Government Relations Institute of Canada (GRIC) submission re: statutory review of the Lobbying Act

February 2, 2012 Mr. Chad Mariage Committee Clerk Standing Committee on Access to Information, Privacy and Ethics Sixth Floor, 131 Queen Street House of Commons Ottawa ON K1A 0A6 Via email: ETHI@parl.gc.ca Government Relations Institute of Canada (GRIC) submission re: statutory review of the Lobbying Act Executive Summary Lobbying public office holders is a right, not a privilege. The Lobbying Act and its supporting framework were created in an attempt to improve transparency of communications between lobbyists and government. However, numerous elements of the Act and framework have achieved the opposite effect, and have, in fact, muddied and confused the ground rules under which lobbyists operate, and under which public office holders relate to lobbyists. GRIC recommends that: i. The Commissioner of Lobbying s duty to educate public office holders in section 4.2 of the Act should be more comprehensive. GRIC is aware of several instances where the Commissioner of Lobbying has met with public office holders to brief them on the provisions of the Lobbying Act and supporting regulations. However it has become evident that a more comprehensive approach is required to ensure that all public office holders are fully aware of and respect both the spirit and letter of the Lobbying Act and its various provisions. ii. The definition of officer responsible for filing returns in section 7(6) should be revised. This section requires the most senior officer of a company or organization to personally oversee the initial registration and GRIC submission re: statutory review of the Lobbying Act Page 1

subsequent monthly reports. This leaves the impression on the public record that the most senior officer personally attends every reportable meeting with public office holders (when in fact, most such meetings are undertaken by less senior staff who then remain anonymous on the monthly report). GRIC recommends that the name of each lobbyist who actually attends a reportable meeting should appear on related monthly returns (with a possible set of limited exemptions where such disclosure would not be in the public interest). iii. The restrictions on lobbying set out in section 10.11(1) should be revised. Under this section of the Act, someone who was a Designated Public Office Holder (DPOH) is prohibited from working as a consultant or in-house lobbyist for a period of five years after leaving office. However, a former DPOH may immediately take up employment as an in-house corporate lobbyist, provided they believe that less than 20% of their work time is spent lobbying. GRIC recommends that this significant part of duties test that applies to in-house corporate lobbyists be removed from the Act, so that going forward, any prohibition period would apply equally to all lobbyists who are former DPOHs. iv. The definitions of oral and arranged communications set out in the Lobbyist Registration Regulations should be clarified. Different interpretations of what constitutes an arranged communication have been provided by the Office of the Commissioner of Lobbying of Canada (OCL) staff at different times to different stakeholders. OCL has not provided any formal guidance on how to define arranged communications where grey areas exist. For example, the latest advice GRIC received from OCL was to report all unplanned but arranged communications, a contradiction in terms. GRIC recommends OCL undertake a formal consultation process on what constitutes oral and arranged communications, with the objective of establishing a clear, workable set of definitions that can be clearly understood and reasonably enforced. v. The standard for determining whether a lobbyist has placed a public office holder in a conflict of interest should be the same as the standard for determining whether a public office holder was placed in a conflict of interest by a lobbyist. OCL s approach to testing for conflict of interest is fundamentally out of synch with the approach employed by the Conflict of Interest and Ethics Commissioner. This creates situations where lobbyists have been found guilty of placing public office holders in a conflict of interest that the public office holder was never in. GRIC recommends that the definition of conflict of interest be the same in the Lobbying Act and the Conflict of Interest Act. GRIC submission re: statutory review of the Lobbying Act Page 2

vi. Rule 8 of the Lobbyists Code of Conduct should be harmonized with language from other legislation governing political activities and conflict of interest. The Canadian Bar Association has found that OCL s handling of Rule 8 of the Lobbyists Code of Conduct to be inconsistent with the Charter of Rights and Freedoms. This is an untenable situation, exacerbated by OCL s cynical assertion that Members of Parliament choose to run for office primarily to advance their personal interests. GRIC recommends that the Code be revised to reflect the language governing (i) conflict of interest and (ii) permitted and prohibited political activities in the Public Service Employment Act and the Conflict of Interest Act. The Commissioner of Lobbying should also be specifically empowered to render advance rulings, in a timely fashion, on questions of possible conflicts of interest arising from lobbyists political activities. Introduction 1. The Government Relations Institute of Canada (GRIC) is pleased to file these comments with respect to the above noted review of the Lobbying Act. 2. GRIC was founded in 1994 by government relations professionals in response to the growth and maturing of the industry over the past several decades. GRIC fosters high standards of practice through professional development and adherence to a code of business conduct. GRIC also speaks on behalf of Canada s government relations community on matters pertaining to the relationship between the lobbying industry and the Government of Canada. GRIC s membership includes consultant and in-house lobbyists from non-governmental organizations (NGOs), national trade associations, crown corporations and private companies (both domestic and multinational), extending across the breadth and depth of the Canadian economy. 3. GRIC notes that the Lobbying Act and its supporting framework were created in an attempt to improve transparency of communications between lobbyists and government. While GRIC continues to support that overriding objective, it respectfully submits that numerous elements of the Act and framework have managed to achieve the opposite effect and have, in fact, muddied and confused the ground rules under which lobbyists operate, and under which public office holders relate to lobbyists. 4. As outlined in this submission, GRIC submits that in some cases the root of the problem lies within the language of the Act and/or in the supporting regulations. In other cases, the problem lies in how the Act and/or regulations have been interpreted and applied by the Office of the Commissioner of Lobbying (OCL). At best, OCL s application of certain sections of the framework has created uncertainty and unpredictability for lobbyists and public office holders. At worst, OCL s application of certain sections of the framework has GRIC submission re: statutory review of the Lobbying Act Page 3

been characterized as inconsistent with the Charter of Rights and Freedoms by wellrespected legal commentators such as the Canadian Bar Association. Lobbying public office holders is a legitimate activity WHEREAS free and open access to government is an important matter of public interest; AND WHEREAS lobbying public office holders is a legitimate activity; AND WHEREAS it is desirable that public office holders and the public be able to know who is engaged in lobbying activities; AND WHEREAS a system for the registration of paid lobbyists should not impede free and open access to government; Preamble to the Lobbying Act 5. At the heart of the Lobbying Act is a recognition that petitioning government is not a privilege, it is a right. That right extends back through the history of constitutional democracy, finding its roots in the right of nobles to seek redress from the Crown in the Magna Carta, to the right of subjects to petition the Monarch in the Bill of Rights 1689, to the First Amendment to the Constitution of the United States, protecting the right of individuals, groups and corporations to petition government. 6. Parliamentarians, government officials, business executives, and charitable organizations each have their own distinct way of talking about public policy issues and managing them. Professional lobbyists understand these differences, including the nuances, and therefore add value to the policy process by translating them across stakeholder lines. 7. Professional lobbyists assist those unfamiliar with government in navigating the everchanging landscape of government rules and regulations. They are hired by business and charitable groups to develop and advocate specific recommendations on legislation, regulations and fiscal decisions facing government. They are frequently approached directly by government for help on complex files and to provide feedback about sector needs and perspectives. 8. The Office of the Registrar of Lobbyists in British Columbia captures this relationship succinctly on its website: To many people, the term lobbying has become something of a dirty word. There is a common and inaccurate perception that lobbying is unethical and damaging to healthy government. The truth is, lobbying is a fundamental part of the political decision making process. Politicians and public servants cannot be expected to know and understand all of the angles of any issue. Lobbyists bring valuable information and expertise to the GRIC submission re: statutory review of the Lobbying Act Page 4

decision-making process. Public agencies often seek outside advice and opinion in the form of public consultations, legislative committees and other public forums. The difference with lobbyists is that they provide input on issues of interest to their client or employer, for payment. i 9. Since the Lobbying Act succeeded the Lobbyist Registration Act in 2008, the vast majority of communications between lobbyists and public office holders have taken place in full compliance with the letter and spirit of the Act. The vast majority of lobbyists have governed, and will continue to govern, themselves in accordance with the standards and rules of the day, whatever they may be. 10. That said, GRIC respectfully submits that certain areas of the Act and regulations could be improved by focusing on greater transparency and predictability for all stakeholders. GRIC further submits that other areas of the Act and regulations require a more comprehensive overhaul, to ensure that the rules and regulations apply equally to everyone, and to ensure that the Act and its supporting framework respect the Charter of Rights and Freedoms. The Commissioner s duty to educate public office holders in section 4.2 of the Act should be more comprehensive 11. Section 4.2 of the Act states that one of the Commissioner s duties is to educate public office holders with regards to the Lobbying Act and its supporting framework. While GRIC is aware that OCL has made a number of presentations to a number of public office holders in this regard, there remains a high level of inconsistency across Government with respect to public officer holders working knowledge of the Act and its provisions. GRIC recommends that the Commissioner s role in educating public office holders take on more prominence, and that the Commissioner have the additional statutory authority to respond to instances where public office holders do not respect the spirit or letter of the Act. 12. For example, GRIC understands that OCL briefed key officials within Public Works and Government Services Canada (PWGSC) at least four times between 2009 and 2011. Nevertheless, in a recent process to award shipbuilding contracts, PWGSC asked involved companies to voluntarily refrain from using lobbyists. Once the successful companies had been announced, drafts of the umbrella agreement between shipyards and the Government of Canada relating to these contracts included an article (8.4) that reads: The company agrees that it will not use any lobbyists to pursue any matter that arises under or in relation to this Agreement without Canada s prior consent. PWSGC s approach to lobbyists in this regard raises several concerns. 13. First, it clearly implies that, at least in some quarters of government, there remains a view that lobbying government is a privilege, not a right. GRIC submits that, at least in this one instance, the Commissioner s efforts to educate PWGSC on the letter of the Act did not prevent that department from making a request that was clearly offside with the spirit of the Act. If PWGSC had, for example, decided that the bidding process would take place in GRIC submission re: statutory review of the Lobbying Act Page 5

English only, one assumes that the Commissioner of Official Languages would have requested an explanation and publicly recommended corrective action, as that decision would have been offside with the Official Languages Act. However, faced with a clear departure by PWGSC from the spirit of the Lobbying Act, GRIC is not aware that the Commissioner of Lobbying publicly addressed the situation in any manner. 14. Second, PWGSC s approach to lobbyists displays an apparent lack of awareness with respect to key definitions and designations under the Act. PWGSC was not precise as to whether shipyards in-house government relations staff could work on proposed bids. Nor was it aware, apparently, that under the Act, the most senior officer of any corporation that lobbies Government is in fact the most senior lobbyist for that corporation. In follows that by issuing an imprecise edict against lobbyists in pre- and post-bidding processes, PWGSC in effect sought to prevent CEOs of Canadian shipyards from participating in their own company s bidding and building processes, in perpetuity. 15. GRIC does not take issue with the results of that process, which are, by all accounts, rational and reasonable. GRIC does take issue with the PWGSC s efforts to limit interactions between the Government and lobbyists without regard to the spirit of the Act which holds that lobbying public office holders is a right, not a privilege, and without regard to the actual definitions and designations of who constitutes a lobbyist under the Act. 16. GRIC therefore recommends that OCL should have an explicit mandate to ensure that public office holders are not only familiar with the day-to-day rules and regulations that govern communication between lobbyists and the Government, but that they are also aware of their own duties with respect to spirit of the Act that holds lobbying public office holders to be a legitimate activity. GRIC further recommends that if similar situations arise in the future, the Commissioner of Lobbying should ensure that Government processes respect both the letter and spirit of the Act (similar to the manner in which other officers of Parliament ensure that Government processes are consistent with whatever legislation they have been charged with administering). The definition of officer responsible for filing returns in section 7(6) should be revised 17. Section 7 (6) of the Act states that the officer responsible for filing returns means the employee who holds the most senior paid position in a corporation or organization. This generally refers to the President and CEO, or Executive Director, of any corporation or organization. 18. In theory, this means that the President and CEO of a corporation or organization bears legal responsibility, and exercises personal oversight over, the operations of that company or organization s initial registration and monthly reports. In practice, this means that the impression left on the public record is that the President and CEO personally attends every reportable meeting, when in fact many senior officers rarely, if ever, attend reportable meetings with DPOHs. In the majority of cases where lobbyists, other than the President GRIC submission re: statutory review of the Lobbying Act Page 6

and CEO, undertake communications with public office holders, the names of those lobbyists never appear on the public record. This has led to cases where Presidents and CEOs have been reported in the media as having met with senior government officials, at a time when they were actually out of the country, or after they had died. This hardly lends itself to increased transparency. 19. For these reasons, GRIC submits that the most senior officer of any company or organization should retain ultimate legal responsibility for their registration, but that the monthly reporting template should be amended to allow for the name of each registered lobbyist who actually attends a reportable meeting to appear on the report of the meeting in question. 20. At the same time, GRIC notes that there could be instances where the short-term publication of the identity of meeting participants was not in the public interest. For example, a meeting between two merger-and-acquisition executives and the Commissioner of Competition could lead to unsupported market speculation and/or incorrect conclusions about impending corporate transactions speculation that could, in turn, effect the valuation of those companies in an irrational fashion. Therefore GRIC further recommends that OCL establish a consultation process to determine whether there should be a limited set of exemptions to the requirement to list all lobbyists who attend a meeting, and if so, what those exemptions should be. The restrictions on lobbying set out in section 10.11(1) should be revised 21. Section 10.11(1) of the Act states that No individual shall (register as a lobbyist) during a period of five years after the day which the individual ceases to be a public office holder. Section 10.11(1.c) qualifies this prohibition as it applies to corporate lobbyists, stating that the five year ban only applies if carrying on (lobbying) activities would constitute a significant part of the individual s work on (the corporation s) behalf. OCL s website paraphrases 10.11(1.c) as a significant part of their duties, which Implementation Notice #3 further defines as 20% or more of the individual s working time. OCL staff have frequently used the example of one day per week to illustrate how that 20% might be calculated. 22. In other words, the five-year ban applies without exception to consultant and organization lobbyists, but only applies to in-house corporate lobbyists if they self-determine that they lobby more than 20% of their time. 23. GRIC recommends that section 10.11(1)(c) of the Act be amended to remove the significant part of duties test as it applies to the application of the five-year ban to in-house corporate lobbyists. This would have the effect of applying the five-year ban equally to all three types of lobbyist, effectively closing what is allegedly been treated by some as a loophole rather than a guideline. This amendment should, however, not be made retroactive to former DPOHs who have accepted employment under the current rules. GRIC submission re: statutory review of the Lobbying Act Page 7

24. GRIC notes that changing the Act in this way would only affect the application of the five year ban to former DPOHs who take on roles as in-house corporate lobbyists. It would not affect private citizens, community groups, and small business owners who have occasional cause to contact their Member of Parliament or other DPOHs. 25. GRIC further recommends that in reviewing this section of the Lobbying Act, the Committee should be examine the length of similar cooling-off periods, applied by professional organizations, provincial governments, and other federal statutes. GRIC takes no formal position on the length of the five-year ban, and will continue to encourage its members to follow the rules of the day, whatever they may be. 26. However, GRIC respectfully notes that at five years, the length of the ban set out in the Lobbying Act is incongruous with other well-established norms, including the Government s own Conflict of Interest and Post-Employment Code for the Public Service (the effect being that the same former public office holder can be deemed by one officer of Parliament, under one Act, to be eligible to lobby government one year after leaving office, and by another officer of Parliament, under another Act, to be eligible to lobby government five years after leaving office). 27. This four-year disparity in post-employment conditions for the same individual is inherently problematic for obvious reasons. Decisions by separate officers of Parliament should be consistent, and should not encourage regulatory comparison shopping by those looking for the most favourable decision for their particular circumstances. The rules should apply, transparently and equally to everyone. To this end GRIC encourages the Committee to review whether the current five-year cooling off period has been effective in meeting the objectives set out in the Lobbying Act. The definitions of oral and arranged communications set out in the Lobbyist Registration Regulations should be clarified 28. The Lobbyist Registration Regulations define the types of communications that must be included in a monthly report as oral and arranged communications excluding oral and arranged communications initiated by public office holders related to the development of a policy, program or legislation. 29. OCL s Implementation Notice #5: Communication with a Designated Public office Holder states that communication in the context of the Act, involves verbal (e.g. arranged meetings, phone calls, informal communication, and grass-roots communications) or written (hard copy or electronic format) contact with a public office holder. It provides several examples of different types of communication between lobbyists and public office holders, noting whether a monthly report would be required in each case. GRIC submission re: statutory review of the Lobbying Act Page 8

30. GRIC submits that while the difference between oral and written communication is straightforward, nowhere in the framework is there a formal explanation of the difference between arranged and unarranged communication. The best guidance we have received to date remains deeply confusing and problematic for most stakeholders, and is, at the end of the day, all but unenforceable by OCL. 31. For example, in 2008 GRIC was advised by OCL that a lobbyist who briefly discusses a file with a DPOH at a conference or in an airport would not be required to report that communication, if the conversation was not arranged in advance. However in the November 8, 2010 issue of Hill Times ii, the Commissioner of Lobbying was reported to have told a parliamentary caucus that if a DPOH is approached at a social function by a lobbyist who asks if they can have a second to discuss an issue that constitutes an arranged communication. 32. In email follow up with OCL, GRIC was advised that the test of whether a communication is arranged is whether there was (i) a request made, (ii) an acceptance, and (iii) a time interval between the request and the meeting. In light of the Commissioner s social function example, it was further noted that the time interval did not have be long (one second, apparently). 33. GRIC respectfully submits that this formula was not what was intended when attempts were made in the regulations to distinguish between arranged business meetings and chance encounters. Rather, it seems to turn on whether a lobbyist politely asks a DPOH if they can talk business for a second, or simply blurts out their communication to an unsuspecting DPOH. 34. Further confusing the issue is the last written advice GRIC received from OCL on this matter. In February 2011, GRIC was advised that its members should report all unplanned but arranged communications. GRIC respectfully notes that unplanned and arranged are contradictory concepts, and submits that this hardly constitutes clear guidance from OCL. 35. The confusion over what constitutes arranged communication has been exacerbated by the recent expansion of the DPOH designation to include all Members of Parliament and Senators public figures who informally encounter literally dozens, if not hundreds, of people who want to communicate with the Government, in one form or another, every month. 36. GRIC notes that the limited guidance offered by Implementation Notice #5 has not been updated since the Act came into effect, and in particular, not since MPs and Senators were designated as DPOHs in 2010. The test for whether a communication is arranged has apparently shifted within OCL since the Implementation Notice was issued, in the absence of any formal consultations, or any formal notice to stakeholders. GRIC submission re: statutory review of the Lobbying Act Page 9

37. GRIC notes that in both its 2011 appearances before the Access to Information, Privacy and Ethics Committee (March 22 and December 13), OCL recommended that this problem could be solved by dropping the word arranged from the Lobbying Act, requiring any and all communication with DPOHs to be reported, whether the conversation was planned or not, and whether the conversation was initiated by the DPOH or not. 38. Specifically, the Commissioner stated on December 13, 2011: I also recommend that all oral communications regardless of who initiated them and whether or not they were planned should be reported. 39. GRIC strongly objects to this proposal, which would expand an already onerous process for lobbyists and public office holders to absurd levels of micro-regulation. Consider the consequences of this proposal under the following scenarios: i. MPs would be required to keep records of every conversation they have, with everyone they encounter, anywhere, at any time, on the possibility that the conversation might be included in a lobbyist s monthly report and subsequently verified by OCL. ii. Alternatively, MPs would be required to ask everyone they meet if they are a registered lobbyist (whether in Ottawa, travelling, or campaigning in their ridings), so that they would know whether to make a record of the communication for future verification by OCL. iii. An MP who called a constituent business owner to seek that person s opinion on a piece of legislation would trigger a requirement for that constituent to report the call from the MP. iv. DPOHs and lobbyists who happened to be spouses, or life-long friends, or neighbours, or family members, would either have to report any work-related conversation that happens at any time, or be off-side with the reporting requirements. 40. GRIC strongly submits that the current problem around oral and arranged communications stems from a lack of clarity around what the word arranged means in the context of reportable communications. OCL s throw the baby out with the bathwater proposal would not be consistent with the original intent of the Act, which is to distinguish between business meetings and chance encounters. 41. Moreover, OCL s proposal would clearly result in an exponential increase in regulatory overhead for both government and business. In this regard, this recommendation departs dramatically from the recent recommendations of the Red Tape Reduction Commission since it seeks to solve a definitional problem in the regulations not by providing additional clarity, but by creating an additional regulatory burden for public office holders, the regulator, and business. GRIC submission re: statutory review of the Lobbying Act Page 10

42. Instead, GRIC recommends that OCL, through the Governor in Council, undertake a public consultation process on what should formally constitute arranged communications going forward. The objective of this process should be to establish a workable set of definitions that can be clearly understood and reasonably enforced. The standard for determining whether a lobbyist has placed a public office holder in a conflict of interest should be the same as the standard for determining whether a public office holder was placed in a conflict of interest by a lobbyist. 43. GRIC notes that for public office holders, the Conflict of Interest Act sets the criteria and meaning for a real conflict of interest only. The Lobbyists Code of Conduct, on the other hand, targets both real and apparent conflicts creating a situation where the ethical bar is higher for lobbyists than for public office holders, and a situation where lobbyists can be guilty of placing a politician in a conflict of interest that they were never in. 44. In February 2011, the Commissioner of Lobbying tabled two reports in Parliament finding that, in both cases, a lobbyist had breached Rule 8 of the Code, and had therefore placed a public office holder in a conflict of interest. iii These rulings pertain to actions that took place in 2004, five years before the current rules were put in place. The retroactive application of 2009 rules to 2004 events was never addressed or explained by OCL. 45. Moreover, in at least one of the cases, the Conflict of Interest and Ethics Commissioner had already concluded, based on the same set of facts, that the actions in question did not constitute a conflict of interest on the part of the public office holder. And, in at least one the cases, the RCMP had determined that there was no cause to investigate the same set of facts under the Lobbyist Registration Act (the precursor to the Lobbying Act). 46. GRIC respectfully submits that the current situation around the regulation of lobbyists political activities is untenable. One officer of Parliament examined the facts and concluded that a public office holder was not in a conflict of interest. Another officer of Parliament examined the same set of facts, and concluded that lobbyists had placed the public officer in a conflict of interest (that the public office holder was, apparently, never in). 47. Logic, due process and the fundamental tenets of natural justice dictate that once a public office holder is found by the RCMP and/or a quasi-judicial body not to have been in a conflict of interest, no individual can then reasonably be found by another quasi-judicial body to have to have placed that public office holder in a conflict of interest, based on the same set of facts. Due process and natural justice would also strongly argue against the unfair and retroactive application of a 2009 legal interpretation to activities that took place in 2004. 48. For these reasons, GRIC recommends that Commissioner of Lobbying s standard for determining whether a lobbyist has placed a public office holder in a conflict of interest be consistent with Conflict of Interest and Ethics Commissioner s standard for determining whether a public office holder has been placed in a conflict of interest by a lobbyist. In both GRIC submission re: statutory review of the Lobbying Act Page 11

cases, the test should be for a real conflict of interest arising from a lobbyist s actions pertaining to a public office holder. 49. GRIC further recommends that, as elaborated below, OCL should adhere to basic legal concepts and fundamental tenets of natural justice when rendering decisions that could result in serious legal consequences for the individuals involved. Rule 8 of the Lobbyists Code of Conduct should be harmonized with language from other legislation governing political activities and conflict of interest. 50. GRIC submits that OCL s current approach to addressing conflict of interest situations arising from political activities does not reflect long standing constitutional rights or legal procedures. 51. Section 10.2 of the Act requires the Commissioner to develop a Lobbyists Code of Conduct respecting the activities described in subsections 5(1) and 7(1). Most of the current Code of Conduct covers how lobbyists interact with their clients. However, Rule 8 of the current Code states that Lobbyists shall not place any public office holders in a conflict of interest by proposing or undertaking any action that would constitute an improper influence on a public office holder. In this sense, the Code mingles two distinct concepts: day-to-day professional ethics, and conflict of interest arising from political activities. 52. In 2009 the Federal Court of Appeal set aside the then-registrar of Lobbyists original interpretation of how this rule applied to lobbyists. iv In response, the current Commissioner of Lobbying issued The Commissioner s Guidance on Conflict of Interest stating that lobbyists may be in breach of Rule 8 if they create a competing obligation or private interest which could arise from such factors as (among other things), political activities, which were left undefined. 53. In June 2010, the Canadian Bar Association (CBA) issued its Opinion Respecting the Constitutionality of Rule 8 of the Lobbyists Code of Conduct. In its opinion, CBA expresses its fundamental concern with the Guidance, and in particular, questions whether the Guidance on Rule 8 is consistent with the Charter of Rights and Freedoms. 54. Ultimately CBA finds that the Commissioner s treatment of political activities under Rule 8 of the Lobbyists Code of Conduct to be a violation of lobbyists freedom of expression under s2(b) of the Charter and... not reasonably justified in a free and democratic society under s. 1 (of the Charter). 55. In August 2010, OCL issued Clarifications about political activities in the context of Rule 8. This document provided general examples of activities that would not, could be, and would likely be breaches of Rule 8. The examples provided are not exhaustive, and turn on whether a lobbyists political activities advance the private interest of a public office holder. GRIC submission re: statutory review of the Lobbying Act Page 12

56. In March 2011, the Commissioner of Lobbying issued a reminder concerning the participation of lobbyists in political activities which includes the statement that Working on a political campaign to support the election of a public office holder is, in my opinion, advancing the private interest of that public office holder. In other words, OCL is of the view that Members of Parliament run for office chiefly to further their private interests a remarkably cynical view of the decision to run for public office. 57. In light of the serious constitutional, governance, and due process problems inherent in the Commissioner s current application of Rule 8, GRIC recommends the following : 58. First, the Commissioner s Guidance on Conflict of Interest should be withdrawn, and the Lobbyists Code of Conduct should be revised to reflect the language currently found in the Public Service Employment Act, and in the Conflict of Interest Act. i. Part 7 section 112 of the Public Service Employment Act recognizes the right of public servants to engage in political activities while maintaining the principle of political impartiality in the public service. The Act defines Political activity as: (a) carrying on any activity in support of, within or in opposition to a political party; (b) carrying on any activity in support of or in opposition to a candidate before or during an election period; or (c) seeking nomination as or being a candidate in an election before or during the election period. ii. Section 15 of the Conflict of Interest Act deals with prohibited political activities of public office holders. Section 15(4) states that: Nothing in this section prohibits or restricts the political activities of a reporting public office holder. Section 16 specifically deals with fundraising and goes on to state that: No public office holder shall personally solicit funds from any person or organization if it would place the public office holder in a conflict of interest. 59. GRIC respectfully submits that by harmonizing Rule 8 of the Lobbyists Code of Conduct with existing legislation governing political activities by public office holders v, the Government could ensure that lobbyists charter rights are not unreasonably trenched by Rule 8 of the Lobbyists Code of Conduct, while at the same time ensuring that lobbyists are held to the same high ethical standards as public office holders when it comes to questions of political activity and conflict of interest. 60. Additionally, GRIC submits the Commissioner of Lobbying should be specifically empowered to render advance rulings on questions of possible conflicts of interest arising from lobbyists political activities, within a 24 to 48 hour timeframe (similar to the window in which most professional ethics bodies render decisions). This measure would significantly reduce the unacceptable level of guesswork on the part of lobbyists who must determine GRIC submission re: statutory review of the Lobbying Act Page 13

in the absence of any meaningful guidance from OCL whether their political activities may be found, years later, to be offside with Rule 8. Conclusion 61. In conclusion, GRIC reiterates that lobbying the government is not a privilege; it is a longstanding right that stretches back through the history of constitutional government. The vast majority of lobbyists take that right very seriously, and govern themselves in accordance with the standards and rules set out by government, and will continue to do so. 62. At the same time, GRIC submits that there are specific elements of the current framework that are not working as well as they could, for either lobbyists or public office holders. To that end, GRIC recommends that: i. The Commissioner s duty to educate public office holders in section 4.2 of the Act should be more comprehensive. ii. The definition of officer responsible for filing returns in section 7(6) should be revised. iii. The restrictions on lobbying set out in section 10.11(1) should be revised. iv. The definitions of oral and arranged communications set out in the Lobbyist Registration Regulations should be the subject of a separate public consultation process to establish definitions that can be clearly understood and reasonably enforced. v. The standard for determining whether a lobbyist has placed a public office holder in a conflict of interest should be the same as the standard for determining whether a public office holder was placed in a conflict of interest by a lobbyist. vi. Rule 8 of the Lobbyists Code of Conduct should be harmonized with language from other legislation governing political activities and conflict of interest, and the Commissioner of Lobbying should be specifically empowered to issue meaningful guidance by way of advance rulings. 63. Finally, GRIC notes that while the Commissioner and staff at OCL have historically been approachable and willing to address concerns from within the lobbying community as they arise, a more formal OCL/GRIC consultation body that met in person, once or twice a year, to discuss trends and issues around the business and regulation of lobbying (with a record of discussion to be made public afterwards) would benefit all stakeholders in the system. GRIC would be pleased to work with OCL to establish a regular discussion framework along these lines. 64. GRIC appreciates the opportunity to share its views in this important proceeding. ***End of Document*** GRIC submission re: statutory review of the Lobbying Act Page 14

Appendix 1: GRIC response to OCL recommendations (As tabled in Opening Remarks by Karen E. Shepherd Commissioner of Lobbying of Canada, March 23, 2011 http://www.ocl-cal.gc.ca/eic/site/lobbyistlobbyiste1.nsf/eng/nx00566.html) 1. That is why I am recommending that the "significant part of duties" provisions be removed from the Act. In doing so, I would also recommend that Parliament give consideration as to whom the legislation should capture and that a limited set of exemptions might be necessary. I would be pleased to explore this issue with Parliament during its deliberations. GRIC recommends that section 10.11(1)(c) of the Act be amended to remove the significant part of duties test (i.e. the 20% rule ) as it applies to the application of the five-year ban on in-house corporate lobbyists. GRIC further recommends that, in fairness to former DPOHs who have accepted employment under the terms of the current rules, and to their employers, this change should not be made retroactive. 2. I believe that it would be more transparent if the names of those actually engaging in lobbying activities at meetings with designated public office holders were also listed in the monthly communication report. GRIC submits that the most senior officer of any company or organization should retain ultimate legal responsibility for their registration, but that the monthly reporting template be amended to allow for the name of each registered lobbyist who actually attends a reportable meeting to appear on the report of the meeting in question. GRIC notes that a limited set of exemptions or extensions may be warranted, where short-term publication of the attendees of a reportable meeting is not in the public interest. 3. I also recommend that all "oral" communications, regardless of who initiated them and whether or not they were planned should be reported. GRIC strongly objects to this proposal, which would expand an already onerous process for lobbyists and public office holders to absurd levels of microregulation. MPs and other DPOHs would be required to ask everyone they encounter, anywhere, at any time, if they are a registered lobbyist. If so, the MP or other DPOH would be required to maintain a record of that conversation to be able to verify its contents and subject matter when, and if, the lobbyist s report of that conversation was verified by OCL. Rather than supporting OCL s throw the baby out with the-bathwater approach, GRIC recommends that OCL, through the Governor in Council, initiate a public GRIC submission re: statutory review of the Lobbying Act Page 15

consultation process to establish a clear, workable and enforceable definition around what constitutes arranged communications. 4. The Act provides me with a mandate to develop and implement educational programs to foster public awareness of the Act. I believe that communicating the rationale and requirements of the Act and the Lobbyists' Code of Conduct leads to greater compliance. It is for this reason that I recommend that this explicit mandate remain in the legislation. GRIC supports this recommendation, and submits that the Commissioner s duty to communicate the rationale and requirements of the Act be explicitly extended to Government personnel and departments who do not respect the spirit or letter of the Act (similar to the function of all other Officers of Parliament who encounter Government decisions that are inconsistent with the legislation they have been charged with overseeing and administering). 5. I am recommending an administrative monetary penalty mechanism be adopted. GRIC strongly objects to this proposal. OCL has demonstrated an unwillingness to respect basic principles of due process and natural law in several of its decisions: o o o o o Lobbyists have been found guilty of breaching rules that came into effect four years after the alleged infractions actually occurred. Investigations are conducted in secret, without the subject of the investigation being made aware of the nature of the allegations against them. Investigations have taken up to ten years to complete. Lobbyists under investigation by OCL have been denied the right to have counsel make oral submissions on behalf of their clients. Certain interpretations and findings by OCL have been described by the Canadian Bar Association as inconsistent of the Charter of Rights and Freedoms. By making this recommendation, the Commissioner is, in effect, asking Parliament to make OCL the registrar, regulator, investigator, prosecutor, judge and jury. Before GRIC could support any request from OCL for additional quasijudicial powers, we would expect to see a greater commitment by OCL to fundamental principles of due process and natural justice. GRIC further notes that other officers of Parliament, such as the Commissioner of Competition, do not levy Administrative Monetary Penalties directly. If the Commissioner of Competition finds that an individual or company has abused its dominant position in the marketplace, a recommendation is made to the GRIC submission re: statutory review of the Lobbying Act Page 16

Competition Tribunal that a monetary penalty be levied. Individuals and companies can then make representations to that neutral body on the Commissioner s recommended penalty. Given OCL s track record with respect to due process and fundamental principles of natural justice, GRIC strongly submits that any additional powers to levy Administrative Monetary Penalties through OCL be backstopped by a neutral tribunal, similar to that in place under sections 78(3.1) through 78(3.3) of the Competition Act. 6. I think it is important that the act be amended to include provisions which would offer the commissioner or any person acting on my behalf some degree of immunity against criminal or civil proceedings, libel or slander. Similar to GRIC s reaction to the question of Administrative Monetary Penalties, GRIC notes that the Commissioner is asking for the powers and protections of a judge, without any additional commitment to manage OCL in a more judicious fashion. Before GRIC could support these additional legal protections for the Commissioner and OCL staff, we would expect the quid pro quo to be, for example, a commitment not to render retroactive decisions, to provide clear and meaningful guidance on questions of compliance, and to respect the Charter of Rights and Freedoms in administering the Act and its supporting framework. " #$$%&''((()*+,,-".$./01".$/2/),3)32' "" 4+516+72513#25#8902)"#$$%#&'():+;0<,0/=8>?@?)AB052$+/.2/0,0"51*+,,"062*<+.$2.<73#2.CD.)E """ B00&#$$%&''((()+3*F32*)13)32'0"3'."$0'*+,,-".$F*+,,-".$0@)5.G'051'5H???@=)#$<* "; >??IJKL%0/D0**0$"0/M)L)G+/$#0K+7/$)*'&+,-.,/0.1,2345.&67'$$.89:11+-8'/;'8'-.$+<5.8.9.=>'?#(1-.-+<@+77/#(1(A) ; D2/$"37*2/*-N01".*2$"+5$#2$/0G*03$.2@II@B7%/0<0K+7/$+GK25262603"."+5+52G7562<05$2**-."<"*2/O70.$"+5)B00&B(7+-8'345.8.9. =%-'.(C-/D+$-9A)P@II@Q>B)K)R)S GRIC submission re: statutory review of the Lobbying Act Page 17