SoVote

Context: House Hansard - 187 - Apr/28/23

Mr. Mike Morrice (Kitchener Centre, GP)

Apr/28/23 12:08:35 p.m.
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Madam Speaker, the Canada summer jobs program is not only a financial lifeline for non-profits, charities and small businesses, but it is a critical support for young people looking to get their start in the workforce. This year the program has been cut by over 50%. That is $60 million less than even prepandemic levels. It means that small organizations in my community, from CAFKA to Red Raccoon Bike Rescue, are reeling. Does the federal government understand that these drastic cuts have real impacts on essential community organizations across the country?

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Ms. Jenna Sudds (Parliamentary Secretary to the Minister for Women and Gender Equality and Youth, Lib.)

Apr/28/23 12:09:20 p.m.
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Madam Speaker, I know many of us in this House cherish what this program does on the ground in our communities for youth. I would say to my colleague that MP input on this program is vital to its success. Our on-the-ground understanding as MPs of what is needed in our communities is really important to its success and to youth. While the number of positions in some of our youth programs in CSJ have recovered back to prepandemic levels, we will keep providing opportunities to youth for youth employment across the country.

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The Assistant Deputy Speaker (Mrs. Carol Hughes)

Apr/28/23 12:10:19 p.m.
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I understand that there have been discussions among representatives of all parties in the House and that there is agreement to mark the National Day of Mourning and honour the memory of workers who were killed or injured at work. I now invite hon. members to rise for a moment of silence. [A moment of silence observed]

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Mr. Brad Vis (Mission—Matsqui—Fraser Canyon, CPC)

Apr/28/23 12:12:25 p.m.
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Madam Speaker, today, I am pleased to table a petition on behalf of Punjabi Canadians across Canada who are calling on the government to establish direct flights between a Canadian international airport and Amritsar in the Punjab. We have over one million Canadians of Punjabi descent. It makes economic sense. It is good for business. It is good for culture. Let us get it done.

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Mr. Tom Kmiec (Calgary Shepard, CPC)

Apr/28/23 12:12:59 p.m.
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Madam Speaker, as I have done before, I am tabling a petition on behalf of constituents of mine who are calling on the Government of Canada to again recognize the ongoing genocide of the Hazara Shia minority in Afghanistan by the Taliban regime. They are also calling upon the Government of Canada to ensure that Hazara Shia minority groups are included in the 40,000 Afghan refugees to be resettled in Canada by end of year.

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Mr. Yasir Naqvi (Ottawa Centre, Lib.)

Apr/28/23 12:13:31 p.m.
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Madam Speaker, this is a very important petition that relates to our essential workers and the important work that they do, especially in light of what we saw during COVID-19, when we saw frontline health care workers working so hard, day in and day out, as essential workers, protecting the lives of Canadians from coast to coast to coast. What we have seen, though, afterward are wage freezes that have been put on these essential workers, especially in Ontario, under Premier Ford's government, where their hard work is not being recognized. What this petition is asking for is to take action, in order to prevent wage freezes and cuts on essential workers, to increase funding and to improve the quality of essential services, to prevent the privatization and to take action against the profiteering of our essential services and health care services and, most importantly, also to support provinces in improving the quality of Canada's health care system. I very much agree with this petition and endorse and present this to the House.

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Mr. Michael Kram (Regina—Wascana, CPC)

Apr/28/23 12:14:31 p.m.
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Madam Speaker, I am very pleased to have the opportunity today to present a petition on behalf of the people of Regina and southern Saskatchewan regarding the RCMP depot in Regina. While the report by the Mass Casualty Commission had many good recommendations, the recommendation to shut down the RCMP depot in Regina is a non-starter for the signers of this petition. The RCMP depot in Regina is a world-class police training facility and any required changes to police training should be done in the existing facility instead of shutting it down. The history of the RCMP in Regina is also a very important part of the local economy and culture. I am pleased to be able to present this petition today here in the House of Commons.

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Mr. Kevin Lamoureux (Winnipeg North, Lib.)

Apr/28/23 12:15:22 p.m.
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Madam Speaker, there has been incredible growth of our Indo-Canadian community across the country. In Manitoba, there has been all sorts of growth that has created a significant demand for more international travel opportunities. The people who have signed this petition are asking for the federal government and different airline carriers to seriously consider establishing a direct flight that would go from Winnipeg International Airport to an airport in India or, at the very least, in Europe. It is something that is in need and that is what it is that my constituents are arguing and asking for.

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Mr. Kevin Lamoureux (Parliamentary Secretary to the Leader of the Government in the House of Commons, Lib.)

Apr/28/23 12:16:25 p.m.
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Madam Speaker, I would ask that all questions be allowed to stand at this time. The Assistant Deputy Speaker (Mrs. Carol Hughes): Is that agreed? Some hon. members: Agreed.

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Mr. Greg McLean (Calgary Centre, CPC)

Apr/28/23 12:17:03 p.m.
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Re: Bill C-42

Madam Speaker, it is my honour today to rise in the House to talk about Bill C-42. “Money laundering” is the short description. Canadians would be surprised to know that, aside from the soft reputation our country has on the international scene, Canada is increasingly known as a popular safe haven for criminals to launder and hide their money. In 2022, Canada ranked 14th on Transparency International's corruption perceptions index, with a score of 74 out of 100. Canadians would be in their right minds to ask why our country's score is not higher, especially since this problem with lack of transparency has been known for a long time, for the past seven years, to be exact. People will remember that, in 2016, the Panama papers leak exposed the fact that international criminals had been exploiting the gaps in Canada's corporate beneficial ownership regulatory scheme to engage in corrupt conduct through federally, provincially and territorially administered corporations. That same year, the Financial Action Task Force, which acts as the world's international money-laundering watchdog, warned Canada that it was being used as a safe haven for money laundering and that a registry was needed to help identify and crack down on this activity. However, since then, under the current government, Canada has been slow to act, and when it did, it failed to go far enough. It took until 2018 for the Liberal government to begin introducing requirements to increase transparency around who exerts significant control over corporations and assets in this country. In 2021, the Financial Action Task Force indicated that Canada had made improvements but remained only partially compliant in five areas and wholly non-compliant in one. Laundered money was still able to find its way into our country with no questions asked. Now, here we are in 2023, introducing measures that are long overdue to tackle a problem that should have been dealt with years ago by the government. Unfortunately for Canadians, while the Liberals were in no hurry to tackle the issue of money laundering throughout all those years, it has had a very real and devastating impact on a sector of our economy that affects everyone, one that keeps being mentioned extensively as of late. I am referring to the housing market. Since the government took office, the price of a home in Canada has doubled, leaving citizens across the country to give up on the dream of home ownership. The situation is dire: Seven in 10 Canadians now believe owning a home is financially reserved for those who are wealthy. Part of this phenomenon of housing growing increasingly out of reach for Canadians is explained by criminals using real estate as a vehicle to launder their money in Canada. This is enabled by the fact that Canada's anti-money-laundering compliance regime is itself least compliant with international standards, when it comes to supervising real estate agents and identifying the buyers of property. For young Canadians looking to start a home and a family, this pushes prices up and puts their dreams of home ownership farther out of reach. Why is this? It is partly because they have to compete against criminals who wish to use real estate to hide their dirty money. It is supply and demand. The situation is especially problematic in British Columbia. In 2018, the province launched the expert panel on money laundering in real estate. That panel estimated that, in B.C. alone, more than $7 billion in dirty money was laundered across the economy in 2018, and that up to $5.3 billion of that money was laundered through the real estate market, raising housing prices by an estimated 5%. It is no secret that housing is exceptionally unaffordable in cities like Vancouver, and criminal activity plays a non-negligible part in aggravating the situation. The situation is so dire that the number of British Columbians moving to Alberta reached a 20-year high in 2021-22, and for most, the main reason was affordability. Alberta is proud of its strong economy. It is one that welcomes Canadians from across the country with open arms and offers opportunity and affordability to its citizens. However, due to the Liberals' weak approach to money laundering in Canada, the problem that plagued British Columbians is now following them across the Rocky Mountains. Calgary, the city I represent here in Parliament, is now also being used as a hub for the criminal network of money-laundering groups that has grown across Canada under the current government. I knocked on a lot of doors during elections in Calgary Centre, and I knock on doors between elections. When I go into the large condos that have recently been developed, sometimes I will find a condo where half of the units are empty. Nobody lives there, yet they are all sold. There has been a lot of construction in Calgary, with a lot of vacant suites, yet there is no one living in these buildings. It is quite clear that it was foreign owners who bought those properties. Whether it is legitimate foreign ownership because people are actually moving their money out of where they live and want to make sure they have some safety elsewhere, or whether it is connected with the criminal element that has also increased the illicit activity of drug addiction in Calgary, is another question entirely. It is a mix between the two. That is something we need to address here, going forward. My constituents are particularly concerned about it because of the effects it has across society, not just on the housing market; housing is only one part of the problem. The broader issue at hand is the fundamental question of who owns what in this country. Are Canadian assets held by hard-working and law-abiding Canadians or by criminals using them as a means to engage in offshore money laundering? As someone who worked in the financial industry for decades, I understand the importance of transparency and accountability, two things that are currently lacking when it comes to the ownership of assets in this country. In last year’s budget, the government committed to finally implementing a national public registry by the end of 2023, ahead of the previously committed year, 2025, but this acceleration of the timeline in the Liberal agenda was not prompted by the housing affordability crisis and its heart-wrenching impact on Canadians. Rather, it was the public concern about the misuse of nominee and corporate ownership by Russian oligarchs that led to the acceleration of this timeline. That is why I support this bill, but I also believe that it should be more ambitious in its reach right now, as opposed to when the next international crisis forces the government to act. The fact remains that we are perceived internationally as having weak laws to combat money laundering and the proceeds of crime. Our Five Eyes partners see us as a laggard on corporate transparency. This is why Conservatives not only support the additional measures being introduced by Bill C-42 but also call on the government to do a number of things. I will interject here and talk about my experience. I acted in the financial industry for years. I actually represented a number of investors who had their money laundered through a bunch of different vehicles. That was a manipulation of the legal process by several parties involved. This happens all the time in Canada. The laws are set out now. I know that since 9/11 in 2001, the government tried to get more transparency through the legal mechanisms, the legal profession, to try to make sure they disclosed when they had transactions of $10,000 or more coming into their accounts. That was overturned by the Supreme Court of Canada in 2015. It ruled that, in fact, lawyers had the right to withhold that information from governments. What I have seen personally is that those lawyers give good advice on how to launder money through accounts in Canada, whether it is offshore accounts or whether it is Canadian “quasi-criminals”. It is hard to call them criminals until they have actually been convicted. That is the direct experience I have had. There are things we need to do. Of course, we need to change the offences outlined in the bill and the existing offences under the Canada Business Corporations Act from summary convictions to Criminal Code offences, which would then rank money laundering on par with the most serious offences under the Criminal Code in Canada, as it should be. We also need to change the threshold for significant interest at which disclosure is required, from 25% control of shares to 10%. That is a threshold already used by the Ontario Securities Commission for public disclosure requirements. Reducing the currently suggested threshold would further reduce the ability of criminals to hide their activities. We need to clarify the degree of back-end access to the registry of law enforcement, in relation to the proceeds of crime and money laundering. Under the bill right now, in its current form, law enforcement, as well as the Financial Transactions and Reports Analysis Centre, or FINTRAC, would require an affidavit to access all of the information contained in the registry.

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Mr. Ken Hardie (Fleetwood—Port Kells, Lib.)

Apr/28/23 12:27:09 p.m.
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Mr. Speaker, I was fascinated to hear the hon. member talk about some of the transactions between lawyers, because we know that transactions between lawyers' trust accounts are not captured by FINTRAC. Is he strongly in favour of changing that? The other thing I would ask him to comment on is the beneficial ownership of broadcast outlets in Canada, because there are concerns about Chinese meddling. We have heard, at least anecdotally, that their control over radio and television and cable stations, if it is not ownership, is certainly something else. Is that also worth a closer look in connection with this bill?

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Mr. Greg McLean

Apr/28/23 12:28:00 p.m.
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Mr. Speaker, I will not address the Broadcasting Act, because I am not sure that should be covered here or should be covered in a different bill, but I will address what the member talked about regarding lawyers' trust accounts. Lawyers' trust accounts are not held to the same standard as financial transactions. I remember that, in the financial industry, if $10,000 in cash came into one's account, one had to report that to FINTRAC authorities immediately. If one was at a brokerage, $1,000 of cash was actually the hurdle. Money laundering actually happens at places like currency exchanges, where people walk in with a thousand bucks and will exchange $999 and effectively do it that way. We do need to include the trust from lawyers in here. We will watch them fight it again in the Supreme Court, but making sure we bring them under the umbrella of what is acceptable for money-laundering mechanisms in Canada is very important.

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Mr. Gabriel Ste-Marie (Joliette, BQ)

Apr/28/23 12:28:59 p.m.
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Mr. Speaker, I thank my colleague for his very interesting speech. I think we share rather similar points of view on this bill. His colleague from Sarnia—Lambton, who spoke before he did, brought up the Panama Papers scandal in her speech to illustrate the fact that the government is not doing enough. I would like to remind the House of some of the figures from that scandal. While the government brags about how much it is doing, the Canada Revenue Agency has recovered less money than Revenu Québec has. By way of comparison, the United Kingdom recovered more than $317 million; Germany, $246 million; Spain, $209 million; France, $179 million; Australia, $173 million and Canada, $21 million. That is 10 times less than the others. Does my colleague agree that the government needs to be doing a lot more?

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Mr. Greg McLean

Apr/28/23 12:30:00 p.m.
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Mr. Speaker, I thank my colleague for his good question. He is right. The CRA's weakness internationally is appalling. Every other country in the world says that it has recovered more “dirty money”, as it is called, from the money laundering that is done in countries like Panama. I am sure that the Canada Revenue Agency should be producing better results.

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Mr. Chandra Arya (Nepean, Lib.)

Apr/28/23 12:30:45 p.m.
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Mr. Speaker, I agree with the hon. member on the need to combat money laundering and tax evasion. On the disclosure norms, I think he mentioned the threshold of 10%. He seems to agree with that. My concern is this. Why should we have any threshold of any percentage before the names of the shareholders are made public? It is very easy to work around this owner threshold.

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Mr. Greg McLean

Apr/28/23 12:31:14 p.m.
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Mr. Speaker, we should have a beneficial owner threshold that actually says who controls these companies. A lot of them will be in separate nominated accounts that might have the same person behind them, but eventually we need to see our way to who those people are. As my colleague is, I think, alluding to, if there are 11 people owning 9% of a corporation, none of those has a full 10%. In that case, the beneficial ownership should be quite clear that it is the same entities that control that corporation. He is right; we should capture making sure we are talking about beneficial ownership of at least 10% or more. There comes a point in time when one is just a passive investor, but at 10%, one is actually a participant, in my opinion.

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Mr. Chandra Arya (Nepean, Lib.)

Apr/28/23 12:32:04 p.m.
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Re: Bill C-42

Mr. Speaker, I will be sharing my time with the hon. member for Richmond Hill. I rise to speak to Bill C-42, which would implement a public and searchable beneficial ownership registry of corporations governed under the Canada Business Corporations Act. We have an issue with money ‎laundering and terrorist financing. To deal with this, we need tools and mechanisms in Canada that are in line with international best practices. Creating a public and searchable registry would increase the transparency of beneficial owners of federally regulated Canadian corporations, which would increase corporate accountability and improve public trust in corporate institutions. These measures would help protect Canadians against money laundering and terrorist financing, deter tax evasion and tax avoidance, and make sure Canada remains an attractive place to conduct business. I will take a moment to mention what corporations are. Corporations exist basically to allow individuals to channel their capital for the benefit of making profits. The corporation, as we know, came into existence in the 1844 act in Britain, and the shareholders were granted limited liabilities in 1855. In 1866, the United States court declared that a corporation is a natural person. Basically, while the corporation channels the resources for investment in a commercial enterprise, it limits the liability of the person to the capital contributed. I will quote from an article published in New Internationalist: What is a corporation? Ambrose Bierce's Devil's Dictionary defines it as “an ingenious device for obtaining profit without individual responsibility”. It is a legal construct, a charter granted by the state to a group of investors to gather private funds for a specific purpose. Originally, charters were granted in the service of a public purpose, and could be revoked if this were not fulfilled. The relationship between state and corporation is a complex one. Over the past 400 years corporations have conquered territory and brought in resources for the state, breaking laws put in place to constrain them and gaining in power and privilege. History shows a repetitive cycle of corporations over-reaching, causing such social turmoil that the state is forced to rein them back in through regulation. Now, corporations are being created for no other purpose than to evade or avoid taxes. Supreme courts around the world have ruled on the difference between tax avoidance and tax evasion, and mentioned that if there is any transaction followed by an individual or a corporation that does not have any impact or consequence other than to reduce or eliminate tax, the transaction can be declared null and void. We need to take all steps to rein back and plug the loopholes that are exploited by individuals and corporations to avoid or evade paying their fair share of taxes. In budget 2022, we committed to implementing a public and searchable registry of beneficial ownership information. The registry would cover corporations governed under the Canada Business Corporations Act and would be scalable to allow access to the beneficial ownership data held by provinces and territories that agree to participate. The objective of the registry is to provide relevant authorities with timely access to accurate and up-to-date information about the true controlling individuals of corporations in order to combat illegal activities, including money laundering, corruption and tax evasion. Greater transparency would also improve corporate accountability more generally and thus help protect the public, improve trust in corporate institutions and ensure a well-functioning marketplace. As it currently stands, corporations are already obligated to compile some beneficial ownership information. Upon the entering into force of this new piece of legislation, corporations would need to collect additional information from their beneficial owners, like citizenship and residential address, and send the information in their register of individuals with significant control to Corporations Canada on an annual basis and within 15 days of the day on which a change is recorded in their register. There are a couple of shortcomings in the current bill, which can be overcome. One is with respect to fully publicly disclosing the names and citizenship of shareholders or members of corporations. The fundamental question is this: Why should the public not be aware of who is investing in a corporation, including their citizenship being known? It is not the fundamental right of any individual that he or she can be a shareholder. It is a privilege offered by the state through various acts, so why should the public not be aware of individuals who are shareholders, including their citizenship? I do understand the need for their privacy of information like the address of the shareholder, which is something that has been addressed, but there is no reason why the names and citizenship of the shareholders of any corporation should be kept from becoming public. Especially, we Canadians should be aware of foreign nationals investing in Canadian corporations; disclosing their citizenship is a must. There is another solution, which is that the information may be disclosed only if a threshold of ownership is significant and exceeds a certain mark. For significant shareholding, the threshold is 25% in some jurisdictions and 10% in other jurisdictions. However, using a threshold to limit disclosure requirements creates a loophole that can easily be exploited. If the threshold is fixed at 25%, five people could form a corporation with 20% each or 11 people could form a corporation if the threshold is 10%. On the positive side, through this bill, we have sought to limit administrative burden by leveraging existing intake and reporting mechanisms that federal corporations are already familiar with. For example, federal corporations are already required to update Corporations Canada within 15 days after a change of directors occurs and to file an annual return. We have carefully considered domestic and international best practices in developing the proposed beneficial ownership registry regime, including the U.K. system. We also made sure the proposed model would meet and exceed the standards for beneficial ownership transparency maintained by the Financial Action Task Force, a global anti-money laundering and anti-terrorism financing body of which Canada is a founding member. In closing, I want to reiterate that this is a good bill that is very much required. We have to bring Canadian standards in line with international best practices. However, there are certain shortcomings, which I think should and must be addressed at the committee stage. I am sure that with the co-operation of all parties in this House, this bill will get passed and will become legislation sooner rather than later.

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Mr. Brad Vis (Mission—Matsqui—Fraser Canyon, CPC)

Apr/28/23 12:41:28 p.m.
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Mr. Speaker, the member for Nepean raised two areas of amendment: on disclosure of information, such as citizenship, and on the significant interest threshold, which members on our side have raised during the debate today as well. I would like the member's opinion about whether the Liberal Party is open to further amendments on the penalties for corporations and individuals. In some cases, penalties in the legislation go up to $200,000, but are as low as $5,000 in other cases for corporations. Would the member opposite be open to further amendments to ensure that people who seek to launder money in Canada and have a registered corporation at the federal level would be accountable to higher penalties?

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Mr. Chandra Arya

Apr/28/23 12:42:27 p.m.
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Mr. Speaker, first on the question of disclosure of information, my understanding is that the bill does disclose citizenship and other details to various law enforcement agencies. However, my view is that citizenship information must be available to the public, too. On the question of imposing penalties, personally I am in favour of changing the penalties if they are too lenient. We have to make it worthwhile. Penalties for the people who break the law should be sufficiently high to cause at least some pain.

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Hon. Randy Boissonnault (Minister of Tourism and Associate Minister of Finance, Lib.)

Apr/28/23 12:43:13 p.m.
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Re: Bill C-47

Mr. Speaker, an agreement could not be reached under the provisions of Standing Orders 78(1) or 78(2) with respect to the second reading stage of Bill C-47, an act to implement certain provisions of the budget tabled in Parliament on March 28. Under the provisions of Standing Order 78(3), I give notice that a minister of the Crown will propose at the next sitting a motion to allot a specific number of days or hours for the consideration and disposal of proceedings at the said stage.

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