Foreign Affairs Committee on Dec. 1st, 2009

[Grant Manuge]

She will be able to undertake fact-finding abroad, yes, but to undertake formal investigations, my understanding is that she cannot.

[The Chair, Conservative, Kevin Sorenson]

Thank you, Mr. Manuge.

We'll go to Mr. Abbott.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

Thank you.

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?

[Grant Manuge]

Yes, that is correct.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

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?

[Grant Manuge]

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.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

I respect the fact that you, as a civil servant, have to be precise and cautious. But I wonder if you could give this committee a ballpark guess as to the dollars and cents that would be required to establish this in the first place and to have it continue to function on an ongoing basis.

[Grant Manuge]

I think I would have to limit myself to saying that it would be a significant amount of resources we would be looking at, as we said in the previous statement.

[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.

[The Chair, Conservative, Kevin Sorenson]

Go ahead, Mr. Goldring, please.

[Peter Goldring, Conservative, Edmonton East, AB]

Thank you very much.

Thank you for appearing here today.

My question is along the same line, although it doesn't necessarily deal with the costing of it. I'm sensing from your comments here that it's in agreement with what we've been hearing from industry, what we've been hearing from EDC, and, quite frankly, what we heard from an earlier witness. The earlier witness from Argentina gave the implication that they were looking towards this bill to in effect codify, institute, responsibility to Canadian...Canadian concerns, to pick up the slack where Argentina's laws may not be complete, or to institute Canadian laws that are more complete. Quite frankly, what we then have is a scenario of interfering with another country's national aspirations and sovereignty, in effect, which would lead to the complications that poses.

I'm sensing from what you're saying in this dissertation that you also see that. That is one of the major reasons you can't quite quantify what this legal responsibility might be, ultimately. Is this one of the concerns?

You can extrapolate this to other parts of the world where mining interests might be. If we try to have our mining concerns involved in and adhering to the various laws and legal systems of the various countries around the world, you'd have to have an amazing amount of knowledge and capability in your legal department. We even go into some parts of the world where there are things like Sharia law. Should the mining concerns be adherent to Sharia law because that is the local custom in the local area of consideration?

Are these large complications? Can we kind of quantify this and say more coherently to what level this would take the legal requirements of the department?

[Grant Manuge]

We have with us today the director general for Latin America and the Caribbean. With respect to our relationships with countries in the hemisphere, perhaps I could invite him to comment on the implications the bill would have for our foreign policy relationships.

[Peter Goldring, Conservative, Edmonton East, AB]

We have to know clearly on here, because we're not talking in just small terms. I sense that we're talking about quite substantial concerns with respect to where our legal department requirements would be heading.

Also, there is the countering aspect to it of the companies themselves. Will they leave the industry from Canada to escape these huge requirements?

[The Chair, Conservative, Kevin Sorenson]

Thank you, Mr. Goldring.

Be very quick, Mr. Lambert.

[James Lambert, Director General, Latin America and Caribbean, Department of Foreign Affairs and International Trade]

Thank you very much.

I'm very happy to have the opportunity to respond to the question.

I currently oversee 26 Canadian embassies and high commissions in the Americas. Our economic footprint in the region is a lot about investment and exploitive industries as well, where the CSR issues are front and centre. The ability of the people in our missions to engage constructively has been set out by my colleagues.

I'd like to mention one concern that can be identified about this. It's in the latter part of the draft, which deals with the Special Economic Measures Act. It seems to me there's a very unclear linkage between the discourse on corporate social responsibility and the larger intent that's written in here, to change the act to in fact address entire regime offences against human rights violations.

First of all, procedurally there's a lack of clarity about how the issues involving a Canadian corporation on the ground in a given country would then be extended to deal with the broader issues about human rights abuse, past and present, as it's currently written in this draft.

Secondly, there's a question here about whether this is an appropriate mechanism indeed to get into the classification of regimes in this region or other parts of the world.

It does seem to open up a great window. When we talked about the number of resources that would be required, I think Mr. Manuge was addressing himself largely to carrying out the corporate social responsibility elements of this. If we extend this to take into account assessment of human rights regimes in the Americas or around the world, it becomes an enormous task.

[The Chair, Conservative, Kevin Sorenson]

Thank you very much.

Mr. Marston.

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

Thank you, Mr. Chair.

This is one of those topics that I'm sure many of us around the table have high emotion around--the value that Canadians put on human rights.

In thinking in terms of Mr. Ruggie, where he talked about having a duty to respect human rights, it seems that a bill like this comes forward when people start to make the assumption that perhaps Canadian corporations have been too flexible in some of the countries they've gone into. However, there's another side to this. If we are policing Canadian companies, to an extent we're also protecting them from the frivolous kinds of accusations that could be made.

I do agree with Mr. Rae—that happens on occasion—when he talks about ministerial responsibility and how, once a bill is passed, the regulations come into place, and it's up to the minister to get to that point.

I've had a number of people come through my office from the Philippines and other countries talking about Canadian corporations. The way I express it best is with what King Henry said about Thomas Becket: Will no one rid me of this troublesome monk? All of a sudden you get trade unionists being murdered.

I'm not suggesting Canadian companies are doing that with any deliberation, but even a casual conversation in some countries can lead to such things. I think that's the impetus behind a bill like this coming forward.

I understand from previous testimony—I just want to check the name of the group, because I'm not a regular on this committee—that the Rights and Democracy group talked about the human rights impact assessment tools that are available.

If we're talking tools and we're talking cost, as you were a few minutes ago, you have no suggested value, not even remotely close, that could be put on what it would cost?

[Sabine Nölke]

I'm with the legal bureau at foreign affairs. We did a fairly informal assessment of the possible cost. The only comparable mechanism that we could see was the Human Rights Commission. Of course, at this point, it would be truly guesswork, because you don't know how many complaints would come forward.

The way the bill is drafted is that literally billions of people could theoretically file a complaint, because any Canadian, or any person in a country where a Canadian company operates, could bring a complaint. The possibility for receiving complaints is virtually endless. At this point, even a frivolous complaint would have to be investigated in order to determine whether it's founded.

So it's very difficult to put a dollar figure on it, but it also needs to be taken into consideration that any investigation would have to necessarily take place abroad. In simply setting up a mechanism that requires Canadian officials to set up shop abroad for any period of time, the resource implications are quite considerable, even allowing for the difficulty necessarily in getting the permission of the host state so that they can enter to carry out such an investigation.

We don't have an exact figure because of all the uncertainties, but it would clearly be in the millions.

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

Mr. Goldring raised a point about the administration of local law. When you're a guest in any country, you're subject to the laws of that country in the first place. You're not going to suddenly have Sharia law pop up. If it's already part of the country, you have to abide by the laws of the host country when you're there. I think there's a bit of red herring in the middle of that one.

Again, a bill like this wouldn't have surfaced or started in the process unless there were some major concerns out there with the...of some Canadian companies. We know that a majority of our companies are very upstanding, and they do their work very well.

What process do you have in place to protect Canadian companies from one of these frivolous accusations?

[The Chair, Conservative, Kevin Sorenson]

Mr. Manuge.

[Grant Manuge]

I would like to clarify a response made earlier to Mr. Rae with regard to where the CSR counsellor is housed. Perhaps I responded to that too literally. Her staff will be staff of the Department of Foreign Affairs and International Trade. We will be developing a protocol with her as an order in council appointment to govern the relationship between the department and her office. I apologize if I was less than clear when I responded in the first instance.

I believe my colleague Ms. Nölke would wish to respond to this question.

[The Chair, Conservative, Kevin Sorenson]

Ms. Nölke.

[Sabine Nölke]

If there are any difficulties for individuals in a company, the immediate protective mechanism would of be through consular relations. There are also mechanisms available in international law to protect companies that have been adversely affected or targeted by the host country in matters that are inconsistent with international law. A company could file a claim against the state in question. They would first have to go through the necessary court proceedings in that state.

If these are ineffective or unavailable, the company could then turn to the Canadian government, with a view to having its claim against the host state espoused. If the claim meets the criteria that exist in international law for the espousal of a state, then Canada could take that claim as its own, raise it to the diplomatic level, and take it as far as the International Court of Justice.

This doesn't happen often, but those are the mechanisms that are available. In a lot of cases, an expropriation matter, for example, would get settled through diplomatic channels. It might include reparations or other forms of dispute settlement.

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

This bill has sanctioning mechanisms built into it. They would revoke taxpayer support for a company that's irresponsible, and that would free more resources for the responsible ones. Would you not see this as encouraging Canadian companies to be as responsible as they should be?

[Grant Manuge]

The type of work we do abroad in support of embassies and missions is related to key services that we deliver to Canadian companies. In addition, there is a whole range of generic support that we provide in relationship-building. We also advocate on behalf of Canadian interests, writ generally or linked to a particular industry or sector.

In respect of these activities, because they're not linked specifically to a Canadian company, we're unsure whether they would be affected by the provisions of this bill. This is one of the issues that we have highlighted in our written submission. The resources that we have available for our work abroad are focused primarily on advocacy and promotion. If we're pushed in the direction of implementing a more quasi-judicial role, our concern is that our staff abroad currently do not have the skills and competencies to undertake that type of role. Hence, the ability to train or recruit such people will be tremendously important in any reallocation of resources.