news Trans Mountain 2.0: what now?
BUSINESSVANCOUVER June 25–July 8, 2019
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With the prospects of more protests and lengthy court battles ahead for the embattled multibillion-dollar pipeline project, does the green light this time really mean go? | Page 5
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Asian unrest stokes B.C. business fears Trade | Protests
threaten Hong Kong’s role as Canada’s Asian market gateway By Chuck Chiang cchiang@biv.com
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hile some sectors might see the unrest in Hong Kong as a business opportunity, most observers agree it could undermine the city’s role as Canada’s top Asian economic hub if it institutes a controversial mainland China extradition law. Millions of protesters have taken to the streets in Hong Kong this month, demonstrating against the Chinese special administrative region for its plans to add an amendment to its extradition ordinance so that Hong Kong can transfer fugitives wanted in mainland China back to Beijing’s control. The proposed bill – which was suspended indefinitely by Hong Kong Chief Executive Carrie Lam on June 15 – has been sharply criticized within Hong Kong and in the West for potentially eroding the city’s judicial independence, a key guarantee of the “one country, two systems” mantra that Beijing has used as a guideline for Hong Kong since it reverted to Chinese control in 1997.
What has been different when compared with the 2014 Umbrella Movement protests in the city, however, is that Hong Kong’s business community has been a much more vocal protester. continued on page 6
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technology | 3
environment | 3
Public-private partnership aiming to deepen the local talent pool for the province’s booming animation industry
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Manufacturers raise concerns over regulatory costs as ban on single-use plastics in Canada looms large on the horizon
real estate | 8 Developers double down on buyer incentives in Metro Vancouver as the region’s condo sales downturn deepens
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BUSINESSVANCOUVER June 25–July 8, 2019
BIV | Beyond the print
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Business in Vancouver’s most-seen online stories for the week ended June 20
Continental divide
•Production company suing former Man in the High Castle accountant who allegedly absconded to Mexico with boyfriend after embezzling more than $900,000 biv.com/article/2019/06/ production-company-suing-former-man-high-castle-accountantwho-allegedly-absconded
Survey reveals gaps in attitudes toward North American free-trade deal
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Business in Vancouver on Global: Hayley Woodin on Apple CEO slamming tech firms over privacy; first e-gaming ETF to trade on TSX
Bryan Yu on a continued surge in B.C. residential construction permits
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B.C.’s biggest accounting firms BIV’s exclusive list, ranked by total number of employees in the province
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destroying British Columbians’ wealth biv.com/article/2019/06/bc-ndphousing-policies-destroying-britishcolumbians-wealth •Multibillion-dollar questions cloud Trans Mountain’s future biv.com/article/2019/06/ multibillion-dollar-questions-cloudtrans-mountains-future •Real estate market ‘primed for a comeback’: Metro Vancouver brokerage biv.com/article/2019/06/realestate-market-primed-comebackmetro-vancouver-brokerage
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BUSINESSVANCOUVER June 25–July 8, 2019
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Public-private partnership targets tech talent crunch TECHNOLOGY | Centre set to deliver approximately 1,000 new workers to VFX, gaming, animation sector BY TYLER ORTON TORTON@BIV.COM
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a n reaction to the fi na l season of HBO’s Game of Thrones was seemingly as split as the continent of Westeros during the War of the Five Kings. But when the Vancouver-based visual effects (VFX) team responsible for some of the fantasy series’ most striking dragon sequences showcased its work at a June panel, all that polarization shattered like a White Walker facing the pointy end of a Valyrian steel blade. “There were gasps in the audience,” said Mike Henniger, who helped facilitate the event featuring VFX house Image Engine Design Inc. “A lot of people, they watch the shows like Game of Thrones and things like that and they have no idea the fantastic work … that’s being done right here in Vancouver.” Henniger, vice-president of marketing and sales at the soonto-launch Vancouver Centre for Entertainment Arts (VCEA), is among those trying to drum up more interest in the creative technology industry to ease the region’s well-documented talent crunch.
The VCEA is set to accept its first intake of about 100 students this September for a program offering two-year training in VFX, animation or video game development. Its 38,000-square-foot facility at 565 Great Northern Way in Vancouver is adjacent to the Centre for Digital Media, owned by the University of British Columbia, Simon Fraser University, the Emily Carr University of Art and Design and the BC Institute of Technology. The program is a public-private partnership offered by Langara College’s continuing studies department, which sees the VCEA licensing a professional curriculum from the private Academy of Art University, San Francisco. But because the program is being offered through a public post-secondary institution in Vancouver, it can offer international students two-to-three-year graduate work permits (private institutions cannot offer such permits). Training young workers in the creative technology sectors has been a particularly thorny subject for the industry, according to Peter Walsh, campus director for the Langara Centre for Entertainment Arts, of which the VCEA is a part. “T here’s a huge a mou nt of
A lot of people, they watch the shows like Game of Thrones and things like that and they have no idea the fantastic work … that’s being done right here in Vancouver
[] Mike Henniger vice-president of marketing and sales, Vancouver Centre for Entertainment Arts
inefficiency in industry right now because a lot of senior people are spending their time training new hires, and the reason is because they’re coming in not ready to hit the ground running,” he said. “Students for the whole two years that they’re with us are learning in the same environment and learning from the same professionals that are working in the studios nearby, so when they graduate they’re able to seamlessly enter those studios.” Walsh added that private institutions have often been more agile with curriculums and better at recruiting faculty than many of
the public institutions, adding to some of the industry woes. “Traditionally, they’ve been hamstrung a little bit because they’ve required strong academic qualifications for their faculty, which doesn’t exist in this industry. Most of the top people … do not have master’s [degrees] and PhDs,” Walsh said. However, the private institutions have not been as well suited to accommodate international students due to the restrictions on graduate work permits.
A public-private partnership whereby a public institution like Langara can offer a private curriculum that’s already been thoroughly road-tested can address those problems, Walsh said. The VCEA expects to have three intakes a year, with between 100 and 150 students in each intake. Walsh estimated that the program will have delivered about 1,000 students to industry within two to three years. “They’ll be gobbled up,” said Brenda Bailey, executive director of the DigiBC industry group representing the VFX, gaming, animation and augmented reality/ virtual reality (AR/VR) sectors. She said a public-private partnership is a smart move by Langara that will benefit industry.
“Four-year animation degrees, the students are getting hired out of Year 1 or Year 2, which isn’t good for the universities, probably isn’t good for the students, and what’s happening on industry side is we’re training them when we get them. So all of us are looking for a solution to that,” Bailey said. And while everyone in the creative technology sector knows there is a severe talent crunch in the province, Bailey said the lack of hard data has made it difficult to address these issues. “We don’t know how big the problem is, and what’s working and what isn’t,” she said. Dig i BC a nd the Animation & Visual Effects Alliance of BC struck a new education committee that met in person for the first time in early June. Part of its mandate is to pursue a new research study examining the talent gap as well as determine ways to boost domestic talent and help young British Columbians learn about job opportunities in the industry. This comes after a new five-year education program was launched in January under which DigiBC will pursue more outreach in high schools and teaching students about coding by using video games. •
Manufacturers fear patchwork of plastic regulations ENVIRONMENT | Different By Glen Korstrom gkorstrom@biv.com
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hen Canadian Prime Minister Justin Trudeau th is month promised to devise a plan to ban single-use plastics by 2021, he stoked fears among global manufacturers that countries will start imposing their own bans on specific materials, instead of working in tandem with other nations. Canada’s ban is expected to mainly target plastic straws, water bottles and bags, but it may extend to certain packaging materials. T hat worries executives at firms such as Mars Inc., the diversified manufacturing giant known for its namesake candy bar along with dozens of other food and pet brands such as M&M’s, Snickers, Uncle Ben’s, Whiskas and Pedigree. “One of the worst outcomes here would be different countries and different geographies having completely different rules, and completely different systems, which means that it stops being viable for us to have globally consistent packaging formats,” Mars Inc.’s global vice-president for sustainability,
national rules for packaging materials could drive up costs
Kevin Rabinovitch, said during a panel discussion at the Consumer Goods Forum’s global summit in Vancouver June 12. “Globally consistent packaging formats help us lower costs, innovate, drive food safety, and it lets us have a factory in one country that could export to multiple countries off one set of [manufacturing] assets.”
Rabinovitch said that if his company had to have factories in a wide range of countries to meet diverse packaging standards, it would add costs while failing to solve the problem of plastic in the global ecosystem.
R abi nov itch , whose company Forbes last year ranked as the sixth-largest privately held company in the U.S. with about 100,000 employees and US$35 bi l l ion i n revenue, sa id he’s “optimistic” that the problem can be solved, though he finds the prospect of a gauntlet of regulatory regimes worrisome “because that creates a real risk,” he said. At least one Vancouverite who has devoted his career to promoting recycling and reducing waste shares Rabinovitch’s concerns. “Everyone wants to address the plastic issue, and I think what we’re all worried about is that there will be a knee-jerk reaction
which puts some heavy-handed government intervention [into law] and that that intervention is different in each jurisdiction,” said Allen Langdon, CEO of Encorp, the operator of B.C.’s Return-It program, which provides refunds to consumers for bringing in used beverage containers, among other items. Until last summer, he headed Recycle BC, which operates the province’s opt-in blue-box program that allows municipalities to provide recycling services for items that do not carry refundable deposits for consumers. B.C.’s recycling system comprises that program and ReturnIt, and there are another couple of dozen different recycling systems operating in the rest of Canada. Langdon told Business in Vancouver that national bans against specific materials are a particular concern because of the use of multi-laminate plastics – fused layers of polymers that can be used as wrappings in candy bars. “Say you can’t use a Mars bar wrapper for a Mars bar anymore – that would be a challenge,” he said. The good news, according to Langdon, is that there are global efforts to create a synchronized approach to plastic use.
Encorp CEO Allen Langdon: “everyone wants to address the plastic issue, and I think what we’re all worried about is that there will be a knee-jerk reaction” | Chung Chow
The Ellen MacArthur Foundation, for example, in October launched its New Plastics Economy Global Commitment, which aims to unite businesses, governments and other organizations toward addressing plastic waste and pollution at its source. That initiative, which is in collaboration with UN Environment, has attracted more than 400 signatories, including more than 200 businesses that are part of the plastic-packaging value
chain, representing more than 20% of all plastic packaging used globally, said Sander Defruyt, who is leading the initiative. Signatories also include at least 16 governments on five continents. At last count, however, that list did not include Canada. “Having a critical mass of stakeholders aligned behind one common vision is an absolutely crucial first step if you want to change a global system, with so many actors involved,” Defruyt said. •
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BUSINESSVANCOUVER June 25–July 8, 2019
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Does Trans Mountain green light mean ‘go’ this time? energy | Revenue
from expanded pipeline to fund clean-energy projects, including electrification
By Nelson Bennett nbennett@biv.com
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arring any regulatory delays or court injunctions, construction on the Trans Mountain pipeline twinning project will begin later this summer or in early fall, with commissioning expected for the second or third quarter of 2022. That is the hope of Ian Anderson, CEO of Trans Mountain Corp., which is now owned by Canadians. Work will also resume on a $150 million expansion of the Western Canada Marine Response Corp.’s fleet of vessels and marine stations. Work was halted on both expansion projects nearly a year ago, when the Federal Court of Appeal quashed the original approval of the pipeline twinning project. A f ter add ressi ng concerns raised by the court, Prime Minister Justin Trudeau last week again approved the project. Markets reacted with apparent indifference. Stocks of major Canadian oil companies either barely nudged upward or dipped slightly, suggesting that the markets had already anticipated a green light or were taking an “I’ll believe it when I see it” attitude. In making the announcement, T r udeau com m itted to ea rmarking all federal tax revenue
from the pipeline – about $500 million a year – for clean-energy projects. Asked what initiatives might qualify, Fisheries and Oceans Minister Jonathan Wilkinson said it could include public projects like beefing up interprovincial transmission interties. “It could be the electrification of the upstream [natural gas fields], which is something that premier [John] Horgan been talking a lot about, in order for B.C. to meet and exceed its climate goals,” Wilkinson said. B e fo re s h o v e l s a re i n t h e ground, Trans Mountain will need to get a National Energy Board (NEB) certificate to proceed. Provincial and municipal permits – some of which would have expired – will also need to be issued or reissued. In addition, Trans Mountain might have to alter the route for the section of pipeline that passes through the Coldwater Indian Band’s reserve. Work in B.C. will restart first at Burnaby’s Westridge Marine Terminal. New construction on the 1,150-kilometre pipeline, which is broken down into seven “spreads,” will break ground in B.C. in the North Thompson region north of Kamloops. Up to 6,000 workers will be needed at peak construction, and the project will be competing
for workers with the $40 billion LNG Canada project, which will need up to 10,000 workers at peak construction. Anderson confirmed that the project will likely exceed the last capital expenditure estimate of $7.4 billion, but could not say if it will come closer to the $9.3 billion that the parliamentary budget officer estimated in January.
“Once there’s more certainty on that regulatory process, and we know when we can get back to work, we’ll be in a better position to provide an update on both the specific schedule and project costs,” Anderson said. “As you can appreciate, those two are connected.” Any delays will add to the pipeline’s costs, which will now be borne by Canadian taxpayers. Canada owns the existing Trans Mountain pipeline and is responsible for expanding it. It is estimated that delays could raise the project’s capital costs as much as $2 billion. The government intends to sell the pipeline once the expansion is complete. Even if all goes smoothly on the regulatory front, the project will almost certainly face more legal challenges and protests. More than 200 people have been arrested to date at various demonstrations of civil disobedience.
Anderson said an injunction that the company was granted last year is still in effect. Martin Olszynski, associate law professor at the University of Calgary, expects environmental groups and local First Nations will again challenge the governor-in-council order approving the expansion at the Federal Court of Appeal and argue that the second approval, like the first, is deficient. But to halt construction, the court would need to issue an injunction. “Without prejudging that, it’s a pretty hard test, as a general rule,” Olszynski told Business in Vancouver. “And I think, in this context, where we’ve already had one approval that was struck down, and we’ve had this additional consideration and consultation, I think that we would expect that to be a relatively high hurdle at this point.” The B.C. government is appealing to the Supreme Court of Canada a BC Court of Appeal decision that ruled the province doesn’t have the constitutional authority to regulate what goes through a federally regulated pipeline. “I think most of us expect that to go nowhere,” Olszynski said. All in, the acquisition of the Trans Mountain pipeline and its expansion could cost up to $12 billion.
Some analysts have questioned whether any buyer will pay that much. Former Liberal environment minister David Anderson recently weighed in on the project’s economic viability, saying there is no market for Alberta oil in Asia. Statistics Canada export data suggests otherwise. As Business in Vancouver recently reported, despite severe capacity constraints on the existing Trans Mountain pipeline, 7.5 million barrels of Alberta crude shipped to Asia via Westridge Marine Terminal in 2018, with a value of $539 million. Of that, 6.3 million barrels ($442 million worth) went to China. Wilkinson suggested the industry, which would include the 13 shippers that signed up for long-term contracts, would not be investing in a project if they didn’t think there was money to be made. Anderson confirmed that all 13 shippers remain committed to the project, not to mention contractually bound. “We have a Crown corporation which is run by former Kinder Morgan [TSX:KML] executives, who assess this on an ongoing basis,” Wilkinson said. “This is their business. They understand their business. And on the basis of everything that we know, this project is an economically viable project.” •
Challenges expected to send pipeline project back to Federal Court LAW |
Tsleil-Waututh, Squamish First Nations among opponents weighing their legal options
By Hayley Woodin hwoodin@biv.com
BC
Fi rst Nations critica l of the Trans Mountain pipeline expansion are weighing their legal options after the project’s third federal approval. Last week, the federal government proposed eight measures to address the concerns it heard in consultations with more than 60 Indigenous communities, a process the Federal Court of Appeal ordered it to re-initiate last August. While Prime Minister Justin Trudeau maintains Canada has successfully executed its obligation to engage First Nations in meaningful, two-way dialogue, certain Indigenous governments disagree, and legal experts believe that tension will likely land the matter back in Federal Court. “It’s pretty clear that the approval will be back in court sooner rather than later, for a couple of reasons, and probably on behalf of different parties,” said Jason MacLean, an assistant professor at the University of Saskatchewan College of Law.
MacLean said Canada may have created challenges for itself in repeatedly assuring investors and project proponents that the pipeline would be built. “From both a constitutional law and an administrative law perspective, that’s a problem. Because the government is legally obligated to pursue those types of consultations with an open mind, which means, practically, that it has to be prepared to change its mind based on the information it hears.” The Squamish Nation has accused the federal government of making a “shallow” attempt at consultation that has failed to address its concerns. “The failure to meaningfully engage with rights holders means this government is either not serious about building this pipeline or not serious about respecting Indigenous rights,” said Squamish Nation spokesman Khelsilem. T he Tsleil-Waututh Nation – which has been vocally and steadfastly opposed to the project – and the Squamish Nation were two of the six communities
named in the Federal Court of Appeal decision last year. Both have said they are reviewing their legal options. They have the support of City of Vancouver Mayor Kennedy Stewart, who issued a statement that he is committed to doing anything in the city’s power to support local First Nations through appeals. B.C. Premier John Horgan has also said the province would join any action that was in the best interest of British Columbians. Kate Gunn, a lawyer with Vancouver-based First Peoples Law, said she sees a variety of ways legal challenges may be brought forward. Though courts have provided a “pretty clear” road map of what consultation requires, there still exists a lot of scope within that map, she said. “A lot of it will likely hinge on the direction the Federal Court of Appeal gave to the Government of Canada when it quashed the approval last time, and whether the Crown’s consultation this round is consistent with the direction that was given there,” Gunn said.
Many First Nations in B.C. and Alberta support the project. Some have publicly entertained the idea of purchasing it from the federal government. Project Reconciliation, founded by former Thunderchild First Nation Chief Delbert Wapass, called Canada’s approval the right decision. It’s proposing to take a 51% ownership stake in the project on behalf of nearly 340 Indigenous communities in Western Canada. Support for the project, however, won’t save the pipeline from renewed court challenges. MacLean pointed out the weaknesses in the government’s proposed measures to accommodate the concerns of Indigenous communities – an obligation it was legally obligated to fulfil. “[They] really don’t hold water from an environmental law point of view,” he said. “They remain very much speculative in the form of what I would call vague assurances.” These measures include funding for habitats affected by the project, support for Indigenousled studies and a commitment to develop a response system
alongside First Nations. “Unfortunately, this feels too familiar – Canada repeated many of the same mistakes from last time,” said Tsleil-Waututh Chief Leah George-Wilson, who called the federal decision disappointing, but not surprising. Legal action could further delay the project, but a second Federal Court challenge may not provide disappointed Indigenous communities with their preferred result. Brian Livingston, an executive fellow with a legal background in Indigenous matters at the University of Calgary, believes it will now be more difficult for a court to find the federal government didn’t properly consult communities in its second attempt. “My assessment is they’ve paid specific attention and particular attention to the two issues,” he said, referencing the consultation issues and environmental concerns identified in the Federal Court of Appeal decision. “But we’ll see. No lawyer worth his salt will ever say that there’s a 100% chance of winning a case or losing a case.” •
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BUSINESSVANCOUVER June 25–July 8, 2019
news
Extradition law could clip Hong travel | Business
travellers fear ‘reverse Meng Wanzhou’ arrests at Hong Kong airport if Chinese legislation passes By Chuck Chiang cchiang@biv.com
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hina’s proposed extradition law in Hong Kong has sparked fears that it could inflict heavy damage on the travel sector by discouraging business travellers from flying through the city. And if passengers do look to avoid connecting through Hong Kong International Airport – the world’s eighth-busiest airport by passenger count – it could have ramifications for Vancouver, as the Vancouver-Hong Kong route is among the most popular international routes here, with three carriers providing as many as 31 weekly flights between the two cities. For veteran Vancouver Chinese-Canadian journalist Victor Ho, the potential application of the proposed law, which would
Asian unrest Continued from page 1
It maintains that an extradition agreement with China wou ld severely da mage the business climate that has been fundamental to Hong Kong’s success as an economy over the last six decades.
One leading Canadian academic says that, had Hong Kong been more effective in showing the law would deal only with clearly criminal matters, there would have been little opposition from the business world. “There are a whole bunch of people in the business community who are in Hong Kong from time to time, and they see sometimes that a business dispute in China can lead to someone ending up behind bars,” said Gordon Houlden, director of the China Institute at the University of Alberta and a former Canadian diplomat. “In Canada, similar cases might, at worst, get you sued in civil court. So we are not talking about elements of criminality; we are talking about contractual disputes, with powerful SOEs [state-owned enterprises] or government agencies having accusations against your business contacts. If that hits the business community, that’s where it affects them.” One exa mple ca n be fou nd locally: John Chang and Allison
facilitate the arrest and extrad ition to ma i n la ndCh i na of suspects in Hong Kong, has an immediate parallel that’s familiar to the Vancouver public. “My first reaction when I heard about the [extradition] law was ‘Oh no, you are trying to copycat the Meng Wanzhou arrest in Hong Kong,’” said Ho, formerly the editor-in-chief of the Vancouver edition of Chineselanguage newspaper Sing Tao Daily. “That’s the acute danger – American citizens, if this extradition law passes, would be the prime targets of Beijing if they want to warn the Trump government that they can also extradite people to China.” Ho said the passing of such an extradition law would have an instant chilling effect on all forms of travel, including business travel, through Hong Kong, damaging the city’s ability to function as a global connections hub for commercial aviation.
A controversial extradition law is threatenening Hong Kong’s status as a hub for international business travel connections | Raunak Kothari/Shutterstock
H o n g K o n g C h i e f E x e c utive Carrie Lam has suspended the proposed extradition bill’s tabling at legislature after millions of protesters took to the streets this month, demonstrating against what critics describe as an erosion of the city’s independent, common-law-based
judicial system. Bob Mann, analyst with NewYork-based a i rl i ne i ndustry consultancy R.W. Mann & Co. Inc., said that while there aren’t exact precedents, there are similar cases where new laws altered
travellers’ route patterns. One such instance, Mann said, happened at Miami International Airport following the September 11, 2001, terrorist attacks, after U.S. authorities eliminated exemptions from clearance for
passengers who were connecting through Miami without a visa to enter the United States. “This drove many Europe-Latin America passengers to connect instead via Toronto, benefiting Air Canada at the expense of U.S.,
Lu, the Ca nad ia n ow ners of Richmond’s Lulu Island Winery, were arrested in China in 2016 after Chinese authorities accused them of undervaluing wine imports. Chang remains in jail and could be sentenced to life in prison. Former Vancouver city councillor and ex-SUCCESS CEO Tung Chan said the more alarming thing for western businesses operating in Hong Kong is that the city has seen a continued pattern of moving away from “one country, two systems” at the behest of Beijing. If that pattern continues – even if the current extradition bill gets withdrawn permanently – western businesses would need to start looking for an Asia-based hub alternative. “T his unrest makes people focus, but Hong Kong has been slowly losing its role as a financial hub in the last 20 years,” said Chan, who was born in Hong Kong and maintains close contact with the Cantonese-Canadian business community. Chan noted that Beijing’s commitment to “one country, two systems” with Great Britain is for a 50-year period starting in 1997. “ We a r e a l m o s t h a l f w a y through that period now. What’s going to happen at the end of the 50 years? I don’t think China will adopt Hong Kong’s system, and I don’t think the current system
will continue.” As of 2018, Hong Kong, when ranked as an independent economy, places 10th among Canada’s largest trading partners, with shipments valuing $3 billion, which is more than markets like France and Italy. The Canadian Chamber of Commerce in Hong Kong did not respond to requests for comment on the extradition situation. T he A merican Chamber of Commerce, however, issued a statement saying it is “relieved” that Lam suspended the extradition bill, but added that maintaining Hong Kong’s judicial independence is crucial to the city’s appeal to international businesses. However, several business sectors see opportunity in the recent Hong Kong unrest. Chan said Metro Vancouver’s sagging real estate sector sees a potential influx of buyers as Canadian citizens leave Hong Kong, and some realtors are going as far as travelling to the city to make the sales pitch. But Andreas Schotter, a former expatriate executive in China and currently an associate professor at the University of Western Ontario’s Ivey Business School, said businesses dependent on success in the Chinese market may now have more reason than ever to consider “skipping the middle man” if Hong Kong no longer
carries the judicial advantage of having a western-style business arbitration environment. “Eventually, such a move could threaten the international hub status of Hong Kong,” Schotter said of the extradition law. Schotter added that the challenge for Canadian businesses is finding another landing spot in Asia that would have as many natural links to B.C. and Vancouver as Hong Kong does. He noted that 300,000 Hong Kong residents – almost 5% of the population – carry Canadian passports. Likely alternatives like Singapore (5,000 Canadian citizens), B a n g kok ( 5,000) a nd cit ie s within mainland China (20,000) wouldn’t have nearly the same level of linkage to make them a viable alternative for Canadian businesses committed to Asia. A nother a lternative, Cha n said, could be to elevate the role of Vancouver in Canada’s trade interactions with Asia. But regardless of the options being sought, there needs to be a Plan B, he noted. “If you believe in the Chinese market, places like Shenzhen have outgrown Hong Kong in recent years,” Chan said. “If you don’t believe in the Chinese market, it used to be that Hong Kong could be a competitive choice. Now, people can look at Singapore, but Vancouver could
be just as good. We have the same language skills and many of the same business links. “Now, I’ve not seen people successfully try to move things like high tech or import/export back to Vancouver from Hong Kong, because the big time-zone difference is very challenging to overcome. So at the moment, I don’t think businesses need to act drastically to leave Hong Kong; but you need to plan for that day when [one country, two systems] ends.” Houlden, however, remains optimistic about Hong Kong’s potential to pull out of the protests w ith its globa l statu re intact. “The odds are still in Hong Kong’s favour,” he said. “It’s a hard-working place, and people are involved in business. Yes, they want a democratic system, but there’s also the pull of people wanting to get their business done.… So I think there will be a bounce-back [economically] after these events as people go back to work. But if Hong Kong develops a here-we-go-again disruption two weeks from now, and then in September things start over again, at a certain point, businesses will look at the risk of Chinese intervention – and that’s when you will have people considering putting their headquarters in Singapore, Tokyo or Shanghai.” •
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BUSINESSVANCOUVER June 25–July 8, 2019
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Kong’s wings as travel hub Latin American and European carriers that had traffic rights to and beyond Miami,” Mann said, adding that another similar scenario is the misuse of Interpol’s red notice, usually reserved for serious criminals, by some countries such as Russia and the United Arab Emirates to pursue political enemies. If used the same way, China’s proposed extradition law could hurt Cathay Pacific Airways Ltd. and Hong Kong’s connecting traffic, Mann said, noting that it is possible that East Asian rivals such as Singapore (Changi Airport/Singapore Airlines) and Seoul (Incheon International Airport/Korean Air/Asiana Airlines) would be primed to pounce on the passenger traffic diverting away from Hong Kong. Sean King, sen ior v icepresident of New York-based
consultancy Park Strategies and an affiliated scholar at the University of Notre Dame’s Liu Institute for Asia and Asian Studies, agreed with Ho that uncertainty around travellers’ status in Hong Kong if the extradition law passes would be a game-changer for many visitors, with Singapore the most likely replacement connecting point for many western investors. “Anybody who’s been to the PRC [People’s Republic of China] is theoretically at risk,” King said. “Critics of [Chinese leader] Xi Jinping’s regime and/or those with mainland business disputes who visit Hong Kong should be on high alert if this bill becomes law.… Singapore’s its own master and is friendly with America, thus making it a far more attractive geopolitical basing option for many multinationals.”
Other observers, however, noted that the recent extradition dispute is just the latest manifestation of a trend that has been in place for several years now. Charlie Wu, managing director of the Asian-Canadian Special Events Association and organizer of the annual TaiwanFest in Vancouver and Toronto, said he had already stopped travelling to Hong Kong even before the outbreak of protests this month, mainly because of his role as a commentator – often critical of Beijing – on local Chineselanguage media outlets such as Fairchild Radio. “I don’t feel safe travelling to Hong Kong, and I have met people who have spoken to that effect, as well,” said Wu, whose TaiwanFest show featured a crossover billing with Hong Kong just a few years prior.
“These people don’t necessarily do a lot of business with China, but because Hong Kong is a hub where a lot of international finance takes place, people do use the city to connect with other markets internationally. What happens with the [extradition] law w i l l determ i ne whether they’d have to find another hub.” Hong Kong authorities will have to consider not just the effect on commercial aviation, but also on the business reputation of the city as a whole, and even on the Chinese market. “I think there’s about 70% of China’s [inbound] foreign investment going through Hong Kong,” Wu said. “That’s definitely going to decline if people don’t believe ‘one country, two systems’ is working out…. Longterm-wise, I think the Chinese government may come around to
Anybody who’s been to the PRC [People’s Republic of China] is theoretically at risk. Critics of Xi Jinping’s regime and/or those with mainland business disputes who visit Hong Kong should be on high alert if this bill becomes law
[] Sean King Senior vice-president, Park Strategies
see the need to keep Hong Kong separate and leave it alone. That would definitely do wonders for people like me to go back to travelling through Hong Kong.” •
China tensions expected to trigger new immigration wave immigration | Many
Canadians in the former British colony are expected to return
By Albert Van Santvoort
business at Simon Fraser University’s Beedie School of Business. “When they leave, they leave for the freedom. They don’t leave for economic opportunity or other benefits because they have that there.” However, the end of British rule in Hong Kong did not have as drastic an impact as many had thought. As years passed, many Hong Kong residents living in Canada began moving back to Hong Kong, not only because of the lack of Chinese intervention but for economic opportunity. But the veil of Hong Kong independence that has existed for the past 20 years has been lifted. Millions took to the streets in Hong Kong last week to protest a newly proposed China extradition bill. If passed, the bill would allow the extradition of people not only to China but also to anywhere in the world with which Hong Kong does not have an existing extradition agreement. Growing concern among Hong Kong residents about China’s encroachment on the territory could result in a wave of migration similar to that experienced in the 1990s. If China continues to intervene in the territory, Hong Kong
avansantvoort@biv.com
R
ising tensions between Hong Kong residents and Chinese authorities may highlight the symbiotic relationship between Hong Kong and Canada by spurring a new cycle of migration from the former British colony. Hong Kong boasts one of the largest Canadian communities abroad, with 300,000 Canadians living in Hong Kong and nearly twice that number of Hong Kong residents living in Canada. The migration pipeline between the two countries is largely a result of the 1997 handover of Hong Kong, where sovereignty of the territory was transferred from the U.K. to China. Many residents feared what the inevitable transfer would mean for democracy and freedom in Hong Kong. These concerns sparked waves of migration in the early 1990s to places like Vancouver and Toronto, with many of the migrants becoming Canadian citizens. “The only things they fear they will be missing out on are the freedoms they enjoyed under the British regime,” said Rajiv Kozhikode, professor of international
Hong Kong residents protest on June 16 against the erosion of freedom under Chinese rule in the territory. Rising tensions between Beijing and the former British colony could drive a fresh wave of migration to Canada | PaulWong/Shutterstock
residents will move to Canada, said Kozhikode. However, if rising Chinese control in Hong Kong turns out to have less drastic consequences than feared, it’s likely those former residents will return.
This two-way flow of people would prevent a large jump in the immigration statistics. Because of the initial 1990s migration wave and the subsequent return, many of the Hong Kong residents likely to migrate to Canada are
already Canadian citizens, having obtained citizenship during the first migration wave, or are the children of people who did.
The ties that many Hong Kong residents have to Canada mean that the likely effect on the real estate market isn’t as simple as increased demand and upward pressu re on housi ng prices. While data is limited, Ken Tung, president of the Civic Education Society and radio commentator, said that many Hong Kong
residents hold property in Canada purchased during the first migration wave, so new housing market demand will likely be tempered. However, this could cause issues in the rental market. If Hong Kong residents have been holding property in Canada and renting it out, rental stock will be taken off the market when they return, pressuring an already squeezed rental market. The migration wave probably could have had better timing for the Canadian economy. Canada and British Columbia in particular are experiencing tight labour markets, where workers are difficult to find. An increased labour pool could put downward pressure on wages and other labour costs that are now rising. The impact, however, may not be significant since the labour shortages are mostly in the trade sectors, such as construction and trucking, whereas Hong Kong residents tend to seek white-collar jobs, Tung said. Post-secondary education is one area of the economy expected to benefit from this migration. Hong Kong residents already make up a large part of B.C.’s international-student base. •
8
news
BUSINESSVANCOUVER June 25–July 8, 2019
Free-trade deal with U.S. and Mexico divides regions, age groups Overall, which one of the three countries do you think has benefited the most from free trade in North America? Canada
Podium Mario Canseco
O
n the final day of November 2018, the heads of government of Canada, the United States and Mexico signed a new free-trade deal, known in this country as the Canada-United States-Mexico Agreement (CUSMA). The ceremony, which took place in South America, was rushed for various reasons, including the fact that Mexican president Enrique Peña Nieto had just a few hours left in his tenure. At the time, U.S. President Donald Trump reverted to his customary over-the-top descriptions (“So important … a truly groundbreaking achievement”) to explain what had been reached. But how do Canadians, who are mostly immune to Trump’s showboating, feel about what free trade has done for the country? A recent Research Co. survey found that only one in five Canadians (20%) believes Canada has benefited the most from the original North American Free Trade Agreement (NAFTA) since it was signed in 1994. More Canadians believe Mexico (26%) and the United States (35%) are the “winners” in the free-trade deal, while 19% are undecided.
Gender
Age
Region
Male
Female
18-34
35-54
55+
BC
Alberta
SK/MB
Ontario
Quebec
Atlantic
Canada
20%
21%
19%
25%
22%
15%
11%
6%
28%
25%
23%
16%
United States
35%
33%
37%
33%
37%
36%
37%
41%
26%
31%
36%
51%
Mexico
26%
34%
18%
16%
25%
36%
33%
32%
23%
30%
18%
10%
Not sure
19%
12%
26%
26%
16%
13%
19%
21%
23%
14%
23%
23% Source: research co.
There are some staggering differences when the views of specific demographics are gauged. Men are significantly more likely than women to say Mexico “won” NAFTA (34% to 18%), and Canadians aged 55 and over are significantly less likely to think Canada is the victor (15%) than their counterparts aged 35 to 54 (22%) and aged 18 to 34 (25%). On a regional basis, the three areas that are the least likely to believe that Canada has “defeated” the other North American countries on free trade are Alberta (6%), British Columbia (11%) and Atlantic Canada (16%). The negotiations that led to NAFTA’s death and CUSMA’s birth were precipitated by Trump’s administration. The legislation that is required to ratify CUSMA is in second reading in the House of Commons. If the new deal is not ratified before the October federal election, it may not stay in place afterward. There is no clear timetable for Canada’s legislature, but Foreign Affairs Minister Chrystia Freeland has said the country intends to move “in tandem”
with the United States to ratify the deal. This might prove problematic. The Republican party no longer holds a majority in the House of Representatives, so ratification in the United States may not be as smooth as once envisioned. In addition, the start of the longest presidential primary season in history may play a role in the immediate future of CUSMA. When Trump was a candidate for the Republican presidential nomination, he threatened to “tear up” NAFTA many times in speeches and rallies. The 2020 campaign may produce a Democratic party front-runner who may prefer to take it slow on new trade deals and ask his fellow party members in the lower house to wait for a more competent head of state before pondering ratification. Mexico, it is safe to say, is not a problem in this calculation. The country has summarily genuflected to Trump’s threats of tariffs, effectively enabling a foreign entity to dictate immigration policy within its borders. For many longtime observers of Mexican politics, the sight
of the current government giving in to the wishes of the United States was not astonishing. Mexican President Andrés Manuel López Obrador – as well as Foreign Secretary Marcelo Ebrard – paid US$4.3 million to a firm headed by Trump’s personal lawyer Rudy Giuliani for advice to deal with security concerns when both served in Mexico City’s government. López Obrador raucously claimed during his campaign that he would put Trump “in his place” once he became Mexico’s president. The Mexican government’s actions suggest that the “place” López Obrador alluded to is a throne. Setting aside Mexico’s current foibles, almost half of Canadians (48%) want to see CUSMA ratified, while just over a third (36%) believe the deal should be rejected. Liberal party voters in the 2015 election (56%), men (53%), Canadians aged 18 to 34 (57%) and British Columbians (51%) are more likely to believe that it is better to just say yes to the deal now. In any case, Liberal Party of Canada supporters can take solace in the fact that negotiations towards the new
free-trade deal have not been particularly detrimental. Just over three in five Canadians (63%) express confidence that the federal government will do what’s best for Canada when it comes to international trade. The regional breakdowns are also important for Justin Trudeau’s political future. Majorities of British Columbians (63%), Ontarians (60%) and Quebecers (56%) express confidence in the government, while the results are more restrained in Alberta (50%), Atlantic Canada (also 50%), and Manitoba and Saskatchewan (49%). The seats that may enable Trudeau to remain in government are in the provinces where, on the free-trade front, the government’s actions are welcomed. • Mario Canseco is president of Research Co. Results are based on an online study conducted from May 31 to June 3, 2019, among 1,000 adults in Canada. The data has been statistically weighted according to Canadian census figures for age, gender and region in Canada. The margin of error, which measures sample variability, is plus or minus 3.1 percentage points, 19 times out of 20.
Condo incentives aim to kick-start stalled market real estate | Buyer’s
bait increases in the valley as developers face sales crunch time postponed sales launches as of April.
By Frank O’Brien fobrien@biv.com
Last December, a Langley developer grabbed headlines with a buyer incentive that promised free mortgage payments for the first year. Now the 78-unit building has been converted to a rental project after sales fell short of the “magic” number.
C
ash bonu ses of up to $100,000 for realtors; free flights, skis and golf; free strata fees for life and 8% interest paid on deposits for buyers are among the tempting incentives being dangled by Metro Vancouver condo developers. In some cases the buyer bait is not enough to turn the tide on what the Real Estate Board of Greater Vancouver is calling the worst housing sales slump in 19 years. As of the end of May, there was an inventory of 766 newly completed and unsold condo apartments in Metro Vancouver, compared with 326 for all of 2017, according to Canada Mortgage and Housing Corp. . Currently, 25,158 condo apartment units are under construction in the Metro
Pre-sale buyers at the Soleil White Rock condo project can earn 8% interest on their deposit during the three years it will take to finish the 178-unit luxury tower | Submitted
region, representing 70% of the total housing units underway. MLA Advisory, a Vancouver
research firm, estimates that about 5,000 concrete condo units in 17 separate projects had
“The magic number is 50%,” said Vince Taylor, president of Platinum Project Marketing, referring to the percentage of sales condo developers must achieve before they can secure construction financing from increasingly nervous lenders. In the current market, developers may set out a nine-month marketing window as they attempt to sell half the units in a project. Just two years ago, it was not uncommon for an entire condo project to sell out within days.
Today developers are turning to all forms of imaginative incentives to attract buyers. Wesgroup is offeri ng price discounts of from $10,000 to $20,000 on its Mode condo project in southeast Vancouver; Intergulf is allowing condo buyers to put down 15% instead of the usual 20% deposit at its Hunter at Lynn Creek project in North Vancouver; the 27North project in North Vancouver by Intergulf and Tatla Developments offers buyers a 10% deposit plus choice of ski pass and skis for all the family, free golf for a year, free mountain bikes for the family, or the cash equivalent; and Platinum Project Marketing’s pitch for the News condo project in Abbotsford includes a choice of $3,000 worth of WestJet continued on page 10
The Commercial Real Estate Poker Invitational All-in for Charity
Thank you to all participants and sponsors who joined us on Thursday, June 13, 2019 to help provide lifesaving care at Royal Columbian Hospital to some of the most seriously ill and injured patients in the province.
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RAFFLE GRAND PRIZE SPONSORS
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TABLE SPONSORS
-
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EXECUTIVE COMMITTEE
- Norm Taylor, Executive Vice President & Managing Director, CBRE - Bill Tucker, CEO, Omicron - Beau Jarvis, Executive Vice President, Wesgroup - Jennifer Podmore Russell, Senior Vice President, Rennie Group
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10
BUSINESSVANCOUVER June 25–July 8, 2019
realestate Inclusive city visions and vertically challenged industrial storeys
Real estate roundup Peter Mitham
Inclusive and complex Vancouver Mayor Kennedy Stewart geeked out – to use his term – with a PowerPoint presentation to Urban Development Institute members on June 13, outlining his vision for the city. Among the first slides he showed was a graphic of where Stewart hopes the new City Plan process will take Vancouver. It showed a graph broken into four quadrants by two axes, the vertical running from exclusive to inclusive, and the horizontal from simple to complex. Stewart said he wants to live in a global city, one with complex regulations that support
inclusive housing. What that city of the future could look like is anyone’s guess, however. There are no concrete examples. None exist. Rather, he said. Vancouver has a shot at creating them. “I think we’re the ones that are going to do this,” he said. “Our council, you, the public – we’re going to come up with a new form of city that’s going to work for everybody.… The most critical part is we all work together.” Out or up? A c u r iou s q u e s t ion q u iet ly emerged from a panel discussion about industrial property recently hosted by commercial real estate association NAIOP. While a shortage of welllocated and readily developable industrial land has plagued municipalities from Vancouver to Chilliwack, panellists also noted that there wasn’t yet enough pressure to force developers to build multi-storey industrial buildings. In short, so long as it’s still cheaper to
build out, industrial space won’t be growing up. Despite having a dozen multistorey industrial projects on the go, Taylor Kurtz Architecture + Design Inc. president Craig Taylor said he doesn’t think the market as a whole is ready to embrace the form. The landconstrained industrial markets of Vancouver and Burnaby are showing potential but the costs are rising. This is true for developers and occupants alike. “Our clients are generally telling us that the pro formas just don’t quite stack up – pardon the pun – when you compare the costs to large tracts of land that you’ve got in Campbell Heights and the [Fraser] Valley,” he said. Taylor dismissed the muchcited example of Goodman Interlink, a 22-storey industrial tower with 2.4 million square feet in Hong Kong, as a function of a lack of land rather than cost. (It’s not the only example of a 22-storey industrial tower, either. An older example is the Grandtech
Centre, a 509,200-square-foot facility in Hong Kong’s Sha Tin neighbourhood.) Ben Taddei, COO of the Conwest Group of Cos., shared Taylor’s view. With land costing $2.5 million to $4.5 million an acre, and construction costs running $300 a square foot, Taddei said total project costs could end up being upwards of $500 per square foot. “I think it will be a while before you see that built form,” he said. “Until the market runs out of industrial land for largebay [facilities] and those prices become so horrendous that the alternative is to pay more for stacked product, I don’t think you’re going to see it.” How high? Colliers International is more bullish on the future of the form, however. Colliers associate vice-president Roy Pat moderated the NAIOP panel, making mention of his firm’s recently published report happily titled Is It Time to
Condo incentives Continued from page 8
CBRE Limited has been exclusively appointed by a confidential post-secondary institution to look at all lease and/or purchase opportunities available in Metro Vancouver. We are requesting information from landlords and/or developers that can satisfy the following requirements:
(TSX:WJA) airline tickets or the same amount in a gift card to Abbotsford shops. W hen R A R Development launched its Eliot condo project June 22 in East Vancouver, where two-bedroom condos start at approximately $700,000, it offered to cover the entire housing costs – mortgage payments, taxes and maintenance fees – for the first year for the first four buyers. But the bait at the 26-storey Soleil White Rock condo tower may be the most lucrative for buyers. Under this plan from developer RDG Management is an offer to pay buyers of the $484,900-to$1,609,900 condos 8% interest on their deposit during the three years the Soleil project is being built. “With the building set to be completed in mid-2022, this means that buyers can receive an extra $23,275 to $77,275 in interest from their down payment of 20%,” explained RDG Management president John Rempel. Craig Anderson, director of marketing and sales for Magnum Projects, who came up with the idea, said that Soleil is attracting local downsizers who often take a line-of-credit loan on their existing house to cover the condo deposit. “They are paying 4% to 5% on their line of credit, but they
Go Vertical in Metro Vancouver?. “While the 22-storey industrial facilities of Asia are unlikely to be seen springing up across Vancouver any time soon, densification of industrial sites is a trend that shows no signs of abating,” the report states. “There are simply too many factors driving the push to go vertical.” NAIOP panellist Eric Aderneck, an independent planning consultant formerly with Metro Vancouver, said references to industrial towers confuse the issue. A report he wrote six years ago for Metro Vancouver pointed instead to the four-storey Asia Airfreight Terminal in Hong Kong, which has 1.8 million square feet, as a better example. Closer to home, it’s matched by the three-storey Georgetown Crossroads facility in Seattle, which Colliers expects will set the pace for future multistorey industrial projects in Vancouver. • pmitham@telus.net
I call it buying or crying. If you don’t buy a new condo today you will be crying about it later
[] Vince Taylor president, Platinum Project Marketing
can earn 8% on their deposit at Soleil,” he said. The earned interest is deducted from the closing price of a Soleil condo. So far, 40% of the Soleil White Rock’s 178 units have sold, and Rempel said he is confident the project will start construction this fall. Anderson said some developers are offering cash incentives to real estate agents of $25,000 up to $100,000 for every new condo unit they sell, but he said direct incentives to buyers appear to be the most effective. Taylor is marketing the Altus condo project in White Rock, which is offering its buyers free strata fees (average $400 per month) for life, plus a guarantee that the developer will buy the condo back if the buyer is not satisfied with the finished product. But, Taylor insisted, the real incentive for buyers today is tomorrow. “I call it buying or crying,” he said. “If you don’t buy a new condo today you will be crying about it later. That is how good the deals are right now.” •
BUSINESSVANCOUVER June 25–July 8, 2019
11
finance
Bryan Yu
R
esidential construction continued to defy expectations with the latest permit and housing starts data showing ongoing strength. Residential building permits more than doubled in April to a record-high $2.2 billion (seasonally adjusted). The Vancouver census metropolitan area (CMA) drove the gain with dollarvolume permits up 164% to $1.42 billion almost entirely for multifamily projects, while Abbotsford-Mission permits rose to $69.8 million – more than six times March levels. Kelowna permits rose 46% from March to $76.6 million, while Victoria permits declined 32%. The surge in the Vancouver CMA reflected developers expediting activity in advance of changes in development cost charges in May. With April’s gain, year-to-date activity in B.C. rose 13%, led by an 18% increase in the Vancouver CMA and a 58% increase in Abbotsford-Mission. This permit surge is temporary and will decline sharply in coming months. Similarly, urban housing starts rose to a seasonally adjusted annualized pace of 53,350 units in May to extend April’s sharp gain. Multi-family starts rose while detached starts declined. This was the strongest month since October 2017 and
Residential building permits more than doubled in April to a record high of $2.2 billion Metro Vancouver, Fraser Valley the main drivers in building permit boom $1,600 1,400
Millions
1,200 1,000 800 600 400 200 January 2011
January 2013
January 2015
January 2017
Vancouver CMA
January 2019
Other B.C. SourceS: statistics canada, central 1 credit union
B.C. urban housing starts rose in May to extend April’s sharp gain Multiple-family housing starts up; single-family housing starts down Units (seasonally adjusted annual rate)
Data Points
compared with a first quarter trending near 25,000 units. Not surprisingly, the Vancouver CMA led this increase, with starts up to a 42,700 seasonally adjusted annualized rate from 34,200 in April. Year-to-date starts increased 7%. Gains were led by a 10% increase in the Vancouver CMA and an 11% increase in Victoria. Housing starts are expected to wane. Elevated inventory and federal and provincial policy measures are hampering presale activity, which will delay and curtail new construction over the next year. This will particularly be the case in the Vancouver CMA, where prices are declining and building activity is near a record high. We continue to forecast a drop in provincial housing starts of up to 10% this year on a secondhalf slowdown, with further declines in 2020. Non-residential permit volume also remained robust despite declining from March. Following a 50% increase in April, permits fell 13.6% to $661.6 million. Nevertheless, levels remained elevated and double those of a year ago. Private-sector permits were broadly unchanged from April at $581.9 million (up 1%) but offset by a 58% pullback in public-sector building permits. While permits are volatile, the current trend speaks to a strong construction cycle. Year-to-date non-residential permit volumes rose 63% to $2.25 billion. Among metro areas, gains were led by a 52% increase in Vancouver CMA permits, which reached $1.38 billion, accounting for just over half of the net provincial gain. •
home construction shows strength
50,000 45,000 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0 January 2005
January 2007
January 2009
January 2011
January 2013
Detached
January 2015
January 2017
January 2019
Multi-family SourceS: statistics canada, central 1 credit union
non-residential building permits up Non-residential construction’s three main categories have remained robust thus far in 2019 Office and retail construction sector has shown the sharpest uptick $1,800 1,600 1,400 1,200 Millions
B.C. residential building permits hit record high
1,000 800 600 400 200 Industrial
Commercial 2018
Bryan Yu is deputy chief economist at Central 1 Credit Union.
Institutional and governmental 2019 SourceS: statistics canada, central 1 credit union
INSIDERTRADING The following is a list of stock trades made by corporate executives, directors and other company insiders of B.C.’s public companies filed in the week ended June 19, 2019. The information comes from a compilation of required reports filed with the BC Securities Commission obtained from DisclosureNet. com.
Insider Frank Giustra, director Company: Leagold Mining Corp. (TSX:LMC) Shares owned: 5,066,900 Trade date: June 14, 17 Trade total: $350,593 Trade: Acquisition of 200,000 shares at prices ranging between $1.75 and $1.76 per share Insider Paul H. Stephens, 10% owner Company: EMX Royalty Corp. (TSXV:EMX)
Shares owned: 8,876,694 Trade date: June 13 Trade total: $232,004 Trade: Sale of 187,100 shares at a price of $1.24 per share Insider Patrick Downey, director Company: Orezone Gold Corp. (TSXV:ORE) Shares owned: 3,790,000 Trade date: June 14 Trade total: $221,760 Trade: Acquisition of 462,000 shares at a price of $0.48 per share Insider Thanh Chan Kang, officer Company: Whitecap Resources Inc. (TSX:WCP) Shares owned: 555,728 Trade date: June 17 Trade total: $200,000 Trade: Acquisition of 50,000 shares at a price of $4 per share
Insider Dale Edwin Andrews, officer Company: Teck Resources Ltd. (TSX:TECK) Shares owned: 60,000 Trade date: June 14 Trade total: $143,750 Trade: Acquisition of 5,000 shares at a price of $28.75 per share Insider George Raymond Burns, director Company: Eldorado Gold Corp. (TSX:ELD) Shares owned: 204,765 Trade date: June 14 Trade total: $109,636 Trade: Sale of 18,551 shares at a price of $5.91 per share Insider Gregory Gibson, director Company: BonTerra Resources Inc. (TSX-V:BTR)
Shares owned: 93,000 Trade date: June 13 Trade total: $100,217 Trade: Acquisition of 49,000 shares at prices ranging between $2.04 and $2.05 per share Insider David Michael Mombourquette, officer Company: Whitecap Resources Inc. (TSX:WCP) Shares owned: 823,823 Trade date: June 13 Trade total: $100,149 Trade: Acquisition of 23,845 shares at a price of $4.20 per share Insider Jacob H. Kalpakian, director Company: 37 Capital Inc. (CSE:JJJ) Shares owned: 1,889,044 Trade date: June 13 Trade total: $93,250
Trade: Acquisition of 1,865,000 shares at a price of $0.05 per share Insider Kenneth Edward Berry, 10% owner Company: Northern Vertex Mining Corp. (TSX-V:NEE) Shares owned: 3,000,547 Trade date: June 13 Trade total: $32,000 Trade: Acquisition of 200,000 shares at a price of $0.16 per share Insider James McDonald, director Company: Northern Vertex Mining Corp. (TSX-V:NEE) Shares owned: 4,196,000 Trade date: June 13 Trade total: $30,400 Trade: Acquisition of 190,000 shares at a price of $0.16 per share •
12
BUSINESSVANCOUVER June 25–July 8, 2019
BIVLIST
Biggest accounting firms in B.C. Ranked Totalnumber numberof ofemployees employeesin inB.C. B.C. RANKED BY | BY | Total Rank Company '19
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
KPMG LLP 777 Dunsmuir St, Vancouver V7Y 1K3 P: 604-691-3000 F: 604-691-3031 kpmg.ca MNP LLP 1021 Hastings St W Suite 2200, Vancouver V6E 0C3 P: 604-685-8408 F: 604-685-8594 mnp.ca Deloitte LLP 1055 Dunsmuir St Suite 2800, Vancouver V7X 1P4 P: 604-669-4466 F: 604-685-0395 deloitte.ca BDO Canada LLP 925 Georgia St W Suite 600, Vancouver V6C 3L2 P: 604-688-5421 F: 604-688-5132 bdo.ca PwC Canada 250 Howe St Suite 1400, Vancouver V6C 3S7 P: 604-806-7000 F: 604-806-7806 pwc.com/ca Grant Thornton LLP 333 Seymour St Suite 1600, Vancouver V6B 0A4 P: 604-687-2711 F: 604-685-6569 grantthornton.ca EY 700 Georgia St W Suite 2300, Vancouver V7Y 1C7 P: 604-891-8200 F: 604-643-5422 ey.com/ca Manning Elliott LLP 1030 Georgia St W Suite 1700, Vancouver V6E 2Y3 P: 604-714-3600 F: 604-714-3669 manningelliott.com Dale Matheson Carr-Hilton LaBonte LLP 1140 Pender St W Suites 1500, 1600 and 1700, Vancouver V6E 4G1 P: 604-687-4747 F: 604-689-2778 dmcl.ca Smythe LLP 475 Howe St Suite 1700, Vancouver V6C 2B3 P: 604-687-1231 F: 604-688-4675 smythecpa.com Baker Tilly WM LLP1 400 Burrard St Suite 900, Vancouver V6C 3B7 P: 604-684-6212 F: 604-688-3497 bakertilly.ca Crowe MacKay LLP 1177 Hastings St W Suite 1100, Vancouver V6E 4T5 P: 604-687-4511 F: 604-687-5805 crowemackay.ca Davidson & Co LLP 609 Granville St Suite 1200, Vancouver V7Y 1G6 P: 604-687-0947 F: NP davidson-co.com D&H Group LLP 1333 Broadway W Suite 1000, Vancouver V6H 4C1 P: 604-731-5881 F: 604-731-9923 dhgroup.ca Martin & Henry Chartered Professional Accountants 1012 Balfour Ave Suite 101, Vancouver V6H 1X1 P: 604-648-2827 F: 604-648-2098 martinhenry.ca Rolfe, Benson LLP Chartered Professional Accountants 1090 Georgia St W Suite 1500, Vancouver V6E 3V7 P: 604-684-1101 F: 604-684-7937 rolfebenson.com Lohn Caulder LLP 1500 Georgia St W Suite 300, Vancouver V6G 2Z6 P: 604-687-5444 F: 604-688-7228 lohncaulder.com Horizon Chartered Professional Accountants 650 Georgia St W Suite 1400, Vancouver V6B 4N8 P: 604-697-7777 F: 604-679-7778 horizoncpa.ca Clearline Chartered Professional Accountants 789 Pender St W Suite 1010, Vancouver V6C 1H2 P: 604-639-0909 F: NP clearlinecpa.ca Langbroek, Louwerse & Thiessen LLP 45515 Knight Rd, Chilliwack V2R 5L2 P: 604-858-4990 F: 604-858-4334 lltcpa.ca
Local managing partner(s)
Year founded
National headquarters
No. of B.C. locations
No. of international offices
Total no. of accountants Total B.C. staff in B.C. '19/'18 '19/'18
Walter Pela, regional managing partner
1897
Toronto
12
958
1,065 942
1,351 1,241
Darren Turchansky, executive vice-president, B.C., and regional managing 1958 partner, Vancouver, Mackenzie Kyle, regional managing partner, B.C. advisory Etienne Bruson, regional managing partner, B.C. 1858
Calgary
20
NP
858 670
1,007 923
Toronto
4
NP
345 352
900 881
Michael Madsen, office managing partner and international liaison partner 1921
Toronto
15
1,591
631 586
851 824
Jim McGuigan, managing partner, B.C. region
1912
Toronto
4
721
567 562
790 760
John Harris, managing partner, south coastal B.C., Dan Little, managing partner, Vancouver Island, Paul Gallo, managing partner, Interior B.C.
1980
Toronto
10
530
353 295
462 366
Fiona Macfarlane, managing partner, B.C., and EY Canada chief inclusiveness officer, Kevin Brennan, office managing partner, B.C., and Western Canada market segment leader Alden Aumann, managing partner
1945
Toronto
1
700
319 321
420 421
1952
Vancouver
4
NP
162 151
239 189
Robert J Burkart, office managing partner
1978
Vancouver
4
0
145 162
226 195
Bob Sanghera, managing partner
1980
Vancouver
4
538
168 148
208 194
Paul Websdale, managing partner
19882
Waterloo
4
746
154 86
203 105
Stefan Ferris, managing director, West Coast offices, David Gautier, managing director, Kelowna office
1969
Vancouver
6
8
152 130
182 155
Grant Block, partner
1984
Vancouver
1
710
107 90
118 104
Arthur Azana, office managing principal
1952
Vancouver
1
200
86 79
99 92
John D Martin, partner
1993
Vancouver
1
0
45 42
51 42
Robert Watts, managing partner
1958
Vancouver
1
467
36 36
50 50
Jason Nakano, managing partner
1978
Vancouver
1
0
41 36
45 40
Wendell Meeres, director
1993
Vancouver
1
0
36 32
42 38
Bilal Kathrada, managing partner
2009
Vancouver
4
0
32 34
36 39
David Langbroek, Kurt Louwerse, managing partners
1976
NP
1
NP
25 NP
34 NP
Sources: Interviews with representatives of above firms and BIV research. Other firms may have ranked but did not respond to information requests by deadline. NP Not provided 1 - Formerly Wolrige Mahon LLP; merger September 13, 2018, with Collins Barrow National Cooperative to form Baker Tilly Canada Cooperative 2 - Date Baker Tilly International network was founded; predecessor firm traces its roots back to the 1920s in Vancouver
Business in Vancouver makes every attempt to publish accurate information in the List, but accuracy cannot be guaranteed. Researched by Anna Liczmanska, lists@biv.com.
Next list published July 9 – Biggest construction companies in B.C.
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Introducing Our Newest Partners Across B.C. To be entrepreneurial in British Columbia’s diverse economy, you need to capitalize on opportunities that build on your strengths and values. That’s why MNP continues to grow the best team possible to ensure our entrepreneurial clients from across the province get the most from every opportunity. As one of Canada’s fastest growing national accounting and business consulting firms, MNP delivers the solutions and the people you need, wherever business takes you. Contact Darren Turchansky, CPA, CA, Executive Vice President for B.C., at 604.685.8408 or darren.turchansky@mnp.ca Back row (left to right): Sean Jordan, CPA, CA, Nanaimo; Blake Allan, CPA, CA, Vancouver; Roy Tong, CIA, CISA, Vancouver; Evert Helms, CPA, CA, Surrey; Paul De Jaegher, CPA, CA, Surrey; Susan Mowbray, MA, Vancouver; Michael Furnell, CPA, CA, Nanaimo; Victor Wong, CPA, CMA, CBV, Vancouver; Alycia Calkins, CPA, CA, Fort St. John; Bob Amsler, CPA, CGA; Kelowna Front row (left to right): Jeannine Walsh , CPA, CA, Chilliwack; Kerry Smith, CPA, CA, Vancouver; Kevin Yu, CPA, CA, Vancouver; Jacqueline Fehr, BA, JD, LL.M., Vancouver; Melissa Riechel, CPA, CGA, Surrey; Shaun Howe , CPA, CA, Surrey; Kathryn MacAulay, CPA, CA, Surrey; Terry Trotic, Vancouver; Ricky Nijjar, CPA, CA; Surrey; Jenn Schofield, CPA, CA, CAFM, Vancouver
14
BUSINESSVANCOUVER June 25–July 8, 2019
BIVLIST
Top accounting firms tally fastest growth in five years ANALYSIS | Largest
companies grew 9.6%, which is more than twice the 2016 rate
One- and five-year revenue growth at B.C.’s top five accounting firms
Number of local employees at the province’s largest accounting firms
The number of staff at the top five has increased an average of 26.6% since 2015
70
1,400
60
1,200 Number of B.C. employees
Percentage change in revenue
MNP leads the field with close to 70% increase over five years
50 40 30 20
1,000 800 600 400 200
10
KPMG LLP
MNP LLP One-year
Deloitte LLP
BDO Canada LLP
PwC Canada
2014 KPMG LLP
Five-year
2015 MNP LLP
2016 Deloitte LLP
Source: BIV list
By Albert Van Santvoort avansantvoort@biv.com
T
he province’s largest accounting firms had their fastest growth rate in five years according to data on Business in Vancouver’s Biggest Accounting Firms in B.C. list (page 12). Over the past year, the average B.C. employee count at the largest accounting firms grew
9.6% to 365.7 in 2019 from 333.6 in 2018. The previous high was 2016’s 4.1% one-year employee growth rate, less than half the recent peak. T he head cou nt at the five largest accounting firms in the province grew by 5.5% from 2018 to 2019, a lower rate when compared with the remainder of the list. However, the most recent growth was higher than the 4.1% one-year employee growth rate
experienced by the top five in 2018. The growth in employee numbers in 2018 from 2017 was less than half of the 8.5% revenue growth the top five experienced during the same period. Not all of the top five accounting firms increased their local employee base over the past five years. Between 2014 and 2018, PwC’s local employee base declined 15% to 760 in 2018 from
2017 BDO Canada LLP
2018 PwC Canada
Source: BIV list
894 in 2014. Some of these losses have been recovered with a 3.9% increase in local employment in 2019. BDO Canada LLP had the largest five-year growth, with employee numbers rising 74.6% to 824 in 2018, up from 472 in 2014. This growth continued into 2019 with local employment increasing by an additional 3.3%. MNP LLP had the second-largest five-year employee growth
at 63.4%, increasing to 923 employees in 2018 from 565 in 2014. Over the past year MNP’s growth continued with the addition of 84 employees or at 9.1%. MNP’s revenue growth over the five-year period ending in 2018 almost mirrored the growth in its head count, increasing 68.8% to $852.5 million, up from $505 million in 2014. The company also boasted the largest one-year revenue growth at 12.2%. •
Briefs
Amazon.com expects up to 800 people to work at its new fulfilment centre on Tsawwassen First Nation land at the Delta iPort industrial park | Chung Chow
e-commerce
Amazon raises hiring target for new B.C. facility R a p i d g r o w t h i s c o n t i n ui n g fo r A m a z on.com I nc.’s (Nasdaq:AMZN) Metro Vancouver operations, as construction on its third warehouse in the region, in Tsawwassen, is in full swing with a launch date set for the fall. Amazon is the second-largest e-commerce retailer in the world in terms of the gross value of merchandise sold, after Alibaba (Nasdaq:BABA), and it has more staff in Metro Vancouver than in any other metropolitan region, except for its home base of Seattle. Its hiring has been increasing, Amazon’s Canadian director of operations, Vibhore Arora, told Business in Vancouver during a June 19 tour of his company’s Tsawwassen facility. The latest staff count in the region is more than 2,300, although that figure is set to more than triple in the next few years.
When Amazon announced last September that it would build the Tsawwassen facility, it estimated that it would hire 700 workers to staff the site. That estimate has risen to about 800, Arora said. He added that the staff count at the company’s other two Metro Vancouver warehouses has increased from the previous 800-worker estimate provided last year, although he would not provide a specific number. The company last year said that it also employs about 1,500 staff in downtown Vancouver offices, mostly in software-related positions. That count was down from a previous 1,800-employee estimate in 2017. Regardless, Amazon still plans to hire 1,000 new workers, mostly for technology-related jobs based in an under-construction building at 402 Dunsmuir Street, by 2020.
BUSINESSVANCOUVER June 25–July 8, 2019
Insights
president | Alvin Brouwer, 604-366-0368 Editor-in-chief; vice-president, editorial, Glacier Media | Kirk LaPointe, 604-608-5183 Managing editor | Timothy Renshaw, 604-608-5131 Deputy Managing editor | Mark Falkenberg, 604-608-5174 online editor | Emma Crawford Hampel, 604-608-5138 Business in Vancouver is owned by Glacier Media Inc., 303 West 5th Avenue, Vancouver, B.C. V5Y 1J6
A transparent need for better investing
G
overnment financial transparency is improving. That’s encouraging. But government-spending decisions are not. In its most recent report on the fiscal accountability of Canada’s senior governments, the C.D. Howe Institute strikes an optimistic tone about the improving state of that accountability based on government reports and
transparency does not guarantee prudent spending of taxpayer dollars financial statements for fiscal year 2017-18 and budgets and estimates for fiscal 2018-19. The non-profit research institute notes, for example, that consistency of accounting is now the rule among senior governments. B.C. fares relatively well when compared with other provincial governments. The C.D. Howe study awards it an A- grade. That’s good enough for third place behind New Brunswick (A+) and Alberta (A) and far ahead of provincial laggards Manitoba (D+)
15
last laugh
and the Northwest Territories and Nunavut (F). The federal government, happily, scores a B+. But while C.D. Howe says Ottawa could join the top rank of fiscal accountability by instituting relatively minor improvements to budgeting procedures and presentation, transparency does not guarantee prudent spending of taxpayer dollars. And the country’s senior levels of government extract a lot of those dollars from the people they are elected to represent: more than $810 billion in 2018 alone, the C.D. Howe report estimates. But many of those billions are too often wasted on ill-conceived and incompetently executed initiatives such as the federal government’s Phoenix payroll system disaster. Meanwhile, concerns over the fiscal wisdom of Ottawa’s Trans Mountain pipeline purchase continue to grow, especially considering that federal government transparency over the re-approved project’s financials has thus far been poor. And analyses continue to point to the weakness of Trans Mountain’s business case now and the erosion of that case in the future based on the relatively low-grade oilsands product that will be shipped to market via any Trans Mountain pipeline expansion and the hurdles the project still faces. Financial transparency is good, but it does not necessarily improve the outcome of how money is spent.
Trudeau faces task of regluing the fragments of his fractured brand
Podium Kirk LaPointe
W
ho is Justin Trudeau? Even more important: What is Justin
Trudeau? The feminist who loses his two senior women from cabinet over questions of integrity. The environmentalist who buys a pipeline. The nationalist who plays passive with the bully pulpit of Washington and feeble in the face of Beijing. The reformist who suffocates his promise of proportional representation. As we head into a summer of pre-election barbecues, the Trudeau brand is on the spit. The lustre he fashioned following the ascendant 2015 victory
has faded such that he is at risk of snatching defeat from the jaws of victory. The conventional political wisdom is that incumbents ease with enormous advantages into a second mandate and only then have to contemplate renewal. Trudeau has to advance that agenda in the weeks ahead to re-establish his competence or he will be, as they say in college basketball, one and done – only in his case, not headed for the bigs. Given the early-term successes of bringing Canada back to the international stage, his fall of 20-plus points in public opinion is astonishing. Even more astounding is that he now has to grapple with the frontrunning ballot box issue of his character. Of course, politics are as elastic as a child’s attention span. Four months feel like four decades. It bears repeating that we were bracing for Tom Mulcair to possibly win this time four years ago. Stephen Harper seemed a spent force,
what’s your opinion?
and Trudeau was the butt of commercials claiming he was just not ready. He fought those ads with what seemed hubris – that he was indeed ready – and never looked back. His first term, though, has hardly sustained the consequential first images. A family-directed tax cut was not exactly revolutionary, but it serves as the signature economic accomplishment – the legalization of cannabis being the signature social one. Fewer live in poverty and we have the lowest unemployment in memory. But there is also deep-seated western Canadian animus from governments of the left and right and a newly fashioned trade deal with the U.S. defined by how little we lost at the table. Perhaps Trudeau’s decline is due to the loss of minuteby-minute collaboration with decade-by-decade friend and principal secretary Gerald Butts, or the loss of the day-today discipline of privy council clerk Michael Wernick, or the
humiliating outflanking of his apparatus by a rookie MP, Jody Wilson-Raybould, who declined to use her clout as attorney general to defer prosecution of SNC-Lavalin on serious allegations of impropriety in Libya. But he is a hollow shell of what was not exactly a pillar of gravitas in the first place. Strangely, the leader who put the party on his back has wounds that are the stuff of an inside job. They cannot be ascribed to the political opposition: Conservative Leader Andrew Scheer has been plugging away somewhat under the radar, while NDP Leader Jagmeet Singh has been all too evident as a hot mess. Scheer won party leadership narrowly in 13 ballots, Singh won handily in one, and neither has caught fire. Now Trudeau is left with little choice to leave behind those “sunny ways” and demonize the wolf in Scheer’s clothing – there will be more impolite terms, be assured – because the swiftest path to turn around
political fortunes is usually to go negative. As for Singh, Trudeau can only hope the NDP exodus comes to him and not the Greens, or there will be Conservatives elected from the dynamic. British Columbia will take a hit, including possibly the Vancouver-Granville riding now featuring an independent Wilson-Raybould. The Atlantic will not be the 2015 sweep it was. The Prairies are a writeoff. Where he stands to gain is Quebec. Where he has to gain is Ontario, where our elections are often settled, or the math won’t work. Those ubiquitous and meticulously rolled-up sleeves need to be for real and not for show this time if he has a chance to win. Barring a crisis that will permit him to don the superhero costume, what isn’t clear is where he is going to summon the special powers a second time.• Kirk LaPointe is editor-in-chief of Business in Vancouver and vicepresident, editorial, of Glacier Media.
| BIV welcomes readers’ opinions. All letters, including those sent by email, must include the author’s name, address and daytime telephone number. Business in Vancouver, 303 West 5th Avenue, Vancouver, B.C. V5Y 1J6. Email: news@biv.com. We reserve the right to edit for brevity, clarity and legality.
16
Insights
BUSINESSVANCOUVER June 25–July 8, 2019
B.C. employers should brace for impact from ESA amendments
Podium J. Geoffrey Howard and James Hsu
F
ollowing through on its commitment to modernize the Employment Standards Act (ESA), the BC NDP government passed several additional important changes to the ESA effective May 30. Here are the key changes to the ESA. Two new types of statutory leaves: Employees will be able to take “critical illness or injury leave” of up to 36 weeks a year to provide care or support to an ill or injured family member under 19 and up to 16 weeks to provide care or support to family members over 19. This significantly expands leave rights to care for family members. Employees who are victims of domestic or sexual violence will be entitled to 10 nonconsecutive days of leave to deal with common issues victims face such as finding new accommodation. In addition, they may take a continuous leave of up to 15 weeks to deal with the consequences of that violence. This leave can also be taken in multiple periods with
the employer’s consent. The new leaves come on top of new and expanded maternity and parental leaves introduced last year and continue a Canada-wide trend of requiring employers to give employees more time off for longer periods for personal reasons with a guarantee of reinstatement. Employers already recognize and generally informally grant leaves for these circumstances and understand that employees need time to deal with such traumas. Unfortunately, the proliferation and extension of leaves imposes real costs on the employer and often on co-workers and managers who have to cover the leave-taker’s workload. That burden is most onerous with leaves of a few months, because it is almost impossible to recruit and train a replacement for that short a time. Expanded liability: The amendments significantly increase potential employer liability for failing to pay overtime and other wages. The period for wage recovery under the ESA has been extended to 12 months from six with the possibility of 24 months in special circumstances to be prescribed by regulation. For employees claiming unpaid wages such as overtime or vacation pay, this significantly increases the potential cost of a claim. The amendments also empower the Employment Standards Branch to, among other things:
•adjudicate a complaint past
the six-month limitation period from termination of employment to file a claim where unjust; and •waive the previously mandatory penalties for contraventions of the act where an employer complies with the requirement to pay wages after the complaint is filed or it is determined that there was a legitimate reason for the contravention. These two amendments will come into force at a later date set by the government. Company directors’ and officers’ personal liability for unpaid wages will no longer be eliminated altogether if the company goes into bankruptcy. Instead, only liability for ESA termination pay is eliminated. Resignation rules: The act now also confirms employees who give notice of their resignation and then are terminated without cause during the resignation notice period are entitled to receive only the lesser of: •their pay over the balance of the resignation notice period; or •the amount the employer must pay if terminating without cause. It is unclear if the second amount is limited to ESA minimum termination pay or may include greater contractual severance if applicable, but the latter view would be more consistent with the ESA. This amendment confirms existing practice and contract law on the
same point. Tighter regulation on hiring children: Responding to concerns raised about children working in onerous or unsafe jobs or businesses, the amendments raise the age a child may work to 16 years old from 12 and places tighter restrictions on hazardous work 16-to-18year-olds may perform, while providing exemptions that allow 14-to-15-year-olds to perform light work. Notably, the legislation maintains existing regulations allowing children to work in recorded and live entertainment with parental consent. These amendments will come into force at a later date. Owners of family businesses will need to review their practices with their children. Tips and gratuity regulation: To better protect tips, the amendments bring in a new legal framework for regulating gratuities and tip pooling, defining them as “wages” protected by and collectible under the ESA and protecting those tips from employer encroachment. In particular, owners and managers are prohibited from taking any tips, although managers who also do the same work as the tipped workers can participate. Those hospitality employers who had been taking some of the tips or gratuities will have to change their practices and potentially their wages and prices as a result. The right of unions and employers to agree to lesser standards: Until now, unions
and employers could agree to different and potentially lesser standards for certain ESA standards such as hours of work and overtime in a collective agreement. The amendments reinstate the prior rule that collective agreements must “meet or exceed” ESA standards on all topics. However, this will take effect only with the next collective agreement, giving the employers a chance to negotiate offsetting arrangements with the union. Unionized employers with lower-than-ESA terms in their agreements need to be aware of this change when bargaining. Practical tips: These are only the main highlights of the reforms. Employers need to become familiar with the new leave rights and incorporate them into their leave policies. In particular, employers who hire children or are in the hospitality industry should make sure they understand and comply with the new laws that are already or will soon be governing their businesses. They should also stay tuned for more possible amendments to come. • J. Geoffrey Howard (ghoward@ meplaw.ca) is a senior employment lawyer who advises employers and employees on workplace law issues at MEP Business Counsel in Vancouver. James Hsu (jhsu@ meplaw.ca) is an associate at MEP. This article is a summary of some recent ESA amendments and should not be construed as legal advice.
Books that point the way to a better work-life balance RESEARCH | Vancouver
Public Library picks focus on juggling business needs with family demands
Work Pause Thrive: How to Pause for Parenthood without Killing Your Career by Lisen Stromberg
Something’s Got to Give: Balancing Work, Childcare, and Eldercare by Linda Duxbury and Christopher Higgins
If you are looking for an approach to work-family balance that eschews the dual day of labour, read Lisen Stromberg’s inspirational story of a woman who chose her family over her career but still became an awardwinning journalist through the simple act of taking a “pause.”
Drawing on the data from a national survey on balancing work, life and caregiving, which collected information from 25,000 Canadian employees, this important book explores the issues around balancing not just work and child care, but also – due to socio-economic change – eldercare. Written by two business professors for employers and policymakers, Something’s Got to Give offers useful balancing strategies for the general reader as well. Highly recommended.
Make Time: How to Focus on What Matters Every Day by Jake Knapp and John Zeratsky
Clockwork: Design Your Business to Run Itself by Mike Michalowicz
Pick Three: You Can Have It All (Just Not Every Day) by Randi Zuckerberg
There are times when building a business may require entrepreneurs to sacrifice time with friends and family. However, you can reclaim control of your life by adopting a simple strategy to structure your workday that focuses on things that truly matter. Jake Knapp and John Zeratsky propose realistic solutions within the boundaries of your lifestyle and work environment to create a balanced work and home life.
Launching and growing a business while maintaining a rewarding life outside of work can be a challenge for entrepreneurs. If you hope to reach a healthier balance, then the insights in Mike Michalowicz’s Clockwork offer practical techniques so that you can build a thriving business without constant involvement. Get more out of your workday without sacrificing family time and other valuable personal interests.
Do you have trouble fitting everything in, work, exercise, spending time with family and friends? Randi Zuckerberg recommends a new approach to the “doing-it-all” strategy: just pick three areas a day to focus on and begin to achieve a better work-life balance. Zuckerberg looks at each of the five main life categories with experts who offer practical solutions to the “doit-all” dilemma.
BUSINESSVANCOUVER
send your free listing to fortherecord@biv.com
June 25–July 8, 2019
17
for the record as national key account manager and territory sales manager with responsibility for Overwaitea Food Group, AG Foods, IGA and Chevron.
People on the Move
Hats Off
Email your For the Record information to: fortherecord@biv.com. Please include a high-resolution, colour headshot where possible. Cannabis Colin Kinsley and Richard Lee have been appointed to Invictus MD Strategies Corp.’s board of directors as independent directors. Kinsley was mayor of the City of Prince George for 12 years and prior to that, he had a 30-year career in the natural gas industry. Lee has more than 27 years of experience working for public accounting firms or for companies that trade on recognized stock exchanges and currently serves as CFO of Kelso Technologies Inc., SIQ Mountain Industries Inc. and Happy Creek Minerals Inc. Aaron Bowden, who was appointed to the board in August 2016, has resigned as a director; he will continue to serve the company as an adviser. Invictus also announced the departures of Jessica Martin, investor relations; Sarah Hardy, vice-president, medical sales; and Kevin Smith, vicepresident, recreational sales. Development/ Construction Darren Sauer Wales McLelland Construction is welcoming back Darren Sauer to the firm in his new role as director of development. Sauer previously worked for the company in a project manager/co-ordinator role from 2008 to 2013, before his most recent tenure at a real estate development company focusing on land development. Sauer brings extensive knowledge regarding project management and has strong connections in the construction and development community.
Alan Davies and Alex Percy have been promoted to principals at Acton Ostry Architects, with Mark Simpson and Matt Wood promoted to associate principals. Michael Fugeta and Matthew Fellows have been named as new associates to the firm.
Business in Vancouver welcomes submissions from local small businesses and large corporations alike that demonstrate examples of corporate philanthropy and community involvement in the Vancouver area. Highresolution images are also welcome.
John Liang, co-founder, Vivagrand Developments, presented a $52,500 donation to Henry Au, principal, Walter Moberly Elementary School | VivaGrand Developments eNERGY Greg Hayes and Jordan Butler have been appointed CFO and executive vice-president, respectively, at enCore Energy Corp. Hayes, who succeeds Scott Davis, is also CFO at Golden Predator Mining Corp. and Taku Gold Corp., and has worked as CEO for Golden Predator and Northern Tiger Resources Inc., and CFO for Shear Minerals Ltd. Butler has significant capital markets and corporate development experience within the natural resource sector, and, prior to this appointment, was vice-president, corporate development, at Callinex Mines Inc., and provided asset and equity valuations for the natural resource portfolio of Till Capital Ltd. Butler has also worked in various capacities within the uranium sector including with Uranium Energy Corp. and enCore Energy Corp. Health/Medical Denis Bosc has been appointed vicepresident, chemistry, manufacturing and control, at NervGen Pharma Corp., a regenerative-medicine company dedicated to creating solutions to treat nerve damage. Bosc has more than 15 years of drug substance and drug product manufacturing experience. In addition, Paul Brennan, a pharmaceutical licensing and product planning professional with over 30 years of experience in the biotechnology and pharmaceutical
industries, has joined the NervGen team to advise on strategy and business development matters. Real estate Chuck We Chuck We has been appointed senior vicepresident, Western Canada, at Hudson Pacific Properties and will be based out of the firm’s newly opened Vancouver office. We previously led Vancouver operations and leasing, and was significantly involved in acquisitions and development for Oxford Properties Group, the real estate investment arm of OMERS, one of Canada’s largest pension plans. Resources Eddy Yu and Jeff Dare have been appointed CFO and corporate secretary, respectively, at Far Resources Ltd. Yu is a chartered professional accountant with more than 20 years of experience in business and financial management. Dare has more than 10 years of professional experience managing external reporting and corporate compliance for listed issuers on the TSX Venture Exchange and Canadian Securities Exchange.
Kendra Johnston has been appointed president and CEO of the Association for Mineral Exploration (AME), succeeding Edie Thome.
Johnston is a geologist and mining executive with more than 15 years of experience in the mineral exploration and mining industry. In addition to corporate board experience, she is an industry advocate working with nonprofits as a director and organizer, and has volunteered with AME in many capacities. Technology Owen Morley has been appointed chief technology officer at Uniserve Communications Corp. Morley is a former director of infrastructure and started his own web hosting venture in 1998, then later joined Peer1 Network as a network analyst and honed his skills to manage its Vancouver and Seattle data centres. He then moved to PlentyOfFish Media, one of the world’s largest online dating sites. Transportation Marco Felicella Marco Felicella, formerly Unilever customer team leader, has been appointed director of sales, Canada, for TransCold Distribution Ltd. Felicella has more than 20 years of experience in the consumer packaged goods industry and deep knowledge and experience in the ice cream business and related markets, having worked with Unilever for the last 10 years. Prior to Unilever, he worked with Pepsi Bottling Group
Vivagrand Developments donated $52,500 to Walter Moberly Elementary School. The funds will be used to build a computer lab with 31 laptops, a renovation lab, which includes a 3D printer, interactive flat panel displays, smart boards, video equipment and editing software and furniture and bike racks. Lead sponsor Teck helped the Pacific Salmon Foundation raise $450,000 for wild salmon at its 27th annual Vancouver Gala Dinner and Auction. The funds will support volunteer community groups that restore salmon habitat, operate conservation hatcheries and deliver classroom education programs. Methanex Corp. donated $10,000 to Science World to fund after-school programming. RBC Foundation donated $50,000 to the Take a Hike Foundation through RBC Future Launch. The funds will help 100 vulnerable youths graduate high school and support Take a Hike’s expansion to Vancouver Island. The Legion Foundation of the Royal Canadian Legion BC/Yukon Command, a longtime partner of the Justice Institute of British Columbia Foundation (JIBC Foundation), has contributed more than $40,000 to help enhance the training of JIBC paramedic students over the past decade. Its most recent donation was directed toward the purchase of an immobilization kit, which is designed to safely immobilize and transport injured patients. Having the use of such equipment during JIBC’s training simulations helps prepare paramedic students for reallife emergencies. •
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BUSINESSVANCOUVER June 25–July 8, 2019
trouble Lawsuit of the week American medical device firm claims West Vancouver businessman and wife used ‘illicit profits’ from counterfeiting scheme to buy B.C. real estate Ohio-based medical device company AtriCure Inc. is suing West Vancouver-based businessman Jian Meng and his homemaker wife Xi Ren, claiming the pair used illicit profits from an intellectual property theft scheme to buy British Columbia real estate. AtriCure filed a notice of civil claim in BC Supreme Court on June 11 naming Jian Meng, also known as Larry Meng, and his wife, Xi Ren, as defendants. According to the lawsuit, the Mason, Ohio-based company was seeking to expand into the Chinese market with its “technologically advanced surgical devices to treat arterial fibrillation,” a degenerative heart condition. “Since being founded in 2000, AtriCure has spent millions of dollars on research and development to develop innovative technological solutions for the treatment of [arterial fibrillation],” the claim states. “Shortly after its formation, Atricure desired to expand its business into China. The company did not, however, have any presence in China, and little knowledge of the Chinese language, the Chinese medical device market, Chinese regulation and the Chinese regulatory process.” From 2005 to 2017, Meng and his company, non-party Beijing ZenoMed Scientific Co. Ltd., acted as exclusive distributor of AtriCure products in China. Part of the distribution arrangement involved AtriCure sharing confidential information with Meng’s firm, the claim states. “Unbeknownst to AtriCure, instead of causing ZenoMed to assist in the distribution of, and securing of regulatory approvals for AtriCure products, Meng embarked on a scheme to steal AtriCure’s confidential information to profit from this theft by causing the production and sale of counterfeit AtriCure products derived entirely from this theft, and to hide the proceeds of this theft in real property in British Columbia,” AtriCure’s lawsuit states. “Ren assisted Meng with the Meng Scheme through the laundering of money derived from it in real property in British Columbia.” AtriCure claims the couple owns properties in Vancouver, Surrey, Port Coquitlam and Powell River, while residing at their West Vancouver home at 2345 Orchard Lane, currently assessed at nearly $4.7 million. “Meng purchases the properties, at least in part, to hide or secure the illicit profits and has used the illicit profits, in whole or in part, to purchase, pay for, improve and maintain the properties,” the claim states. AtriCure claims it only recently discovered that Meng, a purported doctor, has been, “since in or around the year 2000, engaged in a practice of enticing North American medical device companies to do business with companies he owns and controls in China, only to steal their intellectual property and then profit from the production and sale of counterfeit produts derived from this theft.” AtriCure seeks damages for conspiracy, unjust enrichment, fraud and an accounting of illicit profits made from the alleged counterfeiting scheme. The allegations have not been tested or proven in court, and the defendants had not responded to the claim by press time.
Discipline British Columbia Securities Commission The British Columbia Securities Commission (BCSC) announced June 10 that one of its panels has imposed a $350,000 administrative penalty on William Wade Furman, who deceived investors about his status as a registrant, his prior history of success in trading in securities and his use of investor funds. Furman has also been ordered to
return $420,847 in gains that he retained from amounts raised, through his deceptions, from 10 investors through two B.C. companies that have since dissolved, Liquidus Holdings Inc. and Liquidus Capital Inc. Furman, who has never been registered under the Securities Act, also deceived investors by providing them with fictitious-account statements to show purported returns on investment that bore no relationship to the fact that Furman lost almost all of the funds invested in his day trading. In imposing the sanctions, the panel noted that Furman caused significant investor harm and was substantially
LOW TO HIGH VOLUME PRECISION METAL STAMPING
enriched by the misconduct. Furthermore, it found that this case is on the “upper end of the fraudulent misconduct that has come before the BCSC.” It went on to say that “as a consequence of the length and breadth of the dishonesty engaged in by [Furman], we consider him to be a significant future risk to our capital markets.” In addition to the penalty, Furman must resign any position as a director or officer of an issuer or registrant, and is permanently prohibited from taking any such role. Furman also was permanently barred from
trading in or purchasing securities or exchange contracts; relying on any exemptions of the Securities Act; becoming or acting as a registrant or promoter; acting in a management or consultative capacity in the securities market; or engaging in investor relations activities.
BUYER’S ALERT Companies listed below, which are not accredited by the Better Business Bureau, have failed to respond, as of June 14, to Better Business Bureau of Mainland BC’s efforts to mediate complaints from June 2 to June 8. In some instances, the company may have taken care of the complaint and considered the matter closed, or may believe the complaint is unjustified; however, if the BBB has not received a response, records cannot reveal either position. Please note that BBBaccredited businesses must respond to customer complaints that are brought to their attention. The companies listed are not members of this Better Business Bureau. Source: BBB. Apple Painting Ltd., Vancouver BC Environmental Home Services Inc., North Vancouver The Champion Dog’s Club, Burnaby Cheapest Way to Move, Richmond Floorica Tiles & Wood Floors, Surrey Gifts Engraved Co., Abbotsford Lotus Wear, Vancouver Microtech Cyber Services Ltd., Vancouver Mountain Top Recreation, Vanderhoof Numa Models & Talent, Vancouver Onyx Automotive, Surrey Papa John’s, West Kelowna Secret Wood Inc., Vancouver Snuggle Bugz, Coquitlam Spirits Way Designs, White Rock Stone Creek Enterprises, Chilliwack Sunrise Windows Ltd., Surrey Super Save Group, Surrey Venus Furniture Ltd., Richmond Vernon Dodge Jeep, Vernon Zahara Apparel, Surrey The following companies have responded to the BBB subsequent to being published: Impark, Vancouver Precise Parklink, Burnaby Rosewood Hotel Georgia, Vancouver Yellow Pages, Burnaby
WHO’S GETTING SUED These corporate claims were filed with the BC Supreme Court registry in Vancouver. Information is derived from notices of civil claim. Civil claims have not been tested or proven in court. Defendants Vancouver Airport Authority and ABC Co. Plaintiff Jazz Aviation LP Claim US$1,956,186 for a foreign money claim arising from engine damage suffered by plaintiff’s aircraft. Defendants M2K Construction Ltd. and City of Vancouver and Aviva Insurance Co. of Canada Plaintiff Titan Environmental Containment Ltd. Claim $967,785 for installation work; a builders lien. Defendants David Patrick Gardner Lutton and Mark Chandler and 1088595 B.C. Ltd. and NMG Developments Ltd. and KGH Newmark Ventures Inc. and Newmark Group Inc. and 0981478 B.C. Ltd. Plaintiff Fa Cai aka Clark Cai Claim
$300,000 for debt. •
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