New Reporting Burden for Corporate CEOs: The Accountability Act Amends Federal Lobbying Rules

Written By Milos Barutciski

The federal Accountability Act received royal assent on December 12, 2006. The Act includes extensive amendments to the current Lobbyists Registration Act, which will be renamed the Lobbying Act. When it is proclaimed into force by the federal cabinet, the Lobbying Act will, among other things, impose new monthly reporting obligations on corporate chief executive officers where their companies engage in lobbying activities.

Under current federal lobbying rules, corporate filings are required every six months if employees of the corporation engage in specified lobbying activities (as described below), and those activities constitute either a "significant part" of one employee's duties, or would constitute a "significant part" of one employee's duties if they were performed by one employee. The "significant part" threshold is generally viewed as 20% of a full-time employee's duties. The reporting obligation can therefore apply if several employees each engage in a relatively small amount of lobbying activity, but those activities cross the "significant part" threshold in the aggregate. The report must indicate, among other things, the subject matter of the communications, but not the names of the government officials with whom the communications took place.

The new Lobbying Act will require the senior officer of a corporation to file monthly reports with the newly created office of the Commissioner of Lobbying where the "significant part" threshold is met. Unlike the reports required under the current rules, the new monthly reports will have to identify "designated public office holders" with whom the corporation has communicated with respect to specified matters (as described below), including the dates and subject matters of those communications. "Designated public office holders" are defined as meaning Ministers and their staff, Deputy Ministers, Associate Deputy Ministers, Assistant Deputy Ministers, and officials holding equivalent positions within the federal government and its agencies. The government may also designate additional federal officials as "designated public office holders" for the purposes of the Lobbying Act.

Reports filed pursuant to the Lobbying Act, like the previous reports, will be public and available for online review.

In addition to these monthly reporting obligations for corporate CEOs, the Lobbying Act will introduce significant amendments to the current lobbyist registration system that will:

• give the Commissioner extensive new investigative powers, including the power to compel sworn testimony and the production of documents;
• introduce monthly reporting by consultant lobbyists;
• prohibit contingency fees for federal lobbying activities; and
• impose a five-year prohibition on lobbying activity by former designated public office holders.

The new lobbying rules introduced by the Accountability Act will come into force on a day to be proclaimed by the federal cabinet.

Lobbying Activity

The new Lobbying Act, like its predecessor, governs communications with federal government officials regarding:

1. the development of legislative proposals;
2. the introduction, passage, defeat or amendment of any Bill or resolution before either House of Parliament;
3. the making or amendment of any federal regulation;
4. the development of any federal policy or program;
5. the award of any federal grant, contribution or financial benefit; or
6. the award of federal government contracts.

In the case of consultant lobbyists, arranging meetings with government officials is also considered to be lobbying activity and is regulated by federal law. For further information on the new Lobbying Act contact Milos Barutciski (Toronto), Don Greenfield (Calgary), or James Heelan (Edmonton).