Bill S-14 (Historical)

Fighting Foreign Corruption Act

An Act to amend the Corruption of Foreign Public Officials Act

This enactment amends the Corruption of Foreign Public Officials Act to
(a) increase the maximum sentence of imprisonment applicable to the offence of bribing a foreign public official;
(b) eliminate the facilitation payments exception to that offence;
(c) create a new offence relating to books and records and the bribing of a foreign public official or the hiding of that bribery; and
(d) establish nationality jurisdiction that would apply to all of the offences under the Act.

Fighting Foreign Corruption Act

[Julian Fantino, Conservative, Vaughan, ON]

Mr. Speaker, the member has convoluted a whole bunch of issues into what appears to be somewhat of a displeasure with the attempt, the content and the intent of the bill. We are not talking about legitimate business deals, whether we like them or not. We are talking about corrupt practices.

I would caution the member that he needs to do his homework with respect to the F-35 file or any other purchases that the Canadian military is making in the context of good business practices. This is not about that. This is about corrupt practices. Your own leader should be answering to this kind of issue.

[The Acting Speaker, Conservative, Barry Devolin]

I would remind hon. members to address their comments to the Chair rather than their colleagues.

The hon. member for Richmond—Arthabaska.

[André Bellavance, Bloc, Richmond—Arthabaska, QC]

Mr. Speaker, the minister has read us the contents of the bill.

It does indeed contain some measures that would be very important to the police.

However, he has not told us what is not in the bill. In view of his former occupation, he could certainly argue that there are changes to be made, particularly with respect to the resources available to the police. That would be a very important change. Everyone agrees that anti-corruption legislation is needed. We will therefore refer the bill to committee, where we hope to be able to make some changes to improve it.

The police need adequate and effective resources. They are not incompetent, but they often do not have the resources they need. I think that the minister is in a good position to pressure cabinet on this point.

[Julian Fantino, Conservative, Vaughan, ON]

Mr. Speaker, obviously, a lot of this work is labour-intensive and, no doubt, we are looking at some international aspects to this particular piece of legislation or the enforcement of same.

No doubt, resources will be required. I am confident that with the passage of this legislation there would be the capacity and the ability within the RCMP, which has been mandated to deal with this issue, to enable the legislation to truly have a deterrent effect on those who are intent on this kind of activity and to ensure that those who do engage in it pay the appropriate price to society.

[Joy Smith, Conservative, Kildonan—St. Paul, MB]

Mr. Speaker, I want to thank the minister for this very important bill on corruption. Just listening to the comments here in the House, I know this minister has a lot of experience on the justice side and a lot of expertise in this area.

Based upon some of the comments I have heard, I would like the minister to comment on an example of what corruption would be. I think this is very important because I think members opposite are confused about what real corruption is.

[Julian Fantino, Conservative, Vaughan, ON]

Mr. Speaker, I want to thank the hon. member for her insightful and, no doubt, very focused question on the issue.

Very simply stated, I think it is along the lines of what of our Prime Minister was alluding to today, with respect to the leader of the NDP, who apparently was the recipient of an offer of a bribe. Those issues are the kinds of things that we are talking about.

A diversion from ethical, honourable, legal activity, causing people to do something that otherwise would be illegal, improper and certainly against the laws of the land, would be very clearly an illegal activity under this bill, as well.

[Don Davies, NDP, Vancouver Kingsway, BC]

Mr. Speaker, I will be sharing my time with my hon. colleague from LaSalle—Émard.

I am pleased to speak to Bill S-14, An Act to amend the Corruption of Foreign Public Officials Act.

In looking at this bill, and given the record of the government, I find myself yearning to have a companion bill introduced in the House that would be entitled, “an act to amend the corruption of domestic public officials act”. There is a whole host of things we could be dealing with.

In terms of domestic corruption, we could be trying to deal with $90,000 payments to senators made by officials in the Prime Minister's Office allegedly to cover up illegal activity. We could be investigating Canadian senators fraudulently claiming housing and living expenses. We could be looking into people like Arthur Porter, another Conservative and a former appointment made by the Prime Minister to the CSIS oversight board, who apparently helped himself to millions of taxpayer dollars in Montreal and fled to South America. We could be looking into Conservative candidates like Peter Penashue, who spent over the election limits and effectively bought his seat by cheating. We could be looking into robocalls where the Conservative database was used to commit election fraud. Then we watched the Conservative Party try to obscure things and fight against any attempt to bring transparency into that procedure.

There is domestic corruption of public officials galore with the Conservative government. I look forward to the government introducing a bill that would attack corruption and finally clean up politics in this House for Canadians, but unfortunately, that is not the bill before us. We are dealing with foreign public officials.

The NDP, being a party that stands for ethics and transparency in Canadian politics, is proud to support this bill for referral to committee.

This bill makes four main changes to the Corruption of Foreign Public Officials Act. First, it increases the maximum sentence of imprisonment applicable to the offence of bribing a foreign public official from 5 to 14 years. Second, it eliminates an exception for so-called facilitation payments—there is a euphemism if I have ever seen one—where a foreign official is paid to expedite the execution of their responsibilities. The government calls it a facilitation payment, but I call it a bribe. Third, the bill creates a new offence for falsifying or concealing books or records in order to bribe or conceal bribery of a foreign official. Fourth, it establishes a nationality jurisdiction that would apply to all of the offences under the act, such that Canadian nationals could be prosecuted for offences committed overseas.

Again, New Democrats have long supported clear rules requiring transparency and accountability by Canadian individuals and corporations overseas, which usually have been opposed by the Conservatives, unfortunately. This bill complements legislative efforts by New Democrat MPs to encourage responsible, sustainable, and transparent management practices.

In Canada, our inability to enforce anti-corruption laws is a source of embarrassment to the country. We are pleased that the government is finally looking into these problems, but it is deplorable that it has taken so much time and that Canada had to be condemned and discredited before the government took any action.

Canadians want Canadian companies to be successful and responsible representatives of Canada. We want Canadian companies to have clear and consistent standards for international business. Enforced loophole-free regulations would create a level playing field for all companies while ensuring environmental, labour and human rights protection of which we all can be proud.

In a 2011 report, Transparency International ranked Canada as the worst of all G7 countries with regarding to international bribery, with “little or no enforcement” of the scant legislation that exists. Since then the government has been responding to this national embarrassment. However, there have only been three convictions since 1999, two of which were in the last two years. I would like the government to get tough on corruption. When there have been only three convictions since 1999, that is hardly being tough.

By repealing the facilitations exception, this bill would bring Canada into line with the practices in 36 of 39 other OECD countries. However, while the rest of the bill would come into effect at royal assent, the rules on facilitation payments would take effect at an unknown future date at the will of cabinet.

The books and records rule is already being enforced in the United States at the civil level by the Securities and Exchange Commission, but Canada has no equivalent regulator. While criminal law achieves the same effect, we should be increasing our efforts in this regard.

This bill is particularly relevant to the extractive industry, where the NDP has been and remains the strongest advocate for accountability in the House. Examples include my hon. colleague from Burnaby—New Westminster's Bill C-323 as it then was, which would allow lawsuits in Canadian courts by non-Canadians for violations of international obligations; and my colleague from Ottawa Centre's Bill C-486, requiring public due diligence by companies using minerals from the Great Lakes Region of Africa.

I point out that the mining bill was opposed by the Conservative government and 13 Liberals failed to show up for the vote, which led to the narrow defeat of that bill by six votes. Again, Canadians can only count on the New Democrats to bring corporate social responsibility of Canadian mining companies into international normative standards in the House.

The political elites that profit from corruption, particularly in those countries and sectors where corruption is most problematic, consist mainly of men. At the same time, it is primarily women who lack government protection.

While we support the bill for referral to committee, we do have some concerns. It would amend the definition of a “business” to include not-for-profit organizations. The New Democrats believe this clause should be carefully studied at committee, in relation to its impact on charitable and aid organizations, which may, in the world we live in, have to make occasional payments in order to expedite or achieve delivery of essential assistance. We must take great care around that.

The committee should also study the consequences of establishing an indictable offence, punishable by up to 14 years in prison, as this is the threshold at which conditional or absolute discharges or conditional sentences become impossible.

Finally, the committee should study whether the rule on facilitation payment should take effect at the whim of cabinet, as is in the current text of the bill, rather than when ordered by Parliament.

Here are some key facts and figures to consider.

There have been three convictions, as I have mentioned, under Canada's foreign bribery law since it took effect in 1999: Hydro Kleen Group was fined $25,000 in 2005 for bribing a U.S. immigration officer at the Calgary airport; Niko Resources was fined $9.5 million in June 2011 because its subsidiary in Bangladesh paid for a vehicle and travel expenses for the former Blangladeshi state minister for energy and mineral resources; and, Griffiths Energy International was fined $10 million in January of this year, after it agreed to pay $2 million to the wife of Chad's ambassador to Canada and allowed her and two others to buy shares at discounted prices in exchange for supporting an oil and gas project in Chad.

We all are watching the newspapers as we see the difficulties that SNC-Lavalin has got itself into in terms of allegedly paying bribes to foreign officials to secure contracts abroad, in the millions of dollars.

The Transparency International Bribe Payers Index in 2011 ranked the oil and gas and mining industries as the fourth and fifth most likely sectors to issue bribes. This should be of great concern to Canadians because Canada is a world centre for mining and oil and gas industries and companies. These companies, among all sectors as stakeholders, should want to establish very clean, high-level regulations and rules regarding acceptable corporate conduct. Moreover, the mining and oil and gas industries are the second and third most likely to engage in grand bribery targeting of high-ranking officials and politicians. This makes a bill like Bill S-14 especially important in these sectors.

The fact that the government does not enforce the anti-corruption laws is a national shame. We are pleased that it is finally paying attention to these problems. It is nevertheless deplorable that it has taken so much time, and that Canada had to be condemned and discredited before the government took any action.

For business, for the environment and labour and for Canada's international reputation, we urge that this bill go through Parliament and I urge the Conservatives to make the amendments necessary to get the support of all parties in the House.

[Hélène LeBlanc, NDP, LaSalle—Émard, QC]

Mr.Speaker, I would like to thank my colleague for his speech and work as the NDP's international trade critic.

It has become increasingly important for all companies, wherever they may be in the world, be it in Canada or abroad, to respect the social contract.

They have a responsibility to respect the communities where they set up business. I would like the member to elaborate on this issue.

I would like him to say more about the matter.

[Don Davies, NDP, Vancouver Kingsway, BC]

Mr. Speaker, I would like to take this moment to thank my hon. colleague from LaSalle—Émard for the fine work that she does in the House and for her contributions to the debate, which are always of very high quality and perceptive.

What the question really raises is the fact that in an increasingly interconnected global world, what Canadian companies do abroad matters. It has always mattered, but never has it been so fundamentally important to Canada's reputation on the world stage that our corporations act above reproach, that we set a standard on the world stage for conducting business in a legal and ethical manner. It is only by doing that, by showing an example here in the Canadian Parliament, by requiring high standards for Canadian corporations acting abroad, that we can legitimately urge other countries to carry the same standards in their jurisdictions as well.

What we all want in the House is for the standards of ethics and legality to improve in Canada and around the world. I think we can start by passing laws like this and by putting some teeth into these laws as well.

[Greg Rickford, Conservative, Parliamentary Secretary to the Minister of Aboriginal Affairs and Northern Development]

Mr. Speaker, I appreciate the member's speech. We have had versions of this debate in a previous session, when a private member's bill was brought forward around corporate social responsibility with a particular emphasis on the mining companies. I know the diminishing caucus of the New Democrats with respect to mining might explain why they are more focused on government intervention.

When I attended the PDAC conference this year or the year prior there was a lot of excitement about e3 Plus, a program that inspires and sets out a framework for the corporations, particularly mining and energy companies, to act responsibly when abroad, and sets the balance to keep corporate operations here in Canada, particularly for our mining companies.

I was wondering if the member could comment on what his proposals might be or what his thoughts are on letting the industry do some self-regulation when it comes to corporate social responsibility, rather than this paternalistic kind of approach that he is advocating.

[Don Davies, NDP, Vancouver Kingsway, BC]

Mr. Speaker, what I see diminishing in the House is the integrity and credibility of the Conservative government over the last two months. All Canadians just have to open up a newspaper to see that.

I do not know what the member is talking about. We have members on this side of the House, such as the hon. member for Nickel Belt, who were miners. We have people on this side of the House, such as the hon. member for Acadie—Bathurst, who worked in the mines of this country. We do not take any lessons from the Conservatives about experience or what is healthy for the mining industry.

What is important is that corporate social responsibility is an issue. Right now we have a serious investment by a Canadian mining company in Chile, which has been halted by the Chilean courts, the Pascua-Lama mine, because of environmental degradation and violations of Chilean law. We just heard from a Greek delegation about a Canadian company's mining operations in northern Greece, which are causing great concern.

It is time that we recognize that Canadian mining companies play a very important role in our economy. However, they benefit from having strong laws and ethics applied to them too, and the whole world would also benefit from watching Canada expect more from our corporations. It is good for business, it is good for Canadians and it is good for Canada's reputation.

[Hélène LeBlanc, NDP, LaSalle—Émard, QC]

Mr.Speaker, I rise this evening in the House to talk about Bill S–14, the Corruption of Foreign Public Officials Act.

I cannot ignore the fact that this bill has come from the Senate, where there is still a lot of commotion over ethics issues. It is, therefore, ironic that this bill, which deals with the corruption of foreign public officials, originated in the Senate.

As has been previously mentioned, the NDP will support the bill at second reading, because we think it is important. As industry critic, I believe that Canadian industries and companies operating abroad must focus on three pillars. The same could be said of companies operating here, in Canada. Reference is often made to economic development, which is often the only pillar on which development is based. Economic development is intended to be profitable, and good for the economy, period.

The two other pillars, which must form the basis for the development and establishment of industries or companies, seem neglected. One of these pillars is social responsibility. When an industry is developed, social responsibility must be a focus. It is imperative that there be the social guarantee to be able to open a business in a particular locality.

This is the case with many mining companies. However, other types of companies also establish themselves abroad and they must ensure, at the very least, that the surrounding communities have a stake in potential impacts, and that they be able to participate in the establishment of the business in question. They can do this by, for example, providing labour, however this labour must be paid, working conditions must be good, and health and occupational health and safety must be a concern.

In fact, there seem to be a large number of articles written on Canadian companies that have established themselves abroad, and also companies that outsource offshore, where there is no respect for working conditions, occupational health and safety, and a number of other factors.

We agree that under our current system, it is important for companies to be able to establish themselves and survive economically. However, we can no longer ignore this type of social responsibility, which must be taken into account. In other words, responsible working conditions must be provided.

I shall now turn to the last pillar. The environment must also be respected. A business cannot set up just anywhere, nor can this be done in just any old fashion, without taking into consideration the impact on the environment. Also, this issue is often raised in articles around the world. Reference is made to Canadian companies, among others, that have set up businesses abroad and do not respect the environment. They justify their actions by saying that there is no environmental regulation, and that they will do business anywhere, and any way they see fit, yet it is absolutely crucial that measures be taken to protect the environment and, in doing so, protect the surrounding communities. All of this is part of a framework of responsibility that must be developed.

Often, in order to set up business and circumvent these two principles of social and environmental responsibility, unfortunately, and regrettably, payments make it possible to break the rules that are enforced and put in place here. They are not enforced abroad.

As we have stated, when ethics rules, standards and laws are established, the same should be applied abroad. In fact, even more should be done when a business is established abroad because Canada's good name is at stake. We have an international reputation to uphold.

I think that Canadian industries and companies that set up business abroad are responsible corporate citizens. However, there have been, and still are, cases involving certain Canadian business people who have failed to demonstrate their sense of responsibility and ethics.

In my opinion, the bill will establish rules that everyone will have to follow. This goes without saying in a society such as ours, where law and order are respected. We also respect working conditions, human rights, and environmental laws. However, we are sometimes left wondering, especially when the Conservative government violates a number of environmental protections put in place over the years in order to protect the environment. We should ensure that businesses operating abroad continue to adopt our Canadian practices.

The New Democrats have always encouraged Canadian businesses abroad to be transparent and responsible. That is a top priority. In fact, Canadians generally want their businesses to represent Canada abroad in a more respectable and responsible way. Moreover, Canadian businesses want clear and consistent standards for international trade for Canadian businesses operating abroad. When cases of corruption are uncovered, it is these businesses' reputations that are tarnished.

As I already mentioned, the NDP will support the bill at second reading. We also want Canada to restore its reputation as a responsible corporate citizen and businesses operating abroad to focus on the three pillars that I mentioned: respect for human rights, working conditions, occupational health and safety, compliance with environmental standards, and consideration of the economic dimension. However, that dimension does not exist in isolation. It must be based on more than one pillar.

That is all the speaking time I had at my disposal. My time went by very quickly. I hope that I have covered the issue. I look forward to answering my colleagues' questions.

[Jonathan Tremblay, NDP, Montmorency—Charlevoix—Haute-Côte-Nord, QC]

Mr. Speaker, I have this lasting feeling that the bill is yet another attempt by the government to use current issues to score political points, without really thinking about what should be done to solve this problem.

It takes both human and financial resources to successfully fight corruption. With all the cuts at the CRA and in other federal programs, both at the international and national levels, how can we fix these problems with the bill if there is no additional human and financial resources?

[Hélène LeBlanc, NDP, LaSalle—Émard, QC]

Mr. Speaker, I thank my colleague for his question, because this is an issue I did not have time to address.

I think we agree that the bill has very good intentions. The issue is how to take action. I think the hon. member has raised this point before. A large number of cuts were made. We wonder how this bill can be implemented, how we can ensure that there is more than the three convictions obtained since 1999.

A number of issues were reported in the media. They relate to things like the environment, working conditions and Canadian companies put on trial abroad.

How are we going to implement the bill when we know that this government has made major cuts to several agencies?

[Paulina Ayala, NDP, Honoré-Mercier, QC]

Mr. Speaker, we are talking about corruption. However, we do not talk about the fact that Canadian companies are reported as being responsible for the persecution of unions in countries where they are doing business, and are even involved in criminal activities.

I wonder if my colleague could elaborate on this issue.