Tuesday, March 17, 2009

OTTAWA - Today, Democracy Watch applauded the Federal Court of Appeal's historic March 12, 2009 unanimous ruling in its court case which found that the correct interpretation of Rule 8 of the Lobbyists’ Code of Conduct prohibits a lobbyist from doing anything to create a private interest for a public office holder that may compete with that public office holder’s public duty.

Rule 8 of the 12-year-old federal Lobbyists' Code of Conduct (Lobbyists’ Code) states:

"8. Lobbyists shall not place public office holders in a conflict of interest by proposing or undertaking any action that would constitute an improper influence on a public office holder."

The Court of Appeal's ruling rejected the weak standard set out in former-Ethics Counsellor Howard Wilson's September 2002 Advisory Opinion about Rule 8 that claimed a federal lobbyist only violates Rule 8 if the lobbyist's actions demonstrably interfere with and change the decisions of a public office holder (meaning a federal politician, member of their staff, Cabinet appointee, or a public servant) in a way that amounts to a “wrongful constraint" whereby the will of the public office holder is overpowered or the public office holder is "induced to do or forbear an act which he or she would not do if left to act freely.”

The Court of Appeal ruled that Wilson's Advisory Opinion about Rule 8 is "deeply flawed" (para. 48) because it "mistakes conflict of interest for corruption" (para. 51).

The Court of Appeal stated that Rule 8 simply "prohibits lobbyists from placing public office holders in a conflict of interest" because "Any conflict of interest impairs public confidence in government decision-making" (para. 48).

The Court of Appeal's ruling went on to clarify specifically that "A lobbyist's stock in trade is his or her ability to gain access to decision makers, so as to attempt to influence them directly by persuasion and facts.  Where the lobbyist's effectiveness depends upon the decision maker's personal sense of obligation to the lobbyist, or on some other private interest created or facilitated by the lobbyist, the line between legitimate lobbying and illegitimate lobbying has been crossed." (para. 53) -- NOTE: This is essentially the same standard the federal Conflict of Interest and Ethics Commissioner has set out in a guideline for federal decision makers, see details below

"The Federal Court of Appeal's ruling is another milestone in Canada's slow march towards having integrity in government," said David Baker of bakerlaw.ca, who acted as counsel on a pro bono basis for Democracy Watch in the case.  "I hope the decision will result in immediate and noticeable changes to the pervasive environment of cronyism that has understandably caused Canadians to be cynical about the state of our democracy."

"Democracy Watch has struggled for 15 years against federal government ethics lapdogs who have failed to enforce key ethics rules, and the Federal Court of Appeal's ruling is one of its biggest victories because, in our view, it makes it even more clear that the type of conduct prohibited by the Lobbyists' Code of Conduct includes lobbyists giving anything to or doing anything for the benefit of politicians and government officials they are lobbying," said Duff Conacher, Coordinator of Democracy Watch.  "Hopefully, the Commissioner of Lobbying will comply with the Court of Appeal's ruling and finally end the 12-year-old sham lack of enforcement of the Lobbyists' Code, but if not Democracy Watch will not hesitate to take the Commissioner back to court."

The Court of Appeal's ruling follows the same logic, and sets the same ethical standard, as the federal Conflict of Interest and Ethics Commissioner's 2008 Guideline on Gifts (including Invitations, Fundraisers and Business Lunches), which covers gifts of money, property or services as defined under the Conflict of Interest Act and strongly reaffirms that federal Cabinet ministers and other senior government officials (and their family members) essentially cannot accept any gifts or favours from anyone who is trying to influence, or will be trying to influence, or has or will have dealings with, the minister or government official, even if the lobbyist is a friend or a relative. (NOTE: the Ethics Commissioner's guideline is based upon the principles of the science of influence and persuasion -- for more details, click here)

The Guideline on Gifts offers examples of gift givers who the Commissioner views as giving gifts or doing favours in order to influence a minister or government official, including anyone who is associated with, or lobbying for, any entity that has or may have dealings of any kind with the government institution(s) that the minister or official directs (p.5).
   
"We believe that, together, the Federal Court of Appeal's ruling and the federal Ethics Commissioner's guideline strongly reaffirm the standard that federal politicians and government officials and their family members cannot accept gifts or favours from people who are lobbying them, and that people who are lobbying cannot give gifts or do favours for politicians and officials or their family members," said Duff Conacher, Coordinator of Democracy Watch.

The Guideline on Gifts contains the following key statements (among others):

• "It is important to consider who is offering the gift and why it is being offered. The donor's existing, or future relationship to the public office holder is of particular relevance." (p. 5);
• "A public office holder or family member should consider why a gift is being offered. If a gift is being offered by someone whose interests could be affected by a decision the public office holder may be called upon to make, then the Act will likely apply and prohibit its acceptance." (p. 5)
• "If a friend is offering a gift in a context not normally associated with gift-giving and the friend is also doing or likely to do business directly or indirectly with the public service entity of the public office holder, then the gift should not be accepted." (p. 7)
  

The Preamble of the federal Lobbyists' Code states that together it and the Conflict of Interest Act and other ethics codes for public office holders (politicians, their staff and government officials) “play an important role in safeguarding the public interest in the integrity of government decision-making”.  Therefore, Democracy Watch has always argued that the interpretation of Rule 8 of the Lobbyists' Code must be based on public office holders' ethics rules.

There are rules that clarify what types of influence are improper and cause conflicts of interest in the 23-year-old federal Conflict of Interest and Post-Employment Code for Public Office Holders (which applies to Cabinet ministers, ministerial staff, and many senior government officials) and the Conflict of Interest Act which replaced that Code in July 2007, and in the four-year-old Conflict of Interest Code for Members of the House of Commons and in the four-year-old Conflict of Interest Code for Senators and in the 12-year-old federal Values and Ethics Code for the Public Service.

Specifically, all of these codes state that it is improper to receive a gift of money, property or services that could influence a decision.  Given that lobbyists, by definition, try to influence the decisions of public office holders, Democracy Watch believes that a proper application of the Court of Appeal's interpretation of Rule 8 of the Lobbyists' Code would prohibit lobbyists from providing money, property or services to public office holders because that can create, in the words of the Court of Appeal, a “personal sense of obligation” by the public office holder to the lobbyist or a “competing private interest” (paras. 52-53).