from Barrick Gold. If there's a credible, transparent, and legitimate process that allows Canadian companies to address concerns, if anything it should allow them to cut their costs and diminish the possible negative impacts of the assessments that are taking place in any event. However, and this is the nuance, it is possible that some companies are unwilling to invest in the process of addressing public concerns. They may indeed seek to escape from scrutiny by moving to other jurisdictions. The question, I suppose, for members of Parliament is, should legislation be framed to address the worst performers? That's the group that would be an issue.

I'll touch briefly upon two final questions. One is extraterritoriality and the other is the problem of sanction.

In simple terms, this is not extraterritorial legislation. It is legislation that applies to the instrumentalities of the Canadian government. It's a matter of keeping the Canadian government itself accountable for the use of public moneys through the Export Development Corporation and the Canada Pension Plan. Yes, there is the ability to gather information abroad, but that is something the Canadian government does all the time through its embassies and consulates. We see no dimension of this that extends past the point of international law. It's something we can get into in greater detail.

Finally, on the question of sanctions, is this punitive legislation? Is this legislation that would subject Canadian companies to the stick rather than the carrot and as a consequence face them with an inability to improve their performance? The answer to that is no. This legislation has to be seen in the context of all the measures that are being taken by the Canadian government, including, of course, the measures now announced with respect to the counsellor. We have the carrot in place.

The national round table made clear--and my colleague, Mr. Peeling, who will be speaking later, signed off on that document--that we also needed a way of ensuring that Canadian moneys were being spent responsibly and accountably when Canadian companies were failing to act upon the principles and issues. This is not a sanction; this is a matter of finding by ministers, who then turn it over to the Export Development Corporation and the Canada Pension Plan and ask them to implement their standards.

In conclusion, I'm proud as a Canadian citizen that Parliament is considering this legislation. We have an opportunity here to make a real contribution to international discussion. Following this discussion, I was contacted yesterday by a group from Argentina who have been following this debate. I know that groups from around the world are following this debate. The eyes of the world, in a manner of speaking, are on this committee. I very much hope that you will see your way clear to making this legislation a reality.

[Catherine Coumans]

Let me first highlight that I believe we have come to an important consensus with industry. The Prospectors and Developers Association of Canada notes that many countries lack the governance and institutional capacity to enforce legislation and to ensure a stable regulatory regime. However, industry's response to this governance gap is to focus on voluntary CSR measures to be taken by corporations, supported by host country capacity-building to be undertaken by northern hemisphere countries like Canada.

Remarkably, this line of argument appears to support a position that extractive industries should remain exempt from effective legal and regulatory mechanisms, at least until the Government of Canada and other northern hemisphere countries have created sufficient capacity to regulate and provide legal accountability in all weak governance and conflict zones around the world where PDAC and its members choose to operate.

Voluntary CSR approaches by extractive companies, while necessary, are not sufficient to ensure respect of human rights and environments by corporations. They do not, for example, deal with the problem of laggards, companies that choose not to apply CSR standards, or apply them inconsistently and not uniformly across all operations. Another key problem with existing CSR codes and instruments is that they are all weak on human rights, referencing only a subset of human rights, if at all. Another key deficit of voluntary CSR instruments, and this is identified by Ruggie, the UN special representative, is that no CSR instruments have effective accountability mechanisms, particularly with respect to sanction and remedy.

If we can agree that there is a governance gap in many host countries in which our corporations operate, and that voluntary CSR measures, while necessary, are not sufficient, and if we recognize that there is no international regulatory system that can deal with corporate abuses in weak governance zones, nor is there an international legal system to which aggrieved parties can turn, then we must come to the conclusion that it is only the home state of multinationals, home states such as Canada, that can address the governance gap identified by Ruggie.

I'll leave it at that. I would say this conclusion is a conclusion this committee came to in 2005 with the report that was issued at that time. It's also a conclusion that 137 members of Parliament must have come to when they voted in favour of Bill C-300 in the House of Commons on April 22.

Thank you.

[Catherine Coumans, Research Coordinator and Asia Pacific Program, MiningWatch Canada]

Thank you, Mr. Chair, and my thanks to the members of this committee for providing us this opportunity to speak to you today.

In 2008, John Ruggie, the United Nations special representative on the issue of human rights and transnational corporations and other business enterprises, concluded his first two-year mandate by stating, and I am quoting:

The root cause of the business and human rights predicament today lies in the governance gaps created by globalization—between the scope and the impact of economic forces and actors and the capacity of societies to manage their adverse consequences.

These governance gaps provide the permissive environment for wrongful acts by companies of all kinds, without adequate sanctioning or reparation. How to narrow and ultimately bridge the gaps in relation to human rights is our fundamental challenge.

While the high-profile work of Special Representative Ruggie is garnering a lot of international attention, it is appropriate in this context to remember that Ruggie's conclusions of 2008 had already been recognized in the groundbreaking and unanimously endorsed 14th report of this committee in 2005. I am now quoting from this committee's report of 2005:

These hearings have underlined the fact that mining activities in some developing countries have had adverse effects on local host communities, especially where regulations governing the mining sector and its impacts on the economic and social well-being of employees and local residents, as well as on the environment, are weak or non-existent, or where they are not enforced.

That was the SCIFAIT report of 2005, which is now being echoed by John Ruggie, special representative, in 2008.

I had the privilege of testifying before the subcommittee in 2005, and I am encouraged to see some familiar faces of members of Parliament from that committee around this table today.

I would like to start my presentation by putting a human face on the problem that Ruggie identifies and then to explain why MiningWatch Canada believes that Bill C-300 is an appropriate response.

I was first confronted with the environmental devastation and the human rights and health consequences that can result from irresponsible mining practices when I arrived on the small Philippine island of Marinduque in 1988 to start my Ph.D. fieldwork in religious anthropology. I had never seen a mine or spent one day of my life thinking about the potential consequences of mining.

It was sheer coincidence that a huge copper mine in the central hills of this small island province was owned and operated by a Canadian company, but this fact did not immediately persuade me that I had any role to play in the struggle that was taking place on this small island to protect a critical marine environment, the food security of 12 fishing villages that relied on coral reefs for their food, and the health of local children who were exposed to metals in mine waste being dumped into Calancan Bay.

I lived in one of those fishing villages for over a year and came to understand, as I carried on with my research project, the devastating impact the mine was having on the lives of the people of Calancan Bay. It wasn't until years later that a health study conducted by the Philippine department of health confirmed that the children that I had been surrounded with during my fieldwork had unacceptable levels of lead, cadmium, copper, and zinc in their blood. The Philippine government declared a state of emergency in Calancan Bay for health reasons. This was in 1997.

In 1993, the same year that I completed my Ph.D. in Canada, an earthen dam burst at the same mine site and tons of highly acidic and metal-rich mine waste flooded down the Mogpog River. Villages were inundated with mine waste. Houses and livestock were swept away and two young children of Marites Tagle died. They were smothered by the mine waste.

The Canadian managers of the mine said that the mine bore no legal responsibility for the disaster as it was an act of God, brought on by a typhoon. Mrs. Tagle reportedly received, for compassionate reasons, 1,000 pesos from the mine for each of her two dead children, which in Canadian dollars is about $23.

The Mogpog River has never recovered. It is heavily silted by mine waste that flows through the dam. Studies have shown that it is acidic and laden with toxic metals.

This past April I was back in Marinduque after 20 years. I helped villagers fill rice bags with waste from the river in an attempt to lower the level of the river and stop the regular flooding of nearby villages with contaminated water.

In 1996 I was at Cornell University doing post-doctoral research when yet another mine waste impoundment in the hills of Marinduque burst. Another river, this time the Boac River, filled with mine tailings from the mountains to the sea.

This third disaster on this small Philippine island finally closed down the mine. But now, more than 10 years later, the tailings are still piled in sandbags along the banks of the Boac River. Canadian engineers Klohn Crippen have warned that further disasters are likely as the dams and structures of the deserted and unrehabilitated mine site in the mountains crumble away.

I've told you this story because it contains elements of many of the stories regarding Canadian mining companies operating overseas that we are dealing with daily at MiningWatch Canada.

MiningWatch started in 1999, so I've now worked at MiningWatch for 10 years. When I first started at MiningWatch, I did not expect, as an employee of that organization--I was the original employee--that I would see cases as bad as the one that set me on this path in my life. But in fact we are dealing with these same situations literally all the time, from all over the world--irresponsible mine practices, environmental degradation, human rights abuses, health impacts, and the complicity of corrupt, inept, or even dictatorial governments.

Philippine dictator Ferdinand Marcos turned out, when he was deposed, to have been a secret partner in that Marinduque mine that was run and owned by a Canadian company. He had a 50% share in that mine.

The other aspect of this story that is common to others that we deal with at MiningWatch Canada is the lack of recourse for the people who have been damaged--the lack of, as Ruggie put it, sanctioning or reparation.

In this case, a lawsuit was launched by the Province of Marinduque in 2005 against Placer Dome, which was the mining company, now taken over by Barrick Gold. This lawsuit is slowly making its way through the courts. It is a potentially precedent-setting case, because the court it is making its way through is in the United States. Just last week a U.S. judge ruled in favour of the province's suit, and sent it to Nevada state court to proceed.

Three similar suits against the company in the Philippines, one dating back to 1996 when the final spill happened, continue to languish and are going nowhere.

Before turning to the merits of Bill C-300, I want to quickly touch on just a few of the mining cases we are engaged in at MiningWatch Canada.

My final submission to this committee on this brief will provide further detail and references for these cases. I only heard that I was presenting for you on Monday, so I haven't had a chance to finalize my brief. I will just run quickly through this, in the interest of time, to give you a sense of how broad this is.

We are engaged in a number of cases right now. The first is in Ecuador. In March of this year, Toronto-based law firm Klippensteins filed another potentially precedent-setting case against the Canadian junior called Copper Mesa Mining Corporation and against the Toronto Stock Exchange on behalf of Ecuadorian villagers who allege that the company's paramilitary agents have resorted to physical assaults, death threats, and other human rights abuses to break opposition to the company's operations.

This committee in fact heard from one of those villagers, Carlos Zorrilla, from the community of Intag, I think a year or two ago.

The second case is in Tanzania. An independent scientific report released just this week supports reports that we have been receiving from communities near the North Mara gold mine regarding serious human health impacts, and even deaths, related to acid mine drainage and heavy metal and cyanide leakage from the mine into the surrounding environment, and particularly into the nearby rivers.

I won't quote from the report, but I have a copy with me. I can do that later.

The third is in Papua New Guinea. This year Norway's government pension fund announced that it has dropped its shares in Canada's Barrick Gold as a result of the Porgera Joint Venture's mine waste disposal into an 800-kilometre-long Strickland River system.

This is a mine that literally dumps its tailings and its waste directly into a huge tropical river system, one of the largest in the world. That waste goes all the way down, 800 kilometres, to the sea.

At the same mine there have been allegations of killings of civilians by the Porgera mine security guards, and these allegations became the subject of a Papua New Guinea government inquiry in 2005 and 2006, but the final report of that inquiry was never released. In 2005 the then-owner of the mine, Placer Dome, did admit in a newspaper article to eight deaths at the hands of its security guards.

Honduras. Tests carried out by an organization in the United Kingdom and Development and Peace here in Canada have shown evidence of dangerous levels of arsenic, cyanide, and other heavy metals in water sources flowing close to or from within the mine boundary. In 2007 the Honduras Secretariat of Natural Resources and Environment fined Goldcorp, a Canadian company, one million lempiras, equivalent in value to about $26,000 Canadian at the time, for pollution and damage to the environment.

[The Chair, Conservative, Kevin Sorenson]

Good morning, everyone. This is Thursday, October 8, 2009. The Foreign Affairs and International Development Committee is meeting to discuss and hear testimony on Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries.

We're very pleased to have with us this morning Ms. Catherine Coumans, the research coordinator for the Asia-Pacific program at MiningWatch Canada. Thank you for coming, Ms. Coumans. We also have Richard Janda, a professor at McGill University. He is accompanied by research assistant Rachel Doran. We thank all three of you for being here today and we look forward to your comments.

I'm not certain if you've had the privilege of appearing before committee before, but we look forward to your opening comments. Try to keep them within a ten minute range, and then we'll be able to have more time for questions.

I would invite Ms. Coumans to open.

Canada-Colombia Free Trade Agreement Implementation Act

[Larry Bagnell, Liberal, Yukon, YT]

Madam Speaker, the member, in his speech, complained a lot about Bill C-300. Unfortunately, his government was basically the author of that bill by not reacting to the major exercise he talked about, which was corporate social responsibility.

The Government of Canada-sponsored round table with industry and NGOs came up with solutions and recommendations. This was quite a rare situation where everyone agreed to that extent and came up with some good solutions, yet the government did not react. It sat on it for months and months, even though everyone agreed. Even though the government was a sponsor in part, it did not react.

What the member was complaining about was unfortunately caused by his own government's inaction. Even after Bill C-300, it came up with an inadequate response. It was the government's inaction that inspired Bill C-300 and also the motion by the member for Pierrefonds—Dollard to take action on something that industry and NGOs had agreed upon.

[Deepak Obhrai, Conservative, Parliamentary Secretary to the Minister of Foreign Affairs]

Madam Speaker, it is with great pleasure that I speak to the issue of corporate social responsibility today as it relates to the Canada-Colombia free trade agreement.

I agree completely with the Liberal foreign affairs critic when he says that there are those of us who support this agreement. I also agree with his statement that NDP members are talking nonsense when they say that by supporting this agreement we are condoning murder or human rights abuses or the violence that is taking place in Colombia. That is totally misleading and is fearmongering by the NDP, done by the NDP to support the position they always take, which is against this free trade agreement.

Why do they not just say they oppose it because of their ideology? To say that this is directly related to violence is absolutely nonsense. I want to make it very clear that is not the position here.

Today I am standing up to talk about the corporate social responsibility that Canadian companies undergo when they go overseas to do business. The free trade agreement with Colombia would allow a lot of Canadian companies to go there, so social corporate responsibility becomes a key element in the operation of Canadian companies and what Canadians have come to accept.

The Government of Canada undertook a very lengthy in-depth analysis of corporate social responsibility with stakeholders in Canada, with all those involved in corporate social responsibilities, including NGOs, government people, and industrial people. We came up with a voluntary code of conduct which the government has now provided to Parliament in response. This extensive corporate social responsibility analysis done by the Government of Canada and all Canadian stakeholders has laid the foundation for what is expected of Canadian companies when they are in other countries.

I was in Tanzania in April of this year as well as in Zambia where Canadian companies are working. I had the pleasure of talking to the companies to see what they were doing as part of their corporate social responsibility. I was very impressed at the amount of effort Canadian companies are putting toward corporate social responsibilities such as providing fresh water, schools, and little dispensaries which the local government cannot provide. These Canadian companies are providing these basic services on a voluntary basis and giving hope to many.

Canadians should be proud of many of these companies. The majority of companies that operate overseas do a fantastic job with respect to corporate social responsibility. That is why Canadian companies and Canadians in general have such a high reputation around the world.

This is something the NDP should go and see. Those members would never go to countries where progress has taken place. They will always choose countries that are mired in violence and come forward with their ideology to oppose the free trade agreement.

As a result of the in-depth consultation that took place, the Government of Canada will soon be creating a new consular office to help resolve any issue that could arise between Canadian companies and the communities in which they operate. An announcement will be made very shortly. This is one way of ensuring that everyone will voluntarily comply with what is expected, which has come out of the round table conference. The government has taken this strong, positive step to ensure that all stakeholders adhere to the recommendations regarding corporate social responsibility.

The Government of Canada is also going to support a new centre of excellence. This centre of excellence should be outside of the government to develop high quality tools for corporate social responsibility to see what our best practice is. This is a joint venture with the stakeholders. These are some of the positive steps that this government is taking arising out of the consultation process, which is the right way to do things when we talk about this.

This brings me to the question of looking at what the government's approach has been in talking to stakeholders. We have a Liberal member's private member's bill, Bill C-300, which is now before the committee and which has been hastily prepared without stakeholders' input into it. It was badly drafted and would penalize Canadian companies doing business overseas. The bill is one of those bills that has been emotionally created without input from company stakeholders. It just follows an emotional outburst.

This is not how a minority Parliament should work. I would be very much interested to hear the stance of the Liberal trade critic, whose speech I read, and the Liberal foreign affairs critic, who just spoke about how free trade agreements have a potential of helping in this country, on Bill C-300. This is contrary to what they have been talking about. I hope that common sense prevails on the other side and that when it comes before the committee they will kill this bill. This bill has the potential of damaging the great reputations of people doing business overseas.

The intention is good. We all want corporate social responsibility to take place, but the way it was brought forward, the way it was drafted and the way it has lacked consultations and been coached is just using the minority status to push through something that would have serious consequences for Canadian companies, NGOs and everybody else. There is a small minority of NGOs who are supporting this, but I think that overall, under this major exercise that the Government of Canada undertook last year on corporate social responsibility, that is the way the government should be working. That is how we should work on this thing.

I am very happy to state that the Government of Canada is taking corporate social responsibility very seriously. As I have just said, we will be making announcements about our new councillor as well as the centre for excellence. It must be recognized that the free trade agreement, with its side agreements on labour as well as the environment and other issues, will ensure that there is a rules-based system in our dealings with Colombia.

That is what every Canadian wants because that would ensure strong ties between Canada and Colombia. At the same time, we can engage with Colombia on issues of human rights and others.

[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.

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

Okay. Here I thought we were going to be arguing. In fact, we might be agreeing.

Essentially, at this point, there are three things on the table. The ombudsman, which you and I would agree is the ideal choice, would be a legislated position, independent of government. There would be guidelines on conducting an investigation, standards of proof, and so on. That's not going to happen. The government has shown no interest in doing that.

Now we're down to the press release or Bill C-300. Under the press release, it's an order in council, and what a Prime Minister can order, a Prime Minister can un-order. We've seen that happen. In fact, as we speak, Mr. Page, the Parliamentary Budget Officer, is having his chain yanked by the government, because his information has been a little bit too cogent for the government.

My point is that it's a vulnerable appointment, whereas under Bill C-300 it's a legislated appointment. To take a person out of that position, you would have to repeal the legislation as opposed to having a pen and a piece of paper and repealing it.

The other big flaw in the government's press release is that a company can only be investigated if the company consents.

[Jon Baird]

It deals with corporate social responsibility, CSR in English. In terms of oil and gas extraction and mining, Canada has a presence throughout the world, in over 100 countries. As a government and as an industry, we must ensure that Canadian companies respect the local people, their government and the environment.

According to all quantitative surveys, there is no problem. Canadian companies are working on over 10,000 projects, half of which are in Canada and the other half elsewhere in the world and they behave appropriately. However, I should note that we are working under some very difficult circumstances in countries where there are no laws, where the customs and the language are very different. Problems do arise but very few that are caused by our companies.

Bill C-300 was introduced in good faith two or three years ago. Things have changed quite a lot since then. There has been a series of roundtables throughout the country where industry, government and all stakeholders came together to discuss. A report was produced that expressed a wide consensus. It took the government two years to respond to this report. We just received its response, two months ago. The industry is satisfied, even though a number of recommendations were not accepted by the government.

Industry has developed programs to ensure that our practices conform to reasonable standards. None of this was anticipated by the member who introduced this bill. So I would be happy to discuss it with him. Mr. Garneau said he would come. At any rate, this bill will not be beneficial to Canada, to the mining industry nor to other industries that are active throughout the world.

Corporate Social Responsibility and the Canadian Extractive Industry in Developing Countries

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

Mr. Speaker, I want to focus what time I have in this debate on some of the urban myths that seem to be developing around Bill C-300.

However, before I do, I want to commend my colleague, the member for Pierrefonds—Dollard, for his tireless enthusiasm, following this issue over many years and his extraordinary knowledge about the issues of CSR. Liberals are, indeed, fortunate to have him in their caucus. We are fortunate that he is in the House as he has put forward and advocated this issue over a number of years. Bill C-300 and what is behind it would not exist except for the hon. member and the efforts he has made over these many years.

Last week, by a very narrow margin, Bill C-300 passed in principle. I want to speak to the issue that in the House we sometimes talk the good game, but we do not actually legislate the good game. We speak favourably at great length about the principles of CSR and environmental responsibility, but when it comes to actually putting some legislative teeth behind what we say we believe, we sometimes degenerate into some hand-wringing and raise, so to speak, a certain level of bogus concerns.

I thought I would take an opportunity to address four, five or six of these and see whether I can put to rest some of what I call urban myths. The first has to do with our companies being at a corporate disadvantage. The logic, apparently, is that if other countries are doing atrocious things in developing countries to people and/or environments, then our companies should not be prevented from doing the same things or be subject to new, onerous, unclear and unnecessary rules if others are not.

I am not quite sure how to handle an argument that if another country or company is not adhering to CSR or environmental standards, somehow or another our companies should be able to compete at that level. I do not think that is in the best interests of Canadians or, indeed, of companies that fly the Canadian flag.

I would like hon. members to take note that in Bill C-300 the IFC's policy on social environmental sustainability, performance standards, guidance notes to those standards and environmental health and safety guidelines, et cetera, are standards that are neither new or unclear nor are they deemed to be unnecessary or onerous. Indeed, the previous speaker spoke about the minister's March 26 statement wherein the minister in fact referenced some of those guidelines in his statement. If the minister references them in his statement, how could they, therefore, be new, unclear, unnecessary or onerous?

The second complaint we hear about Bill C-300 in particular but CSR in general is that we are in an era of financial instability. That is true. There are financial difficulties around the world and we are in the down part of the economic cycle. It follows, therefore, that apparently we should only introduce legislation when times are prosperous.

If that is true, then the government missed a wonderful opportunity in the last two years to respond to the round table reports and introduce legislation which would, presumably, encompass an ombudsman, as was suggested in the reports. Unfortunately, the government, for whatever reason, chose not to respond to the round table reports.

The third criticism that we hear is that Bill C-300 has massive sanctions. It is one of those criticisms that is so over the top that it reduces the credibility of the critics. Whatever the sanctions are in Bill C-300, they are hardly massive.

All that Bill C-300 proposes is that in the event that a finding is made and gazetted, the offender be cut off from the government's credit card. A lot of people, in fact hundreds of thousands of Canadians, do not want their money used in that way. If in fact these companies want the public dime, then they should be prepared to meet public expectations. The public has clearly set forth its expectations in subclause 5(2) of the bill.

The only sanctions that are contained in Bill C-300 are that the company, if it is gazetted, would not be entitled to access EDC or BDC or CPP or government promotional activities. Those are hardly massive sanctions. It is quite reasonable on the part of the public to say that if companies cannot adhere to corporate social responsibility guidelines and environmental standards, then do not ask us, meaning the taxpayers, for financial support.

The fourth complaint we hear is about frivolous and vexatious complaints. At present, good companies are actually subject to trial by media. Anybody can file a complaint about company X doing activity Y, and the company, particularly good companies have no effective recourse.

Companies that actually are doing these activities, however, appear to prefer taking on lawyers and public relations experts and spending massive sums on them rather than actually addressing the activity or in fact having an alternative dispute resolution process.

For companies that routinely breach CSR and environmental standards, hiring lawyers and hiring PR people may in fact be a preferable process, but for companies that actually value their reputation, this process that is proposed in Bill C-300 is a complete and full answer to frivolous and vexatious complaints.

The fifth issue is foreign and domestic standards, as if there might be some conflict between foreign and domestic standards. There is no conflict if in fact a local country has good CSR standards and good environmental policies, and therefore there would be no conflict between the guidelines set out in Bill C-300 which are internationally recognized and accepted guidelines.

If the jurisdiction exceeds those guidelines, we then have a happy situation and Bill C-300 certainly does not apply. If, however, the local jurisdiction does not meet or enforce its standards, then Canadian companies should surely be expected to adhere to something of a higher standard.

There is some complaint that somehow or another this is an imposition of Canadian law on foreign jurisdictions. Nothing could be further from the truth. International law 101 says that Canada cannot project its law onto other jurisdictions. Bill C-300 cannot be characterized as doing that regardless of how desirable it may be to impose Canadian laws and standards in a jurisdiction where maybe the laws are not adhered to as rigorously as one might hope. Extraterritorial application of Canadian law to another jurisdiction is not only beyond the scope of a private member's bill but is certainly beyond the scope of the government, as well.

The sixth criticism is that there is no consultation. I would suggest the critics take a look at the round table reports in 2007 and look at the signatories on those round table reports. It reads like a corporate who's who of Canada. Included in there are Enbridge Inc., Petro-Canada, PricewaterhouseCoopers, Shell Canada, Talisman Energy, et cetera. In addition, as one speaker referenced, there are well over 200 other witnesses, many of whom come from the corporate who's who of Canada. There has in fact been massive consultation.

When the government repeatedly refused to respond in spite of the re-tabling of the report, Bill C-300 was something of a response to that report. The government issued a press release in March 26 proposing an investigative process which is dependent upon the consent of the corporation involved. It is a little like being subject to an assault, and we can only investigate the assault if the person who is accused of the assault consents to the investigation. Rightly, many others have criticized the response of the government as inadequate and untimely.

Thank you, Mr. Speaker, for the opportunity to respond to those urban myths.

In the event that there are others who wish to enquire about Bill C-300, I then commend my hon. colleague for his energy and enthusiasm in his motion.

[Paul Dewar, NDP, Ottawa Centre, ON]

Mr. Speaker, I want to thank the mover for this motion and also thank his colleague for the legislation he put forward.

I am going to start my comments by quoting an article that was written a couple of years ago by Eve Ensler. Her article, which was in Glamour magazine, sent shock waves through the world. It started off with, “I have just returned from hell”. Those words were conveying her return from the eastern part of the Democratic Republic of the Congo, where we see horrific violence. What she had just seen was something no one should ever see, but for sure no one should ever experience.

She had been to the Panzi Hospital. She had seen girls as young as eight years old who had been gang-raped. She had seen the effects of gender war on a civilian population. What she had seen is something that is still ongoing.

Hundreds of thousands of women and girls, children, have been subjugated into something that is not just deplorable, but something that has been contemplated. What we are talking about is rape as a weapon of war. Indeed, it is rape as a strategy in war.

I say this because it relates directly to the responsibility of our corporations to make sure that when they conduct themselves in countries abroad, they follow every single humanitarian, labour and environmental standard that they follow here.

Right now, the machines that we all use on a daily basis, that we keep our calendars on and send emails from, these BlackBerrys, contain a mineral called coltan. A majority of the coltan that is used in our BlackBerrys comes from the Democratic Republic of the Congo.

Right now, the money that is being earned by some companies is directly connected to the war that is going on in the Democratic Republic of the Congo. Indeed, if we recall years ago the whole issue of blood diamonds, we are now having to deal with the issue of blood coltan.

Right now, over 80% of the mineral coltan that keeps our PlayStations going, that keeps our computers going, that keeps our BlackBerrys functioning, comes from the Democratic Republic of the Congo, the exact place where we see rape being used as a weapon of war and the exact place where unscrupulous mining techniques are being used to actually fund and keep the oxygen going for the conflict, where we have three to four proxy armies absolutely devastating not only the geography but the humanity of the area, and that is the eastern part of the Democratic Republic of the Congo.

This is not just about a nice piece of legislation that we should all pass. This is about our commitment to human rights. I have to say, it is not good enough to say nice things about corporate social responsibility. Indeed, we must act when it comes to corporate social responsibility, and the only way to do that is what is contemplated both in this motion and in the bill that was presented. We must have not just guidelines but absolute certainty in how companies behave abroad.

Further to that, members might not be understanding of the issue, perhaps, but what has been proposed by the government is guidelines, instead of absolute, strict adherence to protocol abroad. Also, it says we would have a counsellor instead of an ombudsperson to make sure that these practices overseas are actually adhered to.

If we in this country are going to stand on the world stage and say we are doing everything we can to end gender violence, to end rape as a weapon of war, to stop the ongoing absolute war against women in the Congo, then we must actually adopt this motion. We should adopt legislation like Bill C-300, and we must make sure that everything we can do is being done to end gender violence, to end the war on women in the Democratic Republic of the Congo.

I would like to take a minute to give some historical perspective on this. My predecessor, Ed Broadbent, started this file when he asked that the government of the day conduct a study to have business and civil society work together to come up with recommendations about how companies should do their business abroad. It was carried on by Alexa McDonough. It is now in the House by a motion and by a bill by my colleagues in the Liberal Party.

This has been an ongoing project. It took the government two years to respond to a report that was done in concert, where we had civil society and business working together and what they came up with was that Canadian companies would adhere to the same laws and provisions that they adhere to here in Canada and that we would have an ombudsperson to make sure that would happen. My constituents would say that is a reasonable proposition. That is the proposition we have in front of us in the House.

The proposition that the government has put forward, after two years of having it in front of it, says we should have guidelines, which may or may not be followed, and a counsellor. It is not strong enough. If we are serious about Canadian companies, who by far have the largest footprint in mining and extractive industries of any other country in the world, we must adhere 100% to the laws that we have here in Canada. That means that no money goes to those who commit genocide. No money goes to proxy armies. No money goes to people who are using it to abuse the people who are supposedly benefiting from the presence of a company there.

Members should take the time to read the history of what is going on in the Democratic Republic of the Congo right now. There is a direct connection between what is going on there and what is happening with the investments of multinational corporations. These are things that Canadians are waking up to. Over five million people have been killed in the D.R.C. since the late 1990s. Most people are not aware of that. As I said, hundreds of thousands of women have been raped, and many of those are children. Many of those are women who have been raped multiple times. Why? It is a tactic that is used by militias, not only to use violence against women, but a strategy to clear out villages so that they can get to the economic bounty that is fueling this conflict.

In sum, if we in the House, as members of Parliament, are serious about having an effect on femicide, as some people are calling it, on what is going on in the D.R.C., if we read the words written by Eve Ensler a couple of years ago that she has just returned from hell and then try to do something about that hell on earth, we must pass this motion. We must pass Bill C-300.

Canada-Peru Free Trade Agreement Implementation Act

[Pierre Paquette, Bloc, Joliette, QC]

Madam Speaker, let us not fool ourselves. Trade between Canada, Quebec and Peru is relatively slim. We are talking about a few hundred thousand dollars, except in one sector: mining. It was primarily to protect Canadian interests in the mining sector that the federal government, the Conservative government, promoted and sought out this agreement. We also have a problem with that. Had the government's response to the roundtables on corporate social responsibility in the mining sector come up to the expectations and recommendations, we could tell ourselves that, in the mining sector, Canadian companies in Peru will be operating in a socially responsible way that is acceptable both in Peru and internationally. Unfortunately, the response from the Minister of International Trade was to establish some kind of representative responsible for receiving complaints, basically an empty shell. I have no illusions in that regard. This agreement was not signed with the paper, lumber or forestry industry in mind, but for the Canadian mining sector, to give it a free hand with something similar to chapter 11 and with the federal government refusing to take its responsibilities, as requested by the roundtables.

I will conclude by saying that, thankfully—and I thank our Liberal colleagues for it—with Bill C-300, we will have the opportunity to discuss at committee this issue of corporate responsibility of Canadian companies abroad. Perhaps that extra element will ensure that the free trade agreement with Peru can eventually be made better. This would also be true of agreements with other countries which are currently smaller trading partners of Canada and Quebec.

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

[The Speaker, Liberal, Peter Milliken]

Pursuant to order made on Tuesday, April 21, 2009, the House will now proceed to the taking of the deferred recorded division on the motion at second reading stage of Bill C-300 under private members' business.

The House resumed from April 3 consideration of the motion that Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries, be read the second time and referred to a committee.

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

Mr. Speaker, I want to thank all hon. members for their contributions to this debate. Naturally I prefer some members' opinions over others, but nevertheless that is the nature of debate. I thank each and every member who has contributed over the last couple of hours of debate.

We are in the final hour of debate on second reading and Bill C-300 will go to a vote on the principle of the bill.

The need for CSR supervision has already been decided. It no longer forms part of the debate. All sides agree, even the government, that there is a need for some form of CSR supervision. The debate has moved from should we do something to really how we should do it.

It may have taken the government a number of years, but on March 26, in its press release, the Government of Canada effectively admitted that there was a serious CSR issue in our country and in the extractive corporate sector. If there was no such issue, then there would have been no such announcement.

Now we will talk about whether Bill C-300 is the best response, or Bill C-298 or the government's press release.

As I said at the beginning of the debate, ideally the government would have taken over this issue and framed the response around the creation of an ombudsman, an independent officers of Parliament. Regrettably that did not happen. Now we have three choices: the government's press release, or CSR lite, as I have taken to calling it; private members' Bill C-298, creating an ombudsman; or Bill C-300, reposing the responsibility in the two ministers with sanctions.

Unfortunately Bill C-298 requires a royal recommendation and for reasons alluded to earlier in the debate, would be dead on arrival as it proposes something that a private member's bill cannot do, namely spend taxpayer money. Only government with the approval of Parliament can do so.

As delighted as I would be to support the NDP party, both for its previous member, the member from Halifax, Alexa McDonough and the member from Ottawa Centre, Ed Broadbent and currently the member for Ottawa Centre in Bill C-298, unfortunately this would be an exercise in futility.

That really leaves Bill C-300 or CSR lite.

Bill C-300 proposes a scheme of accountability which would include an ability to investigate, make findings, deal with frivolous and vexatious claims, report to Parliament and gazette the results. The government proposes an order in council appointment to assist in dispute resolution. Bill C-300 proposes a modest array of sanctions with BDC, EDC, CPP and various promotions. The government proposal is free of consequences for any offending company.

Bill C-300 proposes a review and report to Parliament. The government response, CSR lite, proposes a report by various ministers, and the tabling of that report by the Minister of International Trade to Parliament.

Therefore, should we not just declare a victory, issue a press release, pat ourselves on the back and go home? While I like and respect the Minister of International Trade, even he does not think that he is going to be the Minister of International Trade forever. A new minister may well not be so enthusiastic about CSR and may withdraw the order in council appointment. What a prime minister can make, a prime minister can also unmake.

The only meaningful protection is legislation. Bill C-300 is legislation. A press release, followed by an order in council appointment, is not. Legislation has to be repealed by an act of Parliament. An order in council proceeds at the whim of Parliament.

The effectiveness of the councillor is dependent upon the consent of the involved parties. Bill C-300 does not depend upon the willingness of the accused party to co-operate. In fact, it presumes the opposite. Bill C-300 may not have as optimistic a view of human nature as does the government, but possibly it is just a little more realistic.

While joining hands and singing Kumbaya may be a wonderful experience in Muskoka on a glorious summer night or even Haliburton, it does not cut it in the harsh light of daily life, let alone operating a business in some dreadful conditions.

I would urge all hon. members to support this bill. I am extremely grateful for the support that I have received, that this bill has received, over the past weeks and months from Amnesty International, CCIC, Development and Peace, EFC, Halifax Initiative, Mennonite Central Committee, MiningWatch, World Vision, and the list goes on and on.

I did want to thank each and every person who has supported this bill, and I hope that all hon. members see fit to vote in support of Bill C-300.

[Claude Gravelle, NDP, Nickel Belt, ON]

Mr. Speaker, I want to begin by thanking the hon. member for Scarborough—Guildwood for presenting this private member's bill on corporate accountability.

In the 38th Parliament, a similar but much stronger member's private bill was presented by the former leader of the NDP, Ed Broadbent. New Democrats have long stood for corporate accountability as a principle of international trade. I strongly believe that Canadian companies who operate overseas must be held to the same standards as they are in Canada.

Canada must see to the protection of workers, their families and the environment everywhere Canadian companies operate. I realize that that is what this legislative measure is trying to do. Unfortunately, I do not think it succeeds.

Bill C-300, an act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries, is not perfect. Its scope and application are too limited, and its enforcement mechanisms lack teeth.

There are three main areas of concern that I have with this piece of legislation.

First, the bill should be expanded to include all incorporated companies in Canada, not just companies receiving support from the Government of Canada. This is a significant loophole that would greatly weaken the application of the bill.

Second, the legislation should include additional provisions within the Criminal Code to strengthen its enforcement mechanism and to ensure that all companies operating in Canada have the same legal duty to protect workers' rights in their foreign operations as in their domestic operations.

Third, this piece of legislation should establish an ombudsman to carry out the provision of this legislation rather than relying on the minister.

As usual, the Liberal caucus and its members claim to uphold certain principles, in this case that of corporate accountability, but again they fail to deliver effective legislation to enshrine those principles into law.

While I always welcome progress on a matter of global corporate accountability, Bill C-300 would only encourage a fraction of companies operating in Canada and would have no meaningful enforcement mechanism. In other words, this bill is only aimed at encouraging companies to respect the principle of corporate accountability and not enforcing such behaviour.

Bill C-298 is a far more effective piece of legislation. The hon. member for Scarborough—Guildwood should consider putting forth or accepting two amendments to his bill similar to clauses contained in Bill C-298, especially the establishment of an ombudsman.

Overall, I feel that these issues can be resolved at the committee level, which is why I will support this bill through second reading. The most troubling thing about this bill is that it is a private member's bill. The Conservative government should be making this issue a priority and investing the appropriate resources to finally address this concern.

As a retired steelworker and Vale Inco employee I know first-hand how important it is that we stand together as workers to protect each other. I have worked for close to 35 years for a mining company which has operations outside of Canada and I want to show my solidarity with my brothers and sisters throughout the developing world by supporting the bill through second reading.

As the late Rosemary Brown said, “unless all of us are free, none of us will be free”. It is time for our government to take global corporate accountability seriously and set out clear expectations and consequences for all Canadian companies operating abroad.

[Dean Allison, Conservative, Niagara West—Glanbrook, ON]

Mr. Speaker, it is my great pleasure to rise in the House today to speak about our Conservative government's commitment to promoting corporate social responsibility, or CSR practices, for extractive sector companies operating abroad.

I am very encouraged by the progress our government has made over the years with regard to CSR. This government not only encourages this approach to doing business but sees an active role for itself in supporting companies to develop and implement CSR practices.

In this regard, we share the goal of this bill in ensuring that Canadian companies follow the best possible practices at home and abroad. However, I am concerned that legislating corporate activity forces companies to follow a bureaucratic set of rules rather than to be innovative and create best practices that respond to a particular circumstance. The CSR best practices for one company in one region may not be suitable for another company operating elsewhere.

Not only would Bill C-300 limit the scope of CSR activities for Canadian companies by being too prescriptive, it would severely impair the ability of this government to provide the necessary guidance and assistance to avoid or mitigate potential problems. I should also point out that Bill C-300 is unnecessary.

The Canadian government's departments and crown corporations, implicated in the legal framework proposed by Bill C-300, already have in place a number of policies and guidelines to ensure that their clients are good corporate citizens. The Department of Foreign Affairs and International Trade is undertaking a comprehensive initiative to improve the capacity of its trade and diplomatic offices in Canada and abroad, so that they will have the information and tools that they need to provide timely and effective CSR counsel, advice and advocacy to our companies operating abroad.

A key element of this government's CSR approach has been adherence to the Organization for Economic Co-operation and Development guidelines for multinational enterprises, which recommend voluntary benchmarks for responsible business conduct. The Department of Foreign Affairs and International Trade is home to Canada's national Contact point, a senior level official responsible for promoting awareness of the OECD guidelines and for reviewing reports of specific instances of non-compliance with these guidelines.

In addition, Export Development Canada, or EDC, established in 2005 a compliance officer to enhance its transparency and accountability. Much like an ombudsman, the compliance officer operates independently from EDC management, reviewing complaints from stakeholders and promoting dialogue.

Withdrawing the support from these organizations provided to Canadian companies, as Bill C-300 proposes, would restrict access to vital services and financial capital. It would be counterproductive to promoting CSR best practices within the extractive sector and would put Canadian companies at a serious competitive disadvantage.

Furthermore, the proposed legislative changes would not have their intended effect. Cutting companies off from government assistance after they encounter a problem overseas is precisely the wrong thing to do. It would only serve to exacerbate the issue, further damaging Canada's reputation and that of our companies operating abroad. The preferred approach of this government is to give them the tools and information they need to avoid these problems in the first place.

As we know, in 2006 the government hosted a series of national round tables on CSR and the Canadian extractive sector in developing countries. Following these round tables, the advisory group presented their recommendations on how Canadian companies could meet or exceed leading international CSR standards and practices. Since the conclusion of the round table process, the government has met with representatives of the extractive industries and civil society in a variety of fora to continue the dialogue on a number of issues related to trade and development, including CSR.

On March 26, 2009, the Conservative government tabled its new CSR policy in Parliament, entitled “Building the Canadian Advantage: A Corporate Social Responsibility Strategy for the Canadian International Extractive Sector”. This new strategy was developed through consultations undertaken with a number of stakeholders, including the national round tables, as well as recommendations raised by the former Standing Committee on Foreign Affairs and International Trade.

“Building the Canadian Advantage” will improve the competitive advantages of companies in the Canadian international extractive sector by enhancing their ability to manage social environmental risks. This strategy is founded on four key pillars, which I would like to outline today.

The first pillar calls for continuing assistance from CIDA for developing-country governments to enhance their capacity to manage natural resources in a sustainable and responsible manner.

The Conservative government recognizes that resource governance, transparency and accountability in developing countries are critical to ensuring that the extractive sector contributes to poverty reduction. These factors are also essential for creating a business environment that is conducive to responsible corporate conduct in countries where Canadian companies operate.

The first pillar builds on existing initiatives where CIDA has played a key role. For example, in Peru, CIDA has worked extensively with the government, mining companies and affected communities to develop regulatory requirements for social and environmental management. CIDA has also assisted Bolivia to establish a tax collection unit for hydrocarbon, generating over $1 billion in annual revenues that have been reinvested in public services for impoverished Bolivians.

The second pillar of the strategy calls for the promotion of internationally recognized voluntary CSR performance and reporting guidelines. Building on Canada's adherence to the OECD guidelines, the government will promote the following international CSR performance guidelines.

First is the international finance corporation performance standards on social and environmental sustainability for extractive projects with potential adverse social or environmental impacts. This is the de facto performance benchmark for projects in developing countries that require substantial financial investment.

Second is the voluntary principles on security and human rights for projects involving private or public security forces. At the 2009 plenary in Oslo, Canada was welcomed to this process as the first engaged government under the new participation framework.

Third is the global reporting initiative, or GRI, for CSR reporting by the extractive sector to enhance transparency and encourage market-based rewards for good CSR performance. The government will work with stakeholders to develop GRI supplements for oil and gas and junior mining companies. These widely-recognized international standards will form the basis for Canada's commitment to increasing the quality and quantity of voluntary CSR reporting by Canadian companies operating overseas.

The third pillar of the strategy involves support for the development of a new CSR centre of excellence.

The government is currently discussing with the Canadian Institute of Mining, Metallurgy and Petroleum in Montreal to provide a home for the CSR centre of excellence.

Finally, the fourth pillar of the strategy calls for the creation of a new office of the extractive sector CSR counsellor. This office would be responsible for providing assistance in the resolution of social and environmental issues related to Canadian companies operating abroad in this sector. The counsellor will review and document the CSR practices of Canadian extractive companies operating abroad and advise stakeholders on the implementation of CSR performance guidelines.

Requests for review by the counsellor may originate from an individual, group or community, or their representative, that reasonably believes that it may be adversely affected by the activities of a Canadian extractive company outside Canada. The counsellor will undertake reviews with the full consent of the involved parties. The counsellor will issue a public statement after each review and submit an annual report to be tabled in Parliament by the Minister of International Trade.

The strategy calls upon all Canadian companies working internationally to respect all applicable laws and international standards, to operate transparently and in consultation with the host government and local communities, and to develop and implement CSR best practices. The strategy also proposes a voluntary dispute resolution process that ensures fast and effective results, while remaining independent and at arms reach from government.

To conclude, I would like to reiterate that the Government of Canada, including the departments, agencies and crown corporations implicated in this bill actively support CSR principles and have independently taken steps to promote social responsibility. Corporate social responsibility is absolutely essential in a globally competitive, well-regarded extractive sector. However, Bill C-300 is not an efficient, effective nor desirable mechanism for achieving this end.

[Ken Dryden, Liberal, York Centre, ON]

Mr. Speaker, the members for Scarborough—Guildwood and Dartmouth—Cole Harbour have already spoken very eloquently to this question, as have others I will just add a few brief comments from my own perspective.

Once we lived in a disconnected world, protected by distance, geography, oceans, mountains and deserts. Once governments and corporations could do anything they wanted, wherever they wanted to do it without any real consequences. That is no longer the case.

Now we live in a very connected world. Economic problems do not respect borders or distance nor do greenhouse gases, disease or security. What we do in one place as governments and corporations affects all of us at home in our place. That is the reality of the global world in which we live.

As to the impact of corporations on international relations, let us look at the history of the last 50 years, at the last century and more in Central America, South America, Africa and the Middle East and at what some companies have left behind. As the member for Ottawa South has said, they have left tailings and environment degradation, but some companies have also left a resentment toward the home countries of those companies that many years and decades later still define the relationship between those two countries, still define the understandings that those citizens have of those foreign countries.

Those are immense consequences for all of us, not just the companies, to deal with. It is those realities that are behind the need for Bill C-300.

About two years ago, I was in Sudan and Darfur and, like everyone else, I was haunted by Darfur. I tried to imagine what possible resolution there might be to its ongoing tragedy. What was so clear and so frustrating was the capacity of a country, Sudan, and its president, no matter the vehemence of world opinion, to do what it wanted to do if it wanted to do it with no real transforming consequences, to bog down, to distract with false hope, to wear out the patience, whatever, to do what it wanted to do.

Every governmental representative I spoke with from Canada and from other countries and every NGO said the same thing, that they were having no real impact on changing President Bashir's direction.

Only one country and one company could have an impact if they choose to do something and that country was China and the company was the state company of China Petroleum. Almost 80% of Sudan's GDP came from oil and the great majority of its oil goes to China Petroleum.

With China and China Petroleum's ongoing support, despite other sanctions and despite being charged by the International Criminal Court, Bashir knows he can continue on. What will be the results for Africa, for the world and for China's future in Africa? There are consequences of our global and corporate actions halfway around the world, and big consequences for the future.

One other thing I heard again and again in Sudan and Darfur was, “Where's Canada?” Beyond the aid offered, where was the voice, the diplomatic voice with those of many other nations that was needed to help bring this situation toward a human resolution?

What I kept hearing was that Canada had no idea how influential it was, that we had no history as a colonizer, no history of intervening or imposing on other nations, militarily or economically, and that we had no real history of exploiting and taking advantage of local governments and local populations. They trust us and know they can work with us. They know our reputation and it is a well-earned reputation. Our reputation is precious and it matters. It matters now and it will matter in the future.

In this global world, nobody is really the big guy. Even the United States, with all of its power, economically and militarily, nobody is truly that big and that powerful in a global world.

Our challenge for the future, even more than economic, environmental or security, is the challenge of getting along, and that means working with others and talking, listening, negotiating and compromising. That means trusting and being trusted.

That is our history and our instinct. That is our reputation and we cannot put it at risk. What Canadian companies do outside our borders matters. It matters to Canadians and it matters to the world, which is why Bill C-300 matters.

[Richard Nadeau, Bloc, Gatineau, QC]

Mr. Speaker, the Bloc Québécois supports the principle of Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries.

The issue of social and environmental responsibility for Canadian companies abroad, particularly Canadian mining companies, has long been a concern for the Bloc Québécois.

Canada is a world leader in the mining industry. It has a huge presence in Africa, where most companies are Canadian or American and are incorporated or listed in Canada.

For some years now, a number of Canadian mining companies have been directly or indirectly associated with forced population displacements, significant environmental damage, support to repressive regimes, serious human rights violations and sometimes even assassinations.

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

Also, we have always defended the recommendations in the advisory group report entitled “National Roundtables on Corporate Social Responsibility and the Canadian Extractive Industry in Developing Countries”, whose recommendations were unanimously supported by civil society and the extractive industry.

While Bill C-300 is a step in the right direction, we believe it has flaws in terms of what the national roundtables advisory group recommended. For example, Bill C-300 does not provide any clear, independent and transparent process to ensure accountability or to monitor Canadian companies' compliance with accountability standards.

Here is a review of Bill C-300 by Delphine Abadie, Alain Deneault and William Sacher, the authors of Noir Canada: Pillage, corruption et criminalité en Afrique, published by Écosociété in 2008.

First, the bill does not take the Canadian International Development Agency's policies and activities into account.

Second, it does not take Export Development Canada's lack of transparency into account.

Third, it does not take into account instances of political interference attributed, in some cases, to Canadian diplomacy in southern countries on behalf of Canadian mining interests.

Fourth, it does not take into account the harmful role of the Toronto Stock Exchange in the appreciation of mining claims often obtained suspiciously in southern countries.

Fifth, it does not say whether and under what terms, Canadian companies can or could be prosecuted civilly or criminally in Canada for injurious actions attributed to them abroad.

Sixth, it does not provide for an independent body to receive complaints from foreign nationals, leaving it rather to the minister.

Seventh, it does not provide a process to evaluate the damages to populations outside Canada and consider implementing redress programs.

Eighth, it totally ignores the numerous cases of abuse by Canadian companies already recorded in many credible documents. I am thinking of expert reports from the United Nations, parliamentary reports, conferences held in parliamentary precincts, reports from independent organizations like Amnesty International and Global Witness, comprehensive investigative reporting, compelling documentaries, assessments by recognized experts, and so.

Here are some representative cases cited in Noir Canada with respect to Canadian mining companies' detrimental activities in Africa.

The first example is from Bulyanhulu, Tanzania. In the summer of 1996, bulldozers and the national police force were used to expropriate several hundred small-scale miners and clear the way for Canada's Sutton Mining to exploit the area. Fifty-two people were buried alive in that operation. Sutton Mining was then bought by another Canadian company, Barrick Gold. Canada's diplomatic service was actively involved in the affair; allegations of interference are well founded. The Government of Norway, the Lawyer's Environmental Action Team, Friends of the Earth, Rights & Democracy—an organization founded by the federal government itself—Mining Watch and master's student Dennis Tessier have all stated publicly that these allegations are credible and alarming.

The second example is Banro, a company that helped kindle the bloody conflict in the African Great Lakes region in eastern Congo between 1997 and 2002. Millions died in that conflict, and untold distress was inflicted on the people in the form of rape, recruitment of child soldiers and destruction of villages.

The third example has to do with Diama-Manantali and Sadiola. The Canadian International Development Agency steadfastly supported dam construction projects that profited Canadian engineering firms. These dams, which have a catastrophic impact on the people—think of floods, loss of arable land, ecosystem destruction, disease, social tension and so on—allowed IamGold to turn a 38% profit on operating an open pit mine in Sadiola, another project with a disastrous impact on the people.

The fourth example is the Talisman corporation, which had to leave Sudan after, according to several sources, it apparently ordered the Sudanese army to violently remove any civilian presence in the vicinity of its development site. This passage from Noir Canada shows that Talisman was pressured to leave Sudan because it was registered on the New York stock exchange, not just the Toronto exchange.

Another book that has been written on this topic is Not on Our Watch: The Mission to End Genocide in Darfur and Beyond, by Don Cheadle and John Prendergast, published by Hyperion in 2007. On page 62 is a paragraph that reads:

The Sudanese regime, supported by Canadian, Malaysian and Chinese oil companies, was able to wipe out whole populations in south-central Sudan, leaving the way clear for the oil companies to start pumping the oil.

This information is supported by a memo from the International Crisis Group, Human Rights Watch and Amnesty International. The book I quoted from has an introduction written by none other than Barack Obama, who was then a U.S. senator, and a preface by Elie Wiesel.

Bill C-300 is a step in the right direction. But to put an end to injustices by Canadian and foreign mining, gas and oil companies, we must make sure that they fully respect human rights and environmental rights, without exception.

The House resumed from March 3 consideration of the motion that C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries, be read the second time and referred to a committee.

Corporate social responsibility and Canadian extractive industry in developing countries

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

Mr. Speaker, I would like to congratulate the hon. member for Pierrefonds—Dollard for having his private member's motion drawn so early in the private member's lottery. I would also like to congratulate him for presenting such a worthwhile motion on such an important issue.

I am honoured to speak to the motion and I am honoured to have seconded the motion.

The motion dovetails with Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries, presented by the Liberal member for Scarborough—Guildwood.

I would also like to congratulate members of the Development and Peace movement. I personally received over 500 signature cards from members of that organization who live in my riding.

I would like to thank those who sensitized me on the issue through private conversations either at town hall meetings or in my office, namely, Brian McDonough, André Bergeron, Dr. Mona Abbondanza.

I would like to thank those individuals who visited me in my riding office to discuss the issue and to impress upon me the importance of implementing the recommendations that my hon. colleague from Pierrefonds—Dollard no doubt worked on when he was a member of the foreign affairs committee in the 38th Parliament.

I would like to thank Jack Zylak, Nathalie Doiron, Patricia Oliveri, Nelson Furtado, Thérèse Pereira, Lynn Jansen, June Francis, Yvonne Bourque, and Monica Lambton. These individuals worked hard to collect the signatures on the over 500 cards that I received. They have done a remarkable job of advocating for this cause.

All of us in the House are familiar with citizen lobby campaigns that use, among other things, direct mail techniques, but rarely have I seen such a professional, effective and strategic effort on the part of such a good cause.

I would like to give members a little context. As I mentioned, this initiative comes out of the House of Commons Standing Committee on Foreign Affairs and International Trade, which, during the first session of the 38th Parliament, became concerned about the increasing evidence that some Canadian resource extraction companies were conducting their operations in developing countries without adequate regard for local, social, environmental and human rights standards.

Accordingly, the committee recommended that the government undertake a comprehensive study of the issue by meeting with relevant industry associations, non-governmental organizations, development experts, environmentalists, human rights advocates, and government officials to determine the best course of action to move the issue forward.

As a result of that, the previous Liberal government initiated national round tables on corporate social responsibility and the Canadian extractive industry in developing countries.

What followed was 10 months of rigorous and meticulous negotiations and discussions with representatives from the extractive industry, advocacy groups, academics, government, and members of the public, all of which culminated in a report containing the very recommendations we are discussing today.

Canadian mining companies do not intend to violate environmental rights or human rights in developing countries. Often they are operating in very difficult jurisdictions that do not have appropriate laws and regulations. The executives of these companies are obviously operating at a distance from where the mining activities are taking place.

As we deplete mining resources, mining operations must go further into the outlands of the various countries in which they operate where no doubt the situation is even more nebulous and hard to monitor.

That is why one of the recommendations that came out of the advisory group's report, namely the recommendation that we create a mining ombudsman, would be so important. It would provide a conduit for information about what is going on in the field in these developing countries, a conduit for information not only to the government and to Canadian citizens at large, but to mining executives in Canada who would no doubt use that information to take appropriate action.

The mining ombudsperson would be mandated to ensure Canadian mining companies conduct their international resource extraction operations while adhering to standards of corporate social responsibility by, one, receiving and investigating complaints regarding potential violations of social or environmental standards by Canadian companies working abroad; two, quickly making recommendations to correct these violations; and three, releasing publicly the results of its investigations and recommendations for actions or sanctions.

For example, the ombudsman might recommend that the government withdraw services to an offending company such as by denying financial backing from Export Development Canada, discontinuing diplomatic support the company receives from Canadian consulates in developing countries, or disallowing Canadian tax deductions for tax paid to foreign governments.

The advisory group also recommends that the mining ombudsman play an advisory role, as I mentioned before, to focus the companies on situations on the ground, perhaps even to the point of helping to prevent conflicts in these countries and those regions of the country where the mining company is operating, before those conflicts begin.

Canada has made numerous contributions in the past to the progress of humankind through its foreign policy. We think, for example, of the treaty to ban antipersonnel landmines, which was a Canadian initiative. We think also of the doctrine of the responsibility to protect, the doctrine that was developed by former Liberal member of Parliament and minister in Liberal governments, the hon. Lloyd Axworthy, an idea that was taken up by Paul Martin before and when he was prime minister, an idea that has been discussed and probed further by the current leader of the Liberal Party.

Canada has also been active through Liberal senators like Senator Dallaire, in terms of helping to address the problems in Sudan, namely in the Darfur region. We have another Canadian, Maude Barlow, who has made great efforts to raise awareness of water as an international environmental issue, an international human issue, and who is now special adviser on water to the president of the United Nations General Assembly.

We have a history as a nation of acting to promote humanitarian progress internationally. This is no different. This is an issue on which we can make a contribution, not least of all because Canada is a mining giant. Half of all mining projects in the world are associated with Canadian companies. We understand this industry, we understand how it operates, we have knowledge and experience, and we should use that knowledge and experience to reduce the hardships that many miners and communities that surround mines have endured for various reasons.

It is even part of our culture to understand that mining has many associated hardships. Of course, just about every province has a mining industry. The likes of Hugh MacLennan have written on the hardships of mining communities, and so on.

It is part of our culture and it is part of economic history, and we should use that to make the world a better place.

Corporate Social Responsibility and the Canadian Extractive Industry in Developing Countries

[Bernard Patry, Liberal, Pierrefonds—Dollard, QC]

Mr. Speaker, I want to congratulate my colleague on introducing Bill C-300. It is a very good bill.

As I pointed out, it is going to be two years on March 29 since the round table presented its report and nothing has been done by the government. The thing that really upsets me is that the Prime Minister, at the G8 summit in Germany, pointed out that Canada will be the leader in the world, but we are still waiting.

A motion by itself, if it is adopted by this chamber, would bring support for the round table. More than 200,000 Canadians supported the round table and the presentation done by the foreign affairs committee. If my colleague's bill passed, it would be the law of the country, but we hope the government will come out with a response as soon as possible. In 2008 the ministers of industry and international cooperation pointed out that the government would be coming out with some guidelines on this, but we are still waiting.

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

Mr. Speaker, I congratulate the hon. member on his initiative, one which is well worth supporting. In many respects it parallels Bill C-300, the bill I introduced last week on the same topic. I have two comments on which I would ask for the hon. member's opinion.

The first has to do with the reluctance of the government to respond to the round tables. It is now over two years and there is still no response. I take it that has something to do with the reason the member moved his motion.

The second has to do with a letter I received from the Canadian Chamber of Commerce this morning. The hon. member mentioned that over 200,000 people have actually written in asking for support of Bill C-300, but also on the hon. member's motion. However, the Chamber of Commerce does not like punitive measures, such as no access to funding on EDC, no access to funding on BDC, no access to funding on the Canada pension plan and no consular promotion.

I would be interested in the hon. member's response to both of those issues.

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

[Ed Holder, Conservative, London West, ON]

Madam Speaker, being newer to the House, I must tell you that four minutes seems like an eternity at one level.

It is my privilege to rise in the House today to speak to Canada's role in promoting effective corporate social responsibility and socially responsible investing. Also, as a new member of the House and a rookie in the international trade committee, I take seriously the role that corporations must accept in their capacity as positive contributing members.

Let me thank the hon. member for Scarborough—Guildwood for introducing Bill C-300 on February 9 and all the opposition parties for their continued dialogue on this important issue, because their contributions make this House better.

I would also like to take the opportunity to thank the many constituents of London West who have taken the time to send me their opinions on the subject. I have received many postcards and emails from constituents, many of whom I do not know, who have expressed a desire to see Canadian companies demonstrate more corporate responsibility.

We all know that London is a growing hub for international business and that corporate success comes from serious responsibilities. I know Londoners care and business cares. That is why they are concerned about issues like this.

I consider my role as past president of the London Chamber of Commerce, which provides a thoughtful perspective on corporate social responsibility with companies in my city which are world class, a very personal insight.

The Conservative Government of Canada already encourages and expects Canadian companies working internationally to respect all applicable laws and international standards to operate transparently and in consultation with host governments and local communities and to develop and implement corporate social responsibility practices.

My concern is that Bill C-300 would impose a rigid legal framework of corporate social responsibility standards that has not undergone the necessary degree of consultation and analysis. The framework would abandon the use of multilateral standards and instruments that create a unilateral corporate social responsibility regime against which the Government of Canada would assess the activities of Canadian companies operating abroad, raising concerns of both privacy and extraterritorial jurisdiction.

Moreover, this legislative framework would affect the ability of the government departments, agencies and crown corporations to fulfill their mandates, and its compulsory nature would entail a rigidity that would not be beneficial in today's economic climate.

Londoners believe we can, and should always, encourage greater efforts toward corporate social responsibility, but unfortunately, I believe this proposal falls somewhat short.

Bill C-300 specifically addresses how two crown corporations and one government department encourage Canadian companies to act in a socially responsible and sustainable manner. The bill proposes substantive changes to the legislation that establishes Export Development Canada, the Canada Pension Plan Investment Board and the Department of Foreign Affairs and International Trade without due consideration for the consequences, nature or enforceability of those changes. Those departments and agencies have already incorporated corporate social responsibility initiatives into their operations.

The Department of Foreign Affairs and International Trade actively promotes corporate social responsibility best practices to the companies it serves. As part of this commitment, trade commissioners in Canada and around the world work with companies to help improve their corporate social responsibility records.

The Department of Foreign Affairs and International Trade chairs Canada's national contact point for the OECD guidelines, an interdepartmental committee with representatives from a number of federal government departments whose role is to promote awareness of the guidelines and ensure their effective implementation.

At Export Development Canada, Canada's export credit agency, corporate social responsibility has become an integral part of the operations and risk management practices. It provides expertise to Canadian exporters and investors and its worldwide partners.

Export Development Canada recognizes that in the extractive industries, transparency and environmental responsibility are paramount to a project's sustainability.

[Paul Crête, Bloc, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

Madam Speaker, I would again like to congratulate the hon. member for Scarborough—Guildwood for taking the initiative in presenting this bill. I had the opportunity to work with him on the Standing Committee on Finance and, although I do not wish to cast any aspersions, I would not put him in the left wing of the Liberal Party. This gives the bill even greater merit, because he considered the fact that it would be advantageous to the entire industry, as well as all operations in such countries, to move forward with Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries.

I am rather surprised by the government's position, considering that March 27 is fast approaching, the second anniversary of the report on the national round tables on corporate social responsibility and the Canadian extractive industry in developing countries. The government member says the bill is redundant, but I do not think it is.

The members of this House want the government to take action on this. We are currently examining this bill, a motion will be debated next Monday and another bill is the subject of a notice on the same issue. It is therefore in our best interest to examine this bill, and the Bloc Québécois will support it, because we think it is a step in the right direction.

Here are a few facts: 60% of mining companies are registered in Canada; these companies contribute over 40% of global budgets spent on mining exploration; and it is estimated that approximately US $2.2 billion is invested every year by these corporations in exploration activities abroad. Thus, we see that this is a major economic force and that a great deal of investments are made abroad.

It is important to look at the social and environmental responsibility of Canadian firms abroad, especially Canadian mining companies. The Bloc has been concerned about this issue for a very long time, in fact, since 2001. At the time, we put forward motions to require companies to comply with certain criteria.

I do not believe it is possible to simply rely on companies' good faith. Most companies, like most people, are honest and do their work properly. Unfortunately, some demonstrated in the past that they had unacceptable behaviour, and it is our responsibility to discipline Canadian companies working abroad and give them the chance to behave in a way that is respectful of the entire industry.

Canada is a world leader in the mining industry. It has a huge presence in Africa in particular, where most companies are Canadian and American and are incorporated or listed on Canadian stock exchanges. Canada therefore has a vested interest in making sure that these companies behave acceptably, as its international image is at stake.

For a number of years, several companies have been directly or indirectly associated with forced population displacements, significant environmental damage, support for repressive regimes, serious human rights violations and sometimes even assassinations. We must put an end to this savage behaviour and have much more definite enforcement. That is why the Bloc Québécois has always defended the need to impose standards of social responsibility on companies that work abroad.

But the federal government has always defended the principle of laissez-faire, preferring a voluntary approach, which unfortunately is what the government representatives are still calling for today in this debate. We also defended the recommendations in the report entitled National Roundtables on Corporate Social Responsibility and the Canadian Extractive Industry in Developing Countries. It is important to note that these recommendations were unanimously supported by civil society and the extractive industry.

I gained an awareness of this issue through Development and Peace, a NGO that is mobilizing citizens on the importance of ensuring highly ethical behaviour internationally. They conducted a post card campaign. Thousands responded to the appeal by Development and Peace. We must thank them for this initiative. Many thousands sent post cards asking their MPs and the government to promote this issue. The bill before us reflects this concern.

This bill does not contain all measures found in the roundtables report but it does seek to ensure that extractive corporations will act responsibly and respect international standards for human rights and environmental law.

The bill assigns responsibility for preparing guidelines to the Department of Foreign Affairs. Practices reflecting these standards are based on recognized documents, including the Universal Declaration of Human Rights. Each MP is to receive an annual report on the application of this law. In this regard, the bill is headed in the right direction. It is important to support it and to ensure that it will be studied in committee. At that point, we can take a closer look and determine whether the roundtable recommendations should be added to the report.

The report examined the social and environmental responsibility of Canadian corporations working abroad and issued 10 recommendations urging the Government of Canada to adopt a number of very specific measures to:

—ensure that Canadian companies have the necessary knowledge, support and incentives to conduct their activities in a socially and environmentally responsible manner and in conformity with international human rights standards.

Three specific committee recommendations proposed some concrete objectives relating to the Canadian government's assuming responsibility for follow up and more effective monitoring of Canadian mining operations.

The committee's recommendations were described by several Canadian NGOs as real breakthroughs. There was much hope of their prompt implementation. However, it was pointed out that problems such as those raised by the Standing Committee on Foreign Affairs and International Development would increase in number and severity in the years to come. So the present inaction of the government, its lack of response to the report thus far, is one way of contributing to the disorganization and this is unacceptable behaviour. It is therefore important, this finding and the government's insistence on voluntary measures with other countries such as the United States, the United Kingdom and the other OECD member countries notwithstanding, that there be a more specific legal framework for Canada and for Canadian companies.

We do not share the Conservatives' belief that the responsibility needs to be laid at the feet of the host countries or the industry. The issue for these countries and for the extractive industry is to ensure that natural resources contribute to reducing poverty and promoting economic and social development, and the mining industry does fulfill that function. The problem does not arise from economic development in the developing countries, but it comes from the way certain businesses behave, businesses that should be subject to more supervision and possibly more discipline.

I have referred to our desire to integrate a number of improvements into the bill. Among them, I mentioned the creation of an ombudsman position. We will need to look very seriously at the possibility of integrating all of the recommendations into this bill, even though it might need a royal recommendation in the end. I understand that the hon. member wants to see his bill passed. That is completely normal. But why not put some effort into giving it more teeth and making it more effective? The bill needs to contain as many possibilities and as much efficiency as possible. That aspect of the bill can be improved, and I am convinced that the hon. member will concur and we will be able to move forward with it.

In conclusion, despite these shortcomings, Bill C-300 is a step in the right direction. It fails to act on most of the round table recommendations, but a step in the right direction is still progress. That is why we support this bill in principle. We believe that the situation is so critical that we must act now to ensure that Canadian resource extraction companies comply with international human rights and sustainable development standards so that Canadian companies can contribute to economic development, social development and the redistribution of wealth worldwide, not just to exploiting natural resources with no concern for how they do it.

We can ask the Chinese and Indian governments to introduce environmental protection or worker's rights regulations, but the Government of Canada has to abide by the same standards.

[Ron Cannan, Conservative, Kelowna—Lake Country, BC]

Madam Speaker, it is a pleasure to rise in the House today to speak to the issue of corporate accountability as it relates to the activities of Canadian mining and oil and gas companies operating in developing countries.

I would like to thank my hon. colleague, the member of Parliament for Scarborough—Guildwood, for introducing Bill C-300 today, and with regard to the opposition party, for their continued interest in this very important issue.

The Conservative government attaches a great deal of importance to the question of corporate social responsibility, often referred to as CSR. We encourage and expect Canadian mining and oil and gas companies working around the world to respect all applicable laws and international standards, to operate transparently and in consultation with the host government and local governments, and to conduct their activities in a socially and environmentally responsible manner.

Canada is, after all, a major player in the international extractive sector, a sector that has significant investments and operations in developing countries. Canada is a world leader in mining.

Between 1998 and 2008, the share of worldwide mining exploration attributed to Canadian companies increased from 30% to 43%. Canadian mining companies invested over $60 billion in developing countries abroad, including $41 billion in Latin America and Mexico and almost $15 billion in Africa. Total foreign direct investment in all developing countries is $80 billion.

The economic downturn that started in 2008 will likely decrease or delay further Canadian mining investments. However, the projected figures remain very impressive. For 2009-10, Natural Resources Canada estimates additional Canadian investments in Africa to be between $10 billion and $12 billion.

These investments play a very important role in Canada's economic development. Our companies not only drive prosperity here at home, they also provide jobs, opportunities, and other benefits in what are often small rural, indigenous, and isolated communities abroad. In many cases they bring vital infrastructure to communities that are without roads, hospitals, or even clean water.

As a member of the international trade committee I have had the honour of travelling to some of these communities, whether in Yemen, or last May, in Colombia, seeing the shanty towns and the displaced individuals, working with them, and seeing the Canadian companies and how they are bringing the corporate social responsibility method to the communities' tables, to bring the philosophy that a rising tide lifts all boats and all ships, and every individual has an opportunity to be a better individual with a more prosperous future.

Through global investment, this sector is making its presence and Canada's felt throughout the world in helping other countries to develop their own mining industries.

As Canadians, we recognize that with this presence overseas comes numerous social responsibilities for our corporations towards local communities and stakeholders. That is why our government actively supports CSR best practices for corporations based on internationally recognized CSR standards and principles such as the International Finance Corporation, otherwise known as IFC, and performance guidelines and the voluntary principles mentioned in the bill.

However, our Conservative government goes beyond that. We also look to the Organisation for Economic Co-operation and Development, otherwise known as OECD, the United Nations, the International Labour Organization and other leading standards around the world for inspiration. Indeed, Canadians want our companies to be a positive force in the communities in which they operate.

In fact, adopting CSR practices can be an important benefit to Canadian companies. It can improve their situation and facilitate the business climates in which our companies operate. It can promote trust and goodwill in communities and with host governments. It can also send a powerful signal to the world that Canadian businesses are upholding CSR principles and should be partners of choice around the globe.

Many Canadian companies from every sector already recognize these benefits. They have put in place voluntary CSR practices to help them manage the social, economic and environmental issues they encounter in their daily operations. They recognize that a commitment to CSR is a commitment to their own success. It makes them more competitive by giving them an enhanced social licence to operate in communities. It enhances the brand and reputation they have and helps them manage risks and therefore improve their access to capital and other financing and insurance opportunities.

Unlike these voluntary practices, Bill C-300 mandates ministers to issue guidelines that articulate corporate accountability standards but leaves the legal effect of these guidelines unclear. Therefore, our government does not believe this bill is the right approach to take. As mentioned, we support the voluntary nature of the internationally recognized CSR standards and principles.

Several Canadian industry associations and companies have been globally recognized for their leadership in CSR.

Our Canadian companies are doing their part, and the Conservative government is there to help them. Our trade commissioner service provides counselling and advice on local market conditions including local laws, risk assessments and advocacy through more than 150 offices across Canada and around the world.

The Canadian International Development Agency does tremendous work building the capacity of host governments to support economic and social investments aimed at promoting the sustainable development of rural populations within the areas of influence of the extractive sector operations.

Our partners at Export Development Canada, otherwise known as EDC, and the Canada Pension Plan Investment Board also believe that working with Canadian business to foster CSR best practice is more effective than creating a rigid and punitive legislative regime. The Canada Pension Plan Investment Board already has a policy on responsible investing by which it engages the companies in which it invests. In defining this policy the CPP investment board has taken a broad view of the impact of environmental, social and governance factors on long-term investment performance.

Let me also say that while our companies clearly recognize that CSR is an inherent part of doing business, they have indicated that there is a limit to what they are capable of providing in the area of support for the social, health and educational concerns of the communities within which they operate abroad.

Responsible business conduct cannot substitute for host government responsibility for, and therefore governance of, social and economic policy.

It can already be quite challenging for our companies to do business overseas. Unpredictable business environments, limited services and protection for investors, ill-defined or unevenly applied regulations, legislation and property rights, and weak host government institutional capacity to manage extractive sector development and associated social and environmental considerations are only some of the challenges they face, particularly in developing countries.

In that sense, while environmental stewardship and successful community involvement is a shared responsibility, and Canada can certainly offer a range of assistance to help developing counties build their own capacity to manage CSR issues, host governments ultimately remain responsible for the transparent development of legislation that meets the needs of their citizens.

Following a 2005 report on mining and CSR by the parliamentary Standing Committee on Foreign Affairs and International Trade, the Government of Canada organized the 2006 national round tables on CSR and the Canadian extractive sector in developing countries. The national round tables provided a unique opportunity to encourage a practical and solutions-oriented dialogue on ways to expand the knowledge and capacity of Canadian companies to conduct their operations in a socially and environmentally sustainable manner.

The government shares the view that more can be done to enhance the ability of the Canadian extractive sector to manage the social and environmental risks of its operations abroad and at the same time enhance the benefits arising from their investments for the local communities and the countries in which they operate.

While I know that some hon. members would prefer to address this issue by creating a punitive legislative regime and broadening the scope of our sanctions legislation, we believe it is far more effective to work with our companies and host governments to achieve these goals. Where efforts to work with host governments fail, we do have tools at our disposal. Canada has the ability to impose sanctions against foreign states in response to a call of an international body or when a grave breach of international peace and security has occurred.

In closing, I ask for the support of all hon. members, from both sides of the floor, as we continue to take steps to ensure that Canadian companies can make the most out of global opportunities while setting a high standard for CSR excellence in the communities in which they operate.

Since our government will soon be introducing and announcing a more comprehensive CSR approach for the Canadian international extractive sector, I trust that this bill is redundant.

Thank you, Madam Speaker, for giving me the opportunity to address the House on this important issue, and I look forward to discussing it further with my colleagues.

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

moved that Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries, be read the second time and referred to the Standing Committee on Foreign Affairs and International Development.

Madam Speaker, it is a matter of quite considerable pride for me to introduce this bill into the House and to hopefully precipitate a full debate and ultimately move it on to the committee.

We are all proud Canadians. Everyone in the chamber is a proud Canadian. The people in the gallery are proud Canadians. The people watching on television are proud Canadians. We are proud of our hockey team. When the men and women won gold in Salt Lake City, it was an enormous matter of pride for our nation. Students travelling in Europe are so proud of their country that they sew a flag on their backpacks. They do this for a couple of reasons: one, to say they are proud Canadians, and two, to say they are not Americans.

We are so proud at times that we are at pains to tell others that we are not like those Americans, and sometimes we are right. Certainly we have superior banking and health care systems. We do not have a subprime crisis. However, there are times when we are morally arrogant to the point of being insufferable. At times our superiority is unbecoming to a nation of dignity.

Last week I was visited by some folks from Ecuador. They talked about a Canadian mining company that was behaving in a way that was distinctly un-Canadian, and certainly at variance with our sense of self, of our nation and of how we operate in this world. The video they presented showed the ugly Canadian. It was the ugly Canadian corporation trying to gain a commercial advantage over indigenous people. It showed a company willing to engage in violence, use its superior financial resources, abuse the environment and abuse human rights in order to get its own way.

To be fair, the video did not show the company's side of the story. Basic rules of procedure and fairness require that we at least listen to the other side. Nevertheless, this was a pretty damning indictment of a Canadian company using its financial clout to develop a copper mine.

I wish I could say this was merely an isolated example. Unfortunately, I cannot. There are documented abuses by Canadian companies operating in Guyana, the Philippines and possibly in as many as 30 other countries, Canadian companies that are acting in manners that are unbecoming of our sense of self as a nation, our sense of how we operate in this world and our sense of how Canadian corporations should operate in the world.

The Toronto Stock Exchange is the most active mining exchange in the world. More money for mining and exploration is raised there than anywhere else in the world. Sixty percent of the world's mining and exploration companies are listed in Canada.

It is not my intention to overstate the case by painting all Canadian extractive companies with the same brush. Many companies are quite responsible and actively pursue their responsibilities in terms of both the environment and human rights. They are seriously engaged in environmental compliance and respect for human rights.

However, all our reputations are at risk through the behaviour of certain companies. Not only is there a behavioural risk to an individual company, but there is also a risk to our national reputation.

When a Canadian company behaves badly, our national reputation suffers. All of the hard work done by many Canadians, through NGOs and indeed through the government, gets swept aside when our own companies and our own people abuse human rights standards and environmental standards. Our reputation for responsible environmental stewardship gets swept aside when we degrade and we debase the environments of other countries.

So, what to do? Ideally, the government should be presenting this bill or, if not this bill, certainly a beefed up version of this bill.

The national round tables on corporate social responsibility and the Canadian extractive industry in developing countries presented a report on March 29, 2007. Those round tables were actually sponsored by the government. Yet here we are, almost two years later, and we have yet to hear the government's response to their report.

In fact, the round tables re-deposited their report just in the hope, the faint hope possibly, of trying to solicit a response from the government. To date, there has been silence.

These round tables engaged everyone, from government stakeholders, to NGOs, to corporations. In fact, it kind of reads like a who's who of the mining industry. Mr. Tony Andrews from the Prospectors and Developers Association was part of the round table. Jim Cooney from international government affairs for Placer Dome was in on it. The VP for exploration, Dennis Jones, from IAMGOLD Corporation was there. Talisman was represented. Various other corporations were represented at this round table, in addition to various NGOs and in addition to, if I may say so, the usual suspects.

So, this was a series of round tables engaged in by all of the stakeholders. They presented a comprehensive report and yet, we have no response from the government.

As I say, ideally, this would be a government bill because the government could do so much more than can a private member. For instance, a private member cannot propose the spending of taxpayers' money. Only the government can propose, upon parliamentary approval, the spending of taxpayers' money.

The limitation of every private member's bill that is presented here is called a royal recommendation. We cannot, in a private member's bill, present a bill which would require the government to spend money.

The problem in this case is, ideally, the responsibilities for the implementation of this bill would be reposited in an ombudsman, or an ombudsperson. Unfortunately, however, if we do draft our bill so that the responsibilities are deposited with an ombudsman, we would trigger a royal recommendation and so, the bill would be ruled out of order. Unfortunately, we have had to draft around the issue of a royal recommendation. So, the responsibility in this bill is reposited in the Minister of Foreign Affairs and the Minister of International Trade.

In a lot of other respects the bill looks a lot like the recommendations as contained in the round tables recommendations. The basic purpose of the bill is:

--to ensure that corporations engaged in mining, oil or gas activities and receiving support from the Government of Canada act in a manner consistent with international environmental best practices and with Canada’s commitments to international human rights standards.

Paragraph 5 provides that:

--the Ministers shall issue guidelines that articulate corporate accountability standards for mining, oil or gas activities.

And make reference to specific internationally recognized standards for the environment and human rights.

So, we set up the purpose, and then we set up the guidelines, and adopt these guidelines.

Once the guidelines are adopted, a scheme is set out whereby the minister or ministers, as the case may be, may receive complaints, conduct examinations and publish their results, presumably in the Canada Gazette. That is where the problem arises.

This does not have the force of law such as the Criminal Code. It is not regulatory. They are guidelines for which there is no explicit sanction such as a fine or imprisonment. The reason is that there are limits to the extraterritoriality of Canadian law. Just as other countries cannot and do not apply their law to our country, so too Canada cannot apply its laws and its regulations to other countries.

Where is the teeth in this bill? What would happen to a company that offends these guidelines?

The first sanction is reputational. I would expect that good companies will work at not finding themselves being gazetted. All of us here in this chamber indeed work at protecting our own reputation. What is true of individuals is also true of companies. Companies spend a lot of money preserving and enhancing their reputations. Being gazetted under this bill would not enhance a company's reputation.

Remember the Nike issue, where Nike was accused of engaging in dubious labour practices? Nike had to not only reverse its labour practices but it spent millions and millions of dollars trying to restore its reputation.

There are some companies that simply do not care. There is just way too much money to be made to worry a little bit about a reputational downside and if that reflects badly on Canada, so be it. There is a certain cynical truth that some companies will conclude that it is a lot cheaper to engage a bunch of lawyers and PR people than to comply with internationally recognized guidelines for corporate behaviour in third world countries.

If they are not overly worried about their reputation, and they are aware of the limitations of Canadian law as it applies to activities in other countries, what additional sanctions should we apply? The proposal in Bill C-300 is that we put a bit of financial bite into these guidelines.

If a finding has been made and gazetted, then the company in question will not be eligible for Export Development Bank of Canada's services, EDC. It may be that such a corporation really does not care and it does not need government help. As well, the corporation cannot expect anything from the Government of Canada other than basic consular services.

In the language of the bill, “no undertaking made through a program developed by the Minister in the exercise of his or her powers under this section shall promote or support mining, oil or gas activities”. In other words, basic consular services and nothing else. If the corporation is gazetted, it will basically be on its own.

Maybe the corporation does not care about EDC or does not care about promotion by the government. Maybe disallowing the Canada pension plan from investing in the corporation will get its attention.

With the passage of this bill, CPP would have to assure itself that it has no assets invested in the offending company, in other words, no CPP money, and because CPP is so heavily weighted in the market, other pension plans may well follow suit.

Money just got a whole lot more expensive for a corporation that ignores this bill. Corporations which have nothing to fear and much to gain, those are good corporations. Those corporations will be enhanced. Their reputations will be enhanced. They will be entitled to assistance from EDC. They can expect support from the government and their money gets cheaper. It does not get much better than that.

Let me conclude by urging all hon. members to support Bill C-300. Good ethics make for good business. Good business makes for good ethics. Everyone should win if these guidelines are adopted in this legislation. Canada should win. These corporations should win, and citizens from around the world should win.

Win-win seems like something to be supported and I would urge all members to support this bill.

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

moved for leave to introduce Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries.

Mr. Speaker, the purpose of this bill is to promote environmental best practices and ensure the protection and promotion of international human rights standards in respect of mining, oil or gas activities of Canadian corporations in developing countries. It also would give the Minister of Foreign Affairs and the Minister of International Trade the responsibility to issue guidelines that articulate corporate accountability standards for mining, oil and gas activities and it would require the ministers to submit an annual report to both Houses of Parliament on the operation of this act.

In the business section of The Globe and Mail this morning was a very timely article about this very issue. I am hoping that this bill will receive favour among hon. members here and that it will, in fact, create a debate on what is a very difficult issue for us all. I thank my friend for Lac-Saint-Louis for his generous support.

(Motions deemed adopted, bill read the first time and printed)