Bill C-59

Fall Economic Statement Implementation Act, 2023

An Act to implement certain provisions of the fall economic statement tabled in Parliament on November 21, 2023 and certain provisions of the budget tabled in Parliament on March 28, 2023

Part 1 implements certain measures in respect of the Income Tax Act and the Income Tax Regulations by
(a) limiting the deductibility of net interest and financing expenses by certain corporations and trusts, consistent with certain Organisation for Economic Co-operation and Development and the Group of Twenty Base Erosion and Profit Shifting project recommendations;
(b) implementing hybrid mismatch rules consistent with the Organisation for Economic Co-operation and Development and the Group of Twenty Base Erosion and Profit Shifting project recommendations regarding cross-border tax avoidance structures that exploit differences in the income tax laws of two or more countries to produce “deduction/non-inclusion mismatches”;
(c) allowing expenditures incurred in the exploration and development of all lithium to qualify as Canadian exploration expenses and Canadian development expenses;
(d) ensuring that only genuine intergenerational business transfers are excluded from the anti-surplus stripping rule in section 84.1 of the Income Tax Act ;
(e) denying the dividend received deduction for dividends received by Canadian financial institutions on certain shares that are held as mark-to-market property;
(f) increasing the rate of the rural supplement for Climate Action Incentive payments (CAIP) from 10% to 20% for the 2023 and subsequent taxation years as well as referencing the 2016 census data for the purposes of the CAIP rural supplement eligibility for the 2023 and 2024 taxation years;
(g) providing a refundable investment tax credit to qualifying businesses for eligible carbon capture, utilization and storage equipment;
(h) providing a refundable investment tax credit to qualifying businesses for eligible clean technology equipment;
(i) introducing, under certain circumstances, labour requirements in relation to the new refundable investment tax credits for eligible carbon capture, utilization and storage equipment as well as eligible clean technology equipment;
(j) removing the requirement that credit unions derive no more than 10% of their revenue from sources other than certain specified sources;
(k) permitting a qualifying family member to acquire rights as successor of a holder of a Registered Disability Savings Plan following the death of that plan’s last remaining holder who was also a qualifying family member;
(l) implementing consequential changes of a technical nature to facilitate the operation of the existing rules for First Home Savings Accounts;
(m) introducing a tax of 2% on the net value of equity repurchases by certain Canadian corporations, trusts and partnerships whose equity is listed on a designated stock exchange;
(n) exempting certain fees from the refundable tax applicable to contributions under retirement compensation arrangements;
(o) introducing a technical amendment to the provision that authorizes the sharing of taxpayer information for the purposes of the Canadian Dental Care Plan;
(p) implementing a number of amendments to the general anti-avoidance rule (GAAR) as well as introducing a new penalty applicable to transactions subject to the GAAR and extending the normal reassessment period for the GAAR by three years in certain circumstances;
(q) facilitating the creation of employee ownership trusts;
(r) introducing specific anti-avoidance rules in relation to corporations referred to as substantive CCPCs; and
(s) extending the phase-out by three years, and expanding the eligible activities, in relation to the reduced tax rates for certain zero-emission technology manufacturers.
It also makes related and consequential amendments to the Excise Tax Act and the Excise Act, 2001 .
Part 2 enacts the Digital Services Tax Act and its regulations. That Act provides for the implementation of an annual tax of 3% on certain types of digital services revenue earned by businesses that meet certain revenue thresholds. It sets out rules for the purposes of establishing liability for the tax and also sets out applicable reporting and filing requirements. To promote compliance with its provisions, that Act includes modern administration and enforcement provisions generally aligned with those found in other taxation statutes. Finally, this Part also makes related and consequential amendments to other texts to ensure proper implementation of the tax and cohesive and efficient administration by the Canada Revenue Agency.
Part 3 implements certain Goods and Services Tax/Harmonized Sales Tax (GST/HST) measures by
(a) ensuring that an interest in a corporation that does not have its capital divided into shares is treated as a financial instrument for GST/HST purposes;
(b) ensuring that interest and dividend income from a closely related partnership is not included in the determination of whether a person is a de minimis financial institution for GST/HST purposes;
(c) ensuring that an election related to supplies made within a closely related group of persons that includes a financial institution may not be revoked on a retroactive basis without the permission of the Minister of National Revenue;
(d) making technical amendments to an election that allows electing members of a closely related group to treat certain supplies made between them as having been made for nil consideration;
(e) ensuring that certain supplies between the members of a closely related group are not inadvertently taxed under the imported taxable supply rules that apply to financial institutions;
(f) raising the income threshold for the requirement to file an information return by certain financial institutions;
(g) allowing up to seven years to assess the net tax adjustments owing by certain financial institutions in respect of the imported taxable supply rules;
(h) expanding the GST/HST exemption for services rendered to individuals by certain health care practitioners to include professional services rendered by psychotherapists and counselling therapists;
(i) providing relief in relation to the GST/HST treatment of payment card clearing services;
(j) allowing the joint venture election to be made in respect of the operation of a pipeline, rail terminal or truck terminal that is used for the transportation of oil, natural gas or related products;
(k) raising the input tax credit (ITC) documentation thresholds from $30 to $100 and from $150 to $500 and allowing billing agents to be treated as intermediaries for the purposes of the ITC information rules; and
(l) extending the 100% GST rebate in respect of new purpose-built rental housing to certain cooperative housing corporations.
It also implements an excise tax measure by creating a joint election mechanism to specify who is eligible to claim a rebate of excise tax for goods purchased by provinces for their own use.
Part 4 implements certain excise measures by
(a) allowing vaping product licensees to import packaged vaping products for stamping by the licensee and entry into the Canadian duty-paid market as of January 1, 2024;
(b) permitting all cannabis licensees to elect to remit excise duties on a quarterly rather than a monthly basis, starting from the quarter that began on April 1, 2023;
(c) amending the marking requirements for vaping products to ensure that the volume of the vaping substance is marked on the package;
(d) requiring that a person importing vaping products must be at least 18 years old; and
(e) introducing administrative penalties for certain infractions related to the vaping taxation framework.
Part 5 enacts and amends several Acts in order to implement various measures.
Subdivision A of Division 1 of Part 5 amends Subdivision A of Division 16 of Part 6 of the Budget Implementation Act, 2018, No. 1 to clarify the scope of certain non-financial activities in which federal ‚financial institutions may engage and to remove certain discrepancies between the English and French versions of that Act.
Subdivision B of Division 1 of Part 5 amends the Trust and Loan Companies Act , the Bank Act and the Insurance Companies Act to, among other things, permit federal financial institutions governed by those Acts to hold certain meetings by virtual means without having to obtain a court order and to permit voting during those meetings by virtual means.
Division 2 of Part 5 amends the Canada Labour Code to, among other things, provide a leave of absence of three days in the event of a pregnancy loss and modify certain provisions related to bereavement leave.
Division 3 of Part 5 enacts the Canada Water Agency Act . That Act establishes the Canada Water Agency, whose role is to assist the Minister of the Environment in exercising or performing that Minister’s powers, duties and functions in relation to fresh water. The Division also makes consequential amendments to other Acts.
Division 4 of Part 5 amends the Tobacco and Vaping Products Act to, among other things,
(a) authorize the making of regulations respecting fees or charges to be paid by tobacco and vaping product manufacturers for the purpose of recovering the costs incurred by His Majesty in right of Canada in relation to the carrying out of the purpose of that Act;
(b) provide for related administration and enforcement measures; and
(c) require information relating to the fees or charges to be made available to the public.
Division 5 of Part 5 amends the Canadian Payments Act to, among other things, provide that additional persons are entitled to be members of the Canadian Payments Association and clarify the composition of that Association’s Stakeholder Advisory Council.
Division 6 of Part 5 amends the Competition Act to, among other things,
(a) modernize the merger review regime, including by modifying certain notification rules, clarifying that Act’s application to labour markets, allowing the Competition Tribunal to consider the effect of changes in market share and the likelihood of coordination between competitors following a merger, extending the limitation period for mergers that were not the subject of a notification to the Commissioner of Competition and placing a temporary restraint on the completion of certain mergers until the Tribunal has disposed of any application for an interim order;
(b) improve the effectiveness of the provisions that address anti-competitive conduct, including by allowing the Commissioner to review the effects of past agreements and arrangements, ensuring that an order related to a refusal to deal may address a refusal to supply a means of diagnosis or repair and ensuring that representations of a product’s benefits for protecting or restoring the environment must be supported by adequate and proper tests and that representations of a business or business activity for protecting or restoring the environment must be supported by adequate and proper substantiation;
(c) strengthen the enforcement framework, including by creating new remedial orders, such as administrative monetary penalties, with respect to those collaborations that harm competition, by creating a civilly enforceable procedure to address non-compliance with certain provisions of that Act and by broadening the classes of persons who may bring private cases before the Tribunal and providing for the availability of monetary payments as a remedy in those cases; and
(d) provide for new procedures, such as the certification of agreements or arrangements related to protecting the environment and a remedial process for reprisal actions.
The Division also amends the Competition Tribunal Act to prevent the Competition Tribunal from awarding costs against His Majesty in right of Canada, except in specified circumstances.
Finally, the Division makes a consequential amendment to one other Act.
Division 7 of Part 5 amends the Bankruptcy and Insolvency Act and the Companies’ Creditors Arrangement Act to exclude from their application prescribed public post-secondary educational institutions.
Subdivision A of Division 8 of Part 5 amends the Proceeds of Crime (Money Laundering) and Terrorist Financing Act to, among other things,
(a) provide that, if a person or entity referred to in section 5 of that Act has reasonable grounds to suspect possible sanctions evasion, the relevant information is reported to the Financial Transactions and Reports Analysis Centre of Canada;
(b) add reporting requirements for persons and entities providing certain services in respect of private automatic banking machines;
(c) require declarations respecting money laundering, the financing of terrorist activities and sanctions evasion to be made in relation to the importation and exportation of goods; and
(d) authorize the Financial Transactions and Reports Analysis Centre of Canada to disclose designated information to the Department of the Environment and the Department of Fisheries and Oceans, subject to certain conditions.
It also amends the Budget Implementation Act, 2023, No. 1 in relation to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act and makes consequential amendments to other Acts and a regulation.
Subdivision B of Division 8 of Part 5 amends the Criminal Code to, among other things,
(a) in certain circumstances, provide that a court may infer the knowledge or belief or recklessness required in relation to the offence of laundering proceeds of crime and specify that it is not necessary for the prosecutor to prove that the accused knew, believed they knew or was reckless as to the specific nature of the designated offence;
(b) remove, in the context of the special warrants and restraint order in relation to proceeds of crime, the requirement for the Attorney General to give an undertaking, as well as permit a judge to attach conditions to a special warrant for search and seizure of property that is proceeds of crime; and
(c) modify certain provisions relating to the production order for financial data to include elements specific to accounts associated with digital assets.
It also makes consequential amendments to the Seized Property Management Act and the Forfeited Property Sharing Regulations .
Division 9 of Part 5 retroactively amends section 42 of the Federal-Provincial Fiscal Arrangements Act to specify the payments about which information must be published on a Government of Canada website, as well as the information that must be published.
Division 10 of Part 5 amends the Public Sector Pension Investment Board Act to increase the number of directors in the Public Sector Pension Investment Board, as well as to provide for consultation with the portion of the National Joint Council of the Public Service of Canada that represents employees when certain candidates are included on the list for proposed appointment as directors.
Division 11 of Part 5 enacts the Department of Housing, Infrastructure and Communities Act , which establishes the Department of Housing, Infrastructure and Communities, confers on the Minister of Infrastructure and Communities various responsibilities relating to public infrastructure and confers on the Minister of Housing various responsibilities relating to housing and the reduction and prevention of homelessness. The Division also makes consequential amendments to other Acts and repeals the Canada Strategic Infrastructure Fund Act .
Division 12 of Part 5 amends the Employment Insurance Act to, among other things, create a benefit of 15 weeks for claimants who are carrying out responsibilities related to
(a) the placement with the claimant of one or more children for the purpose of adoption; or
(b) the arrival of one or more new-born children of the claimant into the claimant’s care, in the case where the person who will be giving or gave birth to the child or children is not, or is not intended to be, a parent of the child or children.
The Division also amends the Canada Labour Code to create a leave of absence of up to 16 weeks for an employee to carry out such responsibilities.

Opposition Motion—Carbon Tax

[Julie Dzerowicz, Liberal, Davenport, ON]

Mr. Speaker, I will be sharing my time with the very hon. member for Kings—Hants.

It is my absolute pleasure, as always, to be speaking on behalf of the residents in my riding of Davenport. I will be speaking to today's opposition day motion that was put forward by the Conservatives on affordability and pollution pricing. I will start with a few of my own comments and then I will go into a bit of prepared text.

As members know, climate change is real. Carbon emissions are impacting our climate and causing the climate to change. If Canada does not continue to rapidly move toward reducing emissions now, the cost of waiting will be more expensive for Canadians later. As a result, it will be a world that will be more difficult and more unpredictable to live in.

Last week, I happened to have been blessed to have the Minister of Energy and Natural Resources in my riding, and the question of the carbon tax came up by a Davenport resident, who said that given the fact that Canadians were suffering an affordability crisis and as of April 1 the price on pollution would go up, should people believe the Leader of the Opposition who was trying to convince a lot of Canadians that the price on pollution was a tax that would hurt Canadians?

The minister responded by saying that there were the facts and then there was perception, that putting a price on pollution would be the most economically efficient way to reduce carbon emissions and that if people asked 100 economists, 99 and a half of them would tell them that it was true. He went on to say that the way in which we had structured it was to do it in a way that would make it affordable for Canadians. Therefore, eight out of 10 Canadian families would get more money back than they paid, and it worked directly disproportionate to income. Those who lived on the most modest means would get much more money back than they actually paid. The people who received less money back than they paid were people who lived in 6,000 square foot houses, had a Hummer in their driveway and a boat in the backyard. At the end of the day, the fact that they paid more was because they were polluting more.

It was also noted that the Premier of Saskatchewan had decided that he would stop remitting the price on pollution for home heating. As a direct result of that, the rebate would go down for people in Saskatchewan, and the people who would suffer most would be the those people who were living on modest incomes. The premier was making poor people poorer because of the choices that he was making.

The motion before us is also proposing to do that for Canadians.

In 2023, we saw a record fire season in Canada in which the area burned was more than double that of the historic record, with hundreds of thousands of Canadians evacuated from their homes as a result. The total area burned exceeded 18 million hectares, which is two and a half times the previous record set in 1995 and more than six times the average over the past 10 years.

In its 2020 report on climate risks and their implications for the insurance industry in Canada, the Insurance Bureau of Canada also concluded that “The average annual severe weather claims paid by insurers in Canada could more than double over the next 10 years, increasing from $2.1-billion a year to $5-billion a year, and must be accompanied by an increase in premium income.” It is clear that there are very real costs associated with having one's house burn down or having to flee one's home and job due to an evacuation order.

We also know from experts and research that the most effective and efficient way to address climate change is to put a price on carbon pollution emissions, which are the chief cause of man-made climate change. Putting a price on carbon pollution reduces emissions and encourages reductions across the economy, while giving households and businesses the flexibility to decide when and how to make changes. It creates incentives for Canadian business to develop and adopt new low-carbon products, processes and services, and when it is done right, and we are doing that in Canada, it is both effective and affordable for Canadians.

On the Canada carbon rebate, the bulk of the proceeds from the federal pollution pricing system goes straight back into the pockets of Canadians in provinces where the fuel charge applies, with eight out of 10 households in these provinces continuing to get more money back through their quarterly Canada carbon rebate payments than they pay as a result of the federal pollution pricing system.

The federal government understands that we need to maintain the price signal that, over the long term, is necessary for carbon pricing to work and bring emissions down, but at the same time we have also shown that we are willing to be flexible and innovative in supporting options that will go even further to cut down on climate pollution in the long run.

We took temporary and targeted action to pause the fuel charge on heating oil with the goal of getting consumers off home heating oil and onto a cleaner and far more affordable alternative solution that will save them thousands of dollars and lower carbon emissions over the long run.

Measures such as this will make life more affordable in the right way, while supporting the goal of achieving a prosperous, low-carbon future for all Canadians.

We know that there are better ways to make life more affordable for Canadians, ways that do not involve destroying the environment and incurring more devastating costs further down the road. We are delivering this support where it is most effective, including with the oil to heat pump affordability program, which will increase the amount of federal funding that eligible homeowners can receive for installing a heat pump from $10,000 to $15,000. It includes proposing, under Bill C-59, a doubling of the Canada carbon rebate rural top-up rate, increasing it from 10% to 20% of the base rebate amount starting in April 2024. People who live in rural communities face unique realities, and this measure will help put even more money back in the pockets of families that are dealing with higher energy costs because they live outside a large city. We have been very clear that we will continue to implement our pollution pricing system while ensuring that we continue to put more money into the pockets of Canadian households and families.

More recently, through Bill C-59, the fall economic statement implementation act of 2023, we introduced measures to advance the government’s fiscally responsible plan to build a cleaner, stronger economy. It introduces measures to create well-paying jobs, generate growth and build a cleaner economy that works for everyone by advancing Canada’s competitiveness through the implementation of investment tax credits. Investment tax credits are a key part of the government’s broader plan to work with industry towards the goal of decarbonization. This includes the carbon capture, utilization and storage investment tax credit, which is also known as CCUS.

CCUS is a suite of technologies that capture carbon dioxide emissions, whether from fuel combustion, from industrial processes or directly from the air, either to store CO2, typically deep underground, or to use it in other industrial processes, such as mineralization in concrete. These technologies are an important tool for reducing emissions in high-emitting sectors, where other pathways to reduce emissions may be limited or unavailable. In fact, the Intergovernmental Panel on Climate Change and the International Energy Agency each include CCUS deployment as an important element of scenarios in which the world achieves net-zero emissions. For its part, the CCUS investment tax credit will not only help Canadian companies adopt clean technologies but will also create jobs, ensure Canadian businesses remain globally competitive and reduce Canada’s emissions at the same time.

In conclusion, making life more affordable for Canadians while protecting the environment has always been a priority for the federal Liberal government, and it remains a priority today. I have outlined over the last 10 minutes just a few examples of how we are making targeted and responsible investments to help Canadians find an affordable place to call home. We want to ensure that Canada remains the best place in the world to live, work, go to school and raise a family. Making life more affordable is a key part of that.

It is a pleasure to speak on behalf of the residents of my riding of Davenport on this opposition day motion about affordability and pollution pricing.

I am now very happy to take any questions.

[The Chair, Liberal, Peter Fonseca]

That is the time, MP Thompson. Thank you.

We want to thank our very knowledgeable and hard-working officials who have answered many, many questions here for us today. I know you're going to answer more, because we're going to be sending you some emails.

I know, MP Blaikie, that you have your hand up.

I also want to say to members while I have you here that we have talked about how hard working our clerk is. He's the best clerk on the Hill. To help our clerk, when it comes to witnesses as we get into Bill C-59, I'm asking members to get the preliminary list of witnesses to the clerk by, let's just say, Tuesday of next week. Would that work? Okay. Get that list in by Tuesday, please. That would help the clerk to reach out to them, and we can have them all prepped and ready to come before committee. Thank you for that.

Now we'll go to MP Blaikie before we conclude.

[Gabriel Ste-Marie, Bloc, Joliette, QC]

Thank you, Mr. Chair.

Still on the subject of the Competition Act amendments, I'm interested in repair capacity rights, particularly in the automotive sector. We have to make sure that people can get their car repaired wherever they want. However, we see that filing a complaint would be a complex affair.

My question is more specifically about clarity in the bill. In my opinion, Quebec's and the U.S.'s right to repair legislation is clearer. For example, both acts stipulate that manufacturers cannot withhold information from the outset. However, it's getting harder and harder to demand access to car repair diagnostics. The data are often stored in the cloud.

Why was this not addressed more clearly in Bill C‑59, following the United States' and Quebec's lead?

[Julie Dzerowicz, Liberal, Davenport, ON]

Thank you, Mr. Chair.

First, I want to thank everyone here today. I think often it takes a room where you see a lot of people who've done a lot of hard work to know that there are a heck of a lot of people working in our government doing really important work, so I just want to say a huge thanks to all of you. I know all of you won't get a chance to speak today, but I thank you for being here. Thanks for your hard work.

Since our competition team is here, I might as well ask a question of them. I know that we've been working really hard as a government to try to improve our competition within Canada, and I know there have been elements in Bill C-56 in addition to Bill C-59 around modernizing our competition regime.

If you could, maybe talk to how the measures in Bill C-59 build on those measures that we've introduced in Bill C-56, which was, I believe, our budget. Thank you.

[Philip Lawrence, Conservative, Northumberland—Peterborough South, ON]

Thank you very much.

I just want to follow up with Mr. Hallan. I understand Mr. Hallan's questions, and I understand that there are frameworks, legislation and actions that have to be put in place, but presumably those actions are put in place to achieve results.

Certainly, in the private sector, if an investment is made, if a change is made, there's nearly always a calculation as to the return and what will be achieved. With respect to the changes in the fall economic statement and its implementation act, Bill C-59, what can consumers expect in terms of a reduction in prices?

[Jasraj Singh Hallan, Conservative, Calgary Forest Lawn, AB]

I've never been interrupted by the chair before like that, but I'll move on.

I know we have more than 35 officials here. Have any officials done any analysis on Bill C-59 to see if the measures would lower grocery prices and what the exact number is?

Is there anybody?

I can see officials getting up and leaving.

I just need a number on how much this legislation would lower the grocery prices.

[Jasraj Singh Hallan, Conservative, Calgary Forest Lawn, AB]

The reason I ask is that the finance minister said that with Bill C-59 or the FES, they were putting billions into building new homes. That's what the point of this was, according to her.

She also said that they will “unlock billions of dollars” to unlock more homes and get more homes built faster.

Are you saying that this legislation doesn't do any of that?

[Jasraj Singh Hallan, Conservative, Calgary Forest Lawn, AB]

Thank you, Chair.

Can I call up the department of infrastructure, please?

Thanks, folks.

I just want to continue the questioning by my colleague, Mr. Lawrence.

I'll ask this one more time: For this legislation, Bill C-59, on the FES, is there any analysis on how many homes this legislation will build?

[Gabriel Ste-Marie, Bloc, Joliette, QC]

Thank you, Mr. Chair.

My questions are still on amendments to part 5, division 6 of the Competition Act.

Having said that, first I'd like to thank the clerk of the committee, Mr. Roger, for getting the commissioner's letter to us so quickly. We have the best clerk of all the House and Senate committees.

Mr. Simard, I expect that a gag order will be issued on the study of Bill C‑59, which would limit the length of our study. We're going to invite the commissioner and representatives of other organizations to appear. We may propose amendments to the bill. After the commissioner and the other witnesses have testified, if you have any additional information for us before we vote on the amendments, send it to us so that we can make a well-informed decision.

I want to come back to the second recommendation, which concerns greenwashing. My colleague Daniel Blaikie mentioned it. A number of organizations are telling us that prohibition of greenwashing products as part of the amendment to the Competition Act should also apply to environmental statements in general made by companies, such as allegations about the sustainability of their operations.

Can you comment on this amendment that could be proposed?

[Erin Cassidy]

Thank you, Erin.

Thank you for the question.

Bill C-59 proposes three types of amendments to the Criminal Code that are intended to address operational aspects of the anti-money laundering and anti-terrorist financing regime.

The first proposed amendment targets the laundering of proceeds of crime offence. What we have heard through our consultations and our engagement with provincial and territorial partners is that this offence is particularly challenging to prosecute and to obtain sufficient evidence on to go to prosecution. This is because, among other things, the offence requires that the accused have the knowledge or belief, or be reckless as to whether the property was obtained or derived from the commission of a designated offence.

In the case of money laundering committed by third parties—persons who are not engaged in the underlying offence that gave rise to the proceeds—it can be particularly challenging to establish that mental element, which is that knowledge or belief, or recklessness.

The amendments proposed some changes specifically to address third party money laundering. They establish a statutory inference—

[Patrick Weiler, Liberal, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

Thank you for that.

Beyond the changes you mentioned to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act and the Customs Act, there are some changes being made to the Criminal Code, particularly because these are offences that are very difficult to prove when you need to prove knowledge of some of these things.

I was hoping you might be able to speak a bit to that and how those standards are going to be addressed through Bill C-59.

[Kristina Michaud, Bloc, Avignon—La Mitis—Matane—Matapédia, QC]

Mr. Speaker, no one can really explain this. No sane person in Quebec thinks that climate change is not real. We are living it. I am living it in my riding with coastal erosion. It is a scourge and we need to do more to fight it.

One of the first things we can do is put a price on pollution, but we also need to stop subsidizing oil companies, which pollute enormously.

In Bill C‑59, which we voted on yesterday, there are still billions of dollars in tax credits for these oil companies that make billions of dollars in profits. If we took all that money and helped Canadians cope with the rising cost of living, it seems to me we would be further ahead. It seems to me we would be further ahead if we invested in green economies and green energy.

I will stop here. I hope the NDP will support these measures.

[Patrick Weiler, Liberal, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

Thank you, Chair. I want to thank all of our witnesses for being here today. I'll ask some questions of our witnesses who are sitting here.

I really appreciate the renewed interest of our Conservative Party members on this committee to look into money laundering. Unfortunately, it was the budget cuts that Stephen Harper brought in that cut $500 million from the integrated proceeds of crime unit. That helped create the conditions we see today with money laundering. It's actually mentioned by the Cullen commission, which identified that as one of the factors that led to the amount of money laundering we're seeing in real estate.

Obviously, there have been many changes since then. It's great to see that the Province of B.C. has brought in a land ownership registry, and, just recently, announced it's going to make it free for individuals to access it.

Of course, over the last four years, there have been many very important changes made to our anti-money laundering regime, including in Bill C-59. I was hoping that the witnesses might be able to share with this committee how Bill C-59 will improve the operational effectiveness of our AML regime, and, specifically, how is it going to address some of the ongoing enforcement issues that have been identified within the regime?.

[Adam Chambers, Conservative, Simcoe North, ON]

Thank you very much, Mr. Chair.

Thank you to all our officials.

While Ms. Hunt is getting ready and prepared, I want to apologize on behalf of the government for delaying the budget. I know it takes a lot of time and effort to do it, and work expands to the fill the time available. An extra few weeks is very difficult, I know. I'm sorry. Hopefully, in the future, we will have fixed budget dates, and we can all know when they will be.

Ms. Hunt, thank you very much. It's nice to see you again.

Do you remember Bill C-289? It was a private member's bill that proposed to amend the Criminal Code, and it was related to money laundering.

You're nodding yes.

One of the arguments that the government used to defeat that bill was that it did not enjoy or did not recommend making changes to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act and the Criminal Code outside of the five-year review of that legislation.

My first question is this: Does Bill C-59 amend the Proceeds of Crime (Money Laundering) and Terrorist Financing Act?

[Martin Simard, Senior Director, Corporate, Insolvency and Competition Directorate, Department of Industry]

Good morning. My name is Martin Simard, and I report to Mark Schaan.

There are six recommendations. I don't know how much time we have, but I can quickly explain why the government introduced this bill. The rest will be up to the committee.

First, the commissioner is proposing an amendment regarding drip pricing or last-minute price changes. That's not necessarily within the scope of this bill. This recommendation came from a [Inaudible—Editor] two years ago. The commissioner suggested changing what was done two years ago, because there was an oversight. However, in Bill C‑59, we simply reproduced what had been done, because we wanted all provisions on equal footing. That's why the amendment proposed by the commissioner is not in Bill C‑59.

Next, with respect to greenwashing, as Mr. Schaan mentioned, this just recommends that greenwashing be considered as a factor. Therefore, it doesn't suggest a specific amendment.

In terms of the ordinary selling price of products, the commissioner suggests reversing the burden of proof. In Bill C‑59, the government seeks to correct a concordance error between the English and French versions. This meant that, to prove that someone was posting a sham discount, people had to look at the entire marketplace to determine the average price of the product in question. The bill corrects that by requiring instead that the past prices posted by sellers themselves be used to determine whether a discount is genuine. So the government wants to clarify that.

However, the commissioner wants us to go further and make companies responsible for keeping a price list and proving that they offer genuine discounts. The government didn't go that far. All the government said was that it had to be based on the prices set by the seller. Here, we're taking into account the fact that not all SMEs have a price list, and that could be a burden for them. Currently, the commissioner's power of examination gives him access to large companies' price lists. That's why the government didn't go any further.

Furthermore, with respect to mergers, the commissioner suggests setting a percentage by default and reversing the burden of proof there as well. Currently, the Competition Tribunal cannot prevent a merger solely on the basis of market share. In Bill C‑59, the government removes this barrier, which would allow the tribunal to make intuitive presumptions if market share has become very high. Once again, the commissioner wants us to go further and set a percentage in the act. To our knowledge, no other countries are doing that. Bill C‑59 is in line with what the United States is doing, which is allowing the courts and jurisprudence to evolve.

Basically, in order for a merger to be challenged before the Competition Tribunal, it has to significantly reduce competition. The commissioner proposes requiring that the solutions put forward in the event of a challenge, such as the sale of a company's shares, be used to fully restore competition. The government didn't go that far because a merger can only be challenged if it has a significant impact on competition. It's therefore not clear why the solution to a problematic merger should mean that it has no effect on competition. That's why the government didn't go as far. Once again, the commissioner will be able to present his view on this.

Finally, the commissioner expressed doubts about the new environmental certification process established in Bill C‑59. I can tell you why the government wants to establish the process. A number of companies and environmental groups have told us that getting together to stop the sale of certain toxic products to protect the environment could be considered a cartel and therefore a criminal offence under the Competition Act. The government therefore recommends that a pre-authorization system be set up within the Competition Bureau. That way, people will be able to tell the Competition Bureau that they want to agree not to sell certain toxic products to protect the environment, and the commissioner will then be able to issue a letter saying that they are not at risk of criminal charges. The commissioner will be able to explain why he has doubts. I think his concern is that people will hide behind fake environmental concerns to create a cartel.

However, in the government's view, all the bases are covered. The commissioner has full discretionary powers, so when in doubt, he can simply not issue the letter.

However, we've heard from businesses and environmental groups that criminal penalties can deter companies from engaging in environmentally friendly collaborative efforts. That's why, once again, the system that allows for these collaborative efforts is administered at the commissioner's discretion.