Canada’s Minister of Natural Resources, the Honourable Joe Oliver, today spoke at the opening ceremony of the Prospectors and Developers Association of Canada’s (PDAC) International Convention, Trade Show & Investors Exchange. Minister Oliver outlined the government’s achievements in making Canada one of the most attractive countries in the world for business and investment. Calling Canada the mining capital of the world, the Minister highlighted action to strengthen and grow the mining industry, including:
— the Government’s plan for Responsible Resource Development, ensuring
world-class environmental protection while providing certainty for
— a $100 million commitment over the next seven years for the Geo-Mapping
for Energy and Minerals (GEM) Plan, helping exploration companies find
deposits and create jobs;
— extending the Mineral Exploration Tax Credit in Economic Action Plan
2014, which has helped junior exploration companies raise $5 billion in
— pursuing an aggressive international free trade agenda, including the
conclusion of a comprehensive free trade deal with the European Union –
the largest economy in the world
Minister Oliver also discussed the Government’s efforts to implement transparency and accountability through mandatory reporting standards for Canadian extractive companies. He encouraged provinces and territories to play a leadership role and enact their own equivalent legislation, but noted that if equivalent standards are not implemented the federal government will enact legislation by April 1, 2015, to move this initiative forward.
While at PDAC, Minister Oliver moderated a roundtable with Prime Minister Stephen Harper and the mining industry to discuss Responsible Resource Development and the current challenges and opportunities facing the industry. In addition, Minister Oliver hosted a roundtable discussion with junior mining companies to promote the benefits of geoscience and discuss issues facing the junior sector. He also hosted a roundtable with major and mid-tier companies.
— Canada is a global leader in mining. Close to 60 per cent of the world’s
publicly traded mining and exploration companies are listed on Canadian
stock exchanges, and over 70 per cent of the world’s equity financing
for mineral exploration was raised by companies listed in Canada.
— Canadian mining and mineral processing contributes $60 billion to our
GDP, provides employment to about 400,000 Canadians, including over
10,000 Aboriginal people, and accounts for over 20 per cent of Canada’s
— Bloomberg recently ranked Canada second only to Hong Kong as the world’s
most attractive country for business.
— The pan-Canadian approach to mandatory reporting standards developed by
the Government would require Canadian extractive companies to publicly
report payments over $100,000 to all levels of government both
domestically and internationally. The approach would ensure equivalency
with other jurisdictions – both at home and abroad.
— Reports would be posted to company websites, and the public would be
“Mining creates jobs, growth, and long-term prosperity across the country. That is why our Government is such a strong supporter of this industry. Together, we will ensure that Canada remains the mining capital of the world – now and in the future.”
Canada’s Minister of Natural Resources
Mandatory Reporting in the Canadian Extractive Sector
The new reporting system will complement existing reporting requirements and be established with a view to: improving transparency; ensuring Canada’s framework is aligned with other G-8 countries and consistent with existing international standards, particularly those of the United States and the European Union; ensuring a level playing field for companies operating domestically and abroad; enhancing investment certainty; helping reinforce the integrity of Canadian extractive companies; and, helping to ensure that citizens around the world benefit from the natural resources in their country.
Building the foundation
Work on mandatory reporting is already underway. The Mining Association of Canada, the Prospectors and Developers Association of Canada, Publish What You Pay and the Revenue Watch Institute formed a Working Group to develop recommendations for a framework for mandatory reporting standards, which was published in January 2014. This framework, as well as stakeholder consultations, have informed the Government’s approach.
After extensive consultations with industry, provinces/territories, and non-governmental organizations, as well as information sessions and bilateral discussions with Aboriginal groups, various options for implementing mandatory standards were considered. In assessing these options, the following factors were considered:
— Low cost to industry and government;
— Coverage (i.e., captures payments made by public, and medium and large
private extractive companies to all levels of government);
— Ensuring that the new standards do not place Canadian companies at a
competitive disadvantage; and,
— Stakeholder input.
The Government’s proposed pan-Canadian approach would require Canadian extractive companies to publicly report payments $100,000 and over to all levels of government both domestic and abroad (including Aboriginal entities), on a project-by-project basis.
The approach would apply to public and private, medium and large mining, oil and gas companies operating in Canada that meet or exceed two of the following three thresholds: C$20 million in assets; C$40 million in net turnover; or 250 employees. Annual reports would be published on company websites and the public notified.
The new mandatory reporting standards are expected to be in place by June 2015.
Taking the next steps
Between now and June 2015, the Government will be working on developing the most effective vehicle for implementation.
Implementing mandatory reporting standards through the provincial securities regulators would be the preferred scenario. The advantage of this option is that it already captures publicly listed companies and is cost-effective as it would use an existing reporting infrastructure. This option is also supported by the mining sector and civil society.
The Government plans to work closely with the provinces and territories on this initiative, as they have an opportunity to play a leadership role and enact their own equivalent legislation. However, if this is not possible, the government will work on developing federal legislation. The federal approach will ensure equivalency both domestically and internationally in order to minimize the burden on industry.
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