Citizenship and Immigration Committee on Nov. 18th, 2024

[The Chair, Liberal, Sukh Dhaliwal]

I call this meeting to order. We are meeting in public.

Welcome to meeting number 115 of the House of Commons Standing Committee on Citizenship and Immigration.

Before we begin, I will ask all persons participating to read the guidelines written on the updated card on the table. These measures are in place to help prevent audio feedback incidents and to protect the health and safety of all participants, including the interpreters. You will also notice a QR code on the card, which links to a short awareness video. Please watch that.

Today's meeting is taking place in a hybrid format, but I see that all honourable members are present in person.

I would like to remind participants of the following points.

Please wait until I recognize you by name before speaking. All comments should be addressed through the chair. Whether participating in person or by Zoom, please raise your hand if you wish to speak. The clerk and I will manage the speaking order as best we can. I would also like to remind the honourable members, again, of the process we follow in this committee. If you feel a witness is going too long, I would like you to raise your hand instead of interrupting them. I will stop the watch so your time is not taken away from you. Thank you for your co-operation.

Now we are going to our study.

Pursuant to Standing Order 108(2) and the motion adopted by the committee on February 12, May 1 and June 12, 2024, the committee is resuming its study of pension transferability and access to the mandatory provident fund and delays in permanent residence and visas for Hong Kongers.

On behalf of the committee members, I would now like to welcome our witnesses for today's meeting.

I will start with Mr. James McNamee, director general, family and social immigration, Department of Citizenship and Immigration. From the tax legislation division, we have Ms. Stephanie Smith, senior director, tax treaties. From the financial sector policy branch, we have Mr. Jeffrey Smith, senior economist. Last but not least, we have Ms. Kathleen Wrye, director, pensions policy, financial crimes and security division.

Welcome to all of you. Up to five minutes will be given for opening remarks, after which we will proceed with the rounds of questions.

I am going to invite Mr. McNamee for five minutes.

Please go ahead.

[James McNamee, Director General, Family and Social Immigration Branch, Department of Citizenship and Immigration]

Thank you, Mr. Chair.

I would first like to acknowledge that I'm speaking today on the traditional and unceded lands of the Algonquin Anishinabe people.

I would also like to acknowledge that I'm joined by my colleagues from the Department of Finance.

Canada stands shoulder‑to‑shoulder with the people of Hong Kong. We continue to monitor the situation as they navigate the impact of article 23 of the new national security legislation. Immigration, Refugees and Citizenship Canada, or IRCC, has also implemented special measures to allow individuals from Hong Kong to come to Canada with pathways to permanent residence. The demand for these pathways remains high.

To help ensure that no one loses their status in Canada while waiting for a decision on their permanent residence application, a new public policy was launched on May 27, 2024. This policy will give most permanent residence pathways applicants an opportunity to obtain a new open work permit and to remain in Canada while they await a decision.

As I said in my previous appearance before this committee on June 5, 2024, IRCC is responsible for issuing Canadian permanent resident cards. These cards intend to prove permanent residence status. Some individuals from Hong Kong are also using them as proof that they have left Hong Kong permanently.

In March 2021, the Hong Kong government indicated that it would no longer recognize British national overseas, or BNO, passports as identification. It appears that, at that same time, individuals with a permanent resident card associated with their BNO passport were no longer able to access their pension funds.

IRCC remains committed to taking action, where possible, to help Hong Kong nationals settle in Canada.

Thank you again for the opportunity to join you today. I look forward to answering your questions.

[The Chair, Liberal, Sukh Dhaliwal]

Thank you very much.

We are going to Mr. McLean for six minutes.

Please go ahead.

[Greg McLean, Conservative, Calgary Centre, AB]

I'm sorry, Mr. Chair, but is there a separate introduction coming from the officials from finance, or are we hearing the same...?

[The Chair, Liberal, Sukh Dhaliwal]

It's just one.

[Greg McLean, Conservative, Calgary Centre, AB]

It's just one introduction. Okay. Thank you.

My questions are mostly for the finance officials who are here, so thank you very much.

Mr. Smith, you have been here before. Welcome, Ms. Wrye. Welcome, Ms. Smith.

The main questions we have are about your department's role—in finance—in regulating two Canadian entities, particularly Sun Life and Manulife, and how that regulation impacts them when they have foreign subsidiaries that are regulated by a separate entity. It's that overarching regulatory authority where you're looking after how they behave in Canada with respect to people in Canada who might be permanent residents.

Can you give us a little explanation of how you're overseeing the way you regulate these entities in Canada once they're dealing with people who are Canadians who've come here, in this case, from Hong Kong and can't access their Hong Kong pensions?

[The Chair, Liberal, Sukh Dhaliwal]

Go ahead, Mr. Smith.

[Jeffrey Smith, Senior Economist, Financial Sector Policy Branch, Department of Finance]

Thank you, Mr. Chair.

There's no precedent for this situation within the financial regulatory framework. I can say that unequivocally.

[Greg McLean, Conservative, Calgary Centre, AB]

There's no precedent.... This is the second time you and your colleagues have been before this committee, Mr. Smith. We're trying to see how you might be influencing decision-makers here, particularly the minister, on the way the government deals with the situation regarding people who've come from Hong Kong who are trying to get their pensions moved over to Canada.

Have you given any advice to any minister about how this should be dealt with?

[Jeffrey Smith]

Thank you.

No, we have not given any advice to the Minister of Finance on this issue. The operations—

[Greg McLean, Conservative, Calgary Centre, AB]

Excuse me. I said, “any minister”.

[The Chair, Liberal, Sukh Dhaliwal]

Honourable member, I said to please raise your hand because it's very hard on the interpreters.

I will stop the watch, and I will ask Mr. Smith to continue.

[Jeffrey Smith]

Pardon me for the lack of specificity. We have not given any recommendations to any minister on this issue.

[Greg McLean, Conservative, Calgary Centre, AB]

Your role here is overseeing the regulated entities, which are Canadian entities. Is that correct?

[Jeffrey Smith]

Canadian and foreign entities operating within Canada, yes.

[Greg McLean, Conservative, Calgary Centre, AB]

The issue we're trying to get to the bottom of here is how you regulate Canadian companies that have contradictory regulatory requirements in foreign jurisdictions through their subsidiaries.

Is there a way of getting through that morass and ensuring that those regulated Canadian entities fulfill the requirements to get Canadians—new Canadians, in this case—the funds they are due from their retirement funds?

[Jeffrey Smith]

The foreign operations of Canadian financial institutions are subject to the laws and regulations of the foreign jurisdictions in which they operate. We don't have any authority to compel Canadian financial institutions operating in a foreign jurisdiction to disobey the laws of that foreign jurisdiction.

[Greg McLean, Conservative, Calgary Centre, AB]

When those Canadian entities are trying to get funds for Canadians—no matter where those Canadians come from—from a fund that exists elsewhere that they have put money into, is that where your regulatory authority looks into their Canadian operations?

[Jeffrey Smith]

Our regulatory authority applies strictly to their Canadian operations.

[Greg McLean, Conservative, Calgary Centre, AB]

Yes, that's what I'm asking. They're Canadians who are in Canada, and those are Canadians being served by, in this case, a Canadian registered company. Are those Canadian registered companies subject to Canadian laws and regulations about how they deal with Canadians who have put money in pensions elsewhere?

Is there any protection for those Canadians for getting their repatriated pension earnings back to Canada?

[Jeffrey Smith]

In this instance, no. We regulate the domestic operations of those financial institutions that are operating within Canada.

As I previously noted, any Canadian financial institutions operating in a foreign jurisdiction must still comply with the laws and regulations of the foreign jurisdiction in which they operate.

[Greg McLean, Conservative, Calgary Centre, AB]

Can you let us know if there's any way you're involved in this situation at all?

[Jeffrey Smith]

Could you kindly elaborate on “involved”?

[The Chair, Liberal, Sukh Dhaliwal]

I'll stop the watch.

Please, go ahead, honourable member.

[Greg McLean, Conservative, Calgary Centre, AB]

By “involved”, I would mean that you're providing any input or policy advice to any part of government regarding how this situation should be dealt with or ameliorated.