Annex A:
Regulation of conflicts of interest and business appointments
in Canada
1. To regulate conflicts of interest and the
employment of public servants, Members of Parliament, Ministers
and special advisers, Canada combines legislation and codes of
practice.
2. Paragraph 121 of Canada's criminal code states
that:
[…] every one commits an offence who, being
an official or employee of the government, demands, accepts, or
offers or agrees to accept, from a person who has dealings with
the government, a commission, reward, advantage or benefit of
any kind directly or indirectly, by himself or through a member
of his family or through any one for his benefit, unless he has
the consent in writing of the head of the branch of government
that employs him or of which he is an official, the proof of which
lies on him.[81]
The same paragraph also makes it an offence for anyone
who has a business relationship with the government (including
having tendered to obtain a government contract) to attempt to
influence public officials by offering payment or other benefits
to the officials or their families and friends as "consideration
for cooperation, assistance, exercise of influence or an act or
omission" in connection with their relationship. Breach of
this section of the Code is punishable by up to five years in
prison.
Conflict of Interest Act: Ministers
and Special Advisers
3. As well as paragraph 121 of the Criminal Code,
Canadian Ministers, Permanent Secretaries ("deputy ministers")
and special advisers are also subject to the Conflict of Interest
Act.[82] The Act governs
around 3,100 public office-holders including Ministers, ministerial
staff, some ministerial advisers (special advisers) and other
public appointees. Around 1,100 of these office-holders, called
"reporting public office holders", are subject to the
most stringent rules. There is a separate code covering all 308
Members of the Canadian House of Commons, including Ministers
and their parliamentary secretaries (who are therefore subject
to both the Code and the Act).
4. Section 3 of the Act provides that:
The purpose of this Act is to:
(a) establish clear conflict of interest and post-employment
rules for public office holders;
(b) minimize the possibility of conflicts arising
between the private interests and public duties of public office
holders and provide for the resolution of those conflicts in the
public interest should they arise;
(c) provide the Conflict of Interest and Ethics Commissioner
with the mandate to determine the measures necessary to avoid
conflicts of interest and to determine whether a contravention
of this Act has occurred;
(d) encourage experienced and competent persons to
seek and accept public office; and
(e) facilitate interchange between the private and
public sector.[83]
Conflict of Interest and Ethics
Commissioner
5. Section 81 of the Parliament of Canada Act
provides for the appointment of a Conflict of Interest and Ethics
Commissioner "after consultation with the leader of every
recognized party in the House of Commons and approval of the appointment
by resolution of the House".[84]
The Commissioner is an Officer of Parliament, and must be: a former
judge; a former member of a board, commission or tribunal with
specific expertise in conflicts of interest, financial arrangements,
professional regulation, or ethics; or a former Senate Ethics
Officer or Ethics Commissioner.[85]
6. The Commissioner's mandate is to administer
the provisions of the Conflict of Interest Act; provide confidential
advice to public office holders on its application; and to provide
"confidential policy advice to the Prime Minister in respect
of conflict of interest and ethical issues in general".[86]
The Commissioner also administers and advises on a separate Conflict
of Interest Code for Members of the House of Commons.
7. In carrying out investigations into alleged
contraventions of the Act, the Commissioner has the power to summon
witnesses, to require them to give evidence on oath and to produce
"any documents and things that the Commissioner considers
necessary".[87]
The Commissioner and her staff are also subject to an associated
duty of confidentiality, except to the extent that disclosure
is necessary to interview witnesses and to establish the grounds
for the conclusions contained in her reports.
8. The Commissioner must investigate an alleged
contravention of the Act if asked to do so by a Member of the
House of Commons or the Senate. She also has the power to initiate
her own investigations. Once the subject of her investigation
has been given an opportunity to present his views to her, her
findings are reported—simultaneously—to the Prime
Minister, the public and the subject of her investigation.
9. The Commissioner can fine reporting public
office holders up to $500CAD for failing to meet the various statutory
deadlines for reporting interests and gifts under the Act. The
Commissioner may order a public office holder to "take any
compliance measure, including divestment or recusal, that the
Commissioner determines is necessary to comply" with the
Act. The Commissioner may also order any current public office
holder not to have official dealings with a former reporting public
office holder if the Commissioner determines that a former reporting
public office holder is not complying with the post-employment
obligations. However, the Commissioner has no power to punish
substantive breaches of the Act.
Statutory provisions
10. Part Three of the Act addresses post-employment
rules for people leaving public office. All former public office
holders are under a general duty not to "take improper advantage"
of their public office; from acting against the Crown if they
had previously acted for the Crown in relation to the same issue;
and from disclosing insider information. Stricter rules apply
to the narrower category of former "reporting public office
holders", who, while in office, are required to provide the
Commissioner with extensive disclosures of their interests, financial
affairs, other assets and outside activities. These include:
- a time-limited prohibition
on contracting with, or accepting a directorship or employment
with, any organisation with which they had "direct and significant
official dealings" within the year immediately prior to leaving
office; and
- a time-limited prohibition
on making representations for or on behalf of any organisation
to any government entity with which they had "direct and
significant official dealings" within the year immediately
prior to leaving office.
- Under the Lobbying Act, administered
by the Lobbying Commissioner, former designated public office
holders (which include former reporting public office holders
under the Conflict of Interest Act) are prohibited from engaging
in certain lobbying activities for a period of 5 years after leaving
office.
11. Former Ministers are subject to a further
prohibition on making representations to any of their former Cabinet
colleagues who are still in public office.
12. For most reporting public office holders,
the prohibitions on employment or making representations last
for one year, but this is extended to two years for former Ministers.
The Commissioner also has the discretion to waive or reduce (but
not increase) the waiting period, subject to a public interest
test, and having regard to:
- the circumstances under which
the [person] left his or her office;
- the general employment prospects
of the [person];
- the nature and significance
to the government […] of information possessed by the [person]
by virtue of [his or her] public office;
- the facilitation of interchange
between the public and private sector;
- the degree to which the new
employer might gain unfair commercial advantage by hiring the
[person];
- the authority and influence
possessed by the [person] while in public office; and
- the disposition of other cases.[88]
Federal Public (Civil) Servants
13. Other than deputy ministers or equivalents
(permanent secretaries), federal public servants are not subject
to the Conflict of Interest Act. Instead, they are subject to
both the Public Service Employment Act 2003 (which came into force
in 2005) and the Values and Ethics Code for the Public Sector
(most recently revised in April 2012), supported by a separate
policy on Conflict of Interest and Post-Employment. As in the
UK, adherence to the Code and the policy is part of the terms
and conditions of employment of federal public servants. It places
a number of "general responsibilities and duties" on
all public servants:
Taking all possible steps to recognize, prevent,
report, and resolve any real, apparent or potential conflicts
of interest between their official responsibilities and any of
their private affairs;
Unless otherwise permitted in this appendix, refraining
from having private interests, which would be unduly affected
by government actions in which they participate, or of which they
have knowledge or information;
Not knowingly taking advantage of, or benefiting
from, information that is obtained in the course of their duties
that is not available to the public;
Refraining from the direct or indirect use of, or
allowing the direct or indirect use of government property of
any kind, including property leased to the government, for anything
other than officially approved activities;
Not assisting private entities or persons in their
dealings with the government where this would result in preferential
treatment of the entities or persons;
Not interfering in the dealings of private entities
or persons with the government in order to inappropriately influence
the outcome;
Maintaining the impartiality of the public service
and not engaging in any outside or political activities that impair
or could be seen to impair their ability to perform their duties
in an objective or impartial manner; and
Ensuring that any real, apparent or potential conflict
that arises between their private activities and their official
responsibilities as a public servant is resolved in the public
interest.[89]
14. Part Three of the policy deals with regulation
of post-public employment, and places a general responsibility
on all public servants "to minimise the possibility of real,
apparent or potential conflict of interest between their most
recent responsibilities within the federal public service and
their subsequent employment outside the public service".[90]
Before leaving employment, public servants must also "disclose
their intentions regarding any future outside employment or activities
that may pose a risk of real, apparent or potential conflict of
interest with their current responsibilities, and discuss potential
conflicts with their manager or their deputy head or his/her delegate".[91]
15. Some further specific requirements apply
under the post-employment measures to public servants in "positions
of risk for post-employment conflict of interest situations",
as designated by Deputy Heads (equivalent to Permanent Secretaries).[92]
These additional requirements include a one-year "limitation
period" during which they must disclose to their Deputy Head
all offers of employment or proposed activity outside the public
service which could appear to give rise to a conflict of interest.
They are also subject to:
- a one-year prohibition on accepting
a directorship or employment with any "private entities"
with which they or their subordinates had "significant official
dealings" within the year immediately prior to leaving office;
- a one-year prohibition on lobbying
for or on behalf of any organisation with which they or their
subordinates had "significant official dealings" within
the year immediately prior to leaving office; and
- a one-year prohibition on giving
advice to their clients or new employer "using information
that is not available to the public concerning the programs or
policies of the departments or organizations with which they were
employed or with which they had a direct and substantial relationship".[93]
16. Deputy Heads also have discretion to reduce
or waive the one-year prohibition, taking into account:
- the circumstances under which
the termination of their service occurred;
- the general employment prospects
of the public servant or former public servant;
- the significance to the government
of information possessed by the public servant or former public
servant by virtue of that individual's position in the Public
Service;
- the desirability of a rapid
transfer of the public servant's or former public servant's knowledge
and skills from the government to private, other governmental
or non-governmental sectors;
- the degree to which the new
employer might gain unfair commercial or private advantage by
hiring the public servant or former public servant; and
- the authority and influence
possessed while in the Public Service, and the disposition of
other cases.
17. Finally, Deputy Heads are also charged with
ensuring that prospective, existing and former public servants
are aware of the conflict of interest and post-employment restrictions,
and have access to "advice and assistance" regarding
the Code and policy. They are also responsible for monitoring
their department's compliance with the policy.[94]
81 Paragraph 121(1)(c) Back
82
SC 2006, c 9, s 2 Back
83
Conflict of Interest Act (SC 2006, c 9, s 2) section 3 Back
84
Parliament of Canada Act (RSC 1985, C. P-1) section 81 Back
85
Ibid. Back
86
Conflict of Interest Act section 43 and Parliament of Canada
Act section 85 Back
87
Conflict of Interest Act section 48 Back
88
Conflict of Interest Act section 39 Back
89
Values and Ethics Code for the Public Sector, Appendix B: Requirements
for public servants to prevent and deal with conflict of interest
and post-employment situations, part 1 Back
90
Ibid. paragraph 3 Back
91
Ibid. paragraph 3.1 Back
92
Ibid. paragraph 3.2 Back
93
Ibid. Back
94
Ibid. Part 6 Back
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