Five years after being asked to release internal reports on a controversial loan to a South African business whose owners are accused of massive state corruption, Export Development Canada has acceded to an access request by giving up only a package of e-mails consisting mainly of staff discussing “negative” news coverage.
It is the latest example of how EDC, a Crown corporation that helps fund export deals for Canadian businesses, withholds relevant information about its dealings under commercial confidentiality provisions, which is soon to be the subject of a Federal Court case.
EDC came under fire in 2017 for providing a US$41-million loan to the Gupta brothers of South Africa to buy a Bombardier luxury jet. At the time of the loan, the Guptas were at the centre of one of the country’s biggest corruption scandals, which involved accusations of high-level bribery and an investigation by a judicial commission.
The loan was first reported in The Globe and Mail in August, 2017, and cancelled by EDC by the end of the year.
In early 2018, The Globe began an investigation of EDC, which included filing access-to-information requests to understand the agency’s inner workings and due diligence. One of those access-to-information requests, filed April 6, 2018, was for any briefing materials to the chief executive of EDC that reference the Gupta family of South Africa from Jan. 1, 2014, onward.
EDC rebuffed the request and refunded the $5 processing fee. In a letter, EDC’s director of compliance and ethics said the agency was “legally prohibited” from disclosing any information about its clients and cited Section 24 of the Export Development Act.
The Globe filed a challenge to the Office of the Information Commissioner (OIC) on the grounds that the decision to not even attempt a search for records was inappropriate. The Globe argued that the existence of the Gupta loan was already public knowledge – by EDC itself – and that there could be briefing documents for the chief executive that do not contain commercially sensitive information such as general reports on the agency’s activities in South Africa.
The Globe also argued that Section 24 of the Export Development Act allowed for documents to be released with the permission of the clients, and EDC made no attempt to contact the Guptas to seek permission.
From there, the complaint moved slowly. In October of 2019, an OIC investigator said they had been assigned to the file, and in December said they were leaving the case. In August of 2022, a new investigator said they had been assigned to the file and little work had been done on it so far.
Then, on Jan. 9 of this year, EDC sent a new response to The Globe. The agency said that it had reconsidered the request in light of comments from the OIC and it would release some documents after all. EDC did not provide a description of the OIC comments.
The OIC itself has faced criticism at recent parliamentary hearings examining the access-to-information system about delays in assessing complaints.
The package of documents released to The Globe consisted of 121 pages, of which more than 30 were fully redacted. The remaining pages are e-mails between then-chief executive Benoit Daignault and other senior staff concerning Globe stories about EDC, with subject lines such as “Today’s globe article re Gupta’s and EDC (Privileged & Confidential).”
One e-mail is an all-staff update from Jan. 29, 2018, with advice on how to respond to “negative news coverage.”
“Employees may have noticed ongoing coverage of EDC’s financing for South Africa’s Westdawn, a company within the Gupta family conglomerate … the following talking points summarize EDC’s current position and should help you respond in a meaningful way,” the e-mail said. The talking points then advise staff to say that EDC would not comment on the matter because it is before the courts.
The contents of the various e-mails are largely redacted under Access to Information Act exemptions that cover: discussions between government employees; “trade secrets” of EDC; and the privileged information of its clients. Previous Globe requests for briefing materials on other subjects have included memos, PowerPoint presentations or reports on a country’s economy.
Matt Malone, a law professor who studies trade secrets at Thompson Rivers University in Kamloops, B.C., said a review of EDC’s annual reports show that the agency has increasingly used those exemptions to block entire requests. In its 2018-19 report, EDC said it fully redacted eight of the 36 requests it got that year. In 2021-22, the agency said it had fully redacted 16 of 38 requests, or nearly half.
Prof. Malone said that was much higher than other government departments that have reputations for secrecy such as the Canadian Security Intelligence Service, which fully redacted 13 per cent of its requests last year, or the Royal Canadian Mounted Police, which fully redacted 6 per cent of requests.
Prof. Malone, who reviewed The Globe’s request and EDC’s responses, said the use of exemptions around commercial confidentiality appeared to be overly broad.
“These entities hide behind these exemptions for trade secrets and confidential information, which are vaguely defined and vaguely applied,” he said.
The Globe is continuing to challenge EDC’s redactions with the Information Commissioner.
Last year, the OIC challenged EDC’s use of Section 24 of the Export Development Act in another case.
EDC had received a request in 2019 for a summary of all financial assistance of more than $50,000 provided to Canadian companies in Honduras, from 2009 to 2019. It denied the request based on Section 24, and a separate exemption on divulging trade secrets.
The Information Commissioner argued that releasing such information about its activities does not mean the agency is publishing confidential information obtained from clients. The commissioner ordered EDC to comply with the request.
EDC agreed to release the types of insurance policies it had funded, but no other information. On July 20, 2022, EDC took the Information Commissioner to Federal Court to seek a judicial review of the order.
That case has not yet been heard.
Help The Globe and Mail investigate Canada’s broken freedom-of-information regimes. We’re looking to speak with people who use and interact with the system at all levels of government. Are you a current or former FOI analyst? A public servant? A citizen, academic, researcher or advocate who has filed requests? Are you a current or former appeals adjudicator? A lawyer with experience in this area of law? We want to talk to you. You can get in touch with us at firstname.lastname@example.org.