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TUESDAY, MARCH, 5, 2013
FEATURED OPINION
Politicians hungrily eye mining boom Tasha Kheiriddin
Barrick Gold's Jonathan Drimmer speaks to conference attendees about corruption laws at the Prospectors and
iPolitics
Developers Association of Canada's conference at the Metro Toronto Convention Centre, Monday.
Canada's corruption laws joining big leagues: panelists James Munson
Canada's corruption laws will soon be in line with more sweeping legislation in the U.S. and U.K., as the mining industry grapples with ever-more complex definitions of what constitutes a bribe, a major mineral conference heard Monday. Ottawa's Corruption of Foreign Public Officials Act (CFPOA) has been criticized as the weakest link among western anti-corruption rules, a problem exacerbated by the sheer size of Canada's extractive industries, the biggest in the world in many respects. In February, Foreign Affairs Minister John Baird revealed amendments to CFPOA that will give it a broader net to catch Canadians who pay money to public servants, politicians and government-owned bodies to advance their business interests. An exemption for non-profits
under CFPOA will also be removed. During a seminar Monday morning at the Prospectors and Developers Association of Canada's (PDAC) annual conference in Toronto — one of the world's biggest mining meetings — several experts explained that the changes will bring Canada in league with British and American standards. The U.K's Bribery Act, amended to increase its scope in 2010, applies to any company with a business operating in the U.K. That means if a French company has a subsidiary office in London and dozens of other branches around the world, the Bribery Act applies to actions done by any part of the firm, said Mara Senn, a lawyer with Arnold & Porter LLP. The U.S.'s rules affect any American citizen or company operating anywhere in the world, as well as any act happening within the country's borders.
"Any act that ultimately touches the United States or is directed to the United States is also covered," said Jonathan Drimmer, vice-president and assistant general counsel with Barrick Gold. Recently, the Securities and Exchange Commission (SEC) successfully charged two people from Hungary under the U.S. Foreign Corruption Practices Act. One individual had sent an email to the other relating to the act of corruption and that email was routed through the United States. "That was enough, the court said, to establish jurisdiction in the U.S.," said Drimmer. Canada's CFPOA has long lacked a so-called "nationality clause" that would explicitly target any Canadian person or company. The act only applies to bribery that has a "real and substantial link between the offence and Canada," vague terminology that critics say
leaves enough room for corrupt companies to evade the law. Baird's amendments include a nationality clause as well as the removal of the facilitation payment exemption. A facilitation payment is defined in the current act as any payment made to expedite or secure the performance of a foreign official — something that lawyers have said sounds an awful lot like a bribe. The exemption's elimination will dramatically reduce the ability of companies to use it as a loophole when under investigation by the RCMP, which enforces the CFPAO. Canada will also match the U.K. and the U.S. by now including "books and record-keeping" infractions, which will penalizing companies for not keeping track of government payouts where bribing might be taking place, said the Continued on pg. 14
Welcome to the twenty-first century gold rush. Or lithium, chromite or iron: take your pick. This week the Toronto Convention Center turned into the set of Bonanza, as over 30,000 miners, prospectors and processors convened for the annual meeting and trade show of the Prospectors and Developers Association of Canada (PDAC), the largest such gathering in the world. Not surprisingly, the political class turned out in force. The federal government dispatched forty Conservative MPs, its biggest contingent ever. Treasury Board President and Minister for FedNor Tony Clement kicked off the festivities Sunday night, speaking about the development of Northern Ontario’s “Ring of Fire”. Natural Resources Minister Joe Oliver gave the next morning’s keynote. Newly-minted Liberal Ontario Premier Kathleen Wynne cut the ribbon on the Ontario Pavilion Monday, while Parti Quebecois Natural Resources Minister Martine Ouellette held court at a Quebec reception the previous evening. Ottawa, Ontario and Quebec all have high stakes in the lucrative mining game. The federal government wants to slay the deficit, stave off the threat of America’s fiscal cliff and boost international trade. Ontario and Quebec — both 'havenot' provinces — are grappling with the decline in their manufacturing sectors. Resource extraction could provide the ticket to prosperity for all — but it comes with a host of challenges. Those include opposition by environmental movements and First Nations. It’s no accident that Premier Wynne opened her remarks by acknowledging that the conference was taking place on the territory of the Mississaugas of New Credit. The Ring of Fire, which boasts over 30,000 claims and could yield one fourth of the world’s chromite, affects First Nations like the Webequie and Marten Falls, who blockaded landing strips in the area in 2010. That same year the Liberal government of Dalton McGuinty passed the Far North Act, which gives First Nations a role in Continued on pg. 13