Natural Resources Canada (NRCAN) has opened the enrollment
process for companies who meet the definition of a "Reporting
Entity" under the Extractive Sector
Transparency Measures Act (ESTMA). Reporting
Entities can enrol by downloading a "reporting entity contact
here) which must be completed and submitted prior to
submitting an ESTMA report. Upon enrollment, Reporting Entities
will receive an ID Number and notification of new information
published on NRCAN's website.
Enrollment is not required until the initial ESTMA reports are
due; however, NRCAN is encouraging early enrolment. Annual reports
under ESTMA are due 150 days after a Reporting Entity's
financial year end, beginning with financial years commencing after
June 1, 2015. As an example, companies with a December 31 year-end
will be required to submit their first annual report by May 30,
2017. Reporting of payments made to aboriginal governments or
entities is deferred for a two-year period until June 1,
A guidance document, which provides general information on who
is subject to ESTMA, which entities must report payments under
ESTMA, and what payments should be reported under ESTMA;
A technical reporting specifications document, which provides
information on the mechanics of reporting under ESTMA (including
specifying accounting methods, reporting currency, and reporting
in-kind payments); and
A template for reports under ESTMA.
As described in our earlier blog posts (here, here, and here) the stated purpose of ESTMA is to foster
better transparency to ensure that resource extractive industries
support proper development in the countries where they operate,
while at the same time making it harder to conceal illicit
payments. A "Reporting Entity" under ESTMA refers to a
corporation or other type of business enterprise engaged in the
commercial development of oil, gas or minerals, which is also:
listed on a stock exchange in Canada; or
has a place of business, does business or has assets in Canada
and, for at least one of its two most recent financial years, meets
at least two of the three thresholds below:
has at least C$20 million in assets;
has at least C$40 million in revenue;
employs an average of at least 250 employees.
Since we wrote about the implementation tools in August
2015, there have been no updates to NRCAN's
assessment as to the substitutability of other jurisdictions'
reporting requirements. Reports conforming to the requirements
under the European Union's Accounting and Transparency
Directives remain the only acceptable substitutes under ESTMA. It
remains to be seen whether similar U.S. rules under Section 1504 of
the Dodd-Frank Act (SEC Rules) will also be an acceptable
substitute once finalized. The SEC Rules were most recently
re-proposed on December 11, 2015, and have since been subject to
two comment periods, the last ending on February 16, 2016. Under
the most recent timetable available, the SEC Rules are expected to
be adopted in June 2016. If NRCAN determines the final SEC Rules
are an acceptable substitute, reports prepared in compliance with
the SEC Rules may be submitted to the Minister of Natural Resources
as a substitute for a report prepared under ESTMA.
For further information, please see our earlier blog posts about
ESTMA (here, here, and here).
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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Under the Income Tax Act, the Employment Insurance Act, and the Excise Tax Act, a director of a corporation is jointly and severally liable for a corporation's failure to deduct and remit source deductions or GST.
Under the Income Tax Act, the Employment Insurance Act, the Canada Pension Plan Act and the Excise Tax Act, a director of a corporation is jointly and severally liable for a corporation's failure to deduct and remit source deductions.
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