The prospective registry is expected to have the goal of making it easier to identify owners of corporations who launder money, commit financial crimes or evade taxes.
Prime Minister Justin Trudeau’s mandate letter to Champagne after the last federal election included instructions to create such a registry.
The Liberals’ 2021 budget dedicated $2.1 million over two years “to support the implementation of a publicly accessible corporate beneficial ownership registry by 2025.”
But the Liberals’ supply-and-confidence agreement with New Democrats, signed a year ago, required a quicker timeline.
In that deal, which sees the NDP supporting the government on key votes in exchange for movement on NDP priorities, the federal government committed to implementing the registry by the end of 2023.
In a statement, NDP finance critic Daniel Blaikie said his party has been pushing for the creation of the registry “to make it harder for wealthy tax dodgers, corrupt businesspeople and sanctioned Russian oligarchs to hide their assets in Canada.”
The federal government held public consultations in 2020 with a range of stakeholders — including law enforcement, tax agencies and industry associations — and found nearly all agreed with the idea of creating a registry.
During a technical briefing with reporters on Wednesday evening, a government official said the new registry will make it easier for law enforcement to go after people suspected of financial crimes because the ownership information will already be publicly available.
“One of the advantages of a centralized registry is that police can start their investigation without tipping off … bad actors,” Martin Simard, a senior director of corporate, insolvency and competition policy at Innovation, Science and Economic Development Canada.
It will also increase accountability, he said, since the information will be public and available to citizens, journalists and non-profit organizations.
If the bill passes, Simard said, corporations will be given a period of time to learn about the new registry and provide the necessary information to be compliant. Corporations found not in compliance will be fined $5,000.
Directors, officers and shareholders who undermine the prospective new regime would be subject to $200,000 in fines, six months in prison or both.