THE BLOG

The Kind of Responsibility Canada Needs

06/20/2013 12:14 EDT | Updated 08/20/2013 05:12 EDT
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Parliament Hill. Summer

Tuesday night the Conservatives ushered a number of fundamentally flawed pieces of legislation through the House of Commons--including Bill C-54, the Non-Criminally Responsible Reform Act -- as part of the unanimous consent motion to adjourn for the summer.

While I oppose much of what was passed, I am pleased about the adoption of Bill S-14, the Fighting Foreign Corruption Act, which brings Canada in line with OECD standards regarding the prohibition of individuals and corporations bribing foreign officials to obtain contracts and other business advantages.

S-14 makes several much-needed changes to the current legal regime addressing foreign bribes: the Corruption of Foreign Public Officials Act (CFPOA). First, it increases the maximum sentence for bribing a foreign public official from 5 to 14 years. Second, it eliminates a loophole that permits so-called "facilitation payments" made to foreign public officials to secure or expedite their performance of routine duties and obligations -- in effect, bribes in disguise.

Third, it makes it an offence for companies to misrepresent their records in an attempt to cover up bribery. Fourth, it concentrates the power to lay charges under the Act within the RCMP. And finally, it establishes national jurisdiction so that Canada can prosecute those who would commit offences under the CFPOA regardless of where in the world they might take place.

The debate on S-14 was timely, with Transparency International recently condemning western governments for "watering down [their] anti-corruption legislation." Thankfully Canada chose the opposite course, for bribery is not only unethical, but it degrades human rights and harms entire societies. As Transparency International stated: "A company does not pay a bribe in a vacuum. It is perpetuating a system that embeds the power of corrupt elites with devastating effects for economic development, effectively taxing the poor."

Although Canada is far from the worst offender globally in terms of our nationals engaging in bribery and corruption abroad, regrettably, we are not innocent either, as there have already been three convictions under the CFPOA. There are also currently 35 ongoing investigations under the Act, including two cases in which charges have been laid but not yet concluded.

One such case involves the Montreal-based engineering and construction firm SNC Lavalin. In 2012, the RCMP's International Anti-corruption Unit arrested and charged two former executives -- Ramesh Shah of Oakville and Mohammad Ismail of Mississauga -- for allegedly bribing Bangladeshi officials in order to secure a contract to supervise and consult on the construction of the Padma Multipurpose Bridge in Bangladesh.

Soon afterwards, the World Bank announced that it had canceled a $1.2 billion loan for the project; that it had referred the case to Canadian authorities for investigation; and that it had "credible evidence corroborated by a variety of sources [pointing] to a high-level corruption conspiracy among Bangladeshi government officials, SNC Lavalin executives, and private individuals."

Such allegations were echoed by the Globe and Mail and CBC, the latter reporting that the company has for years used a secret internal accounting code -- "PCC", or project consulting costs -- for bribes in association with projects across Africa and Asia. And just weeks ago, SNC Lavalin's offices in Algeria were raided by police seeking information about possible corruption involving a 2005 contract to build a power plant.

While the case involving SNC Lavalin remains outstanding -- and I do not wish to prejudge its outcome, which will be properly determined by a competent Canadian court -- it helps to illustrate that we are not dealing with this issue in some hypothetical realm. The reality is that Canadians and Canadian companies stand accused of engaging in bribery and corruption abroad and Bill S-14 will help us crack down on such abhorrent practices.

However, while I am pleased to see the government taking action in light of the aforementioned circumstances, I remain troubled by its apparent lack of consistency with respect to the broader matter of corporate accountability and social responsibility. In this respect I am referring to the government's support of S-14 but opposition to Bill C-474, a private member's bill championed by my colleague John McKay, which uses financial disclosures to encourage transparency within Canada's extractive sector.

If enacted, C-474 would help provide evidence for prosecutions under the CFPOA, which, of course, S-14 strengthens. This is an important connection that I believe should not be overlooked or dismissed by the Conservatives, yet they still oppose C-474 and have given no indication that they will even allow it to be reviewed and possibly amended at committee.

During recent debate on the bill, the Parliamentary Secretary to the Minister of Foreign Affairs Bob Dechert spent most of his allotted time describing steps already being taken by the government to promote transparency and accountability in the extractive sector, all of which -- the implication was -- made for better policy than C-474. Yet, of all the measures he mentioned -- while positive and welcomed steps at the international level, such as providing funding for the Extractive Industries Transparency Initiative (EITI) and for the African Minerals Development Centre -- none of them directly deter Canadian companies from engaging in unethical activity abroad as C-474 would do.

Mr. Dechert also alluded to having some constitutional concerns with respect to the bill, but did not explicitly state what they were. Because I firmly believe that we should only enact legislation that is in accordance with our Constitution -- which my new private member's bill, C-537, seeks to ensure -- I would have been interested to hear the Parliamentary Secretary elaborate on his legal analysis. And, while we are on the subject, I would have welcomed such concern for legislative compliance with the Constitution during debate on Conservative bills, notably C-10.

Finally, Mr. Dechert and other Conservatives have claimed that C-474 would overburden Canada's extractive companies, leaving them at a competitive disadvantage in the global economy. Even if this were true -- and even if it were a reason to, in effect, see no evil while some of our companies perpetuate corruption and human rights violations abroad -- many in Canada's extractive sector, including Pierre Gratton, President of the Mining Association of Canada, not only support corporate transparency procedures, but have called them good business. Meanwhile, some, including witnesses at the Senate Foreign Affairs Committee, have raised the very same concerns with respect to competitive disadvantage in relation to S-14 and its provision outlawing facilitation payments.

So I ask: How can the government champion one bill that promotes corporate accountability abroad while simultaneously opposing another, when both have the capacity to positively impact the way our companies conduct business? I cannot reconcile this disparity easily. Perhaps it lies with the simple fact that C-474 is not a Conservative bill.

Therefore, while I am delighted that S-14 will soon become law, I will continue to urge my honourable colleagues on both sides of the aisle to support Bill C-474 when Parliament resumes sitting in the fall.

Together, we have a responsibility to help counter corruption, curtail bribery, and combat the culture of impunity abroad, while ensuring corporate accountability at home.