The Vancouver Sun, Colin MacDonald, 25/6/2008

A centerpiece of the federal Conservative election campaign in 2005 was to raise the ethical standards for how the government of Canada conducts its business.

More than two years after Prime Minister Stephen Harper introduced the Federal Accountability Act as his government's first piece of legislation, the much-touted changes to lobbying rules are due to come into effect on July 2.

How will the changes affect lobbyists' dealings with Ottawa?

The amended statute (now called the Lobbying Act) will replace the office of the registrar, who reported to the industry minister, with an independent office of the commissioner of lobbying who reports directly to Parliament. The commissioner will have increased investigative and reporting powers and additional enforcement tools to prosecute violations of the amended law.

The Lobbying Act builds upon the previous law, beefing up the penalties for violations by doubling the fines to $200,000 and increasing potential prison time to up to two years for serious violations of the law. In addition, the commissioner now has up to 10 years to lay charges for breaches of the act.

The definition of lobbying has not changed. It is defined as communicating with any public office-holder, for payment, in respect of development of any legislative proposal, the introduction, defeat or amendment of any bill or resolution, the making or amendment of any regulation, the development or amendment of any policy or program or the wording of any grant, contribution or other financial benefit. In addition, the definition of lobbying includes communicating in respect of the awarding of any contract for any client or the simple arranging of a meeting between a public office holder and another person.

The Lobbying Act defines three types of lobbyists -- consultant, in-house (corporations) and in-house (organizations.) The rules vary slightly for each type.

A consultant lobbyists is hired to communicate with a public-office holder on behalf of a client for a fee. This may be a professional lobbyist, but could also be any person, including a member of a board of directors, who, in the course of his or her work for a client, communicates with or arranges meetings with a public-office holder.

An in-house lobbyist (corporation) works as an employee for the company and communicates with the government on behalf of his or her employer. In-house lobbyists (organization) do the same for non-profit entities.

One of the most burdensome changes of the act is the requirement for monthly reporting of any arranged meetings with senior officials (known as designated public office-holders.) These include individuals at the assistant deputy minister level up to and including ministers and their staffs. The monthly reporting requirement is expected to generate significant new registrations, requiring many large organizations that have multiple contacts with the federal government to add compliance officers to ensure conformity with the new law.

Many feel that this new reporting obligation, along with the fact that such meetings will now become part of the public record, will create a communications chill between government officials who might feel sensitive about their names appearing too frequently on the public registry, and individuals, companies or not-for-profit organizations who want to keep their meetings confidential for legitimate competitive reasons.

There is now a prohibition on charging or paying a contingency fee, and registered lobbyists need to confirm that no contingency fee is being charged in the matter for which they have been retained.

The amended act also prohibits former designated public office-holders and former members of the PM's transition team from acting as consultant lobbyists for five years or carrying out lobbying activities on behalf of a company or organization as an employee after leaving the public service. Most other jurisdictions in Canada and the United States have one- to two-year restrictions on such post-government activities. Employers hoping to hire experienced former senior public servants will need to keep these restrictions in mind.

The most significant change from the previous law will likely be the increased investigative powers and the independence now conferred on the commissioner, which is expected to result in much closer scrutiny of lobbying activities. The recent high-profile investigations into alleged violations of British Columbia's Lobbyists Registration Act may well become the norm under the new federal act. Should this occur, it is likely to result in greater overall public scrutiny of all lobbying activities in all Canadian jurisdictions.

Colin MacDonald is a partner at the law firm of Borden Ladner Gervais.