This seminar is part of the 2016 Gowling WLG Risk to Reward series, designed to address the most important legal, regulatory and corporate risks facing your organization.
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About this seminar
Your organization has a position to advocate, and needs to communicate with government on public policy issues and programs. But how can you do this effectively?
This seminar will provide insight into Canada’s three levels of government and teach you about critical legislative requirements, codes of conduct and ethical aspects to consider when lobbying government. In addition, this seminar will give views on strategy and an overview of public and private procurement practices, as well as forward-thinking perspectives on emerging government trends.
This program counts for up to 1 hour of substantive credits towards the mandatory CPD requirements of the LSUC.
Working with and Lobbying Government
Good morning everyone. It’s good to see you here bright and early. I think we’re fortunate today. Rain is going to come. It’s going to be here in only a few minutes so we all got here good and dry. It’s interesting because to have the privilege of being able to address these issues with you, is for me, quite special and it’s in the context of our series at Gowling WLG of “Risk to Reward”. The whole idea is really to provide advice and thoughts on where we see risk, how to address risk and essentially to ensure there is a reward by addressing those risks before anything happens. That is I think something that is extremely important. The context of how we address issues with government, how we work with government and certainly, ultimately, how we lobby government when we need to. It’s special to do this, also, steps away from Parliament Hill, because we know how much Parliament obviously affects our daily lives and it’s in the context of us being able to deal with a whole range of issues that really touch on our lives that we’re able to address, meaningfully, with members of Parliament, with Senators and others and certainly officials of government. Before I begin and provide all the introductions, first I just want to acknowledge the fact that we have Wayne Warren, who is our managing partner here in the Ottawa office, and certainly Wayne is stellar in the way in which he represents the firm and does so much for the partners here. I’ll also acknowledge Todd Burke who has been actively involved in organizing this series and working together on these initiatives. Todd, thank you.
Before I begin any further also I do want to acknowledge a very distinguished Canadian who is here at the front with us, who is a member now of Gowling WLG, and we’re just thrilled to count Robert Ghiz, former Premier of Prince Edward Island, to the fold of Gowling WLG. For many of us that have admired Robert I think we really feel like we know you but the fact that we now have you here with us, working with us and addressing the kinds of issues we are going to be dealing with today, is really a delight. I can also add that Robert will be speaking right at the very end of our session just to wrap things up, but I do want to emphasize that Robert served in a very distinguished way, Prince Edward Island from 2007 to February 2015, and he was first selected as a member of Legislative Assembly in 2003. Robert, I have to say, is someone who has played a key role in advancing the Province and I see him playing a key role also in advancing the kinds of initiatives that this firm wishes to engage in, both nationally and internationally. With nearly two decades of experience in government public policy, including as I say 12 years in elected office, Robert does bring wealth of high level expertise to the role. He also worked with the Prime Minister Jean Chretien as manager of government affairs for the Bank of Nova Scotia. He became leader of the opposition in Legislative Assembly and then went on to be elected in 2007. His mandate, certainly in that position, he was regarded as a key builder and someone who obviously did an enormous amount in the context of P.E.I.’s education health care systems, in the context also of the economic stewardship that he brought the Province to the position of the highest unemployment as well. He’s heavily involved in volunteering and serves on the advisory board of “Prince’s Charities of Canada” and is a board member of “True Patriot Love”. I could go on and one but I will certainly let Robert add his thoughts a bit at the very end too. On both sides of Robert also we have Guy Regimbald, who is one of our fine partners and I’ll provide details on his background, and also on the left of Robert is Phuong Ngo, also an exceptional partner dealing with issues on procurement. I think that will basically cover out many of the issues obviously we want to share with you in the context of lobbying and government.
So, I’ll begin and again say that this is an interesting topic. It’s one that clearly one could have, not just one session, but a dozen sessions very easily. There are courses in law. There are courses in public policy. A number of fields as we’re looking at really dealing with the very sophisticated field of how one advocates issues before government. It’s interesting, when I initially dictated the first draft of my remarks for you today, my assistant mistakenly didn’t put “Working and lobbying the government” but she said, actually on the note, “Awakening government” and I thought that was interesting because what we really try to do very often is awake government. Ensure that they can really appreciate the issues that are so critical to understand. Something that Robert certainly knows and a few of us in this room recognize the importance of waking government at the right time.
When you look at that and you look at the definition, Black’s Law Dictionary definition, lobbying is something that essentially has been around for many, many decades. We have specific rules now, legislation and regulations since 1989. The environment for a lobbyist and lawyers such as myself, who work in the field of government relations, advocacy, lobbying, has certainly become much more complex with the proliferation of regulations, legislation, codes of conduct and various levels of government. There is a lot, effectively, to navigate. We started in ’89 and we’ve gone right up here to 2008 and there are a number of changes. We continue to have changes as a result of interpretation bulletins, as a result of codes of conduct and now we see, as well, lobby legislation that exists in Ontario. Which has also been around for quite some time, since 1999. We have a new Act that is coming in force. There are very significant differences also from the current regime to what we’re going to see on July 1 when the Act is implemented. Those are certainly issues that we can certainly address with you if you have any questions later on in the day.
There are obviously significant issues and yet a whole field of law that has been created over the last few decades. There has also been lots of media attention and focus on lobbyists. People who wish to know what is doing what with government. It’s very interesting when you look at, I think of a Picasso or I think of a Riopelle and those sort of cubes and the elements, and you’re trying to think, “What’s going on there?” For many it’s sort of a bit of a maze and really, for the media or for people who are competitors in business, they’re really trying to figure out how do you address issues with the government? How do you make sense of that? On whose behalf, so questions come on, on whose behalf is someone lobbying? And which organizations, associations, companies, are lobbying for what? Who is getting the attention of government? Who is seeking a change in policy? Who is seeking a change of legislation or regulations? Who is competing for what? The system of lobbying is effectively designed for the purpose of transparency. The expectation is, essentially, that if light is shined on what people are doing in the context of discussions with government, then everyone will be more honest, and straight and narrow in their approach influencing government. That’s what is certainly expected. Transparency, and I certainly am one of those promoters of that, and a number of years certainly spoke before a Parliamentary committee as we are entering a phase of a second set of amendments to the Act, but really transparency would then demonstrate that there would be no undue influence of personal favours. No back room deals done with government under the table rather all above board. Disappointing, but still with all this regulation, there is too often a negative impression of lobbying or lobbyists. It’s seriously unfortunate. Critics have claimed that there has been, also, that transparency sort of led to over regulating this field. The say rules regarding lobbying on various codes are too broad or too tough today. In some instances that is the case. Some believe there is a presumption that government officials and politicians, and those who speak with them on any given matter, lack integrity. Therefore these rules exist. Indeed, this may often be viewed as the case because of a growing attitude or atmosphere of suspicion or cynicism in what motivates government. That is too bad. But hopefully this impression of a negative presumption, that people are not be trusted if it does exist, will change under the current Trudeau administration. We have seen a tendency over the past few years for public servants to retreat into their offices and be less open to dealing with the public on serious public policy issues. Program development, legislative reform and a myriad of subjects that any government must deal with every day, truly do require appropriate engagement. It becomes disconcerting that when the job of lobbyists or advocates is, by and large, to help educate and enhance or improve public policy process, that these voices are not heard, or not expressed in the right way, for truly meaningful consideration. As I have said on many occasions one cannot develop good public policy from the back end of a dark cave. There appears to be a return to the view that consultation is important and good in ensuring better government decision making, consistent with government goals and policies, and ultimately beneficial to all in the long run. Government needs help to appreciate and understand the points of view and many sides of an issue to make these right decisions and understand the options available for reaching the ultimate best choice. Informed debate requires full appreciation of the subject matter and the ways people are, or will be, affected by government policy.
We look at the touch points, government contacts. Well, when we look at the number of people, or the number of individuals that have significant areas of responsibility, they are an enormous number. There are 214 federal departments, agencies and Crown corporations and special agencies. There are 31 Cabinet Ministers. We have scores of staff. We have 86 sitting Senators. A total of 105 when all those seats are filled and then we also look at the number of Members of Parliament, 337 Members of Parliament and thousands of Public Servants. Just think, all of these individuals are your targets, they’re often your targets. The ones you want to talk to. The ones that will appreciate. You have to choose which ones are going to be your champions and when you do that, and addressing the issues, you also have to know there are very specific rules on lobbying, which Guy will deal with some of those details, and I’ll share something with you in a moment. Of these noted government officials many hundreds are designated public office holders. Thus requiring appropriate monthly reporting when contact with these individuals have occurred. If you, or someone on your behalf, advocates a position seeking something from government, then chances are you are lobbying. The definition of lobbying at the federal level generally refers to those, who for payment, communicate with legislators or other public officials against or in favour of a specific cause. Here, this is right out of the Federal Lobbying Act, section 5.1, it’s very specific. There are very, very significant elements in that that frankly we spend a lot of time dealing with, interpreting, advising our clients as to first of all, whether they are lobbying, what it is that they are sharing, but as you’ll notice in this context when here we’re dealing with consultant lobbyists, there’s even a requirement, a requirement if you are going to just set up a meeting you have to register as a lobbyist. These are things that are absolutely critical to consider.
I can share with you a number of examples from “Lobby Monitor” on the kind of lobbying that takes place on any given day on Parliament Hill. It’s incredible. I do read this first thing each morning to see what exactly is going on, who is speaking and what’s going on. For example, April 28, 2016, the “Agriculture Manufactures of Canada” met with Parliamentarians to discuss their agenda on innovation and trade with relation to agra manufacturing. This a multibillion dollar business for Canadians and they obviously have very specific issues on their plate to address. We look at Google, Uber and they formed a new group that will advocate for self-driving cars. Now, that’s on behalf of also working with Ford. There may be organizations out there that say, “I don’t want that. I don’t want my municipality not having drivers.” or, “I feel that this is an opportunity for me. I want to engage in that.” And then you have CADSI which represents the defense industry, specifically looking at the whole issue of the procurement review, the defense review that is taking place in the context of that in procurement. So certainly individual companies are supporting that initiative, but at the same time while their association is addressing initiative, he’ll let individual members of that particular organization, also wanting to share their specific requirements, what they feel they can add value in the context of the discussion. Another one, June 1, the Great Lakes and St. Lawrence cities initiative. Well, there is a coalition of 120 US and Canadian mayors and officials and they want to re-engage on the discussion on Lake Erie, addressing issues to reduce phosphorous run off. I look at the Dominion of Canada, general insurance company. They’ve registered to lobby on emergency preparedness and disaster relief. Again, these are just a few examples of what we’re seeing that is out there and there are literally thousands.
If you are lobbying, as well, you want to do it right. You want to be credible. You want to lobby effectively to get your message across. As we all know first impressions are important in how you, or your organization or company, speak to or appear before government. I say appear because since as a lawyer my preparation for meetings with officials and politicians can be very reminiscent of how I plead a case. Sure, I’m the lobbyist but I really am the lawyer. I’m the advocate. I’m defined as doing a lobbying activity so I have to register in that context. But we want to be clear in getting all of our key messages across and these points must be shared respectively and persuasively. I want the official that I’m dealing with to feel and know that I’m helping him, or her, to better understand the situation of my client or prepare my client to appreciate and know how to get his or her story, at critical points, understood. Strategy also needs to be considered. It will depend on the issue, the program, the policy, the grant, the procurement program that is being addressed as to where do you start. You begin with a Member of Parliament, a minister, senior government bureaucrat. Do you deal with the opposition or simply the governing party? Do you reach out to the Prime Minister’s office, privy council officer or both? So strategy counts in what you do each step of the way might also give you a sense of whether or not you’re going to succeed. I say this often, there is no point to waste a year’s government relations budget on a naïve initiative for something that is simply a non-starter. In most cases today doing business includes knowing how to work with government and to nurture relationships with those officials that have an impact on your business or the goals of your organization. To think about your relationships with government, it’s worthy to enhance relationships when all is going well. So that it’s easy to speak with government when required at a later stage. Deal with the bureaucracy, engage with the agencies and the branches of government that you need to reach out to, when you have a problem that require attention. It’s best to do that at the good times. To be prepared to deal with potentially difficult days. It is surprising to me, and I know to my colleagues, how often an organization’s budget or a company budget, has no line item on government relations. This is an investment that pays off in spades when done correctly. The modest investment of time and financial resources can be effective in preventing a problem or ensuring you are at least being heard when it’s important to get a message across. Those are some of the elements you want to be thinking about.
The questions you ask: Is it good for Canada? Is it for good for you and you can’t afford ignoring it? Should it be of importance to Canada? Is it something that we need to be competitive to grow the economy to avoid a disaster or better protect Canadians to achieve the governments objectives? Will an unintended consequence be created by the government doing so? I’m sure that you’re aware of those circumstances where the government puts together a program or does something that clearly affects something in a very negative way. We have on a good number of occasions stopped government from doing certain things when they realize what the implications could be. Good intentions don’t always lead to best results. Therefore, we must alert government because it would be bad for Canada if we go ahead with legislation, or a new regulation, or policy, or program that has not been fully considered. Often it is indeed specifically up to you to add value in making good policy, legislation or the way in which programs are designed. It is not just up to legislators to weigh in. We have a role to play as citizens, as stakeholders, as experts, investors in our Canadian economy. But it is up to us to be clear to act responsibly, honestly and respectfully to get our messages across in a manner that is consistent with transparency and fairness within the corridors of political power. As said earlier, it is my hope that government can truly appreciate the value of advocacy and lobbying and believe that meaningful consultations can generally lead to better results for legislation, successful government programs and superior public policy.
While today’s Gowling WLG program has been designed to provide you with some specific information on the legal requirements of lobbying, and to acclimatize you to the issues relating to working with and lobbying government, it is also intended to make sure that you are thinking, your thinking is further enhanced, so that you may better appreciate where you and your companies, organizations goals fit within the overall frame work of addressing issues with government. Creating new opportunities with government or working with government to either solve some of your problems or assist you. And while you do all that, make sure you’re not getting in any trouble, that you’re not breaching any legal requirements that are clearly there. These are hard law issues to which Guy and I can share with you some of our work over the last number of years in advising when there has been a breach of the Lobbying Act.
With all that said I will call upon my partner, Guy Regimbald, who will provide you with some of the critical nuts and bolts of the rules with respect to lobbying government. Following Guy we will hear from my partner Phuong Ngo, one of Canada’s best recognized and leading lawyers in the field of government procurement law. As I promised Robert Ghiz will certainly speak, for the first time I guess at this podium, representing the firm on observations or anything you may want to add to that Robert, be happy to. Before I actually call Guy here I just want to give very, very quick reviews on both Guy and Phuong, with regard to their respective practices.
Guy is a partner here in the Ottawa office and he practices in the areas of constitutional administrative law, aboriginal law, trademark, copyright and generally in litigation. He’s appeared as lead council, or co-council, before the Supreme Court of Canada in over 12 high profile cases and he’s been cited by “Lexpert Magazine’s” top 10 case in 2014. He’s also the co-author of “Canadian Administrative Law” and “The Law of Canadian Constitution”. These are tremendous works that have been cited also by the Supreme Court of Canada and numerous courts across the land. Guy advises clients on government regulatory issues including lobbying requirements that may arise in the context of their working government relations. He’s got a good pedigree in that he also spent some good time in the Supreme Court of Canada, the Privy Council Office and also the Department of Justice. It’s interesting that Guy has that skill also which really adds so much value as we work together. We advise clients, we talk to them about what their options are in terms of government relations, but what it also means that if they brick wall there is then the legal component and the legal issues and the court action which could then take place after that.
After Guy we’ll call on Phuong Ngo. Phuong is also a partner here in the Gowling WGL office. She practices in the areas of civil and administrative litigation, health law, government procurement, bit process and judicial review. She’s ranked in “Chambers Global 2015” as one of the top lawyers. She’s best lawyer in Canada in 2016 for public procurement. She’s an advocate in Ontario courts, the Federal Court of Canada and she’s spends a lot of time dealing with issues with the Canadian International Council Trade Tribunal. Her experience really in dealing with issues in the private sector, that deal with policies and obligations relating to government procurement, is really incredible. I have the privilege of working with Phuong very often and it’s unbelievable how much she has in her tool kit to appreciate the very significant roles that take place when one wants to sell the government or has an issue with government. She also sits on the Board of Trustees of the Canadian Museum of Immigration at Pier 21. I now call upon Guy Regimbald. Thank you.
Thank you Jacques for the kind introduction. This part of the presentation is the more technical part of it where we will look at the different lobbying registration requirements. We will focus mostly on the federal level but similar obligations apply across the country in all the Provinces, or most Provinces, as well as some municipalities. The first issue is to define what is lobbying. Lobbying is whenever you communicate with public office holders so the person has to be a public office holder. When you’re also compensated for making that communication so you need to be paid. And obviously the subject of the communication must be one that is targeted by the Lobbying Act. There’s a distinction, a very important one, to be made between consulted lobbyists and in house or employees who communicate with public office holders on behalf of their employer. A consultant would be, for example, Jacques is a consultant. He’s a lawyer, he’s not an employee of the corporation that he represents so Jacques would have to, if he arranges a meeting or communicates with the public office holder on behalf of a client, would have to register as a consultant lobbyist. In the case of employees, obviously if you’re an employee of the your corporation and you do have as an element of your obligations with your employer to communicate with public office holders, than you are an in house lobbyist. One of the main distinctions also between a consultant lobbyist and the employee, or in house lobbyist, is that consultant lobbyist needs to register as soon as there is an undertaking to communicate with the public office holder. If Jacques gets a mandate today, or retainer today, to arrange a meeting with a public office holder he has 10 days to register as a lobbyist. Whereas if you are an employee this is different. There’s a different threshold applicable across the country, we’ll get back to this, but if you are an employee and one of your duties on behalf of your employer is to communicate with public office holders, you lobbying but you are not necessarily required to register as an in house lobbyist unless you meet some threshold. That threshold is different across the country. This is the main distinction. Jacques is lobbying, you’re also lobbying, Jacques needs to register as soon as he gets a retainer, you can wait until you meet some specific threshold. The lobbying itself remains the same.
So what is lobbying? Jacques has put forward earlier section 5 of the Lobbying Act. This is what section 5 says again and so you can meet MP’s or public office holders at an airport, everywhere you want, and you can introduce yourself to them, let them know what you do and if the conversation ensues you can give them information about your corporation. You can say a lot of things without lobbying them. But once that discussion, at an airport or any event you meet, comes to these issues then obviously then you’re starting to lobby. If you’re telling an MP that you need that something in the regulations doesn’t fit well with your employee, then you’re lobbying. You would like them to eventually amend legislation or introduce a bill or resolution or make an amendment. If you’re asking for some funding from the government you’re also lobbying. The last one is important here because when Jacques, as a consultant lobbyist, arranges a meeting between a public holder and one of his clients, even if Jacques does not attend that meeting he needs to register because he is arranging a meeting between a public office holder and a client. However, that does not apply if you are an in house lobbyist. It only applies to consultant lobbyist but this is at the federal level. We’ll see later on that at some Provincial levels there is a requirement to register also for arranging meetings for in house lobbyists.
What are requirements to register as a lobbyist? We said earlier that we need to communicate with a public office holder, this is what we have here, and you need to be paid for that communication and also the communication must target one of the elements that I’ve noted just before. So who are public office holders? The rule here is quite wide. At the end of the day, if you are talking to anyone that is an employee of government, you are likely lobbying. Of course, if you meet the other thresholds. So all government employees, all Senators, MP’s, their staff, governing council appointees except Judges, officers, directors or employees of federal board commissions or other tribunals, members of the communion, Armed Forces and the Mounted Police. Basically whoever is paid by the government is a public office holder at the federal level only. And this is getting more and more technical, the next slides only apply at the federal level, but they don’t apply at the provincial level. Public office holders being all employees of government that applies also at the provincial level. There’s an added requirement so if we unravel again you are communicating with the public office holder, you are paying to do so, and for example, you’re communicating with them to change legislation. So you are lobbying. You need to be registered. You will register, you will say what the topic of your discussions, what you’re trying to change, and everything will be okay, you’re allowed to talk to them.
At the federal level only, there’s an added requirement, to not file a registration but file a communication on the 15 day of every month, if those public office holders that you communicated with are designated public office holders. For example, if you have a meeting with a director general of a department at the federal level, and you already have a current registration that is live, that person is not a designated public office holder so you can go talk to them, no problem. But if you meet an MP, for example, MP’s are designated public office holder and so the 15 day of the following month, say you meet an MP today, we are June 2 today, that means by July 15, you need to file a communication saying that on June 2 you’ve met with this MP. That applies for all designated public office holders who include all Ministers of the Crown and their staff, all Members of Parliament, all Senators, the staff in the office of the leader of the opposition, in the House of Commons and in the Senate, senior public servants, Deputy and assistant Deputy Ministers and some other positions that are designated by regulations and here they are. So, you’ve got Chief of the Defense staff, I won’t go through the list, but generally speaking we’re talking about very high ranking officials of the federal government. When you meet with these people you need, on the 15 day of the following month, file a communication simply stating that on June 2 you met with these people and this was the topic of the discussion. This slide basically states what I’ve been saying before, if you have an oral and an arranged communication with designated public office holders, you need to file this communication on the 15 day of the following month. You need to put the name of the DPOH, the position and title of the designated public office holder, name, branch, date of communication and the subject matter. This is the lobbying requirements from about 40,000 feet above and so whenever you’re communicating with public office holders, if you’re not sure whether you’re lobbying or not, you can always call upon us to advise you. We’ll let you know one, if you’re communication was lobbying and if it was and you’re a consultant you need to register now, if you’re an in house employee, well it depends, we’ll see later, you are lobbying but you may not need to register because you may have not met that threshold. So there are lobbying regulations across the country, British Columbia, Alberta, Saskatchewan has a legislation in place, it should be in force in the spring, this spring and we’ve been told that it might be pushed back to June, to this month or maybe next month, so this is one of our targets that need to be careful with, Manitoba, Ontario, Quebec, Nova Scotia, New Brunswick is not in force yet, and Newfoundland and Labrador, and PEI does not have the lobbying legislation. All Quebec municipalities also have lobbying registrations, the City of Toronto, Ottawa, Hamilton, Surrey, BC and St. John’s Newfoundland and Labrador.
Again same as the definition of lobbying at the federal level, those apply pretty much across Canada. Any legislative proposal, bill resolution, regulations, bylaw, policy program, grant contribution of financial benefit, those are all within the definition of lobbying across the country. Arranging a meeting between a public office holder and a client is also lobbying across the country but similar to the federal level, some Provinces require only consultant lobbyists to register when a arranging a meeting. Some Provinces also want in house lobbyists to register when you’re arranging a meeting between a public office holder and a client. Some jurisdictions are more restrictive than others. For example, in BC, Quebec, Quebec municipalities, Newfoundland and Labrador, Toronto, Ottawa, Hamilton and St. John’s, if you’re communicating with a government for the purposes of selling your product or services, you are lobbying. For some other Provinces like Ontario, for example, if you’re trying to sell to Ontario your services or products, that’s not lobbying. You don’t need to register that. There is obviously a different definition as to what is lobbying in Ontario as compared to these Provinces. Same with the issuance of a permit, licence, certificate or other authorization, that’s lobbying in Quebec. The approval and denial of an application for service grant, planning approval and so on, that is lobbying in Toronto and Hamilton. Those apply mostly for municipalities but note that Ottawa is not there. If you apply for a service or grant or planning approval for Ottawa that’s not lobbying. But it is for Toronto and Hamilton. If you’re lobbying for the awarding of a contract, that’s lobbying, in BC, Quebec, Toronto, Ottawa, Hamilton, and so on. You can see it’s not easy to navigate these waters. If you’re operating in more than one jurisdiction you need to be very careful. It’s probably easier to use the lowest common denominator and register then failing to register and get caught with the lobbying requirements. More distinctions between Provinces and municipalities, the terms of procurement or tender, that’s lobbying in some jurisdictions but not others, appointment of public office holders, choice of contractor, the sale of government of all or part of any business, so it goes on and on and on and on as to the distinction between various jurisdictions in the country.
Luckily with what is consistent everywhere is the definition of a public office holder. So at the end of the day, if you’re talking to a public office holder, includes anyone that is paid by that level of government. It could be someone at the very low level or it could be a high rank officials, if they’re paid by the government, they are public office holders. So we always give this call as to whether they need to register because I spoke with an employee of government, it’s not a public office holder in the sense of that person is not elected, and it’s true that when we think of public office holders we often think of elected officials. For the purposes of the Lobbying Act across the country public office holders are employees.
Here are the thresholds. I’ve put the ones for Ottawa, Hamilton and Toronto because they’re different than the others in the country. If you are consultant lobbyist you need to register, as I said earlier, at the very outset. You pick up the phone, you get a retainer to prepare or for a meeting with an office holder, or even arrange a meeting between a public office holder and a client, you have to register at the outset. If you’re an in house lobbyist, so if you’re an employee, you can lobby and you do not need to register until you meet some threshold. At the federal level, for example, if you or together with the other employees of your corporation, taken together, you lobby the federal government for an amount of time that is equal to about 20% of the duties of one employee taken on a 1 month period, then you need to register the company. The registration will not be made by the employee that communicates but it’s going to be made by the CEO of the corporation. So the employer will file the registration and that registration will note the employees that actually do the communications. At the federal level it’s 20% of the one person’s time, taken together, on a monthly basis. In Eastern Canada it’s the same threshold but it’s taken over a 3 month period and so obviously you need to have even more lobbying to meet that threshold. Quebec has something completely different. It’s about 12 days in the year. Ottawa is currently 20% taken over 3 months but that will change on July 1 and it’s going to be much more restrictive and it’s going to be 50 hours in the year. Also for Nova Scotia and Ontario, currently it is the in house lobbyist themselves that need to register but for Ontario, again, there’s going to be some sweeping changes on July 1 and Ontario will now be similar to the other jurisdictions in Canada where it is a corporation that will have to register and note all the employees. Why else would Ottawa, Hamilton and Toronto there, is because in these jurisdictions they do not make a distinction between in house employees and consultants. Everyone needs to register at the outset if you’re compensated and for the City of Toronto and Hamilton, this is somewhere where people get caught all the time, you need to be registered before you make the communication.
If registration is necessary, the Provinces and the federal government are pretty much consistent as to what you need to put in the registration, and those that are clients always are surprised to note that they have to disclose when they have to register, is the amount of public funding that the organization or corporation has received, and also when you note the employees that are lobbying you need to note whether they have held prior public offices. Those public offices, when we talk about that, those are more elected officials. There is no duty of any provincial or municipal level to make monthly returns when you’re meeting high ranked officials that we’ve discussed earlier so the designated public office holders at the federal level that requires a monthly report does not exist at the provincial or municipal level.
Why is it important to comply? Because the fines and penalties are quite stiff. At the federal level you can be issued a fine up to $200,000.00 and you can spend 2 years in jail. This has not been imposed as of yet but it’s there so you still need to be careful. With all these technical issues having been discussed, again at a 40,000 feet level, I invite you if you do have questions as to whether you’re lobbying government, you might not even know, or if you are lobbying if you’re organization or employer meets the threshold necessary to register at the municipal, provincial or even federal level, I would invite you to call me and we can discuss these matters.
No further ado my colleague Phuong will speak to you.
Good morning everyone. Bonjour. I’m going to be speaking about the communications with the government in the context of procurement and in a bidding process. I’m going to take what Jacques and Guy have spoken about and try to put it into a bidding situation. It’s going to be a little bit more narrow what I’m going to speak about. But before going into the heart and the overview, because you’ve got all of the good work that’s being done, you’ve done the lobbying, you’ve awakened the government with respect to industry needs, standards, just the reality of what is out there, informing them and educating them about the lay of the land and hopefully, if you’re in the procurement process, those interactions and communications, the information that has been conveyed finds its way into a requirement of an RFP or procurement process that’s run by the government. But then what happens when you’re in that process? What kinds of communications are allowed? What types of interactions are permitted and what are the potential pitfalls? That’s what I’m going to be covering today.
But before going into the meat of it I wanted to give you a brief overview, to give you context as to what I’m speaking about. Because the overarching obligation of a procuring entity, whether it’s a government or a private procuring entity, is to be fair. You heard Jacques talk earlier about fairness, openness and transparency in communications, the same principals apply but actually to a more extensive level in a procurement context. Those who work in procurement, whether you’re in a bid team or legal counsel, you know that this is the overview of the obligations that a procurement entity has. For the federal and provincial governments we’ve got a number of different types of statutes and regulations that they’re bound by when they’re procuring and, in addition to that, you’ve got the common law and contractual obligations of the duty of fairness that have been encapsulated through the years in court decisions. So many, many trees have died who have explained what the duty of fairness is, what kind of obligations you have and these obligations are further solidified because when we’re talking about a contract A contract B situation, you have implied terms. They’re not terms that are expressly set out in a RFP but the courts have implied them to have been incorporated into the RFP documentation as general obligations of fairness. You hear about the duty of fairness a fair bit and there a number of cases – this is just a cross section that speak to that type of fairness. There is also a plethora of case law that is generated from the Canadian International Trade Tribunal, the “CITT”, which is a specialized tribunal dealing with federal government procurement disputes. What you then have to consider is those obligations, and then for the federal government as well, trade agreements and obligations of fairness that are also mandated to them under those trade agreements. In that context the duty of good faith from a procuring entity includes the duty to provide bidders with proper disclosure, relevant and accurate information, the duty to avoid conflict of interest and bias, the duty to conduct a fair competition, the duty to avoid unequal or unfair advantage or disadvantage to bidders, and a purchaser has to disclose all material information that could impact the suppliers decision to bid, and the amount that it bids, the evaluation criteria, the process rules that will govern the contract and a clear description of the project deliverables. While this is not specifically set out in the RFP itself those are the overarching implied obligations that a procuring entity has with respect to its bidder pool. It is an obligation to all bidders not just the one who wins. When you take that into that context and the communications occur during an RFP process or procurement process has to tie into the duty of fairness. That a communication that takes place must not breach that duty that the owner has towards all of their bidders. When you’re engaged in communications or contact with the procuring entity or contracting authority or whatnot, you have to make sure in the back of your head that you can understand that that’s where they’re coming from so that if the communications you are getting are very cryptic or non-existent or they don’t want to talk to you, that you can understand where they’re coming from. It’s because they have to safeguard the duty of fairness and the obligations that they have towards other bidders. The reason for that is also very important because if they breach that they get sued. It’s with that duty of fairness that I want to present to you in the context of communications with a government official or a government contracting authority in the context of an ongoing procurement process.
The caveat I give to you though, is notwithstanding all of these general principles that I’ve given to you and I’m going to give to you today, you have to look at the RFP itself as well. Because that sets out the rules and the process that the contracting authority or the procurement authority has to follow. It’s those rules that they need to adhere to and make sure that they comply with. Again, there are a lot of things that are specifically mentioned in RFP’s. I’m going to use the federal one as an example just because they are more robust, they’re a lot more of them out there in terms of RFP’s so we’ll use those as examples. But again, it’s to make sure too that notwithstanding the generally principals we talk about, you look at the specific terms of the RFP to see what it is that they procuring entity has to do.
For those who work in the federal context you’ll know Public Works has a supply manual that it publishes and it serves as a guide to the contracting authorities at public works. It’s also a guide that other government agencies or departments can also use if it’s outside of public works to give them guidance, it’s actually quite extensive, it’s a very detailed manual on what to do, the types of clauses, processes and things like that. It’s a road map for the person who is going to be running a procurement process. In that supply manual there is a specific provision that deals with communications with the government during the solicitation process. That means that’s when the RFP gets issued and it’s put out to market. Generally speaking it’s common practice at that point that the communications become much more narrow and much more directed to a single point of contact within the department who’s running the procurement process. Again, it’s to make sure that everything is fair. That people are receiving consistent information. That bidders are speaking to one point of contact as opposed to speaking to a number of different people within a department and to make sure that things, again, are transparent. That you’ve got a clear and open line of communication. In the supply manual, as you can see in bold, it speaks to procedurally isolating the communication with respect to that RFP, with respect to that procurement, to the contracting officer who’s identified in the RFP and then not to the client department or other government officials. So while this is a guideline that tells them what to do this is what they’re expected to adhere to and to uphold in terms of a process. Then when you’re interacting with the contracting authority, during an RFP process, the manner in which you are supposed to communicate with them is also set out in the RFP. They may say you can only email me, no phone calls, and things like that. Look at the RFP again to guide you on what types of communications you can have. They also have deadlines for communications and they tell you how they’re going to have communications. Again, to be fair, they also have to make sure that those communications are transparent so you just can’t pick up the phone necessarily, call a contracting authority up and say, “Hey, I was just wondering if you can give me a hand about understanding this and that.” It can happen but again, it’s up to the contracting authority to make sure that those interactions are conducted in a fair way as it relates to other bidders.
During the RFP, and that’s before the RFP closes, you may also find in the RFP itself, notwithstanding what the supply manual has said and given directions to the contracting authority, the RFP may prohibit specific types of communication. I just pulled this from a RFP I found and in it speaks specifically to you can only speak to this person. If you do not you will get disqualified. There may be other clauses in the RFP that also expressly indicate that you can no longer have any lobbying activities as it relates to this RFP. There is like a no lobbying clause that will appear in the RFP. Other RFP’s will also ask bidders to list, or identify, any officers, shareholders, directors, employees, subcontractors, etc. who are registered as a lobbyist under the Lobbyist Act. And again, you would have to look specifically to the RFP to guide you as to what it is you need to disclose. Look at the RFP to get directions. The RFP will also include for a number of different entities, and it could be the federal government or whatnot, other types of contractual clauses or general conditions that are incorporated by reference into the RFP, so again, you need to go outside of that necessarily and you’ll also need to look at some of the policies that may also be applicable to the RFP itself. All this to say is your starting point is the RFP to see what it is that you can do, who you can speak to and so on and then look to the specifics and if you’re not sure don’t assume that you know the answer. There are still ways to figure that out.
What if you actually have a question about the RFP itself? The RFP’s come out and it’s not clear or something is ambiguous or you’re not sure what it is they want out of a bidder or a requirement. You can communicated with the contracting authority. One of the things they have in a procurement process is a question and answer phase in the solicitation process where you can then ask those questions. So the question you have to look at, not just with respect to changing a clause or changing a requirement or a deliverable, but those other types of strategic questions that you may have wanted to, or have not done, from a lobbying type or influencing type of communication that is now kind of sealed because the RFP process has been undertaken. Some people use the Q&A process not just to try to amend the terms and conditions and do all the technical things, but they may also try to use it for strategic reasons, and try to change requirements or try to alter different types of things. It’s much more difficult to do that when you get into an RFP process, again, because they need to make sure the projects running on time, they’re now actually trying to make a deliverable, so you really need to make sure that those questions that you’re asking, if you’re going down a certain path that you’re willing to accept the answer because again, because they have to be fair, they have to publish the answers that are given to all the bidders. So, one person asks a question and they hand it in writing, the answers need to, generally, go out to everyone. There are some exceptions where they don’t do that but again, it’s up to the contracting authority to balance the answer to make sure that they’re again being fair and not giving information that one bidder has and others do not. Arguably people often say by the time the RFP’s come out the time to influence those requirements is over. It’s published, it’s issued, there is a statement, there is a declaration by the government, “This is what we want. This is how we want it. This is how we want it delivered.” Trying to change those in a substantial way in a procurement process is much more difficult. In that sense most of those communications that you are then having in a procurement process is less to influence the outcome but more to try to get yourself some leverage or clarity or understanding in the bidding process.
The other issue too is because you have legal rights in the context of a procurement process, sometimes not asking a question or not communicating, will prevent you from being able to bring forward challenges later on in the process. Again, these types of rights and processes that you have at your disposition in a procurement process should be considered when you’re going through it. It shouldn’t be just, “Oh my gosh. We’ve got to, you know, the RFP closes on this date, we’ve just go to barrel our way through.” There are a lot of procedural and other things that should be considered in the meantime, and those should be noted, and that’s what we give in terms of our advice to clients who are bidding, is that you have your milestone maps of the deliverables and the drafts and things like that. That there has to be a time and a segment in your review of this RFP where you raise potential fairness issues, procedural issues or other types of technical issues, and then account for the time to deal with that as opposed to just putting pen to paper and just putting your head and putting a bid in. Again, the issues, I raise all of this because there have been cases that have dealt with these types of communications. A case at the CITT in 2006 was a complaint by a bidder who was bidding on IT management services. It was Environment Canada who had been receiving questions and answers but was not publishing them. It would just receive a question then answer to a particular person but not letting others know. One of the bidders said that that was not fair, it breached the obligations that the government has under trade agreements as well as fundamental principles of Canadian tendering law and government policy. The Tribunal agreed and indicated that those people who were not provided with the questions and answers could be viewed to have received less favourable treatment by the government by not having equal access to this information in order to then be able to consider that and put it into the context of their bid. There was an inherent issue on fairness when the communication from the government to bidders was not consistent.
On the other hand, during a bidding process the government can also ask the bidder questions. Now this is the part that from the lawyer’s standpoint I get very, you know, okay, let’s make sure this is done all right. And the reason for that is because while the government has the right or a procuring entity usually reserves the right to seek questions of clarification, do some independent due diligence and all those types of things, again, if it’s set out in the RFP, asking a question of a bidder during a bidding process has the risk that the bidder may inadvertently fall into a bid repair situation and provide more information than they should have. Then that causes the procuring entity to have to disqualify them. The questions that can come from the bidding entity, they’re in the evaluation process and they send a question to the team and they say, “Can you please clarify X requirement.” or, “You said this in your proposal please clarify why.” The question you need to ask yourself is, “Does the provision of this information amount to changing the evaluation criteria? Is the information already in your proposal or are you providing new information? Does this information create a wholly new different term that could potentially change the nature of the tender itself? Is it a mere clarification of the original proposal or is this something else?” And again, the issue surrounding this is because you want to make sure that you don’t go offside of that and cause yourself to be challenged. If you were successful and then somebody finds out that they got a call and they gave more information or so on, again, you want to try to protect yourself from that. The other issue too is you want to protect yourself from not being disqualified. When you were just literally minding your own business, doing your thing and then you get this question and all of a sudden you’ve been told, “I’m sorry. You’ve just engaged in bid repair. We’re not considering your bid any further.” So, these are cases that have appeared, again, at the CITT in courts and it speaks to not just bid repair but bid enhancement, in terms of the principles of clarification and questions and answers and communications with the contracting authority. And again, there have been cases where the government, under the auspicious of saying, “I’ve been seeking clarification. The tribunal has said you’ve gone above and beyond and you’ve overstepped the discretion that you gave yourself to seek clarification.” One aspect, as I’ve said, is a bidder who’s unsuccessful finds out that the successful bidder had engaged in some form of exchange and engaged in bid repair. The other would be non-compliance or finding of non-compliance and being disqualified. So, again, that all boils back to the duty of fairness and not to give preferential treatment to one bidder over another. Or let them fix a mistake because, again, it’s not fair to the other bidders who are participating in the procurement process.
There are a number of cases that also speak to the fact that once bid repair has been found, and we won’t talk about whether or not it’s true or not or to be upheld, but let’s say that the contracting authority says, “Your bid is now no longer compliant.” The duty of fairness is one aspect of it but also the manner in which mandatory requirements are interrupted by the courts. If it says that you must do x, y and z, you must comply with x, y and z and so on, by not doing that. It is basically mandatory, forgive the word, for the government to have to disqualify. They will then say, “I have no other choice but to do this.” and render you non-compliant. The reason for that is because the courts and judicial consideration has basically said there is no such thing as a minor consequential breach of a mandatory requirement. I often talk about this case where National Defense put a mandatory requirement that trunk holders had to have black handles and the procuring entity put that in the RFP and the bidder submitted something that just meant all the specs except the handles weren’t black. They had to be disqualified just because of the manner in which the RFP was drafted because a they had to be fair. That case is there and it says, “You’re the drafter and if you said this was important and it’s a legitimate operational requirement, I can’t second guess that. But if you’ve done it, then there it is.” So bidders are required to follow the rules that are set out in the RFP and the government is required to adhere to them.
As it relates to the Lobbying Act, in a procurement context, bidders are now being asked, or have been for some time, to give certifications that they comply with the code of conduct on procurement. In that code is a number of obligations, requirements that are put on bidders, as it relates to conflict of interest and all types of behaviours with the government, but it also includes certifications that touch on the Lobbying Act. That certification is also a term of the contract and a term of the RFP. Breaches of that could be cause for breaches of contract. The contract itself will also incorporate, and this is the standard acquisition clause and condition, so the government’s standard terms and conditions at the federal level, that will include certain types of certification specifically with the Lobbying Act and that’s incorporated as a term of the contract itself. This is section 2035 so it’s general conditions for high complexity contracts. There are other ones so you’ll have to, again, take a look to see which certification you are required to give.
The integrity provisions are also incorporated by reference and that’s a new regime that’s come out as well. Under the integrity regime those types of breaches will not be just breaches of contract but it may cause a bidder to become ineligible to participate or be suspended from government procurement activities. These are relatively new in the sense that it’s been around for about a year and just recently clarified by the government. Part of the process is that a supplier who has been convicted of an offense pursuant to certain sections of the Lobbying Act may be ineligible to participate in federal government contracting for a period of up to 10 years. You can then try to negotiate that down to 5 years within an administrative agreement. That’s how, again, breaches of the Lobbying Act can then tie into procurement type activities and precluding a bidder from bidding on government contracts or having engaging into contracts with the federal government as a result of those breaches.
In conclusion, I know we’ve given you a lot of material, but mostly speaking to the government during a procurement process is permissible. It’s not a complete moratorium. It just needs to adhere by certain rules, obviously the RFP, policies and whatnot. We often give advice to our clients, especially in a bid repair situation and things like that, where they’re being asked questions of clarification to see whether or not what they’re answering is going to encroach into a bid repair issue and to speak strategically about the types of questions that should be asked in context of the procurement process. These are kinds of things that are overlapping a bidding team and I know that when a team gets together to put together a proposal, these types of things are mostly at the back of their heads, or on the periphery. But it’s something that I hope at least we can identify to consider and think about in a substantial way.
On this note I wanted to thank you for your attention and I’m going to pass the mic along now to Jacques. Thank you.
Phuong thank you so much and as our good audience will appreciate, there are many details and I know that one of the tough things for you was to determine what you share in the few minutes you have here because, again, there’s an enormous amount in specific detail that needs to be considered for one to be successful when dealing with government procurement. I also want to really just thank Guy because, again, as everyone will appreciate here, there are very specific requirements. People imagine when they speak with officials they wouldn’t consider the fact that they’re lobbying. You must know your lobbying as you know there are very specific and significant roles on that that could lead to either imprisonment or a significant fine. These are serious issues and we have lobbying commissioners that are far more focused on enforcement. This brings us to the moment where I can actually call upon the Honourable Robert Ghiz because I think that, again, with the incredible background, the experience, the expertise, I loved to hear your comment. I think we all would, just on how you would sum all of this up for us. So, thank you Robert.
Thank you very much Jacques.
I’m going to ask you to come up here. Only because there is a video and you are very photogenic so you’ll be on that and this way you have the opportunity to have that as well.
Well, thank you very much Jacques. This was a great opportunity to realize some of the rules around dealing with government but also how important it is to deal with government. No matter what your business at some point every business, corporation, association is going to be dealing with the federal, provincial or municipal government along the way. I think it’s essential to one, understand strategy, like Jacques talked about at the beginning, it’s extremely important. It’s not good enough to just visit one arm of government. There’s a whole strategy that needs to be put forward when you’re dealing with governments. When it comes to rules I always say err on the side of caution. There are a lot of rules out there and Guy’s presentation and his understanding of how that works is very important. Of course when it comes to procurement being prepared is essential. As you can tell today by Phuong’s presentation, she knows how procurement works. Gowlings knows how procurement works and having that expertise is something that when you go into procurement you want to make sure that you are well prepared and that you know every possible detail.
I do want to talk just for a few seconds about really lobbying and how I believe it’s essentially important. And yes, it does get a bad reputation sometimes, as Jacques talked about, but we’re all lobbyists. Everyone deals with government to a certain extent. There’s just some that do it for more of their career. But it helps not only your association or your business but it also helps government. Politicians and Cabinet Ministers and Prime Ministers, they’re busy people. They deal with a lot of different issues on a daily basis ranging from their own constituency, to their department, to dealing with caucus, to dealing with different departments. They don’t concentrate on your issues the same way you do. They get advice from their bureaucrats but it’s also essential that you get advice from the private sector as well. You need to hear both sides of a story and that leads, in my opinion, to good policy making by governments. I just want to give a couple of examples. I’ve been fortunate that in my career I’ve been able to see both sides. I was involved on the Hill working for Cabinet Ministers, a Prime Minister, but I was also in the lobbying world for 3 years working for the Bank of Nova Scotia and then I got to see it from the other end as an elected official. I want to go back a point Jacques made and it’s extremely important. It’s good to be there during the good times because that will allow you to have an open door when the bad times do arise. All your organization and corporations are all going to have difficulties at some point. My first job as a lobbyist was working for the Bank of Nova Scotia where bank mergers were going on. At that time Bank of Nova Scotia was the one without a dancing partner. The banks are big corporations. They just thought they could come in and announce mergers. They’d call up the Prime Minister’s office or the Minister of Finance and allow things to happen. What they didn’t realize was the importance of MP’s in terms of influencing government decision making and they didn’t understand that they could just show up at a door and say, “I’m here and we need you to do this.” A lot of the politicians of that time said, “You’re just at my door now when you need something. Where were you the last 5 or 10 years?” That’s why I think it’s important to develop these relationships over a period of time so when an important issue does come up you’re then able to have those relationships already in place.
I talked about dealing with MP’s. I think people sometimes take for granted that if you just talk to the Cabinet Minister or you talk to the PMO that you’re going to be there with the decision makers and it’s going to help get things happen. Well, I can guarantee you that for a Prime Minister to still be elected and have the authority of being a Prime Minister and for a Cabinet Minister to be there, having the support of MP’s in caucus is really important. If the Prime Minister or Cabinet Minister takes an issue or a piece of legislation that perhaps you’ve lobbied on and they get to the caucus room and they’re going to realize that caucus is not in favour of what’s going on here, it’s going to slow down all the work you did. That’s why I think it’s important to deal with people like Jacques so they can set up a whole strategy to deal with legislation or an issue you may have from beginning to end. You never know where a problem may come to exist. Of course, if you’re going to do that, you need to know the rules, and that’s what Guy does, and then of course if you are doing procurement, Phuong is obviously an expert on it. I think today was a great learning opportunity. I know that I learned different things as I listened to the presentation this morning and we want to thank everyone for coming out today. I know our speakers would be more than happy to stick around for a few minutes and if anybody has any questions you’re free to deal with them one on one. Thank you very much for coming out today and we hope that you enjoyed the presentation.
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