Evidence of meeting #18 for Access to Information, Privacy and Ethics in the 45th Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was carney.
A video is available from Parliament.
Liberal
Linda Lapointe Liberal Rivière-des-Mille-Îles, QC
Thank you, Mr. Chair.
Welcome to the Standing Committee on Access to Information, Privacy and Ethics, Mr. Beber. We are pleased to have you with us.
In your experience, whether at Brookfield or elsewhere in the business world, have you ever had any interaction with the federal conflict of interest regime or the Conflict of Interest Act?
Chief Operating Officer, Brookfield Corporation
Thank you for the question.
Brookfield, as a private enterprise, is not subject to the Conflict of Interest Act, so we have not had interaction on this particular matter as a result.
Liberal
Linda Lapointe Liberal Rivière-des-Mille-Îles, QC
Right, thank you.
Do you think that Brookfield's tax situation is relevant to our study of the Conflict of Interest Act?
Chief Operating Officer, Brookfield Corporation
My view is that since the Conflict of Interest Act really does not apply to private enterprise and its implementation and adjudication should be the purview of the government, the Ethics Commissioner and the other government apparatuses that exist in order to manage those who enter government and exit government, I would say that private enterprise likely has little to say about those mechanics.
Liberal
Linda Lapointe Liberal Rivière-des-Mille-Îles, QC
Thank you.
In the course of our study, witnesses have told us the expression “tax haven” is not a technical term and in reality any country could be accused of being one, including Canada.
From your experience in the business world, is that an accurate description of the international tax environment?
Chief Operating Officer, Brookfield Corporation
No. I think that's a gross mis-characterization of our global taxation system. We at Brookfield, like many sophisticated institutional investors, invest all over the world. We invest in large businesses in their home jurisdictions. When we do that, we are buying businesses with employees, large management teams and assets on the ground. Those businesses pay tax in their jurisdictions.
The caricature of the taxation system as being in tax havens is not apt, because what we are actually trying to do is create tax transparency so that after-tax proceeds from those companies can then be returned to investors with no friction and then tax is paid by those investors in their home jurisdictions.
The tax legislation in Canada recognizes that. It affords institutional investors, such as ourselves, to utilize those frameworks in order to compete globally and in order to ensure that our investors are receiving the maximum after-tax proceeds that we can generate.
Liberal
Linda Lapointe Liberal Rivière-des-Mille-Îles, QC
Thank you.
Since we began this study, we have mostly heard our colleagues on this committee saying that your company avoids paying a substantial portion of its income tax in Canada.
What would you like to say to the Canadians watching us now who might be concerned about these accusations, given the extensive scope of Brookfield's activities in Canada?
Chief Operating Officer, Brookfield Corporation
As I said, what I would want everybody to know and what all of our investors all over the world—our shareholders, our clients and some of the most sophisticated institutional investors in the world—know, is that contrary to some of these so-called publications, we pay all taxes that are due and payable in all jurisdictions in which we operate.
As I mentioned before, the structures that we put in place actually facilitate the payment of taxes in the appropriate jurisdictions where they should be paid.
Liberal
Linda Lapointe Liberal Rivière-des-Mille-Îles, QC
What measures does your company adopt to make sure it pays all taxes it is required to pay in Canada?
Chief Operating Officer, Brookfield Corporation
We have very significant reporting and tracking across all of our businesses. We are meticulous in ensuring that our records are always up to date. We have strong governance principles in place with all of our businesses.
As soon as we onboard a new company, they become part of Brookfield, and the reporting lines are implemented immediately. We have, in fact, people inside of Brookfield, internal auditors, who are also checking the work and ensuring that all of our procedures are operating properly.
Conservative
The Chair Conservative John Brassard
Thank you, Ms. Lapointe.
Mr. Beber, make sure you have your earpiece on, please.
Mr. Thériault, the floor is yours for six minutes.
Bloc
Luc Thériault Bloc Montcalm, QC
Thank you, Mr. Chair.
In an exchange of emails and letters that I would venture to characterize as rather extensive, Brookfield asked why it had to testify here, given that the subject of this committee's study is the review of the Conflict of Interest Act. I would therefore like to begin by clarifying our mandate.
We are directed to consider the need to expand the scope of the act. We want to enhance transparency, prevent conflicts of interest, avoid potential or apparent conflicts of interest, regulate public office holders’ ownership of assets in tax havens and limit the availability of blind trusts.
You will understand that with witnesses telling us that Brookfield is the tax avoidance champion, when we knew, given the Prime Minister's declaration of interests, that he has interests in Brookfield, your presence here is obligatory.
I would like a short answer.
Chief Operating Officer, Brookfield Corporation
I appreciate the spirit in which you—
Bloc
Luc Thériault Bloc Montcalm, QC
Mr. Chair, I would like Mr. Beber to keep his earpiece in and to have someone show him how to put it on. If he is constantly putting it down and putting it back on, we will be wasting time.
Conservative
The Chair Conservative John Brassard
Mr. Beber, it may not look good on TV, but I suggest that you put your earpiece on so that you can hear the entirety of the question and any comments that come your way.
It's just easier that way. I do the same thing sometimes.
Chief Operating Officer, Brookfield Corporation
It was suggested to me that I might wind up hearing myself in my ear.
Conservative
The Chair Conservative John Brassard
You could, and at that point you can take it off, but just make sure for the entirety of the question that you keep it on for the comments.
Conservative
The Chair Conservative John Brassard
Mr. Thériault, I have stopped the clock.
Mr. Beber, you can respond to Mr. Thériault's comment. I'll start the clock right now.
Thank you.
Chief Operating Officer, Brookfield Corporation
I was simply going to say that we respect the spirit in which this committee is undertaking its work.
First and foremost, the reports that you've heard are completely false. I've tried to explain, in response to some of the questions we've already received, that Brookfield pays all applicable taxes. We have demonstrated systems and structures in place to do that. We do want to be helpful in your quest to assess whether or not your current rules apply and apply effectively.
Bloc
Luc Thériault Bloc Montcalm, QC
Are you telling us here that Brookfield does not practise tax avoidance, something that is entirely legal?
We are talking about tax avoidance, not tax evasion.
Is that what you are telling us, yes or no?
Chief Operating Officer, Brookfield Corporation
We practise tax planning the way any other company practises tax planning.