Natural Resources Committee on June 2nd, 2023

[Charlie Angus, NDP, Timmins—James Bay, ON]

—and you gave him a thumbs-up.

I guess I'm having a hard time believing you, because we have evidence, including the emails, that Jackson Wijaya worked for Asia Pulp & Paper. We have the premier of Nova Scotia, who flew to Sinar Mas, and yet you come here and tell me, no, it's run out of the Netherlands by an individual.

I'm going to ask more about Asia Pulp & Paper and whether you did your job, because it is about the interest of the Canadian people. If Jackson Wijaya works for Asia Pulp & Paper, we're dealing with a company that has serious international allegations of environmental devastation. They lost their FSC certification. There have been international environmental campaigns against Sinar Mas; there have been defaults on loans, and now we have allegations of the theft of Canadian IP that was bootlegged for Chinese competitors.

Did you guys look at any of this in your security review? Will you confirm, yes or no?

[Mark Schaan]

I can simply confirm that a national security review of this transaction was conducted under the factors that are considered in our national security guidelines.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Okay, so you gave a thumbs-up. Did you look into Asia Pulp & Paper, or did you look into this guy, Jackson Wijaya?

[Mark Schaan]

I can simply confirm that a national security review of this transaction was conducted under the act.

[Charlie Angus, NDP, Timmins—James Bay, ON]

That's it. Okay.

We've been told by whistle-blowers out of Shanghai that assuming control of 22 million hectares of Canadian forest is a fibre grab for Sinar Mas-Asia Pulp & Paper.

Can you explain how our turning that over to a series of shell companies that may be Asia Pulp & Paper, where Mr. Jackson Wijaya may work and that may be Sinar Mas, and that the premier of Nova Scotia had to fly to meet, is a net benefit to Canadians, and how Canadian security economically, regionally and down to the community level is not being impacted?

Did you look into whether this is a fibre grab by China to take control of Canadian forests?

[Mark Schaan]

I would confirm that a review was conducted on this transaction, which involved the responsible government departments and agencies, including Canada's security and intelligence community, led by Public Safety Canada, the Department of Innovation, Science and Economic Development and the Department of Natural Resources, as part of the review process.

[Charlie Angus, NDP, Timmins—James Bay, ON]

You guys all—

[Mark Schaan]

Paper Excellence provided representations to Canada, including meaningful commitments to maintain Canadian representation on Resolute's board of directors and senior management team.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Yeah, yeah, yeah, but you will not tell us whether or not Jackson Wijaya...whether you even bothered to look into whether Jackson Wijaya works for Asia Pulp & Paper and has an office at Sinar Mas in Shanghai.

Will you say whether or not you actually looked into that? If you didn't, that's serious negligence and it's putting Canadian jobs and communities and our environment at risk. If you didn't do that, what do we tell Canadian people that they should trust?

[The Chair, Liberal, John Aldag]

I'd say we're out of time, but I'll give you the opportunity for a brief response, and then we're going to move into our next round.

[Mark Schaan]

Mr. Chair, I would just note that obviously national security reviews are extraordinarily important and we take them very seriously. Obviously national security considerations are extraordinarily sensitive, which is why I'm not in a position to be able to reveal the specific details of the national security considerations in this transaction.

[The Chair, Liberal, John Aldag]

We're now going to go to our second round. This round starts with five minutes.

Mr. Albas, you have the floor first.

[Michael Kram, Conservative, Regina—Wascana, SK]

Thank you, Mr. Chair. It's great to see a British Columbian in charge here.

Thank you to the witnesses for what you do for Canadians. I'd like to follow up on MP Angus's request. Is there a way you can bring forward any kinds of documents that would refute the documents that show that Nova Scotia believes there's a different ultimate controller of these companies?

[Mark Schaan]

I'm not in a position to provide documentation related to the ownership structure of the company, because it's subject to the confidentiality provisions of the act.

[Michael Kram, Conservative, Regina—Wascana, SK]

I'm not ultimately a member of this committee, so I'll let the regular members decide what to do in the face of that answer.

You used the term “meaningful commitments”. My only very bad experience with the ICA is with Anbang, the purchase of Retirement Concepts in British Columbia, which ultimately saw the purchase of that company. A number of provisions were promised by the government in the House of Commons, saying that Anbang would be held to high standards. Ultimately it was left to the Minister of Health in British Columbia to basically push that company to make sure seniors were getting basic services that were necessary under the law.

When you say “meaningful commitments”, can you tell me if those are actual, locked-in-stone commitments, or are they just commitments they've made to the government, and now the government is using that as a fig leaf? Maybe you could go into it a little so we know exactly what kinds of commitments have been made in order to have the ICA approve this deal.

[Mark Schaan]

The commitments made by the investor are part of their commitment in allowing the government to proceed with the investment.

It includes ensuring that no fewer than two-thirds of the members of Resolute Canada's board of directors are Canadian. It includes ensuring that no fewer than three-quarters of Resolute Canada's senior managers are Canadian. It includes continuing to produce craft pulp at Resolute Canada's facility in St. Félicien in Quebec and making annual maintenance expenditures at a level consistent with Resolute Canada's past practice. It includes giving full and due consideration to investing in the conversion of Resolute Canada's facility in Gatineau, subject to market conditions and the availability of skilled labour, fibre commitments and Quebec government support. It includes maintaining existing Canadian patents and patent applications owned by Resolute Canada. It includes adhering to Canadian employment and environmental laws, consistent with Resolute Canada's past practice. It includes learning from Resolute Canada's environmental values, including responsible environmental stewardship, sustainable forest management and implementing environmental management systems across Resolute Canada's facilities. Finally, it includes implementing leadership and human resource practices to create an inclusive workplace at Resolute Canada.

[Michael Kram, Conservative, Regina—Wascana, SK]

My question, then, is this. Are those meaningful commitments from the company to the government, or are they meaningful commitments for the government to ensure that the company follows through on?

[Mark Schaan]

I'm not sure I understand the distinction.

[Michael Kram, Conservative, Regina—Wascana, SK]

The distinction is that I can make a commitment to you to be here on time for work tomorrow, but if you're not here to pay attention to that and I don't show up.... That's the difference.

[Mark Schaan]

I think we've negotiated commitments from the investor that we believe ensure the continued role of the firm in Canada and its continued meaningful participation in the industry.

[Michael Kram, Conservative, Regina—Wascana, SK]

Whose job is it in your department to follow up to make sure these commitments are being done?

[Mark Schaan]

DeNeige, do you want to speak to that?

[DeNeige Dojack]

As part of my team we have a compliance and monitoring function, which includes receiving annual reports—depending on the nature of the commitments—to ensure that companies are compliant.

When we review annual reports, we make sure they're compliant, but we also consider alternative factors. For example, as a result of COVID-19, there were a number of facilities that had commitments around expanding facilities—HR commitments, personnel commitments—and they were not able to make them, so we allowed exemptions for that.

[Michael Kram, Conservative, Regina—Wascana, SK]

My time is short.

How many full-time equivalents are dedicated towards reviewing and ensuring compliance with these meaningful commitments?

[Mark Schaan]

We can come back to you on the number of full-time equivalents within the investment review division.