Until relatively recently, paying bribes to foreign officials was simply part of the cost of doing business for Canadian companies working abroad.
Surprisingly, many Canadian lawyers and business people are still not aware that it’s an offence in Canada to bribe or cover up a bribe of a government official elsewhere in the world, says Michael Osborne of Affleck Greene McMurtry in Toronto, who is a member of the Canadian Bar Association’s Anti-Corruption Team.“I suspect many lawyers would take the view that what goes on in [another] country stays in that country and not realize it’s an offence.”
But with the government starting to strongly enforce the 1999 Corruption of Foreign Public Officials Act in the past few years, people making – or taking – bribes are facing fines in the millions of dollars and serious jail terms are also a possibility. That should be a big deterrent, Osborne says. “If you’re doing business in other countries, you need to be aware of the CFPOA. You need to know what the rules are so that when and if you get asked for a bribe … you’ll know what to do.”
When lawyers think about moving from a law firm or government agency to an in-house position, they’re often looking for a better work/life balance, a steady salary, a pension plan and — hopefully — less stress.
But there are important things to consider before making such a move. “Your hours are not necessarily as predictable as you might think,” says Jim Spurr, corporate legal counsel and secretary to the board of the Halifax Regional Water Commission. “You’re a salaried employee, your benefits can be very lucrative, with annual bonuses, stock options, performance shares. But you don’t get all of that by simply working from nine to five.”
The CEO can call at any time, says Spurr, who has taken calls at night, on the weekend and while on vacation.
As part of the executive or senior management team, an in-house lawyer must have or develop a good understanding of business principles. Since not all lawyers have a background in business — or much interest in it — not everyone is cut out for the job.
Canada’s takeover bid regime is now harmonized across the country with the Canadian Securities Administrators’ implementation of National Instrument 62-104 Take-Over Bids and Issuer Bids. As of May 9, all non-exempt takeover bids are subject to a 105-day bid period, a 50 per cent minimum tender requirement and a 10-day extension requirement in order to permit other shareholders to tender to the bid.
Extending the minimum deposit period for takeover bids from 35 days to 105 days provides a more certain time frame for a hostile bid, equalizing “the negotiation leverage that a target board has with a hostile bidder,” says Frederic Duguay of Hansell LLP in Toronto. “It gives the board of the target more time in order for it to properly evaluate the bid, seek competitive offers from other parties and make a recommendation to its shareholders whether they should tender or not to that particular bid or tender to a strategic alternative that has been proposed by the board.”
The increased bid period is subject to two exceptions: The target’s board may issue a news release that there is a shorter deposit bid period of at least 35 days that is acceptable to the board or it issues a release stating that it has agreed to enter into an alternative transaction.
Privacy and confidentiality concerns took centre stage in April in the wake of Panamanian-based law firm Mossack Fonseca’s massive data leak. The theft of millions of its confidential documents exposed the names of the firm’s clients and their use of offshore shell companies and tax havens.
Founding partner Roman Fonseca told Reuters the firm had ruled out an internal leak of the information. “This is not a leak. This is a hack,” he said. But whether the documents were leaked by an insider or hacked by an outsider, the big question is: What firm will be next?
“Law firms are appealing and sought-after targets,” said Dan Pinnington, vice president claims prevention and stakeholder relations at Lawyers’ Professional Indemnity Company in Toronto. “We’ve got loads of sensitive and confidential information, frequently have large sums of money in the trust accounts, bank accounts and, relative to many of our clients and particularly bigger institutions or corporate clients, we tend to have weaker security. So the hackers literally come after us.”
More than 80 per cent of American law firms have had some type of breach, according to a 2015 Bloomberg article. And there’s a wide range of hackers out there, including foreign governments, hacktivists, organized or petty criminals—even high schoolers trying their luck at breaking into a firm’s files.
The low dollar, uncertain commodity prices and Canada’s new government are all factors at play in M&A projections for the new year, says Pavan Jawanda, an associate at McCarthy Tétrault in Vancouver.
The unseating of the Conservative government in favour of the Liberals in the October federal election appears to have affected the timing of some deals that are already in the market, says Jawanda, who specializes in mergers and acquisitions.
“Some sellers are sitting on some large capital gains and are of the view that they need to close a deal and crystallize some of those gains before year-end because of some potential tax uncertainty in 2016,” he says. “Potential tax changes, in and of themselves, aren’t driving companies to do deals they wouldn’t have otherwise done but they do seem to be affecting the timing of some deals that are already in the market.”
Jawanda says his firm has been busy over the past several months with a number of cross-border and international deals involving U.S. and foreign investors that are interested in building a Canadian presence and there is some expectation that the general trend in deal activity will continue into 2016, driven by a low Canadian dollar. “Now that currency analysts are forecasting that the lower dollar might be the new norm for the foreseeable future, it seems to be giving some foreign investors the comfort to get a deal done in a reasonable time frame.”
Uncertainty about commodity prices means some blockbuster deals in those areas may be sitting on the sidelines, but that’s by no means the whole story for M&A activity. “While deal volume in resource-based industries is still understandably lighter than levels from a couple of years ago, private mid-market and public deal activity in industries such as tech, consumer products, manufacturing and financial services seems to be thriving.”