Parliament is back in session, and we can expect some tumultuous days ahead in Ottawa.
The NDP's decision to walk away from the supply-and-confidence agreement on Sept. 4 means an even busier fall for individuals lobbying the federal government. "Lobbyists" must make their asks to government without too much delay because of the uncertainty surrounding the call of the next federal election. Canadians could be going to polls sooner than Oct. 20, 2025.
At the same time, the Commissioner of Lobbying of Canada Nancy Bélanger ("Commissioner") has recently introduced new guidance on the interpretation of the Lobbying Act, which will impact how lobbyists register and report on their lobbying undertakings. In addition, the provisions of the 2023 Lobbyists' Code of Conduct ("Code") with respect to paid and unpaid political work and the applicable cooling-off periods will be put to the test when the federal election is called.
Lobbying and gift giving during an election campaign
Regarding the provinces, British Columbia, New Brunswick, and Saskatchewan are in election campaign mode. There are requirements and considerations under British Columbia's Lobbyists Transparency Act ("LTA"), New Brunswick's Lobbyists Registration Act, and Saskatchewan's Lobbyists Act for lobbyists to be aware of during the election period.
Under the Lobbyists Transparency Act:
- Members of the Legislative Assembly (MLAs) cease to be public office holders once the Legislature is dissolved. There is no need to register or report lobbying those individuals in your lobbying returns during the election campaign.
- Premier Eby and his Ministers retain their roles and remain members of the Executive Council (i.e.: Cabinet) during an election campaign. Any lobbying communications with them should be reported in your monthly reports as they are senior public office holders under the LTA.
- In addition, there are public office holders and senior public office holders that are not elected officials, such as Ministerial staff who retain their positions during an election campaigns and/or public servants, employees of government Crown corporations, boards, or agencies. You must continue reporting your lobbying communication activities with those individuals in your lobbying returns during the election campaign.
- There are no requirements to register lobbying communications with unelected candidates because they are not a public office holders or senior public office holders.
Worthy to note a word of caution from the Office of the Lobbying Registrar of British Columbia regarding gift giving during an election campaign. Under subsection 2.4, the LTA prohibits a lobbyist from giving and/or promising to give, directly or indirectly, any gift to any public office holder the lobbyist is lobbying. There is, however, a limited exception in the LTA to the gift prohibition.
A gift to a public office holder whom the lobbyist is lobbying is only acceptable if it meets the following conditions:
- The gift is given or promised under the protocol or social obligations that normally accompany the duties or responsibilities of office of the public office holder.
AND
- The total value of gifts given or promised to the public office holder by the lobbyist over a 12-month period is less than $100.
Gifts must be registered. Although the LTA's gift prohibition and reporting requirements do not apply to gifts provided to candidates who are not public office holders, candidates become public office holders if elected. If a lobbyist promises or gives a gift to a candidate who then becomes a public office holder and is lobbied by the organization employing the lobbyist (or by the consultant lobbyist), the gift would be subject to the LTA's gift prohibition and reporting requirements.
Although New Brunswick's Lobbyists Registration Act, and Saskatchewan's Lobbyists Act do not require lobbyists to file monthly reports on lobbying communications undertakings with senior public office holders, they do require that lobbying registrations are accurate and up to date during election campaigns with respect to any lobbying communications undertaken with the Premiers, Ministers and their staff who remain on staff during the election campaigns as well as public servants and employees of government Crown corporations, boards or agencies.
While lobbyists are not required to register gifts under New Brunswick's Lobbyists Registration Act and Saskatchewan Lobbyists Act, they must remember that gift giving prohibitions exist in both provinces and the prohibitions have implications for lobbying activities. Both provinces prohibit gift giving to public office holders subject to the limited exemption of a gift or personal benefit of limited value that is given as an incident of protocol or social obligations that normally accompany the duties or responsibilities of office of the public office holder. That prohibition is found in section 12 of the Lobbyists Act and in section 8 of the New Brunswick Members' Conflict of Interest Act. The gift value in Saskatchewan amounts to $200 or less per year, while the gift value is $250 or less per year in New Brunswick.
Perspectives on requirements at the federal level
When the federal election is called, there are no requirements
to report lobbying communications with Members of Parliament (MPs)
because they cease to be public office holders during an election
campaign. Lobbyists must continue reporting their lobbying
undertakings with Prime Minister Trudeau, Ministers of the Crown,
members of their staff who retain their position during an election
campaign and Senators in their monthly report. Lobbyists must also
continue reporting lobbying communication with public office
holders and senior public office holders that are not elected
officials such as public servants, employees of Crown corporations,
boards, or agencies during the election campaign. There are no
requirements to register lobbying communications with unelected
candidates because they are not public office holders or senior
public office holders.
Regarding gifts, the Code prohibits lobbyists from offering gifts or hospitality – directly or indirectly – to any official that they expect to lobby, other than:
- a "low value" gift that is a token of appreciation or promotional item, or
- "low value" hospitality for consumption during an in-person gathering.
"Low value" means any gift or hospitality worth $40 or less, up to an annual limit of $200 per official in 2023 dollars. The Commissioner has the authority to grant exemptions to the gift and hospitality rule, including considerations on cultural exceptions and discretionary exemptions assessed on a case-by-case basis.
There are no requirements to register gifts at the federal level and the Code does not apply to gifts provided to candidates who are not public office holders. However, lobbyists should exercise caution when providing gifts or hospitality to candidates because, as noted above, candidates become public office holders if elected. Lobbyists should consider the nature of the relationship with a candidate and whether that relationship would be subject to a prohibition on communications with public office holders.
One of the most significant changes to the Code is the reformulation of the conflict-of-interest rules. The rules have been expanded to prohibit a lobbyist from lobbying a public office holder if the public office holder "could reasonably been seen to have a sense of obligation towards the lobbyist in circumstances beyond the scope of other rules in the Code" (Rule 4.3) due to a "close relationship" (Rule 4.1). A "close relationship" is defined as "a close bond – based on personal affection, on mutual trust or loyalty, or on professional, business or financial interdependence – that extends beyond simply being acquainted." The Code provides examples of what may be a "close relationship" such as a close family relationship, close personal relationships, close business relationships, or close working relationships.
The Code has updated the rules regarding the cooling-off periods that apply to election campaign workers. Under Rule 4.2, the applicable cooling-off period are either 12 or 24 months, depending on the lobbyist's level of engagement in the campaign. Strategic or organizing roles, such as campaign managers, executives of an electoral district association, people directing or coordinating political research, data analysis, are all subject to the 24-month cooling-off period. People with other roles, such as canvassing, fundraising, campaign coordination, are subject to the 12-month cooling-off period. The Commissioner may reduce the cooling-off period in certain circumstances.
New guidance documents on the interpretation of the Lobbying Act
In recent years, the Commissioner of Lobbying of Canada has been honest about her views on the overdue Lobbying Act review and the rules she wants changed. She has been transparent before the House Standing Committee on Access to Information, Privacy and Ethics (ETHI), in public forums, and media interviews.
In her opening remarks to ETHI on the consideration of Main Estimates of the Office of the Commissioner of Lobbying of Canada, the Commissioner stated on April 16, 2024:
Before I conclude, I must reiterate that the Lobbying Act requires this committee to undertake a review of the act every five years. The last review occurred in 2012. Two opportunities to improve the lobbying regime were missed in 2017 and 2022. I will continue to identify and pursue improvements that could enhance the transparency, fairness, clarity, and efficiency of the federal lobbying regime, but most of the regime's identified deficiencies can only be addressed through legislative amendments. I would urge this committee to avoid any further delays, prioritize initiating a review of the act and put forward legislative amendments.
The preliminary list of recommendations for improving the Lobbying Act can be found here. The preliminary recommendations propose a range of measures to amend the Lobbying Act that include, for example, removing the lobbying registration threshold (also known as the 20 per cent rule), harmonizing registration time limits for consultant and in-house lobbyists to 15 days, expanding reporting requirements for monthly communications reports and providing additional contextual information in monthly communication reports.
Last year, on July 1, the 2023 version of Lobbyists' Code of Conduct came into force. This past spring, the Commissioner required registrants to link subject matters, and their corresponding details in their lobbying returns. On Oct. 1, another update will require lobbyists to identify the details discussed in association with the subject matter when submitting monthly communication reports. At the same time, the Commissioner is updating interpretation materials with respect to the application and enforcement of the Lobbying Act and plans to issue advisory notes in respect of the Code.
On Sept. 5, the Commissioner of Lobbying of Canada released new guidance documents on the interpretation of the Lobbying Act. The first two deal with "Identifying Public Officer Holders" and "Submissions to parliamentary committees and other proceedings of public record," respectively. The third and forthcoming guidance document is expected to deal with the interpretation of the phrase "a significant part of duties" under section 7 of the Lobbying Act, which has guided the application of the lobbying registration threshold under the Act since July 2009.
- Identifying public office holders
As a reminder, under the Lobbying Act, organizations must report, monthly, all oral and arranged lobbying communications with designated public office holders (DPOH).
The most significant difference between the new and the previous Federal interpretation bulletins is the OCL's emphasis on a "contextual analysis" to interpret the terms "equivalent rank" and "comparable rank" within the definition of "designated public office holder" under the Financial Administrative Act and the Public Service Employment Act, respectively.
The OCL will complete a contextual analysis to determine whether a public office holder is of comparable/equivalent rank as described above. The OCL will consider the following non-exhaustive list of factors:
- The seniority or rank of the position;
- The responsibilities and decision-making authority of the position; and
- The pay range associated with the position.
As a practical matter, the OCL will consider the strongest indicators of a "comparable/equivalent rank" to be:
- Occupying a position in the first, second or third highest level of a government institution's hierarchy; and/or,
- Having pay range is like that of an EX-04.
The OCL emphasizes that no one factor is determinative, and the OCL will consider the full context of each circumstance to determine whether a public office holder is a DPOH. This has been the subject of confusion for some time and greater clarity and specific direction will be welcome.
While some categories of individuals have already been defined as "designated public office holder" in the Lobbying Act and the Designated Public Office Holder Regulations enacted under the Lobbying Act, there is more that could be done to mitigate overrepresentation when completing monthly communications reports. As the Commissioner is responsible for the administration of the Lobbying Act, it is understood by many that the onus is ultimately on the Commissioner to provide a list of position titles of DPOHs in the federal public service. To do so would remove the guesswork and potential for arbitrary decision making in identifying DPOHs when completing monthly communications reports.
- Submissions to parliamentary committees and to other proceedings of public record
In this interpretation bulletin, the OCL reiterates its interpretation of the narrow exclusion set out in paragraph 4(2)(a) of the Lobbying Act, which states that the Act does not apply to:
(a) any oral or written submission made to a committee of the Senate or House of Commons or of both Houses of Parliament or to any body or person having jurisdiction or powers conferred by or under an Act of Parliament, in proceedings that are a matter of public record
Indications that a proceeding constitutes a "matter of public record" include:
- A published notice of meeting is available to the public at large (not only a group of stakeholders).
- Witnesses (in the case of a Parliamentary Committee meeting) or participating parties (in the context of government advisory, stakeholder, and/or public consultations) are publicly identified.
- The circumstances and substance of the proceedings are described in sufficient detail and are maintained in a record that is accessible to the public.
- Minutes of meetings as well as transcripts, related evidence and associated reports, judgments or decisions are published.
The OCL considers a person or body to have "jurisdiction or powers conferred by or under an Act of Parliament" when they exercise powers of a public character pursuant to federal legislation and provides additional guidance in the context of government advisory, stakeholder and public consultations, submissions that may be excluded from the application of the Lobbying Act if:
- The circumstances of consultation proceedings are known to the public (for example, where public notice of meetings or hearings is given); and
- The content of such proceedings, including submissions, is made available to the public in sufficient detail (for example, where the proceedings are recorded, transcripts and/or detailed minutes are published, etc.).
The Commissioner is making changes to the interpretation of the Lobbying Act, emphasizing the need for contextual analysis. However, the application of the OCL's contextual analysis, particularly as it relates to the determination of a DPOH, may leave some uncertainty, and further clarification may be required as this approach is put into practice.
Update on Canadian municipalities
The City of Burlington has introduced a mandatory lobbyists' registry earlier this year and the City of Guelph has implemented its registry, on Oct. 1, 2024. Lobbying registration and reporting requirements vary among cities in Ontario and across Canada, adding to the current patchwork of rules businesses, not-for-profit organizations and, in some cases, coalitions must navigate at the federal and provincial levels of government to comply with the statutory requirements.
Conclusion
The federal Lobbying Registration Act came into force in 1989. Since then, the provinces, the territory of Yukon, and Canadian municipalities have followed the lead of the federal government in establishing their own lobbying laws and requirements. The requirements have evolved and have become more sophisticated throughout the years. In addition, the Commissioners of Lobbying or their equivalent positions across the country are increasing scrutiny of lobbyists regarding compliance with lobbying registration and reporting requirements and rules of ethics. Penalties vary by jurisdiction. However, offences for failing to file a return or knowingly make a false statement can include imprisonment for up to two (2) years and a fine of $200,000. In some cases, these penalties may be imposed on an employee personally, and in others, on the company itself.
It is of critical importance to be able to understand and comply with the lobbying registration and reporting requirements and Codes of Conduct governing the behaviour of lobbyists to mitigate the risk of fines and penalties, and the resulting reputational damage.
We have a team of dedicated legal specialists who, collectively, have dealt with all the facets of lobbying compliance, including completing and filing lobbying returns, conducting research and audits of lobbying registrations, training, developing due diligence questionnaires, and interacting with Lobbying Commissioners across the country to deal with some of the complexities of registration and reporting requirements. Our experience also includes assisting clients during investigations, representing them in negotiated settlements and enforcement proceedings. We appreciate that no question is too big, or too small. If you have questions or concerns on compliance with lobbying laws and regulations, the evolution of lobbying laws in Canada, conflict of interest rules or ethics of lobbying, please contact us to obtain the guidance and advice that you require. We would be pleased to assist you.
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