Natural Resources Minister Greg Rickford vowed to introduce legislation requiring energy and mining companies to report all revenue paid to foreign and domestic governments, but said its impact on corporate payments made to First Nations will be delayed for two years while Ottawa consults aboriginal leaders.
At a meeting in Sudbury, provincial and territorial resource ministers endorsed Ottawa’s plan to impose new mandatory reporting of resource payments. But most provinces appear willing to let Ottawa take the lead on the measure, which includes controversial new accountability rules for First Nations.
“Canada is recognized around the world as a leader in promoting transparency and accountability in the extractive sector as a whole, here at home and around the world,” Mr. Rickford said on Tuesday after the ministerial meeting. “We have a responsibility to ensure that here at home and abroad, our corporations – in their relationships that they build in the effort to develop resources responsibility – that they are transparent and accountable.”
Mr. Rickford said the proposed legislation would allow each province or territory to implement its own mandatory reporting regime that could supersede the federal rule, and Quebec has indicated it intends to do so.
The federal minister said Ottawa would defer the implementation of its legislation as it pertains to company payments to aboriginal governments for two years in order to allow time for consultation.
The Canadian mining industry has worked with non-governmental organizations to urge Canadian governments to adopt mandatory reporting rules, as the United States and European Union have developed similar regulations. The international effort aims to curb corruption in the developing world, where multinational companies often operate amid poor accountability rules and little transparency for the taxes, fees and royalties they pay to governments.
The Mining Association of Canada and the Prospectors and Developers Association of Canada both welcomed Mr. Rickford’s announcement, and the support from the provincial and territorial governments.
"Improved transparency on revenues paid will help increase accountability and ensure that the benefits of resource development reach the more than one billion people living in resource-rich countries,” PDAC president Rod Thomas said in a statement.
The British government released its proposed legislation earlier this month, while the U.S. Securities and Exchange Commission is redrafting its regulations after losing a court challenge by the oil industry.
The Canadian Association of Petroleum Producers says it supports the principle of transparency but has had concerns about how it may be implemented.
The mining industry had urged the provinces to take the lead on the mandatory reporting through their securities commissions in order to confirm to the American approach.
Ontario’s Minister of Northern Development and Mines Michael Gravelle said the Liberal government is conferring with the Ontario Securities Commision but is waiting to see the federal legislation before deciding whether to proceed with its own regulations. Mr. Gravelle said he welcomed the federal plan but cautioned that aboriginal leaders need to be fully consulted before having new rules imposed on them.
Mining Association president Pierre Gratton said Ontario is a global centre for mining finance and should pursue its own rules for revenue transparency. “We believe they have a responsibility to show global leadership – it’s very disappointing if they don’t,” Mr. Gratton said.
Grand Chief Edward John of the First Nations Summit in B.C. said Ottawa needs to consult with aboriginal leaders before it decides to impose new regulations, not after the fact.
He said aboriginal governments already face myriad reporting requirements that ensure accountability to their members. And he worried Ottawa will impose transparency rules on aboriginal-owned businesses that will undermine their competitiveness as they seek contracts from resource companies.Report Typo/Error