Ontario inched closer to strengthening its lobbying law, last month, when the Ontario Legislature approved in principle Bill 115, the Lobbyists Registration Amendment Act, and sent it to committee for further study. The proposed changes would profoundly affect most businesses and organizations that have dealings with Ontario public officials.
While the vote (in a half-empty chamber) was unanimous, debate revealed that MPPs were deeply divided on the merits of the legislation, which had been introduced by Cindy Forster (NDP - Welland). Representatives of the Legislature’s second-largest political party (the Progressive Conservatives) sharply criticized the bill and objected to its key features. Liberal Cabinet Ministers, meanwhile, suggested that the Liberal Government would prefer to introduce its own lobbying law reforms.
Perhaps the most noteworthy development during debate (but not reported by the news media) was one Minister’s revelation that in 2012 Cabinet had approved a “Lobbyist and Expense Accountability and Transparency Act” that was never introduced because the Legislature was prorogued between October 16, 2012, and February 18, 2013. Presumably this was draft legislation to give effect to the Government’s July 25, 2012, policy announcement, analyzed in our previous bulletin (Ontario Government Proposes Changes to Lobbying Disclosure Law). The news that legislation had already been drafted and approved by Cabinet was significant, because previously the Government had only stated that it was still “studying” possible reforms.
It is unclear whether Bill 115 will emerge from the Standing Committee on Regulations and Private Bills (to which it has been referred) and, if so, whether the bill will be significantly weakened. Nevertheless, businesses, associations and consultants who deal with the Ontario Government or provincial officials should pay careful attention to the bill’s progress.
Impact on Businesses, Organizations and Consultants
The bill proposes several changes that would make Ontario’s law more consistent with the federal Lobbying Act and that respond to recommendations of Ontario’s Integrity Commissioner/Lobbyist Registrar. It contains 13 substantive changes to the Lobbyists Registration Act, plus a dozen additional complementary and clarifying amendments.
At the same time, the bill contains certain anomalous provisions. For example, in-house lobbyists would have to be registered before they lobby, while consultant lobbyists would remain free to delay registration until after they have started to lobby. Further, lobbying of senior government officials by consultants and by employees of non-profit organizations would be subject to expanded disclosure, but lobbying of senior government officials by employees of businesses would not be affected. There has been no explanation of these discrepancies, and they may be drafting errors.
In descending order of significance, the proposed substantive changes are as follows:
- Elimination of the minimum volume threshold (commonly known as the “20% rule”) for registration of in-house lobbying. This change would have a profound impact on Ontario’s business community and non-profit sector.
- A five-year ban on lobbying by former senior government officials.
- Expanding the reporting obligation to include the names of senior government officials who are lobbied, and specific details of certain lobbying communications. However, this new obligation would only apply to lobbying by consultants and by employees of non-profit organizations; lobbying by employees of businesses would not be affected.
- Requiring registration before in-house lobbying occurs. (Currently registration can occur after the lobbying commences.) Consultant lobbyists, however, would still be permitted to commence lobbying without registration, and then register afterward.
- Prohibiting lobbying by persons paid to advise or provide services to the Government or a government agency concerning the same subject.
- Prohibiting reprisals against people who seek, or assist with, enforcement of the Act.
- Increasing the maximum fine for an offence under the Act.
- Reducing the deadline for consultant lobbyist registration from ten calendar days, to five business days, after commencement of lobbying.
- Requiring a consultant lobbyist to include with each registration a list of provincial political contributions made by the consultant lobbyist and the client.
- Adjusting the definition of grass-roots communication to confirm that it does not apply to communication that is internal to an organization or business.
- Permitting the Registrar to seek information from senior government officials (and former senior officials) concerning lobbying of them.
- Requiring that the Registrar report annually on charges and convictions under the Act.
- Providing for a five-year review of the Act by a legislative committee.
Changes 2, 3, 11 and 13, above, would bring the Ontario law more into line with the federal Lobbying Act. Changes 1 and 5 reflect, or respond to, recommendations by the Integrity Commissioner/Lobbyists Registrar.
1. Eliminate Minimum Threshold (20% Rule) for In-House Lobbying
The most sweeping change proposed by Bill 115 would be the requirement to register all in-house lobbying on behalf of businesses and organizations. Currently, only in-house lobbying that meets a volume threshold must be reported. The current threshold varies depending on whether the lobbying is by employees of a business or employees of a non-profit organization. In the business context, an employee meets the threshold if 20 per cent of his or her duties involve lobbying of provincial officials. In the non-profit context, all employees of the organization who lobby meet the threshold if collectively their combined lobbying of provincial officials is equivalent to 20 per cent of one employee’s time.
Under Bill 115, any amount of lobbying by the employee of a business or non-profit entity would trigger the registration requirement. Employees of a business must, under Ontario law, file their own lobbying registrations; Bill 115 would not change that. Employees of a non-profit entity must be registered as lobbyists by the CEO of the non-profit entity; Bill 115 would not change that requirement either.
Elimination of the 20-per-cent rule has great potential to affect every business and association that deals with Ontario provincial government officials.
2. Five-year Ban on Lobbying By Former Senior Officials
Bill 115 would prohibit lobbying, for five years after they cease to hold office, by former senior provincial officials. These senior officials, to be known as “high level public office holders,” would include:
- Cabinet Ministers
- Staff members in Ministers’ offices
- Public servants in the Cabinet Office.
- Deputy ministers, associate deputy ministers, assistant deputy ministers, and public servants of equivalent rank.
- Others designated by regulation.
The proposed five-year ban mirrors a similar provision in the federal Lobbying Act. The federal prohibition was a signature initiative contained in the Federal Accountability Act, on which the federal Conservative Party campaigned prior to the 2006 general election and which Parliament passed later the same year.
Despite the federal precedent, during debate on Bill 115 Progressive Conservative MPPs spoke harshly about the five-year prohibition, calling it “draconian” and suggesting that it might be unconstitutional. One MPP expressed concern about the impact on former politicians who may wish to seek “gainful employment” as lobbyists after leaving office.
More generally, the PC representatives were critical of the entire bill. They defended the lobbying industry, claimed that Bill 115 was not the “the right way to tighten the rules,” and suggested that it is impossible to “legislate morality.”
3. Expanded Reporting on Lobbying of Senior Government Officials
Bill 115 also proposes to adopt the federal requirement of additional, monthly reporting on lobbying of senior government officials: see definition of “high level public office holders,” above.
The monthly reporting would apply to lobbying of senior officials (high level public office holders) only by consultant lobbyists and by in-house lobbyists for non-profit entities. Lobbying of senior officials by businesses’ employees would not be affected.
To be filed by the 15th day of each month, a report (by each individual consultant, or by the CEO of a non-profit entity) would provide the following information about lobbying of any high level public office holder during the previous month: name of the official, date of lobbying, and particulars of the subject-matter.
4. Registration Before In-House Lobbying Commences
Currently, in-house lobbying registration must occur within two months after an employee becomes an in-house lobbyist. If Bill 115 passes, then employees of businesses and non-profit entities must be registered before they lobby public officials.
The requirement of advance registration would be virtually without precedent in Canada. In most jurisdictions, registration can occur after lobbying commences (or the undertaking to lobby is made).
For an unexplained reason, Bill 115 would only impose the advance registration requirement on in-house lobbying. Consultants would remain free to delay registration until after they start to lobby.
5. No Lobbying While Providing Advice or Services to Government or Public Agency
The proposed legislation would prohibit individuals from lobbying on a subject if they are paid to provide advice or services to the Government or a government agency concerning the same subject. Provincial lobbying laws in Alberta, British Columbia, Manitoba and Quebec already contain a similar restriction.
The bill would include membership on the board of a government agency within the definition of providing advice or services, though the drafting creates ambiguity in how the expanded definition would affect the prohibition.
6. Prohibiting Reprisals
Bill 115 would create a new offence of retaliation against a person because of a disclosure to the Lobbyist Registrar or evidence that has been or might be given in a proceeding.
Such an anti-reprisal provision would be precedent-setting in Canadian lobbying law.
7. Higher Maximum Fine
The bill would increase to $250,000 the maximum fine for an offence under the Lobbyists Registration Act. At present the maximum fine is $25,000.
Since the Ontario law took effect in 1999, nobody has ever been charged with (let alone been convicted of) an offence under the Act.
8. Requiring Slightly Faster Registration by Consultant Lobbyists
The proposed legislation would slightly accelerate the deadline for a consultant lobbyist to file his or her registration: from 10 calendar days, to five business days, after starting to lobby. This would effectively reduce the time frame from one and one-half weeks to one week.
In this respect, Bill 115 would treat consultant lobbyists more leniently than in-house lobbyists. As explained above, the bill would prohibit in-house lobbyists from engaging in any lobbying until they are registered. Consultants, on the other hand, would be free to commence lobbying and then register afterward.
This discrepancy is remarkable, because the universal approach of Canadian lobbying law (including, but for this proposal, the Ontario Act) is to subject consultant lobbyists to standards that are the same as, or more stringent than, the standards applying to in-house lobbyists. Applying a more lax registration deadline to consultants, as Bill 115 proposes, would be unprecedented in Canada.
9. Making Consultant Lobbyists Disclose Their and Their Clients’ Political Contributions
Bill 115 would also require that a consultant lobbyist, at the time of registration, file a list of the consultant’s and his or her client’s provincial political contributions during the preceding 24 months. The sources and amounts of political contributions are already publicly available under the Election Finances Act (Ontario), but the bill’s sponsor said this proposal would “add another level of transparency.”
While this proposal would increase transparency, it would not prohibit lobbyists from mixing political fundraising with lobbying in order to secure a lobbying advantage. At present, it is common for Ontario political parties to host fundraising receptions targeted at lobbyists and their clients. It is also common for lobbyists to engage in lobbying at political fundraising events; often lobbyists will bring their clients to political fundraisers in order to introduce the clients to politicians for the purpose lobbying.
The practice of the Ontario lobbying industry is inconsistent with the decision of the Federal Court of Appeal in Democracy Watch v. Campbell, where the Court held that a lobbyist places an elected politician in a conflict of interest when the lobbyist engages in fundraising for the politician and lobbies at the same time. Referring to the combining of fundraising with lobbying, the Court stated:
“A lobbyist’s stock in trade is his or her ability to gain access to decision makers, so as to attempt to influence them directly by persuasion and facts. Where the lobbyist’s effectiveness depends upon the decision-maker’s personal sense of obligation to the lobbyist, or on some other private interest created or facilitated by the lobbyist, the line between legitimate lobbying and illegitimate lobbying has been crossed.”
The Federal Court of Appeal was interpreting a rule that prevents federal lobbyists from placing federal officials in a conflict of interest. Though differently worded, subsections 18(5) and 18(6) of the Ontario Act are to the same effect: they make it an offence for a lobbyist, in the course of lobbying, knowingly to place an Ontario public office holder in a conflict of interest. While the Federal Court of Appeal decision does not bind those interpreting the Lobbyists Registration Act (Ontario), its careful analysis of conflict-of-interest precedents is difficult to refute or to ignore.
Following the Democracy Watch decision, the Prime Minister issued new guidelines for federal Cabinet Ministers and Parliamentary Secretaries. These guidelines, appearing as part of the Prime Minister’s rules for his Cabinet, tell federal politicians not to involve lobbyists in their fundraising, not to target lobbyists and stakeholders as the objects of fundraising, and not to discuss government business (i.e., not to allow themselves to be lobbied) at political fundraising events.
At the provincial level, the mixing of lobbying and political fundraising is an ethical issue that the Ontario Legislature has not yet addressed.
10. Adjusting the Definition of Grass-Roots Communication
Grass-roots communication is a form of lobbying; in fact, it is the only form of lobbying in which a lobbyist does not communicate directly with public officials. Instead, the lobbyist makes appeals to the members of the public, urging them to contact a public office holder directly to put pressure on him or her. In essence, the lobbyist is communicating indirectly with the public office holder, by working through the public.
Bill 115 would amend the definition of grass-roots communication to confirm that it “does not include communication between an organization, person or partnership and the members, officers or employees of the organization, person or partnership.”
In 2012, Ontario’s Liberal Government outlined its own proposals to amend the Lobbyists Registration Act, though it never tabled actual legislation. Its proposals included: expanded reporting obligations for in-house lobbying; more detailed reporting (identifying MPPs and Ministers’ offices being lobbied); authorizing the Lobbyist Registrar to establish a Code of Conduct for Lobbyists; and restricting certain lobbyist arrangements (e.g., contingency fees).
Earlier in 2012, the Integrity Commissioner (Lobbyist Registrar) had published her own recommendations for reform. These included: elimination of the 20-per-cent threshold for in-house lobbying; empowering the Registrar to impose administrative monetary penalties; and tightening the restriction on lobbying by former public servants.
View our earlier bulletin analyzing the Government’s and the Registrar’s proposals.
View the Government’s 2012 announcement.
View the recommendations (PDF) made by Lynn Morrison, the Integrity Commissioner and Lobbyist Registrar.
The Standing Committee on Regulations and Private Bills has not yet scheduled a time to consider Bill 115.
The Committee can be contacted through the Clerk, Ms Valerie Quioc Lim (+1 416 325 7352), or the Chair, Mr. Peter Tabuns (NDP - Toronto-Danforth) ( ).