EXPANDED REPORTING OBLIGATIONS FOR MINING AND OIL & GAS SECTOR COMPANIES
Under the Extractive Sector Transparency Measures Act (ESTMA), the government of Canada requires extractive sector companies operating in Canada to report on payments made to foreign and domestic government entities. Beginning on 1 June 2017, this obligation expanded to the reporting of payments made by extractor sector companies to Canadian indigenous government entities, an obligation which had been deferred for two years.
Obligations under ESTMA are broad, and apply to a wide range of companies that own or control, directly or indirectly, companies engaged in the commercial development of oil, gas or minerals in Canada or elsewhere. For example, this includes companies that are cross-listed on the Toronto Stock Exchange (TSX) or TSX Venture Exchange (TSXV). Interestingly, it also includes companies that are not ‘traditional’ extractive sector companies. For example, investment funds that hold controlling share positions in extractive companies.
The expansion of ESTMA to payments to indigenous government entities provides an opportunity to re-examine the requirements of ESTMA to better determine if your organisation is caught within the scope of the legislation, and whether your organisation is properly discharging its reporting obligations.
Who is required to report under ESTMA?
As is the case with reporting requirements in place since 1 June 2015, the new reporting obligations apply broadly to include not only entities listed on a Canadian stock exchange but also certain private companies.
Apr-Jun 2018 Issue
McCarthy Tétrault LLP