Ethics and anti-corruption rules for defence contractors in Canada

Ethics and anti-corruption

When and how may former government employees take up appointments in the private sector and vice versa?

Former government employees are subject to restrictions associated with their employment. Generally, former government employees must undergo a ‘cooling-off’ period before they may join a private sector employer that has significant dealings with government.

The government hires employees from the private sector. Such employees are subject to conflict-of-interest guidelines.

How is domestic and foreign corruption addressed and what requirements are placed on contractors?

Domestic and foreign corruption is addressed through criminal laws of general application, which include the Criminal Code and the Corruption of Foreign Public Officials Act. Also, the government has adopted the Integrity Regime, which is a set of contractual provisions and associated policies (such as the Ineligibility and Suspension Policy) that have the effect of prohibiting bidders and contractors that have been convicted of specific offences from participating in procurements. The offences that may result in disqualification range from offices related to the participation in a criminal organisation, fraud against the government or bid rigging. Disqualification may result from the commission of an offence as articulated as being part of Canada’s domestic law or a foreign equivalent to a listed domestic offence.

Following consultations, Canada has decided to create a revised Ineligibility and Suspension Policy, which is expected to be published in November 2018 and come into effect in January 2019. The revision is expected to introduce greater flexibility for disbarment decisions; and expand the scope of ‘triggers’ for potential disbarment to include certain provincial and federal offences (such as labour or occupational health and safety and environmental violations) and to take into consideration any foreign decisions and judgments suggesting misconduct.

What are the registration requirements for lobbyists or commercial agents?

Lobbyists or commercial agents are required to register under lobbyist registry legislation. With respect to procurements conducted by the government, the applicable legislation is the Lobbying Act. The Lobbying Act requires lobbyist and commercial agents to file a registration identifying themselves, their clients, the topic of their lobbying activity and the government offices or officials that are being lobbied.

Are there limitations on the use of agents or representatives that earn a commission on the transaction?

Yes. Pursuant to the Lobbying Act and standard contracting provisions, the paying of a commission to a third-party agent or representative is prohibited.