The New York Times Co. seeks financial statements for Advantage BC saying the group “has refused to disclose its financial statements, in violation of provisions of the Societies Act.”Scott Eells/Bloomberg
The New York Times is suing Advantage BC, a non-profit society set up to promote British Columbia as a destination for international business and capital.
The lawsuit, filed May 4 in the Supreme Court of B.C., follows a New York Times story of May 2 that described the tax breaks provided under the International Business Activity Act and promoted through Advantage BC as "an unusually opaque arrangement" that has generated few jobs even though millions have been doled out in tax credits.
The claim seeks financial statements for Advantage BC, saying the group "has refused to disclose its financial statements, in violation of provisions of the Societies Act."
Advantage BC president Colin Hansen was not immediately available. The group has said it is exempt from those disclosure requirements because it is a member-funded society, the court claim states, but the paper disputes that claim.
A statement of defence has not been filed.
Since the New York Times story was published, Liberal Leader Christy Clark has defended the program, saying it has created more revenue than it has cost and that it is aimed at attracting companies to B.C.
On May 4, Colin Hansen told CKNW radio that the program is "designed to encourage companies to locate international financial activity in the province of B.C." and is administered by the provincial government through the Ministry of Finance.
Mr. Hansen credited the program with helping to increase Vancouver's presence on the world financial scene.
Mr. Hansen, a former minister of finance, credited the program with helping to increase Vancouver's presence on the world financial scene, saying the city was ranked No. 33 worldwide as a global financial centre in 2008 and currently sits in 18th spot.
The province is not allowed to disclose information about companies' or individuals' tax returns, he said, adding that tax rebates paid out through the program were based on activity that would not otherwise have come to B.C.
And he said the program does not provide tax or other advantages to foreign companies at the expense of Canadian businesses.
"These programs are available to Canadian companies on the same basis as they are available to international companies," Mr. Hansen told CKNW host Jon McComb. "The benefits available to individuals coming to work in B.C. are available to Canadians and to non-Canadians – there is no bias in that respect."
The rebates paid out amount to about $22-million a year, he said.
Asked about the potential for money laundering through the program, Mr. Hansen said Advantage BC members are subject to approval by other agencies – including the Office of the Superintendent of Financial Institutions, which regulates banks, and Investment Industry Regulatory Organization of Canada, which regulates investment firms. Financial activity, he added, is overseen by the Financial Transactions and Reports Analysis Centre of Canada.
"That's not the role that we play," he said. "The role that Advantage BC plays is we are out marketing B.C. to the world, and encouraging companies to locate activity here. We rely, just as all British Columbians, on these other institutions to identify where there is inappropriate financial activity taking place."
Wendy Stueck