Legal Update - May 1996:
Changes to Lobbyists Registration Act

Amendments to the Lobbyists Registration Act came into force on January 31, 1996. Changes to the Act have increased reporting obligations on federal lobbyists, enhanced the Registrar's ability to verify and request clarification of submitted information, and will require lobbyists to conform to a code of conduct. The information collected will be available to the public through a computerized registry system. The Act will be reviewed by Parliament in five years.

Overview
The Act now differentiates among three types of lobbyists. Paid individuals who lobby on behalf of clients--formerly Tier 1 lobbyists--must register as Consultant Lobbyists, while employees of corporations who lobby as a significant part of their duties--formerly Tier 2 lobbyists--must register as In-house Lobbyists (Corporate). Finally, senior officials of organizations must register as In-house Lobbyists (Organization), where lobbying by one or more employees, when accumulated, amounts to a significant part of the duties of one employee. The Registrar has defined "significant" to mean at least 20 percent of an employee s time. All three types of lobbyists are generally required to disclose the specific subject-matter of their lobbying efforts, the government departments and institutions they approach, and the methods they adopt to communicate with public office holders.

Consultant lobbyists
In addition to existing requirements to disclose the identity of their clients, Consultant Lobbyists must disclose the true beneficiaries of their lobbying efforts. Consultant Lobbyists must register the name and business address of anyone who directs or controls the client, the client s subsidiaries which directly benefit from the lobbying efforts, and, if the client is a coalition, the names and business addresses of its corporate and organizational members. Whether the client receives any government funding must also be provided to the registry. Funds subject to disclosure typically include federal grants and other unconditional and conditional transfer payments for which the government does not receive any goods or services, but do not include repayable contributions, loans, loan guarantees, tax credits, remission orders or procurement contracts. The Consultant Lobbyist must also disclose whether his or her payment is through a contingency fee. The Act does not require registration for individuals who merely monitor federal government activities.

In-house lobbyists (corporate)
In the past, corporate officers who attempted to influence government decisions were only obligated to disclose their name, and the employer's name and address to the Registry (the so-called "business card disclosure"). Amendments to the Act now require In-house Corporate Lobbyists to disclose practically the same information required of Consultant Lobbyists. Aside from the names and addresses of the employee, employer, parent corporations, and the subsidiaries that directly benefit from the lobbying activities, the Corporate Lobbyist must also provide a general description of the employer's business or activities to the Registrar, and any government funding received by the employer. Although In-house lobbyists are subject to general reporting requirements, described above, routine dealings with government inspectors and regulatory authorities do not require registration. Similarly, communications between government officials and employees, whose job it is to sell a company's products and services, do not fall under the Act.

In-house lobbyists (organizational)
Senior officers of organizations must register lobbying efforts when one or more paid employees carry on lobbying activities sufficient to constitute at least 20 percent of the duties of one employee, in the event that one employee carried out all such lobbying activity. The Act defines "organization" broadly to include entities ranging from charities to trade unions and partnerships.

Aside from the general reporting requirements for existing lobbying and lobbying proposed for the following six months, the organization must provide a general description of its membership, the name of the senior paid officer, the names of all employees who lobby, and the source and amount of any government funding received by the organization. The Registrar does not require the registration of activities such as research, standard administrative contracts or the preparation and presentation of briefings to parliamentary committees.

Registering changes
Each Consultant Lobbyist is required to report to the Registrar within 10 days of each new undertaking and subsequently update filed information or notify the Registrar that lobbying has been completed or terminated within 30 days of any changes. In-house Corporate Lobbyists are only required to report annually, but must similarly update any changes within 30 days. In-house Organizational Lobbyists are required to report semi-annually, although the senior officer must advise the Registrar when employees cease to lobby or be employed by the organization within 30 days after the event.

Powers of the Registrar and ethics counsellor
To facilitate implementation of the Act, the Registrar is now empowered to issue interpretation bulletins and advisory opinions. He or she may also verify or require clarification of submitted information. One of the most notable changes to the Act includes the creation of the position of the Ethics Counsellor and the creation of a code of conduct which will legally bind lobbyists. The Counsellor may investigate and determine whether a party has breached the code. A report of the results of investigations and reasons for conclusions is then presented to Parliament. A discussion paper on the code of conduct for lobbyists has been prepared and circulated for public comment, with a draft code expected to be released in June of this year.

Registration procedures
Parties who were previously registered under the old Act were required to file a new return no later than March 31, 1996. While paper filing is available for a fee, free electronic filing is available and encouraged by the government. Before filing electronically, however, the lobbyist must complete an Electronic Registration Agreement.

Penalties for breach of the Act are severe. Knowingly making false or misleading statements may result in a maximum penalty of $100,000 and two years imprisonment, whereas failing to register will result in a summary conviction and fine not exceeding $25,000.

Clients are frequently unaware of the existence of the Lobbyists Registration Act, let alone the registration requirements. If a company's activities include dealing with representatives of the federal government, it should be made aware of the provisions of the Act. If such dealings occur on an ongoing basis, we recommend establishing a central in-house procedure to co-ordinate all required filings.

This commentary was written by student-at-law Debbie L. Wolanski, under the supervision of Anthony H.A. Keenleyside, a partner in the Communications Law Group in Ottawa.

Written for Parliamentary Names & Numbers.

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