Two recent decisions to Canada's Conflict of Interest and Ethics Commissioner are a sobering reminder of the rules governing gifts and hospitality to government officials. Anyone doing business with the public sector (federal, provincial or municipal) must remember that contravention can land the public official, the person giving the benefit, or both, in trouble.
In one case, the federal Commissioner held that accepting a bouquet of flowers and a box of chocolates from a stakeholder contravened the Conflict of Interest Act (PDF).[1] In the other case, the Commissioner found that the outgoing head of the Royal Canadian Mint breached the Act by accepting dinner from a supplier (as well as accepting a model ship).[2]
While these decisions were based on a federal law that prohibits a public office holder from accepting any gift that might reasonably be seen to have been given to influence the office holder in the exercise of an official power, duty or function, many provincial and municipal laws in Canada impose similar restrictions on government officials.
For example, gift baskets were recently found to be improper gifts in the City of Ottawa,[3] and in the City of Toronto free cookies have been held to breach the municipal lobbying law.[4]
Acceptance of Gifts and Benefits
Almost every federal, provincial and local government official in Canada is subject to rules that restrict the acceptance of gifts, entertainment and other benefits.
Apart from the Criminal Code, which addresses corrupt dealings with advantages or benefits to public officials everywhere in Canada,[5] no universal "gift rule" covers all jurisdictions. Instead, the acceptance of gifts and benefits is subject to the laws of the government (federal, provincial or municipal) where the recipient holds office. Often acceptance is governed by a specific rule or policy of the individual department, agency or institution where the recipient serves.
Even within a single jurisdiction, different rules apply to different categories of officials. For example, federal Cabinet Ministers, senior public servants and ministerial aides are subject to the gift rules of the Conflict of Interest Act, while other government employees are covered by the Policy on Conflict of Interest and Post-Employment and Members of Parliament must adhere to the Conflict of Interest Code for Members of the House of Commons.
Similar differences exist in most provinces, including Alberta,[6] British Columbia,[7] Ontario[8] and Quebec.[9]
British Columbia has enacted legislation that regulates the acceptance of gifts by all municipal councillors in the province.[10] Similarly, Quebec legislation requires each municipality to adopt a code of ethics and conduct that includes a rule prohibiting a member of council from accepting any gift, hospitality or other benefit, that may impair the member's independence of judgment in carrying out the duties of office or that may compromise the member's integrity.[11]
On the other hand, Ontario and Alberta municipalities are presently free to choose their own rules, if any, on gifts to council members.[12]
Whether they are required to do so or have acted voluntarily, numerous Canadian municipalities have enacted policies and rules governing the acceptance of gifts to council members. Some also have adopted policies and rules on gifts to municipal government employees.
Unless otherwise stipulated, federal, provincial and municipal rules on the acceptance of benefits by public officials do not apply to the person offering or giving the benefit. Notable exceptions are discussed under the next heading.
Even where they are not directly affected by a restriction in gifts, however, most companies and organizations understand that it is counterproductive to give a government official a benefit that might land the recipient in trouble.
Giving Benefits to Government Officials
In many jurisdictions, companies, organizations and individuals that lobby the government are restricted from providing gifts or benefits to public office holders.
For example:
- Under the federal Lobbyists' Code of Conduct, a lobbyist is prohibited from giving or promising to give to a public office holder being lobbied[13] a gift, favour, or other benefit which the public office holder is not allowed to accept.
- It is an offence against the Ontario Lobbyists Registration Act for a lobbyist knowingly to place a public office holder in a conflict of interest, including by causing the public office holder to accept a fee, gift or personal benefit that is connected directly or indirectly with the performance of the public officer's duties of office, unless one of four narrow exceptions applies.[14] The maximum fine for a first offence is $25,000.[15]
- In Quebec the Code of Conduct for Lobbyists prohibits a lobbyist from inducing a public office holder to contravene the standards of conduct applicable to the public office holder. For example this would prohibit a lobbyist from inducing a public office holder to contravene a restriction on accepting gifts and benefits.[16] A lobbyist who contravenes this prohibition is subject to a potential fine of up to $25,000.[17]
- The City of Toronto has established a maximum penalty of $25,000 for contravention of the rule that, "Lobbyists shall not undertake to lobby in a form or manner that includes offering, providing or bestowing entertainment, gifts, meals, trips or favours of any kind."[18]
- In the City of Ottawa the prohibition is even broader: "Lobbyists with active lobbying registrations, their registered clients or their employees shall not, directly or indirectly, offer or provide any gift, benefit or hospitality to Members of Council or their staff."[19]
Acceptability and Disclosure Are Different
Many jurisdictions require public disclosure whenever a government official receives a gift whose value exceeds a certain threshold. For example, under the federal Conflict of Interest Act, a reporting public office holder must disclose a gifts or other advantages from a single source in a 12-month period if the total value exceeds $200.[20] The same $200 gift disclosure threshold applies to Members of the National Assembly[21] and to political staff members[22] in the Province of Quebec and to Members of the Legislative Assembly in Ontario.[23] In the case of Members of the Legislative Assembly[24] and municipal councillors[25] in British Columbia, the gift disclosure threshold is $250.
Frequently, recipients and givers confuse the gift disclosure threshold with confirmation that a gift or benefit is proper and may be accepted. In other words, many assume that a gift worth $200 (or $250) or less may always be accepted. This is incorrect. The threshold at which a gift must be disclosed is unrelated to whether the gift may properly be accepted.
Next Steps
Companies and organizations that deal with government should adopt a policy that covers gifts and hospitality to public office holders. The policy should include a clear, internal approval process.
Employees who routinely deal with government officials should receive regular training in how to avoid placing the officials in conflicts of interest.
The rules and policies that govern gifts in the relevant jurisdiction should be checked before anything is offered to a public office holder.
Consult an Expert
Everyone has the right to counsel during an investigation into the alleged giving or receiving of an improper benefit. You have the right to consult a lawyer with expertise in government ethics law before you respond to inquiries.
[1] The Vennard Report. The cost of the flowers and chocolates was $123.80. The report does not make clear whether this amount included delivery and/or tax.
[2] The Bennett Report. The cost of the dinner was approximately $100 per person and the cost of the model ship was $150.
[3] Compliance Agreement, Case no. 04-16.
[4] Report to Council on the Provision of Gifts by a Consultant Lobbyist Firm (2014).
[5] R.S.C., 1985, c. C-46, Part IV, ss. 118, 119, 121, 122, 123.
[6] Gifts to public servants are subject to the Code of Conduct and Ethics for the Public Service of Alberta, Part IV; the acceptance of gifts by political aides is covered by the Code of Conduct for Employees Serving in the Offices of the Premier and Cabinet Ministers, being Schedule 2 to the Premier's and Ministers' Staff Employment Order, O.C. 502/2014. Gifts to Ministers and Members of the Legislative Assembly are addressed in the Conflicts of Interest Act, R.S.A. 2000, c. C-23.
[7] For gifts to public servants, see BC Public Service Agency, Standards of Conduct. Gift acceptance by the political staff is covered by the Standards of Conduct for Political Staff Regulation, B.C. Reg. 67/2014. Gifts to Members of the Legislative Assembly are addressed in the Members' Conflict of Interest Act, R.S.B.C. 1996, c. 287.
[8] Separate regulations under the Public Service of Ontario Act apply to ministerial aides (Conflict of Interest Rules for Public Servants (Ministers' Offices) and Former Public Servants (Ministers' Offices), O. Reg. 382/07) and to other government employees (Conflict of Interest Rules for Public Servants (Ministry) and Former Public Servants (Ministry), O. Reg. 381/07). Gift acceptance by Members of the Legislative Assembly is subject to the Members' Integrity Act, S.O. 1994, c. 38.
[9] Section 6 of the Regulation respecting ethics and discipline in the public service, C.Q.L.R., c. F-3.1.1, r. 3, restricts public servants from accepting gifts. The receipt of gifts and benefits by Members of the National Assembly is governed by Part IV, Code of Ethics and Conduct of the Members of the National Assembly, C.Q.L.R., c. C-23.1. Gift acceptance by the political staff is subject to the Regulation respecting the rules of conduct applicable to the office staff of ministers, C.Q.L.R., c. C-23.1, r. 2, and gifts to other public office holders are addressed in the Regulation respecting the ethics and professional conduct of public office holders, C.Q.L.R., c M-30, r. 1.
[10] Community Charter, S.B.C. 2003, c. 26.
[11] Municipal Ethics and Good Conduct Act, C.Q.L.R., c. E-15.1.0.1.
[12] On a date to be fixed by the Alberta Cabinet, the Municipal Government Act will be amended by the insertion of new section 146.1 which will require municipalities to adopt codes of conduct will permit the Minister by regulation to make certain content (such as, possibly, gift restrictions) mandatory: Municipal Government Amendment Act, S.A. 2015, c. 8. A bill currently before the Ontario Legislature contains a proposal that is similar: Bill 68, Modernizing Ontario's Municipal Legislation Act, 2016.
[13] That is, a federal public office holder being lobbied by the lobbyist or who will be lobbied by the lobbyist.
[14] The Lobbyists Registration Act incorporates (and applies to all public office holders) the rules in the Members' Integrity Act. Under the latter statute, the four exceptions from the gift prohibition are: (a) compensation authorized by law; (b) a gift or personal benefit received as an incident of the protocol, customs or social obligations that normally accompany the responsibilities of office; (c) a fee, gift or personal benefit (including remuneration or financial assistance) given by or on behalf of a political party, constituency association, candidate or leadership contestant registered under the Election Finances Act; and (d) any other gift or personal benefit, if the Integrity Commissioner is of the opinion it is unlikely that receipt of the gift or benefit gives rise to a reasonable presumption that the gift or benefit was given in order to influence the public office holder in the performance of duties.
[15] Lobbyists Registration Act, S.O. 1998, c. 27, Sched., subs. 18(8).
[16] See note 9.
[17] Lobbying Transparency and Ethics Act, C.Q.L.R., c. T-11.011, s. 63.
[18] Toronto Municipal Code, Chapter 140, §§ 140-42A, 140-47.
[19] Lobbyist Code of Conduct, subs. 6(3).
[20] Conflict of Interest Act, s. 23.
[21] Code of Ethics and Conduct of the Members of the National Assembly, s. 31.
[22] Regulation respecting the rules of conduct applicable to the office staff of ministers, s. 13.
[23] Members' Integrity Act, s. 6.
[24] Members' Conflict of Interest Act, s. 7.
[25] Community Charter, s. 106.
