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Is Your Business Complying with
the Canadian Extractive Sector
Transparency Measures Act?

By Jean Phillipe Buteau ( jean-philippe.buteau@nortonrosefulbright.com); Janne Duncan ( janne.duncan@nortonrosefulbright.com); Amar Leclair-Ghosh ( amar.leclair-ghosh@nortonrosefulbright.com); and Roger F. Smith ( roger.smith@nortonrosefulbright.com), Norton Rose Fulbright

The Canadian Extractive Sector Transparency Measures Act1 (the Act) came into force on June 1, 2015. The purpose of this legislation is to implement Canada’s international commitments to fight corruption in the extractive industries.

It applies to certain Canadian businesses and their subsidiaries engaged in the commercial development of oil, gas, or minerals in Canada and abroad. The Act is different from anti-bribery legislation in that it creates disclosure obligations, rather than prohibiting specific payments and imposing criminal sanctions.

Disclosure requirements

As outlined in our previous legal up-
date, the Act imposes annual reporting
obligations on certain businesses that:
• are publicly listed in Canada; or have
• a place of business in Canada, do
business in Canada or have assets in
Canada and meet at least two of the
following conditions for at least one of
their two most recent financial years:
• CAD$20 million in assets;

• CAD$40 million in revenue; and/or
• employ an average of at least 250
employees.

Now that the Act is in force, Canadian businesses must begin collecting information on certain categories of payments made to domestic and foreign governments (and related bodies), whether they are monetary or in-kind payments, over CAD$100,000 starting on the first day of their financial year. For example, companies with a financial year-end of December 31 will need to collect this information for the reporting period between January 1, 2016, and December 31, 2016. A series of related

1 Is Your Business Complying with the Canadian Extractive Sector Transparency Measures Act? By Jean Phillipe Buteau, Janne Duncan, Amar Leclair-Ghosh, and Roger F. Smith