Interacting With the B.C. Government? Get Acquainted With the New Lobbying Rules
When you or one of your employees, officers, or directors communicates with the B.C. government, your organization may be lobbying. Amid the COVID-19 epidemic, more and more businesses are engaging with the B.C. government in an attempt to protect their interests. Rest assured, lobbying is perfectly lawful – as long as you follow the rules. It is important for all such businesses to know the rules, and consider how their conduct may be reportable, before the new lobbying laws take effect in B.C. on May 4, 2020. Organizations can face monetary penalties for non-compliance.
The provinces, the federal government, and some municipalities have passed legislation to regulate lobbying, each with some important differences. This post has a B.C. focus. You can also read our Canada-wide lobbying post, which includes links to the various rules across the country: https://www.mccarthy.ca/en/insights/articles/lobbying-time-covid-19-rules-still-apply
Is your organization lobbying in B.C.?
“Lobbying” is a broadly defined term that captures a host of activities, all of them involving paid employees, officers, or directors of an organization communicating with a public office holder in an attempt to influence government decision making.
If you or one of your paid employees are communicating with a B.C. public office holder in an attempt to influence their decision making, it is likely that your organization is lobbying. A public office holder includes any of the following:
- An MLA of B.C.;
- An employee of the B.C. government;
- An employee of a B.C. Provincial entity, like the Workers’ Compensation Board; and
- A B.C. government appointee.
Not every communication with a public office holder constitutes lobbying. The B.C. lobbyist legislation only regulates communications that are an attempt to influence the public office holder in some way. For example, merely seeking clarification from a public office holder about whether a new government program applies to your business will likely not constitute lobbying. On the other hand, if your communication is about whether the program should apply to your business, you are likely engaging in lobbying.
If someone in your business is trying to influence the decision-making process of a B.C. public office holder in any of the following ways, they are likely engaging in lobbying:
- Suggesting amendments to legislation, regulations, or legislative proposals;
- Influencing an MLA to vote for the passage or defeat of a Bill or resolution;
- Influencing the government to have the private sector instead of the Crown provide goods or services to the Crown, a Provincial entity, or the public, or
- Arranging a government contract for your business to provide labour, material, or services to a B.C. government entity.
This list is not exhaustive; it is always important to consider the purpose for your communication, and to whom the communication is directed. Think about this in advance of communications, and also retrospectively: some communications can develop into lobbying inadvertently.
Some organizations pay third parties to engage in lobbying on their behalf. The legislation refers to these third parties as “consultant lobbyists”. The rules applicable to consultant lobbyists are outside the scope of this post; please feel free to contact us for assistance if you have questions about how consultant lobbyist rules may apply to your business.
What are the new rules?
On May 4, 2020 a new set of rules will come into effect—the Lobbyists Transparency Act and its regulation. The new rules introduce several changes to the regulatory scheme. For some businesses already engaged in lobbying activities, it may be important to adjust your internal policies and procedures prior to May 4th to help ensure compliance with the new rules.
What are the registration requirements?
The most significant changes in the new Lobbyists Transparency Act are the registration requirements. Under the new rules, nearly all organizations that engage in lobbying will be required to register. Under the “old” rules (the Lobbyist Registration Act) if a business’ collective lobbying efforts for the year amounted to fewer than 100 hours, no registration was required. As of May 4th in B.C., only select small businesses with fewer than six employees will be able to avoid registration.
From the very first time a paid employee of a business conducts a lobbying activity in the course of their work, the business will have 10 calendar days to submit a “Registration Return” with the Lobbyists Registry.
The obligation to file a return falls on the organization’s most senior paid officer (usually the President, CEO, or Executive Director); if the organization’s most senior officer is not paid, the obligation will fall on the organization’s most senior employee conducting lobbying activities. This person is the organization’s “designated filer”.
What to include in your Registration Return and Monthly Returns
The rules require numerous details to be submitted about each lobbying activity in the Registration Return, including:
- The name and business address of the designated filer, along with the name of each person in the organization who is to engage in lobbying activities;
- The date when lobbying first occurred and, if known, the date lobbying activities will cease;
- A summary of the business or activities of the organization;
- For a corporation, the contact details for
- each affiliate of the corporation; and
- any person who controls or directs the activities of the corporation,
that has a direct interest in the outcome of any lobbying activity conducted by any lobbyist named in the Registration Return;
- The name of any government, government agency, or provincial entity from which the organization has requested funding in the preceding 12 months (as discussed below), and the amount of that funding; and
- Particulars of lobbying activities, both already conducted and anticipated (including, as of the May 4th amendment, the intended outcome of the activities).
For a number of these items that must be included, the rules require that the designated filer make “reasonable inquiries”; it is not enough for the designated filer to fill out the Registration Return according to his or her present knowledge. If any of the information in the Registration Return changes, it must be updated promptly: within 15 days of the beginning of the following month.
Monthly Returns are a new requirement as of May 4th. After an organization’s Registration Return is filed (no later than ten days after the organization’s first lobbying activity), an organization will be required to file a Monthly Return no later than the 15th day of each following month. Monthly Returns must include a detailed lobbying activity log, including:
- The name and position of the public office holder who was the object of the lobbying;
- The names of the lobbyists and the dates of the activities;
- Details of the subject matter of the lobbying activity; and
- If the activity involved the giving or promising of a gift, details regarding the value and intended recipient of the gift, and the circumstances under which it was given or promised.
Declaring government funding
A significant new requirement as of May 4th will be the disclosure of certain details relating to government funding in the Registration Return.
This new disclosure requirement applies to funding requested or received in the preceding 12 months from the B.C. government or provincial entity, and from any other government or government agency. Funding that must be reported includes government grants, and other funding arrangements that do not need to be repaid (but does not include tax credits).
Once the new rules come into effect, organizations engaging in lobbying will need to disclose the name of each government or government agency from which funding was received or requested, and the amount of that funding.
If your organization receives new funding, an update to the disclosure in the Registration Return will be required. This update must be filed within 15 days of the beginning of the month following the request (or receipt, if no request is made) of the funding.
Gift ban (almost)
After May 4, 2020, organizations may not give or promise to give gifts, either directly or indirectly, to any public office holder whom the organization is lobbying. Meals are gifts. The only exception will be for gifts “under the protocol or social obligations that normally accompany the duties or responsibilities of office of the public office holder.” Thus, the context of the gift is important. For instance, an invitation to dinner event attended by various stakeholders intended to raise awareness of issues may be an exception because public office holders’ duties include communicating with stakeholder groups. Even where that exception to the ban applies, the total value of any gifts in a 12-month period must be less than $100.
Transition rules – lobbying activities engaged in before May 4, 2020
The new rules will not create offences retrospectively: your lobbying conduct between now and May 4th will not attract a penalty under the new rules if the conduct was not prohibited under the current rules.
That said, the new rules contain several reporting requirements that apply to lobbying activities prior to May 4th. Organizations conducting lobbying activities now or beginning before May should take these requirements into consideration.
When the new rules come into effect, lobbyists will be required to report most instances of the following:
- Government funding received or requested in the preceding 12 months, as described above;
- Contributions made in the preceding 12 months of $1,000 or more toward the lobbying activities from persons or organizations with a direct interest in the outcome of those activities, and the identity of the contributor; and
- Political, sponsorship, or recall contributions made by a lobbyist named in a Monthly Return on or after the date the writ was issued for the last B.C. provincial election, up to May 4.
Consider updating (or creating) internal policies and procedures
If your organization interacts with the B.C. government, consider updating (or creating) your internal policies and procedures in advance of May 4th to ensure your organization is in compliance once the new rules take effect. At a minimum, organizations should be keeping up to date information about (a) individuals at B.C. government with whom members of the organization are communicating and the purpose of those communications; and (b) applications for, and receipt of, government funding in the preceding 12 months. If registration is required, the organization should ensure the “designated filer” (the organization’s most senior paid officer) is aware of his or her obligations; and consider appointing someone internally (or hiring external counsel) to assist the designated filer with preparing the registration.
Doing so will greatly assist if and when your organization is required to register its lobbying activities with the B.C. Lobbyist Registry.
We would be pleased to help you with any specific questions or concerns you may have about your organization’s lobbying policies and practices in British Columbia. For more information, please contact Awi Sinha, Alex Cocks, Adam Goldenberg, or Jacob Klugsberg.
This update is part of our continuing efforts to keep you informed about COVID-19. For the latest information, please visit our COVID-19 hub.