The Government of Canada has introduced legislation to create a registry of foreign agents that would be less independent and potentially less transparent than the current federal lobbyists' registry.
The proposed Foreign Influence Transparency and Accountability Act, Part 4 of Bill C-70,1 would give the Prime Minister and Cabinet, through regulation, broad discretion to decide what information must be disclosed, who is not required to register, and how the new law will be enforced.
Mandatory Registration
The proposed Act would require registration of persons who enter arrangements with foreign principals to communicate with public office holders, to disseminate information by any means including social media, or to distribute money, items or services, in relation to Canadian political or governmental processes.
- A political or governmental process is a federal, provincial, territorial, or Indigenous nation's or Indigenous community's process. Significantly, the proposed Act does not apply to a municipal (local government) process.
- Within the above limits, a political or governmental
process includes:
- A proceeding of a legislative body.
- Development of a legislative proposal.
- Development or amendment of a policy or program.
- Decision-making by a public office holder or government body, including the awarding of a contract.
- An election.
- A referendum.
- Nomination of a candidate.
- Development of a political party's election platform.
- Public office holders include:
- MPs and Senators, and members of their staffs.
- Members of provincial and territorial legislatures and members of their staffs.
- Municipal councillors and members of their staffs.
- Members of Indigenous governments, self-governing institutions and band councils, and members of their staffs.
- Officers and employees of the federal government, employees of provincial and territorial governments, and officers and employees of municipalities and local governments.
- Employees of Indigenous governments, self-governing institutions and band councils.
- Officers and employees of entities that represent the interests of First Nations, the Inuit or the Métis.
- Appointees of the federal Cabinet and of federal Cabinet Ministers, and any individual whose appointment is approved by the Cabinet or a Minister.
- Officers, directors and employees of federal boards, commissions and tribunals.
- Members of the RCMP and the Canadian Armed Forces.
- Foreign principals are:
- Foreign states, groups of foreign states, governments of foreign states (whether or not recognized by Canada and including entities purporting to be governments), and foreign political parties and factions whose stated purpose is to become government.
- Groups and associations of the governments, political parties and factions described above, alone or in combination with terrorist groups.
- Persons acting at the direction of, for the benefit of, or in association with, the governments, political parties and factions described above, or groups and associations of those governments, political parties and factions and/or of terrorist groups.
- Entities controlled or substantially owned by foreign states or groups of foreign states.
The Prime Minister and Cabinet would be empowered, by regulation, to include or exclude people from the public office holder definition.
An individual, corporation, or other entity (including an unincorporated association or organization) that enters into an arrangement with a foreign principal to communicate with a public office holder, to disseminate information, or to distribute money, items or services, in relation to a political or governmental process, must register on the foreign agents' registry. The deadline to register is within 14 days of entering into the arrangement.
The Prime Minister and Cabinet would have the discretion to make a regulation that excludes persons and arrangements from the above requirement. This discretionary power would only be exercisable in one direction: less transparency. They would not have the power to include additional persons and arrangements on the foreign agents' registry.
The Act does not specify the information that a foreign agent must provide. Those requirements would be set out in a regulation decided by the Prime Minister and Cabinet. At this stage, it is unknown whether foreign agents will be required to disclose more or less information about their activities and their foreign principals than federal consultant lobbyists must disclose about their activities and their clients.
The structural difference between the Lobbying Act and the Foreign Influence Transparency and Accountability Act suggests that foreign agents will not be required to report on individual meetings with public office holders or on the individual activities that they perform for foreign principals.2
Notable Omissions
The following processes, any of which could in theory be subject to attempted foreign influence, are not specifically mentioned in the Act: elections to internal political party offices; political party leadership contests; appointments of individuals to public offices; government hiring decisions; third party political advertising (which is known by various names under provincial laws); decision making within parliamentary and legislative caucuses, such as the selection of officers, expulsion of members, and removal of leaders; law enforcement decisions; and decisions of tribunals and regulators. (It is true that the Act's list of specific types of political and governmental processes is potentially non-exhaustive. In theory, additional processes might be included by interpretation, though the Act says the Commissioner's interpretations would be non-binding. The Act would not permit processes to be added by regulation.)
The "public office holder" definition excludes judges and Lieutenant Governors of the Provinces. It also does not include officers, directors, members and employees of provincial, territorial and municipal government corporations and government agencies.3 Further, "public office holder" does not cover individuals appointed to offices by provincial, territorial, municipal and Indigenous governments.
As noted above, municipal councillors, employees and officers would be "public office holders," but their inclusion in the definition may be academic because a municipal process would not be considered a "political or governmental process" to which the Act applies.
Non-Independent Enforcement
Unlike the Lobbying Act, the Conflict of Interest Act, the Access to Information Act, and the Privacy Act,4 the proposed Foreign Influence Transparency and Accountability Act would not be independently enforced. The Governor in Council (effectively, the Cabinet) would appoint5 and be free at any time to remove6 the Foreign Influence Transparency Commissioner, without needing parliamentary approval for either step.
In practice, any federal appointment made by the Cabinet requires the Prime Minister's approval, and the appointment process is centralized under the direction of the political staff of the Prime Minister's Office. The proposed Act does not indicate that appointment of the Foreign Influence Transparency Commissioner would be managed in any different manner.
The Foreign Influence Transparency Commissioner would report to a Cabinet Minister (a politician), and not to Parliament. According to Parliamentary convention, this means that the Commissioner would be accountable to the Minister, and the Minister would be accountable to Parliament for the activities of the Commissioner. In contrast, the Commissioner of Lobbying is directly accountable to Parliament and the Conflict of Interest and Ethics Commissioner is directly accountable to the House of Commons.
The independent Commissioners who are appointed by and serve the House of Commons or Parliament do not hesitate to make decisions and to issue reports that are sometimes unfavourable, even embarrassing, to the government of the day and those associated with the government.7 Unlike these parliamentary officers,8 the Foreign Influence Transparency Commissioner would not be independent of the Cabinet. The independence issue takes on particular significance given recent controversy about the sufficiency of government transparency in dealing with information about foreign interference.9
In contrast to parliamentary officers, whose reports are not vetted by the Government, the Foreign Influence Transparency Commissioner would be required to consult with government deputy ministers on content of the Commissioner's reports.
Penalties
The Foreign Influence Transparency Commissioner would have the power to issue administrative monetary penalties, but the Act is silent on the amounts. The range of penalties would be contained in a regulation issued in the discretion of the Prime Minister and Cabinet. The Prime Minister and Cabinet would also be able to decide (by regulation) to empower people other than the Commissioner to impose administrative monetary penalties.
Penalties could be imposed on anyone who fails to report an arrangement with 14 days, fails to update information about an arrangement, or knowingly provides false or misleading information to the Commissioner.
There is no appeal from an administrative monetary penalty, but one could apply for judicial review of the Commissioner's decision.
Prosecution is an alternative means of enforcement. The maximum penalty for an offence under the Foreign Influence Transparency and Accountability Act would be C$5 million, five years' imprisonment, or both. Due diligence would be available as a defence.
Obstruction of the Commissioner may be prosecuted as an offence. It would not be subject to administrative monetary penalty.
An alleged contravention may be subject to administrative enforcement or prosecution, but not both.
Foreign Agents Treated Differently Than Lobbyists
The proposed Act would treat foreign agents differently than the Lobbying Act treats federal lobbyists:
- Foreign agents would not be required to register as quickly as consultant lobbyists.10
- Unlike federal lobbyists, foreign agents would not be subject to a code of conduct that requires them to act honestly and with integrity.
- The structural difference between the Lobbying Act and the Foreign Influence Transparency and Accountability Act suggest that, unlike lobbyists, foreign agents will not be required to report on individual meetings with some public office holders.
- Unlike federal lobbyists, foreign agents could not be required by the Commissioner to clarify the information in their returns.
- The Foreign Influence Transparency Commissioner would have no recourse to a provision similar to section 9.1 of the Lobbying Act, which requires designated public office holders to confirm the accuracy of information filed by lobbyists.
- Unlike lobbyists, foreign agents would not be under the jurisdiction of an independent regulator (i.e., Commissioner who is independent of the Prime Minister and Cabinet).
- Foreign agents would be subject to potential administrative monetary penalties. Despite many recommendations to this effect, the Lobbying Act has never been amended to provide for administrative monetary penalties for unregistered lobbying.
Prepare Now for Compliance
The scope of the proposed Act is broad. It could affect companies, organizations and individuals that have dealings in Canada or with Canadians if they are in any way connected to governments (including sub-national governments) outside Canada or to non-Canadian political parties or entities.
Anyone who is potentially affected should start planning now for compliance.
Footnotes
1. Canada, House of Commons, 44th Parliament, 1st session, Bill C-70, An Act respecting countering foreign interference, introduction and first reading May 6, 2024.
2. The Act does state that Cabinet may, by regulation, specify the information that foreign agents must provide and govern the updating of that information. In contrast, the requirement to report on individual lobbying communications is spelled out in subsections 5(3) and 7(4) of the Lobbying Act, and the Lobbyists Registration Regulations build on these subsections.
3. The definition does include members, officers and employees of "a statutory body charged with the administration of the civil or municipal affairs of a city, town, municipality or district."
4. Each of the Commissioner of Lobbying, the Information Commissioner and the Privacy Commissioner is appointed following adoption of a resolution by both Houses of Parliament, and may only be removed from office with the approval of both Houses. The Conflict of Interest and Ethics Commissioner is appointed following adoption of a resolution by the House of Commons and may only be removed with the House's approval. Lobbying Act, s. 4.1; Access to Information Act, s. 54; Privacy Act, s. 53; Parliament of Canada Act, ss. 81-82.
5. Appointment (but not removal) would require consultation with party leaders. In law and in practice, consultation does not require the parties' agreement; often the Government only "consults" on the name of a single, chosen appointee.
6. The proposed Act states that the Commissioner could be "removed for cause." In the case of Cabinet appointments, Canadian courts will not second-guess the sufficiency of "cause," but they will require that the removal process respect procedural fairness.
7. See, for example: Commissioner of Lobbying, The lobbying activities of GPG-Green Power Generation Corp. and Patrick Glémaud and Rahim Jaffer (December 2011); Conflict of Interest and Ethics Commissioner, Trudeau II Report (August 2019); Information Commissioner, Interference with access to information: Part 1 (March 11, 2011); Privacy Commissioner, Erroneous quarantine notifications from ArriveCAN (May 29. 2023).
8. Parliament, whose officers they are, refers to the Commissioner of Lobbying, Information Commissioner, etc. as Officers of Parliament. The Privy Council Office and the rest of the Government of Canada prefer the term "Agents of Parliament." Since these are positions that belong to Parliament and not the Government, this bulletin uses the nomenclature favoured by Parliament.
9. Ismail Shakil, Reuters, "Lawmaker says Canada government did not inform him of report of China's threats to family" (May 1, 2023).
10. 14 days versus 10 days.
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