In October, the federal Commissioner of Lobbying released a revised draft of the Lobbyists’ Code of Conduct (Draft Code) for consultation. The existing Code provides a set of principles and rules outlining the behaviour expected of lobbyists in Canada. The Draft Code proposes several key amendments. Public affairs professionals and other lobbyists should take advantage of the consultation process to make their views known prior to December 19, 2014.
The existing Code is composed of three overarching principles and eight rules addressing transparency, confidentiality and conflicts of interest. The Draft Code amends the introduction and the preamble, adds a fourth principle, “Respect for Democratic Institutions,” and revises and adds to the rules. We discuss below the key amendments proposed in the Draft Code.
CONFLICT OF INTEREST, ‘FRIENDS’ AND ‘POLITICAL ACTIVITIES’
The amendment that will have the greatest impact is the proposed clarification of the conflict of interest or improper influence rule (current Rule 8). The current Rule 8 concerns a number of public affairs professionals because of its lack of specificity. Unfortunately, the new rules still lack specifics and add further interpretation issues.
Proposed Rule 6, together with Proposed Rules 7 to 10, replaces current Rule 8. In proposed Rule 6, the words “real or apparent” are added to the general conflict of interest rule, which introduces and informs the interpretation of Rules 7 to 10. In our view, this will add to the lack of clarity in the rules because no actual conflict of interest need exist and views will certainly differ on this point when circumstances come under review.
Proposed Rule 7 will preclude consultant lobbyists from arranging a meeting for another person with a public office holder who is a friend (among others). Further, Rule 8 will preclude all lobbyists from lobbying a public office holder who is a friend (among others) and other public office holders who work within that public office holder’s (friend’s) area of responsibility. “Friend” is not defined and if these changes are adopted many public office holders may find themselves demoted from friend to acquaintance. Further, the term “area of responsibility” is new and undefined. In some circumstances this provision could extend this lobbying ban to a large number of people. In addition to these definitional issues, it is difficult to see how a lobbyist is to ensure that he or she is not lobbying a public office holder who works within the “area of responsibility” of a friend of the lobbyist. Must a lobbyist obtain from each friend who is a public office holder a clear definition of who works within his or her area of responsibility? How can this be achieved within the constraints of privacy legislation?
Proposed Rule 9 states that “a lobbyist shall not lobby a public office holder if political activities undertaken by the lobbyist prior to or at the same time as the lobbying activities create a sense of obligation which might bring into question the public office holder’s primary duty to uphold the public interest. A lobbyist shall also not lobby other public officers working within that public officer’s area of responsibility.”
The Draft Code does not specify which political activities will lead to a conflict of interest situation. However, according to guidance issued in 2010, the Commissioner established three categories of political activities which applied to breaches of the old Rule 8 (and presumably the new Rule 9, although this has yet to be expressly confirmed):
- Activities that advance the private interests of a public office holder to a “low degree” are not in breach. These activities include “voting in an election, placing a sign on a lawn, purchasing a ticket to a fundraising event such as a barbeque or golf tournament, or donating money to an election campaign within the limits established in the Canada Elections Act.”
- Activities that advance the private interests of a public office holder to a “higher degree” have an increased potential to result in a breach, which includes both a real and perceived conflict of interest. These activities include “being a member of a public office holder's constituency association or limited participation in a campaign for the election of the public office holder.”
- Activities that advance the private interests of a public office holder to a “high degree” are likely to result in a breach. These activities include “being a member of the board of directors of a public office holder's constituency association, or organizing a fundraising activity for the benefit of the public office holder or their constituency association, or chairing a campaign for the election of the public office holder.”
Like the existing Code, the Draft Code applies to any individual who, for payment, communicates with a public official about a government decision on a client’s behalf. This includes directors, partners, lawyers and accountants. Given this scope, Rule 9 could greatly impact persons who have participated in political campaigns or fundraising, and in particular would have retroactive impact in respect of past political activity.
To mitigate this retroactive effect, the Commissioner has stated that she is considering a “cooling off” period after which political activities would no longer be a factor in terms of creating a conflict of interest. She suggests that a five-year period similar to that applied to former designated public office holders under the Lobbying Act may be appropriate. This would not assist current lobbyists who have recently engaged in political activities that may curtail their lobbying activity for the next five years.
Further, Rules 7 to 9 seem to be unworkable in the context of in-house lobbyists. The first in-house person to communicate with a federal public office holder may not meet the “significant part of the duties” test, and so the fact he or she is active in politics or speaking with someone in the department of a friend does not matter. However, if there is more lobbying activity by others in the company within the relevant time, the communications of this first person, which were acceptable at the time, would be offside.
Consequences for non-compliance with the Draft Code include an official investigation and a parliamentary report. However, significant reputational risk must also be considered. In addition, public office holders are often reluctant to deal with persons accused of improper lobbying. Clients who communicate with federal public office holders are strongly encouraged to consider whether their current and past political activities would allow them to comply with the Draft Code and continue as lobbyists.
The Draft Code is open for comment until December 19, 2014. Comments can be submitted to email@example.com and will be posted on the Commissioner’s website. The Commissioner’s office has confirmed that such submissions are communications made “in proceedings that are a matter of public record” and therefore exempt from the requirements of the Lobbying Act.