Fisheries Committee on June 16th, 2021

[Adam Burns]

No, we don't have such a concern. Certainly these requirements are in place. These are established companies, largely, which that very much, by and large, behave responsibly.

That said, our enforcement operations do provide that additional assurance to us. We know that if there were issues that warranted further action on their part, as Heather McCready noted, they would.

Our view of the Canadian ownership of those 97 offshore licences is that they do all currently meet the Canadian ownership requirements, which is 51%.

[The Chair, Liberal, Ken McDonald]

Thank you, Madam Gill.

We'll now go to Mr. Johns for six minutes or less, please.

[Gord Johns, NDP, Courtenay—Alberni, BC]

Thank you for your testimony.

Does the department look at each species—each fishery, for example—and look at what the maximum community benefit is and if there are leakages that are going to foreign entities? Does it look at ways to improve and plug the gaps?

[Adam Burns]

When it comes to the offshore fishery.... I'm not sure if you were specifically referring to offshore licences.

[Gord Johns, NDP, Courtenay—Alberni, BC]

Sure, I mean both offshore and the processing.

[Adam Burns]

In terms of processing, with the provincial jurisdiction there I wouldn't be able to speak to any sort of analysis that provincial governments may do related to processing rules and regulations within their jurisdictions.

In terms of the offshore licensing regime, offshore licences are just that: They're operating offshore. Their link is different from inshore licences in terms of the policies we look at. The primary focus on our offshore licences in terms of that economic review is linked to that Canadian ownership and ensuring that they are majority Canadian-owned and meet the 51% requirement.

[Gord Johns, NDP, Courtenay—Alberni, BC]

Are you saying there's no coordinated effort with the provinces in terms of an overall strategy?

We heard testimony here about Royal Greenland profiting $52 million. They bought the second- and fourth-highest processors on the east coast. I would assume that's a pretty big economic leakage. In terms of beneficial agreements, there are ways to navigate through to impact the harvesters.

What is the government doing about it? Have other countries taken action to reduce the foreign ownership and the leakage that's happening right now on both coasts?

[Adam Burns]

In terms of fishing licences and fishing operations, they are all majority Canadian-owned.

The ownership of processing is provincial jurisdiction. The department does, of course, work with provincial governments, recognizing their jurisdiction. We do work closely with provincial governments on a variety of issues through the Canadian Council of Fisheries and Aquaculture Ministers.

I would note that different provinces have different regimes governing—

[Gord Johns, NDP, Courtenay—Alberni, BC]

I guess other countries must have different regimes. I can't think of another country that would allow this type of foreign ownership and leakage that's happening with its fisheries.

Are you looking at what other countries are doing and working with the provinces so that you can end this leakage and actually ensure that money's staying in our communities instead of leaving to foreign corporate entities? That's what's happening.

[Adam Burns]

Certainly, in terms of the fishing licences and that aspect of things, we are confident that they are majority Canadian-owned in all cases.

In terms of the processing sector and the ownership of those corporations and those operations, the rules are different from province to province and—

[Gord Johns, NDP, Courtenay—Alberni, BC]

Do you agree that they're interconnected?

[Adam Burns]

Well, it is true that the processing sector is part of—

[Gord Johns, NDP, Courtenay—Alberni, BC]

I'm just flagging that, because I think the department needs to take some leadership to work with the provinces so that we can plug those economic leakages.

You talked about both coasts. It's been raised here multiple times that it's like we live in two different countries. Why isn't the government following through with the study that was presented to the minister from 2019—two years ago last month—around, obviously, dealing with foreign ownership and transfers on the west coast and a public registry for west coast fishers? I think that Canadians would expect that they should be able to know who owns the quota.

[Adam Burns]

Certainly, the department is working on those issues on the west coast. I don't have specific responses or further answers to give you in terms of what possible future policy responses might be considered at this point, but certainly, the department is obviously aware of the committee's report and is assessing that.

[Gord Johns, NDP, Courtenay—Alberni, BC]

We've heard this, though. We have been hearing this for two years now. This committee has heard that the government is reviewing and looking at it. In the meantime, fishers are getting squeezed.

We saw what's happening to a lot of fishers. Some of them are paying 90% of their catch to slipper skippers. That's just unacceptable. That money is leaving their hands. We have seven supertrawlers right now on the west coast catching about 100,000 pounds a day. These vessels are heading, gutting, freezing on board. They're in B.C. They're trying to get temporary foreign workers onto the boats. Basically, we're going to have foreign fishing fleets if we continue down this path. They're technically not called processors but they're basically doing a bunch of the processing and they're shipping to Asia for the rest of it. We're losing tens of millions of dollars.

What are you doing to stop that? What are you going to do to ensure that the people on board those boats are Canadians and that we're actually processing with Canadians on board?

[Adam Burns]

I will say, Chair, that this isn't an area that I have direct linkage in terms of the work that's being led from our policy and regional offices. Unfortunately, I don't have—

[Gord Johns, NDP, Courtenay—Alberni, BC]

Is the department raising concerns with Immigration in terms of the concerns around this?

[Adam Burns]

Unfortunately, I don't have specific responses. I came prepared on the offshore study. I do apologize for that.

[Gord Johns, NDP, Courtenay—Alberni, BC]

Okay. Well, we saw how Royal Greenland is circumnavigating the Investment Canada Act. They're buying up smaller companies and they're adding to it.

What is the department doing to communicate with the other departments about ensuring that the processing side...? We know there are lots of opportunities for those controlling agreements to impact those fishers out on the water. I understand you say it's provincial, but there is a federal role and there has to be some sort of communication between the departments.

[The Chair, Liberal, Ken McDonald]

Thank you, Mr. Johns. Your time has gone way over.

If there is an answer to that, I would ask the witnesses to submit it in writing over the next day or so.

We'll now go to Mr. Mazier for five minutes or less, please.

[Dan Mazier, Conservative, Dauphin—Swan River—Neepawa, MB]

Thank you, Chair, and thank you to the witnesses for coming out this afternoon.

Mr. Burns, we heard a lot of concern from the witnesses at the last committee meeting on foreign ownership of Canadian fisheries. What protection does the department offer to limit foreign takeovers of Canadian fisheries?

[Adam Burns]

For companies to whom offshore licences are issued, there is the 51% Canadian ownership requirement and the rules around notifying the department when there's a change in that corporate structure. If a company is not able to meet that Canadian ownership requirement, they would be ineligible to receive a licence. Licences are issued annually, so at the point of their “renewal”—I'll use my quotation marks; our lawyers don't like it when I talk about renewal—that is, the reissuance of the licence, that is a moment where that licence would not be reissued if the company were not to be 51% Canadian owned.

[Dan Mazier, Conservative, Dauphin—Swan River—Neepawa, MB]

Okay. Very good.

The Canadian Independent Fish Harvesters Federation told this committee, “Access to the fishery by these vertically integrated and foreign multinationals threatens our coastal communities whose livelihoods depend on the economic vibrancy of the fishery.” What safeguards are in place to ensure that Canadians and coastal communities are the beneficiaries of the Canadian fisheries?

[Adam Burns]

In terms of the offshore licensing regime, I would go back to that 51% Canadian ownership requirement that is a key piece there. Not to speak for the federation, but they may also have been speaking about inshore licenses. In that instance, we have the inshore regulations that ensure that fishing licences must be issued to individuals who maintain the rights and privileges of the control of that licence. With that we have residency requirements that would then require them to be a resident of Atlantic Canada or Quebec to be eligible to hold that licence.

[Dan Mazier, Conservative, Dauphin—Swan River—Neepawa, MB]

Does the DFO consider economic impacts on coastal communities in its regulatory approval of corporate offshore licences and quota transfer transactions?